What happened in 2024?

Brief executive summary of the main legal issues of general application to companies in 2024.

The aim is to provide an overview of these changes to make it easier for companies to identify and implement them. 

Voluntary carbon market

Decree-Law 4/2024 of January 5 established the voluntary carbon market, providing for a tradable carbon credits mechanism to encourage carbon sequestration. The regime has since been amended and regulated, and its electronic platform is expected to start operating in 2025.

See: Legal Flash | Legal regime for voluntary carbon market , Post | Rectifications to voluntary carbon market legislation , Legal Flash | Regulating voluntary carbon market functioning

Waste

Amendments to the waste management regimes introduced by Decree-Law 24/2024 of March 26, which also have an impact on waste disposal in landfills and the reduction of plastic products in the environment (see Post).

Water supply and sanitation

On October 23, Decree-Law 77/2024 was published, which establishes the tariffs and tariff yields for multi-municipal water supply and sanitation systems for 2024 and amends the statutes of the Water and Waste Services Regulatory Authority, strengthening its powers in the area of tariffs (see Post).  

Non-performing loans (NPL)

The NPL Directive entered into force in 2021 and is waiting to be transposed into Portuguese law. On July 24, the EBA published its final report amending the Guidelines, the main aspects of which are summarized in the post The Evolution of the NPL Directive. 

Cryptoassets

Regulation (EU) 2023/1114 of the European Parliament and of the Council (“MiCA”) establishes a European regulatory framework for the issuance and admission to trading of cryptoassets, and providing services related to them. MiCA takes full effect on December 30 (see Post).

Prevalence of mortgages over retention rights

Decree-Law 48/2024 of July 25 amended the legal regime on the right of retention over real estate, limiting the situations in which it prevails over a previously registered mortgage (see Post).

Asset management regime

On January 1, Securities Market Commission (“CMVM”) Regulation 7/2023—regulating the new asset management regime (“RGA”)—entered into force (see Post).

The RGA was amended by Decree-Law 89/2024. This decree-law allows large management companies to invest amounts exceeding the amount of own funds required by law, provided that the investment is ancillary to the main activity and conflicts of interest are prevented. The CMVM is responsible for regulating the terms under which this activity can take place.

Listing Act

On October 8, 2024, the European Council approved the Listing Act, a package of legislative measures which (i) reviews the Prospectus Regulation, the Market Abuse Regulation, MiFIR and MiFID II, (ii) introduces a new directive harmonizing the regulation on multiple vote share structures, and (iii) repeals the Listing Directive (as defined below). This legislative package is part of the Capital Markets Union project and aims to simplify access to EU capital markets, making them more attractive for companies, especially SMEs. Ultimately, the goal is to enable companies to diversify funding sources, therefore reducing bank lending in the EU economy (see Post).

General regime for the prevention of corruption

Under the General Regime for the Prevention of Corruption (“RGPC”), legal entities with head offices in Portugal employing 50 or more employees and branches in Portugal of legal entities with head offices abroad employing 50 or more employees must appoint a regulatory compliance officer (RCO). In May, MENAC issued Recommendation 7/2024, requiring RCOs to report monthly on the regularity or failures of regulatory compliance (see Post).

In September, MENAC published Guideline 1/2024, which standardizes the applicable perspective regarding the appointment of RCOs (see Post).

The RGPC Platform has become operational, allowing entities covered by the RGPC to submit regulatory compliance documents to MENAC. Documents must be registered and sent by February 14^th 2025 (Since the December 31^st 2024 deadline was extended. (see Post).

Money laundering

Law 4/2024—broadening the scope of the crime of money laundering and embezzlement and criminalizing the misuse of European Union revenue—was published (see Post).

 Competition

Foreign subsidies (FSR)

Regulation (EU) 2022/2560 of the European Parliament and of the Council on foreign subsidies that distort the internal market (“FSR”) entered into force on July 12, 2023. The FSR’s main objective is to control subsidies granted by non-EU countries to companies operating in the internal market. This control has an impact on company mergers and on participation in public tenders.

