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October 31, 2019 - No Comments!

NHR application will automatically give acess to HAVA

On 8th October a circular was published by the Portuguese Tax Department changing the approach to and methodology in respect of the High Added Value Activity (“HAVA”) application. The benefits of the HAVA include paying tax on domestic salary at a flat rate of 20% and an exemption on overseas consulting income generated in the exercise of the activity. Conscious of its excessive delays in the granting of approvals, running up to 12 months and more, with the resulting lack of certainty, it was decided that, upon approval, the NHR applicant will automatically acquire the right to be taxed with the special tax rate of 20%. This is on the basis that they already meet the HAVA requirements, without the need for a separate application.

Up to now, the HAVA application was made by way of a subsequent and independent application after NHR approval and, due to the delays, the credibility of the HAVA regime was being undermined. With this in mind, the Tax Authorities have decided to eliminate the need to make an HAVA application, granting this tax benefit automatically.

A new more practical HAVA list comes into force on 1st January 2020 and NHRs who fulfill the criteria will only need to declare it in their annual tax return. However, supervision will continue to be exercised by the Tax Authorities and they may, after the filing of the tax return, notify the HAVA to file proof that they meet the necessary requirements. The type of evidence will be defined in a legislation which is expected to be published shortly by the Portuguese Authorities.

Although there are still some elements that need to be clarified by the Portuguese Tax Authorities, this is will undoubtedly eliminate the delays in the HAVA applications and restore the credibility of the regime, whilst also reinforcing the commitment to the NHR programme.

Lisbon, October 2019
info@edge-il.com

October 31, 2019 - No Comments!

Recent legislative changes to inventory process (Law no. 117/2019 of 13th September)

The inventory process aims to catalogue the assets left by the deceased and split the inherited assets through the heirs or to divide common assets of the spouses due to the end of their marriage.

Currently, and for some years, the inventory process has been a non-judicial process being dealt exclusively by Notaries, with the courts only intervening of very few occasions.

The Law no. 117/2019, which shall enter into force on 1st January 2020, will revoke the current legal regime of the inventory process and creates a new one, where the courts can also deal with these matters, meaning that the inventory process can also become a judicial process and not just a process before the Notary.

In relation to new inventory processes started after 1st January 2020the new regime will give the people directly interested in the division of assets (such as the heirs or the spouses) the possibility of choosing between filing the inventory process in a Notary Office or before the court.

If the interested parties choose the judicial way, the court with jurisdiction to deal with the matter is the one located in the territory of the deceased's habitual residence, or the deceased’s last residence in Portugal, or if the deceased had property in Portugal, on the court where that property is located. If none of these criteria are met, the Lisbon court will have jurisdiction. However, for the cases of divorce/separation, the court with jurisdiction is the one located within the area of residence of the person who filed the inventory process.

For ongoing inventory processes taking place before the Notary, the regime will continue the same regime, with some exceptions. Solely for ongoing cases and starting on 1st January 2020, these exceptions include the possibility of any of the people directly interested in the division of assets requesting that the process be sent to the court with jurisdiction, when:

- The inventory process is stopped for over 6 months, with nothing useful having been done;

- The inventory process has been stayed due to judicial matters for over a year. Irrespective of the reason, any heirs who, solely or together, represent more than 50% of the inheritance may also request that the inventory process be sent to the court with jurisdiction or to any other Portuguese court that most suits the heirs.

For the inventory process to be sent to the court, the heirs/parties have to pay court fees in the amount of € 102,00, but the court can set a higher amount at the end of the inventory process.

There also cases where the only courts can deal with the inventory process, with the main example being:

- When the inventory is part on another judicial case;

- When the inventory is requested by the Public Prosecution Office;

- When one of the heirs cannot be found or cannot participate in an amicable division of assets due to suffering from a de facto permanent incapacity.

Starting from 1st January 2020, when one of the direct interested people in the inventory is a minor, a person of age who needs a legal representative to assist him/her or a person who cannot be found, the Notary will send those processes to the court with jurisdiction, on its own.

