Which international agreements help investors decide for Portugal?
Portugal has signed three different kinds of treaties to protect the investments made by foreign businessmen. AICEP Portugal Global explains the basics of these agreements, and how they might help investors decide for Portugal.
Portuguese International Agreements to Protect Investments
1. Agreements for the Reciprocal Protection and Promotion of Investments.
Agreements for the Reciprocal Protection and Promotion of Investments are bilateral instruments containing binding measures aimed at creating more favorable conditions for investments by investors of one signatory state in the territory of another, ensuring more favorable treatment of investors and a guarantee of complete security and protection of investments already made, on a reciprocal basis. These agreements cover four major areas: entry of investments, treatment of investments, expropriation and losses on investments, and conflict resolution.
Portugal has signed agreements with the following countries: Albania, Germany, Angola, Algeria, Argentina, Bosnia Herzegovina, Brazil, Bulgaria, Cape Verde, Chile, China, South Korea, Croatia, Cuba, Egypt, Slovakia, Slovenia, Philippines, Gabon, Guinea-Bissau, Hungary, India, Kuwait, Latvia, Libya, Lithuania, Macao, Morocco, Mauritius, Mexico, Mozambique, Pakistan, Paraguay, Peru, Poland, Qatar, Czech Republic, Romania, Russia, Sao Tome and Principe, Timor, Tunisia, Turkey, Ukraine, Uruguay, Uzbekistan, Venezuela and Zimbabwe.
The agreements and the markets where Portugal has executed such treaties, as well as the countries in which they are in place, can be viewed in Aicep’s digital library (PDF format, requires registration in Aicep’s digital library). This document, while not exhaustive, includes a listing of bilateral economic agreements between Portugal and over 100 countries and territories between 1980 and March 31, 2010.
2. Conventions to Avoid International Double Taxation
Conventions to Avoid International Double Taxation (CDT) are an important instrument of international tax law. Given the absence of consistent international legislation, establishing residence in the country means that all income earned by nationals of other countries may be taxable in this country, thus giving rise to double taxation. This situation can only be eliminated by conventions executed between states to avoid double taxation. Thus, these conventions allow the income of a foreign national from a country with which Portugal has such a convention to benefit from lower withholding rates.
To date, Portugal has entered into several CDTs, according to the OECD Model, and many others are being negotiated, signed or approved for ratification.
Some of the countries covered by these agreements that Portugal has executed include: Germany, South Africa, Algeria, Austria, Belgium, Brazil, Bulgaria, Cape Verde, Canada, Chile, China, Korea, Cuba, Denmark, Slovakia, Slovenia, Spain, the United States, Estonia, Finland, France, Greece, Guinea-Bissau, the Netherlands, Hungary, India, Indonesia, Ireland, Iceland, Israel, Italy, Latvia, Lithuania, Luxembourg, Macao, Malta, Morocco, Mexico, Mozambique, Norway, Pakistan, Poland, United Kingdom, Czech Republic, Romania, Russia, Singapore, Sweden, Switzerland, Tunisia, Turkey, Ukraine and Venezuela.
The conventions used and a summary table of the CDTs executed by Portugal are available on the Finance Portal.
3. OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions
The OECD Anti-Bribery Convention establishes legally binding standards to criminalise bribery of foreign public officials in international business transactions and provides for a host of related measures that make this effective. It is the first and only international anti-corruption instrument focused on the ‘supply side’ of the bribery transaction. The 34 OECD member countries and six non-member countries - Argentina, Brazil, Bulgaria, Colombia, Russia, and South Africa - have adopted this Convention.