In July, the European Commission published a working document providing the first clarifications on the notion of “distortion” of the internal market and the “balancing test” (see Post).

On September 24, 2024, the European Commission announced the authorization of the first M&A transaction, subject to commitments (see Post).

Good practice guide on sustainability agreements

After a period of public consultation, the Competition Authority has published a Guide to Best Practices on Sustainability Agreements, aimed at reconciling sustainability and competition in companies (see Post).

2024 guides for competition authority inspections

We have published three guides recommending the actions to be taken in the event of unannounced inspections by competition authorities—national or European—both at the company’s head office, at private homes and remotely, highlighting the most important steps (see Post).

Service in legal proceedings involving legal persons

Decree-Law 87/2024 of November 7—establishing electronic service for legal persons and making it possible for individuals to sign up for this service—was published. The rules in the insolvency, administrative procedure, and labor codes have been harmonized (see Post).

Withdrawal from the Energy Charter Treaty

Portugal has formally withdrawn from the Energy Charter Treaty (“ECT”). Despite the withdrawal, investments made in Portugal and investments made by Portuguese investors in other contracting states will continue to be protected by the ECT until February 2, 2045 (see Post).

In the July 2024 publication “Cuatrecasas Arbitration Highlights,” we provide an overview of significant court decisions and legislative developments in international arbitration in various jurisdictions, including Chile, Colombia, Spain, Portugal, and Peru, highlighting trends in the recognition and enforcement of arbitral awards.

Law 43/2024 introduces three major amendments to special public procurement measures in the context of procedures and contracts that are financed or co-financed by European funds: (i) a system of preventive supervision by the Court of Auditors; (ii) new procedural rules for pre-contractual litigation; and (iii) the possibility of recourse to arbitration (see Post).

Corporate sustainability reporting: CSRD Directive

Portugal has not yet transposed Directive (EU) 2022/2464 of the European Parliament and of the Council of 14 December 2022 as regards corporate sustainability reporting (see more), and the government is still considering and discussing the transposition draft.

The CSRD Directive requires large European companies, listed SMEs (except micro-enterprises) and subsidiaries of companies from other countries to disclose sustainability information in accordance with strict European standards. On December 9, the CMVM issued a communication on the application of the CSRD Directive, recommending that companies start adapting their reporting systems and internal processes to comply with these requirements, even before the directive is fully transposed into national law.

Corporate due diligence: CS3D Directive

On July 5, Directive (EU) 2024/1760 of the European Parliament and of the Council on corporate sustainability due diligence (CS3D) was published. CS3D establishes a duty for companies subject to its application to prevent, mitigate, correct, and remedy adverse effects on the environment and on human rights resulting from their operations (including those of their subsidiaries) and from operations in their chain of activities (i.e., their business partners in a global market).

See: Post | CS3D in perspective; Post | Who does the CS3D affect?; Post | Legal interests protected by the CS3D?; and Post | Risk-based approach

ESG ratings

In November 2024, the European Parliament and the Council adopted Regulation (EU) 2024/3005 of the European Parliament and of the Council of 27 November 2024 on the transparency and integrity of environmental, social and governance (ESG) rating activities. ESG ratings provide an opinion on the sustainability profile of a company or an instrument, assessing its exposure to sustainability risks (see Post).

Electricity

On July 16, 2024,  Regulation (EU) 2024/1747 of the European Parliament and of the Council of June 13 came into force, establishing guidelines for the reform of the EU electricity market to reduce its fluctuations and protect consumers from price variations, while ensuring security of supply and accelerating the deployment of renewable energies (see Post).

Council of Ministers Resolution 122/2024 amended the procedure for establishing the timetable and guidelines for municipal LV electricity distribution concessions, resulting in the postponement of the date initially set for launching the tender, as well as a review of the conditions and criteria for LV concessions (see Post).

Renewable energy

Decree-Law 22/2024 of March 19 extended exceptional measures for simplifying procedures for renewable energy projects. This extension aims to ensure the continued implementation of the measures that have contributed to achieving the goals of energy transition and reducing dependence on fossil fuels (see Post).