As mentioned at the beginning, please be reminded that these legal changes will be only come into force starting 1st January 2020.

In the meantime, the ongoing cases and future inventory cases to be filed before 1st January 2020 will continue to run their course before the Notary.

For further information please contact Rodrigo Noronha Mourão - rmourao@edge-il.com

October 31, 2019 - No Comments!

Changes to the employment proceeding’s code

Further to a few relevant changes to the Employment Code itself, now it’s the time for the employment proceedings to be adjusted in line with the Civil Proceedings Code.

Some of the major changes were relate to timeframes which in general tend to be extended making the rules more similar to the general Civil Proceedings’ Code.

The new regime entered into force on 9th October.

JUST A FEW CHANGES IN TIMEFRAMES

- The time that the petitioner (generaly the employee) has to reply to defense (generaly of the employer), now of 15 days as a general rule, when before there was only the possibility to reply within 10 days after defense.

- Also in the sepcific court procedure to claim against dismissal – which starts by a digital or paper application filled by the employee then followed by the petition written by the employee justifying dismissal; in case the employee replies with a defense, the employer can now reply to the employee’s defense if the employee has made a claim / reconvention – or in other words – if the employee has made a claim in his defense, then the employer is entitled to reply to this pleading. The time frame is of 15 days to do so.

In case of appeal, the timeframe to file the application including allegations, is now of 30 days, when before it was of 20 days only. Currently only for urgent proceedings the timeframe of 20 days is maintained for apeals to be filed of court decisions.

OTHER CHANGES

In relation to witnesses the general rule is still of a 10 total number of witnesses per claim, but now there is a reduction by half of this limit in case of court cases where the value of the claim is lower than € 5,000.

The new rule about court hearings is now that also in line with civil proceedings’ rules the court hearing must be recorded.

Finally regarding the court prelimiary hearing designated as “audiência de partes” in the specific process against dismissal, the news is that the employer is now allowed to justify its absense and this way have another opportunity to be present and this way try to reach a settlement in the process at this stage.

9th October 2019

Cláudia Vaz Póvoa

Employment Department

cpovoa@edge-il.com

October 31, 2019 - No Comments!

Immigration Authorities increase number of residency appointments

Foreigners and Borders Services (SEF) will increase the number of available appointments for the granting of residency, renewals and family reunion. SEF informed that until the end of the current year it will be made available around 11 thousand appointments more to address the increase of requests.

Further to the above, and so that the time of waiting for approvals may also be reduced, SEF will also employ 116 technical assistants for the front office which will allow SEF to double their capacity of reply, according to the press release.

Until the end of the year there are already scheduled more than 135 thousand appointments and SEF has already opened the calendar for the first quarter of 2020. Only in the first semester of this year there were already 155 thousand appointments, an increase of 24% in comparison to the previous year.

In fact, the number of granted residency cards in the first semester of 2019 increased 68% when compared to the same period last year, referring to a total of 76,940 new residency cards.

In 2018, we had already reached a record in grating new residency cards, with more than 93 thousand cards grated, but in the first semester of this year alone there are already almost 77 thousand cards. The residency cards’ renewals have also increased when compared to the same period last year, an increase of 16%, resulting on 53,900 cards renewed.

The above shows the commitment of the authorities in providing a reply to all requests and the effort in reducing the waiting period.

Lisbon, 20th September 2019
By Catarina Ruivo Rosa, Associate at EDGE International Lawyers
For further information please contact: crosa@edge-il.com

September 20, 2019 - No Comments!

EDGE in Hong Kong

We will be travelling to Hong Kong between 20th and 29th September.  Francisco Barata Salgueiro and Ana Rita Reis, partners of the firm, will be in Hong Kong to attend different events and hold meetings with clients and business partners.

We are available to schedule meetings during this visit to discuss investment in Portugal, the Golden Visa programme and other related topics.  Please feel free to contacts us should you wish to schedule a meeting or contact Francisco and Ana Rita during their visit.

