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Fintech Market Overview

This article does not constitute legal advice.

Crowdfunding in Portugal

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When it comes to crowdfunding platforms, Portuguese law establishes requirements and conditions for the corporate entities that manage these platforms, which are supervised by the CMVM when they are collaborative equity-based or loan-based. Prior registration and authorisation with the CMVM is necessary for these entities. Alongside this request there must be various documents such as the entity's corporate information, structure and beneficial ownership, identification of its managers, a fit and proper declaration, business plan and model and evidence of meeting minimum financial requirements. It must also be made clear if it should be classified as a financial intermediary or an agent thereof. Minimum financial requirements are either (1) a minimum share capital of €50,000; (2) an insurance policy covering a minimum of €1 million per claim, and a minimum of €1.5 million in aggregate claims per year; or (3) a combination of both (1) and (2) that ensures proper similar coverage.1

Crowdfunding schemes are gaining some traction. At present, six management entities managing crowdfunding platforms are registered with the CMVM, mostly within the loan-based platforms sector. As the industry evolves and the number of players grows, prospective changes could arise with the Execution of Regulation on European Crowdfunding Service Providers for Business. Furthermore, it is possible that in the medium to long term, there may be movement towards securitisation of loan portfolios stemming from these platforms.1

Under the current securitisation law (Decree Law No. 453/99, as amended), the Portuguese state and other public legal persons, credit institutions, financial companies, insurance firms, pension funds and pension fund management companies are the only bodies permitted to act as originators of receivables for securitisation purposes. Nevertheless, loans can be assigned for securitisation by entities that have had their accounts from the past three years legally certified by a CMVM-registered auditor. This could potentially open up avenues for crowdfunding entities to enter into structured finance transactions previously exclusive to banks and other established players. However, considering the kind of organisations resorting to crowd-lending platforms and managing them, it may still take some time before this inclination towards securitisation is realised.1

In June 2019, Regulation (EU) 2019/1150 of the European Parliament and of the Council on promoting fairness and transparency for business users of online intermediation services came into force, placing certain obligations upon providers of online intermediation services, simultaneously (1) constituting information society services, (2) allowing business users to offer goods or services to consumers, and (3) provided to business users on the basis of contractual relationships (such as platforms' terms of use). Obligations of platforms include demands for transparency and clarity in terms and conditions, informing business users of any changes, limiting restrictions or suspensions to online intermediation services, disclosing the basis of rankings (if they are a feature), being honest with different treatments to business users, protecting personal data and setting up an effective internal complaint-handling system available to all customers without hindering their alternative pathways such as mediation.1

Payment services in Portugal

Fintech in Portugal

Fintech in other countries

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Portuguese Fintech Lawyers

Denis Polyakov

Denis Polyakov

Comprehensive legal services for businesses on corporate, tax law, cryptocurrency legislation, investment activities

Kristina Berkes

Kristina Berkes

Participation as a lawyer at investment venture funds, leading venture M&A deals in IT, supporting iGaming and business assets

Viacheslav Losev

Viacheslav Losev

Legal support for FinTech and Blockchain projects

Notes
  1. https://thelawreviews.co.uk/title/the-financial-technology-law-review/portugal