Decree-Law 99/2024 was published on December 3, introducing significant changes to the regulatory framework for renewable energy, aimed at (i) simplifying licensing procedures and facilitating the connection of production facilities to the grid; (ii) streamlining decentralized energy production and expanding the concept of hybridization, including storage; (iii) introducing new rules on compensation for municipalities; (iv) simplifying the rules for using areas in the national agricultural reserve (RAN) and registering of small-scale renewable energy production units; and (v) adjusting the Electro-intensive Customer Status to be more in line with European Union law, benefiting eligible productive sectors (see Post).

Green hydrogen and biomethane

In February 2024, we published a summary document on the legal framework and regulation of hydrogen in Portugal: (see Post).

Following Ordinance 15/2023, establishing a centralized purchasing system for biomethane and green hydrogen produced through water electrolysis (see Post), Ordinance 5971-A/2024 of May 27 was published, stipulating the launch of a tender in the form of an electronic auction and including the sale of the respective guarantees of origin. This measure aims to encourage green hydrogen and biomethane projects and has an allocation of €140 million to be delivered over a 10-year period.

Ordinance 168/2024/1 of June 18 approved the regulation for the company incentive system “Promotion of Renewable Hydrogen and Other Renewable Gases–Scaled-up Measure” (see Post).

Pillar II

The European directive commonly referred to as Pillar II has been transposed, establishing an overall minimum level of taxation for multinational enterprise groups and large-scale national groups in the European Union whose turnover was at least €750 million in two or more of the previous four tax years (see Post).

Balance sheet bonuses

Tax Authority Circular 20271 clarified the conditions for applying the IRS exemption on employment income arising from the payment of balance sheet bonuses to employees in 2024 (see Post).

Tax incentives - capital market development

A law has been published establishing a variety of incentives designed to develop the capital markets, promote the capitalization of non-financial companies and encourage housing rentals, creating incentives to boost supply and demand in the capital markets. This new regime also clarifies certain tax aspects, including the regime applicable to alternative credit investment organizations (see Post).

2025 State Budget Law Proposal

The process for approving the State Budget Law Proposal for 2025 took place between October and November (see Post).

Urban Simplex

On January 8, Decree-Law 10/2024 (“Urban Development Simplex”) was published, aimed at simplifying and speeding up procedures. It also produced a paradigm shift that is worth noting: the shift of municipalities’ control of urban development operations from the pre-execution phase (prior control) to the time of execution or even completion (simultaneous and successive checks).

For more information, see the Guide to the Urban Development Simplex and the Regulations on the Urban Development Simplex.

Affordable rentals and controlled-cost housing

Following the More Housing Law of October 2023, two ordinances were published in February 2024 to regulate: (i) the terms and conditions for promoting affordable housing by assigning surface rights to public land and buildings; and (ii) the controlled-cost housing regime (HCC) (see Post).

Forced rentals

Decree-Law 43/2024 revokes the extension of the forced rental regime to vacant residences that the More Housing Law introduced into the Legal Regime on Urbanization and Building (RJUE) (see Post).

Short-term letting

Decree-Law 76/2024 introduced significant changes to the legal regime on the operation of short-term letting establishments.

This law revoked and amended several measures previously established in the More Housing Program. Specifically, it lifts the suspension on new registrations, alters the validity and transferability of registrations, and grants new powers to municipalities (see Post).

Special regime for reclassifying land as urban

The Council of Ministers meeting on November 28, 2024, approved a decree-law amending the Legal Regime on Territorial Management Instruments (“RJIGT”), permitting an increase in the supply of land for housing. It is waiting to be signed into law and published in the Official Gazette of the Portuguese Republic.

Amendments to the port operation regime and general bases for public service concessions for cargo handling in port areas by Decree-Law 92/2024 of November 25, in particular the increase in the maximum concession term to 75 years, were approved.