September 20, 2019 - No Comments!

EDGE welcomes new Associate Lawyers

EDGE is proud to inform that we have strengthened our team with seven newly qualified Associate Lawyers. From multiple backgrounds, our seven new colleagues finished their internship with us and successfully completed their articles with the Portuguese Law society.

Our new colleagues are Mariana Alves de Melo, Maria Pizzuti, Catarina dos Santos Sequeira, Joana de Oliveira Alves, Vitória Pontes, André Pinho and Catarina Eça.

We are also welcoming new associates Filipa Teixeira Barbosa, Giovana Silva, Karla Morais and Raakel Lehtola, who have also joined our team

Francisco Barata Salgueiro
Senior Partner

September 20, 2019 - No Comments!

NHR New list of High Added Value Activities

The Portuguese Government has published a new High Added Value Activities (HAVA) list for Non-Habitual Residents Regime.

This new list shows a strong commitment of the government with the NHR status and a will to revamp the HAVA side of the NHR. Hopefully the waiting time for approval process will also be reduced significantly.

This updated list of activities is geared towards the recent needs of human resources and the new reality of the country. When NHR was launched Portugal was in the middle of one of the biggest financial crises in living memory with unemployment peaking, together with emigration of young qualified professionals. Now unemployment is at a very low level and in many areas, entrepreneurs are struggling to find skilled workforce.

Another objective of the new list is to clarify which activities are included in this category, giving clarity and objectivity to a list that would often create interpretative doubts regarding the professions included in the concept of high added-value activity.

For this purpose, the list is now based on a new model that has direct correspondence with the Portuguese Classification of Jobs (Classificação Portuguesa de Profissões) instead of the previous CAE (Códigos de Actividade Económicas).

The new list shall enter into force in January 1st 2020 and will be applied for all new requests after that date. For those already having a HAVA code the current list still applies, even if the NHR status is suspended.

It is also worth mentioning that depending on the assessment of the country’s economic situation, the table may be revised within three years which shows that there is a long term strategic thinking regarding NHR.

4th September 2019
By Geoffrey Graham
Senior Partner at EDGE International Lawyers
contact@edge-il.com

September 20, 2019 - No Comments!

The Algarve tourism conference 2019

The Algarve Tourism Conference will take place at the “Hilton Vilamoura As Cascatas Golf Resort & SPA” on September 27, 2019.

New tourism markets for new times and preparing the Algarve for a circular economy for the 2020‘s are the mottos for this conference that will count on national and international experts from different areas who will debate the opportunity for an Algarve circular tourism economy, based on the emerging markets: wellness, medical and sports tourism, eco-tourism and senior tourism / senior living. The supply side will also be represented by hotel operators, tourism and travel agents, developers and real estate players.

The Global Wellness Institute estimates that wellness tourism will grow at an average annual rate of 7.5% through 2022, considerably faster than the 6.4% annual growth forecasted for overall global tourism.

This represents a great opportunity for the Algarve with its natural assets and also the players investing in the health tourism by improving and diversifying the supply, both in the wellness tourism and medical tourism areas.

The Conference has been co-organised by the ILM Tourism & Hospitality Real Estate Group Portugal, Dengun Digital Agency and the Ireland Portugal Business Network and is supported by the Turismo de Portugal, AHETA, Portuguese Chamber of Commerce in UK and several private players such as Open Media Group, Vilamoura World, Grupo Enolagest, Vale do Lobo, Pine Cliffs Resort Algarve, Grupo HPA Saúde and NERA, amongst others.

Worth attending!

September 20, 2019 - No Comments!

The changes to the employment code

After a long period of great discussion, debate and analysis of the new changes to the Employment Code, the Law 93/2019 was published on 4th September further to the approval by the President of the Republic.

This is an important review of a few of the core areas of the Code including fixed term contracts’ regime, very short term contracts, probationary period for long term contracts, working hours’ regime.

