Portugal 2020

With the aim of providing favourable conditions for entrepreneurship within the European Union, the Europe 2020 strategy brings together a set of measures aimed at smart and sustainable economic growth as a way to overcome difficulties improve the business environment and ensure a sustainable economy within the bloc. In this context, the Portugal 2020 plan stems from a partnership agreement between Portugal and the European Commission, a body bringing together five European Structural and Investment Funds (European Regional Development Fund, Cohesion Fund, European Social Security, European Agricultural Fund for Rural Development and European Maritime And Fisheries Fund), where policy strategies for economic, social and territorial development are defined with a focus on research, development technological technology and innovation. The total investment value expected for Portugal in the term is 25,000,000,000.00 (twenty-five billion) euros.

Under European Community law, the Europe 2020 strategy, especially the management of the five funds involved, is provided for in Regulation (EU) No 1303/2013 of the European Parliament and the Council (recital 3). In Portuguese law, the development agreement was internalized by Decree Law 159/2014 and, in more detail, by Ordinance 57-A/2015, a fundamental document for any interested in the subject.

Like any public program to promote the economy, access to benefits depends on compliance with formal, financial and social conditions, all legally imposed either by Law 159/2014, or in the specific regulation introduced by Ordinance 57-A /2015.

As it works: according to Articles 6 and 7 of Decree Law 159/2014 and 3rd of Ordinance 57-A/2015, the program provides, in addition to benefits, reimbursable financial support and lost fund. Incentives can be cumulative. Investment/support rates vary according to the business regulatory framework (business innovation and entrepreneurship, qualification and internationalization of SMEs, research and technological development), the size of the company, the country region and social and economic impacts of the enterprise. Also according to the objective criteria of the program, reimbursable financing can be granted without the payment of interest and by granting grace periods such as industrial and tourism projects (Ordinance 57-A/2015).

Who can apply: In accordance with Article 12 of DL 159/2014, any entity, natural or collective, with or without profit may apply, provided that it fulfils the requirements required in all legislation and does not incur cases of impediments and conditioning described in the article 14 of the same standard. Article 4 of Ordinance 57-A/2015 gives an idea of the breadth of the program saying, verbatim, that businesses inserted in all economic activities, especially those aimed at producing assets and services that are transactionable and internationalisable or contributing to their value chain and do not concern services of general economic interest, except: (a) financial and insurance; b) defense and; c) lotteries and other betting games.

Need for legal monitoring: The procedures for examining, selecting and deciding applications are those contained in Articles 17 and 20 of Decree-Law No. 159/2014 and ordinance 57-A/2015. To succeed in the application and thus gain access to Portugal 2020, the company must adopt a series of measures with a focus on meeting the required requirements. First, it is necessary to correctly verify the framework of the project and, from this, what are the specific requirements of Ordinance 57-A/2015. Then it is necessary to obtain and validate all general documents (permanent certificate, declaration of start of activity) and specific (architectural projects, licensing, budgets, investment plans) and only then register the application in the Portal 2020. According to Article 10(2) of Ordinance 57-A/2015, the applicant may be notified to present additional clarifications, information or documents. Non-service in the legal period means the withdrawal of the application. The evaluation is carried out according to “indicator of the merits of the project” and result given in a decision based on 60 days

Criteria for selecting applications. According to Article 24 of DL 159/2014 and 18th of Ordinance 57-A/2015, evaluation criteria are briefly: (a) the quality of the project according to the coherence, rationality and innovative nature of investment; b) impact of the project on the competitiveness of the company, assessed according to business orientation, positioning in the value chain, the level of productive efficiency, as well as, for certain types of investment, the strengthening of its ability to innovation; c) contribution of the project to the economy, considering the degree of response to current social challenges, the qualification of created employment, the structural impact of the project measured by economic productivity, positive externalities to the economy and the drag effect on SMEs, and the contribution to achieving the results and; (d) contribution of the project to regional competitiveness, observed by the adequacy of the project to local strategies and by contributing to the support of regional convergence processes. As we see compliance with decision criteria, although necessary, is not sufficient for the selection of an application. In other words, if the specific formal requirements of the application process are elimination clauses, specialized advice is equally important to lead the project to achieve a satisfactory classification.

Portugal 2020 in a context of legal stability. The Portugal 2020 program is not only part of the successful effort of the Portuguese State to promote the recovery of the economy, which suffered the impacts of the 2008 global crisis, but is part of the current scenario of frank recovery. In addition to public policies directed directly to the promotion of entrepreneurship, the legal-normative environment in Portugal is fertile for business realization. As we know, the execution of lasting investments requires stability of the rules of the game as a presupposition of knowledge, clarity and predictability, characteristics present today both in legislative production and in Portuguese jurisprudence. In Portugal, nowadays, the protection of investor confidence stems legally from the stability of laws regulating relationships inherent to private initiative and the coherence of jurisprudence, which basically gives the foreign investor tranquility to plan and run successful business.