Labor

Hot topics

In January, we previewed what we considered to be the five hot topics for 2024: (i) international mobility; (ii) new incentives and benefits; (iii) flexible working; (iv) artificial intelligence and technology; and (v) ESG | D&I (see Post).

Certifying temporary incapacity for work

In January, Ordinance 11/2024 was published, introducing amendments to the regime on certifying temporary work incapacity that may impact employers’ human resources management with regard to the rules on justifying absence due to sick leave (see Post).

Employment promotion

In September 2024, the government approved a set of measures to promote employment, including financial support for internships and open-ended contracts for unemployed individuals and qualified young people (see Post).

Working on digital platforms

The European Union has regulated digital platform work. Directive (EU) 2024/2831 of the European Parliament and of the Council of October 23, 2024 applies to all workers providing services through systems defined by the directive as digital platforms, regardless of the sector, the contractual nature, and whether the service provision is carried out directly or through an intermediary (see Post).

November saw the publication of two particularly important pieces of EU legislation: Regulation (EU) 2024/2822 on Community designs and Directive (EU) 2024/2823 on the legal protection of designs (recast version). With regard to Portugal, work is underway to review the Industrial Property Code (which governs industrial designs). The new developments arising from the directive should therefore be incorporated into the new code (see Post).

In December, we published the “Restructuring in Iberia and LatAm” guide, offering a detailed and specialized analysis of the main legislative changes and restructuring and insolvency cases. In Portugal, we highlight the restructuring of the Perufish group, which involved a restructuring plan under English law, and the purchase of the Efacec Group by Mutares, which resulted in a non-judicial restructuring of two of the group’s companies in Portugal. Additionally, Tupperware and INAPA faced insolvency proceedings with significant impacts on their operations in Portugal.

Amendments to the merger, demerger, and transformation regimes

On January 4, 2024, Decree-Law 114-D/2023 of December 5 entered into force, amending regimes such as the merger, demerger and transformation regimes established in the Companies Code, and introducing new regimes on crossborder demergers and transformations (see Post).

Cybersecurity

The Cyber Resilience Act, establishing unified cybersecurity standards for digital products across the EU, has been published in the Official Journal of the European Union (see Post).

On November 22, the draft decree-law transposing Directive (EU) 2022/2555 of the European Parliament and of the Council (NIS2 Directive), updating the NIS Directive, was submitted for public consultation. Following NIS2, the draft decree-law expands the entities covered, prioritizing the widespread prevention of cybersecurity risks and adapting the regulatory requirement according to the size of the entity and the importance of its activity, as well as prioritizing the proportionality of the applicable measures (see Post).

Three delegated regulations [(EU) 2024/1772, 2024/1773, 2024/1774] aimed at complementing the DORA Regulation have also entered into force, establishing various regulatory technical standards that specify various criteria relevant to the use of information technology services.

Artificial intelligence

The Artificial Intelligence Act has been published, establishing a common risk-based framework and imposing a comprehensive set of obligations on all actors in the AI value chain, from providers to deployers. This regulation also imposes substantial penalties for non-compliance.

A practical guide to the Artificial Intelligence Act was published in 2024, providing an overview of the Act, clarifying its scope and providing practical advice for navigating its complexities (see Post).  

Directive (EU) 2024/2853 of the European Parliament and of the Council of 23 October 2024 updates the liability regime for defective products to reflect technological advances, including artificial intelligence (AI). This directive strengthens consumer protection, including access to compensation for personal injury, and damage to mixed-use goods (private and professional), through common rules on the liability of economic operators (see Post).

The European Data Protection Supervisor has published the first guidelines for ensuring data protection compliance when using generative AI systems, which are intended to provide practical recommendations to EU institutions, bodies, offices and agencies on the processing of personal data (see Post).

The European Commission has also established the European Artificial Intelligence Office, made up of technology experts, administrative assistants, lawyers, policy specialists and economists. The EACI aims to implement and ensure the execution of the Artificial Intelligence Act, as well as to monitor the evolution of artificial intelligence markets and technologies.