In respect of the fixed term contracts’ regime, the new rules determine that the contracts as a whole including renewals have a total limit of 2 years’ duration. This being said, the renewals are also limited to the duration of the first fixed term contract signed  which limits the whole duration of the contract.

The possibility of signing a fixed term contract due to the start of activity of business, is now applicable during a period of 2 years after such fact;on the restrictive side of the regime, now this reason is limited to companies holding up to 250 employees (before it was applicable to companies holding up to 750 employees).

All contracts being of services, fixed term, temporary or other for the same job position under the same employer’s structure (even if through different companies) will be considered for the purposes of the limit of 2 years’ contract duration as a whole.

Another crucial change on the flexibility side of the measures is the possibility of employers working in the agricultural sector and hotel industry, to hire employees under the regime of the very short term contracts.

This regime makes it possible for employers to hire without a proper written contract just filling in a form to be sent to social security services. The limit is that those contracts can only be used in case of exceptional increase of activity of the employer and up to 35 days each, in a maximum of 70 days of contracts in a civil year per employee.

Also on the flexibility side of the measures approved there is the probationary period, since 180 days’ probation will continue to apply to long terms contracts in situation of employees hired for high trust and confidence jobs or due to high qualification, complexity or responsibilty reasons, but now also for employees seeking first employment and also in case of unemployment of long duration.

The changes should now enter into force 1st October 2019 and may have still to be adapted due to the revision which will be operated in due course by the Constitutional Court.

4th September 2019
Cláudia Vaz Póvoa
Partner
Employment Department : cpovoa@edge-ilcom

July 8, 2019 - No Comments!

Immigration in Portugal: Breaking Records since 1976

Portugal is becoming more and more a residency destination for foreigners. This information is confirmed by the Immigration Authorities with the Immigration and Asylum Report, published on 28th June 2019, by occasion of the Service of Foreign and Boarders’ 43rd Anniversary.

According to the Report, the number of foreigners residing in Portugal continues to increase every year, with an increase of 13.9% in 2018, in relation to the previous year, which translates to an increase of 58,589 individuals in a total of 480,300.

The Government justifies this increase with the appealing factors that Portugal has, namely due to Portugal being a safe country. In fact, according to the Global Peace Index, Portugal is currently ranked 3rd as the safest in the world.

This position is justified by the increase investment of the country in policing activities and organization between the several different police forces, including the Immigration Authorities. It is also considered that the immigration increase shows that Portugal is an appealing country due also to its growing economy.

The majority of the foreigners residing in Portugal, in a percentage of 81%, are part of the working population, between ages of 28 and 44; again showing the growing economy in Portugal, and 68.9% resides in the boroughs of Lisbon, Faro and Setúbal.

Brazilians continue to be the leading nationality of foreigners residing in Portugal but there is a significant increase of other nationalities, such as Italians and French, and also Bengali, Nepali, Indians and Venezuelans.

Portuguese Nationality Applications have also broke the record of the past five years, as more than 41,000 citizens have requested Portuguese Nationality in 2018 only. From the same, it has been issued 32,414 favorable decisions.

This increase reflects the amendments of the Nationality Law from July 2018 that opened the scope for Portuguese nationality acquisition. In fact, this amendment reduced from 6 to 5 years, the legal residency period for foreigner applicants to become Portuguese. The acquisition of nationality based on residency is on the top applications, representing 70% of the same.

The issuance of new residency cards in 2018 has also suffered a significant increase of 51.7%, referring to 93,154 new Portuguese residents. In particular regarding the Golden Visa applications, the Report refers that in 2018 it were approved more than 3,000 new applications, with a total amount invested of € 838,532,935.27.

Considering the increasing numbers and also justifying the same, the Immigration Authorities have implemented and continuously worked during 2018 in integration friendly policies and simplified procedures in order to be able to assist all foreigners in Portugal.

Lisbon, 28th June 2019
By Catarina Ruivo Rosa, Associate at EDGE International Lawyers
For further information please contact: crosa@edge-il.com