Member Article

Law 58/2020 came into force on 1 September 2020 and it implements into Portuguese law:

• Directive (EU) 2018/843 of the European Parliament and of the Council of 30 May 2018 amending Directive (EU) 2015/849 on the prevention of the use of the financial system for money laundering or terrorist financing, commonly known as the 5th Anti-Money Laundering Directive; and
• Directive (EU) 2018/1673 of the European Parliament and the Council of 23 October 2018 on combating money laundering by criminal law.
  
  

This law introduces substantial changes to the rules previously in force. These changes are being made to implement in Portugal’s national legal system new measures to prevent and combat money laundering and terrorist financing. They strengthen the measures implemented following the recommendations of the Financial Action Task Force (FATF) and the approval of Law 83/2017 of 18 August, the Law to Combat Money Laundering and Terrorist Financing (“LCMLTF”), and Law 89/2017 of 21 August, which approves the Legal Rules of the Central Register of the Beneficial Owner.

Specifically, the new legislation is intended to: (i) increase the transparency of the economic and financial system, and deter the concealment of criminal practices through opaque structures, (ii) ensure the transparency of corporate structures, trust funds and similar legal arrangements, (iii) combat and mitigate the risks inherent to the use of alternative financial systems, such as electronic money and other virtual assets, which allow anonymity, and (iv) ensure that Portugal has coherent and consistent criminal mechanisms and instruments to provide better cross-border cooperation with the authorities in other countries in combating money laundering and terrorist financing.

To this end, significant changes have been made to the following legal texts:

• Law 15/2001 of 5 June, the General Rules on Tax Infringements
• Law 20/2008 of 21 April 21, Criminal Liability for Crimes of Corruption in International Trade and Private Activity
• Annex I to Law 147/2015 of 9 September, Legal Rules on Access to and Engaging in Insurance and Reinsurance Activity;
• Law 83/2017 of 18 August, Measures to Combat Money Laundering and Terrorist Financing
• Law 89/2017 of 21 August, Legal Rules of the Central Register of the Beneficial Owner
• Law 97/2017 of 23 August, Application and Enforcement of Restrictive Measures Approved by the UN or EU
• The Criminal Code
• The Commercial Registry Code
• The General Rules on Credit Institutions and Financial Companies
• Decree-Law 15/93 of 22 January, Legislation to Combat Drugs
• The Notarial Code
• Fee Regulations for Registries and Notaries
• Decree-Law 14/2013 of 28 January, which organises and harmonises the legislation regarding the Tax Identification Number.
  
  

Highlights of the changes mentioned above include: i) widening the range of entities subject to measures to prevent and combat money laundering, and increasing transparency regarding the identification of the beneficial owner, ii) the introduction of stricter controls on transactions with customers located in high-risk third countries, iii) implementing restrictions on the anonymous use of virtual currencies, iv) better identification of politically exposed persons (“PEPs”), and v) broadening the framework of offences and typical conducts underlying the crime of money laundering.

• In the financial sector: i) securities investment companies to foster the economy, ii) qualified venture capital fund managers, iii) qualified social entrepreneurship fund managers, iv) self-managed European Union long-term investment funds with the designation ELTIF, and v) real estate investment and management companies in Portugal.
• In the non-financial sector: i) entities that engage in any activity with virtual assets; ii) any person that provides, directly or indirectly, material aid, assistance or consultancy in tax matters, as their main commercial or professional activity; iii) persons that store, trade or act as intermediaries in the trade of works of art, when the payment is made in cash, if the value is EUR 3000 or more, or through another means of payment, if the value is EUR 10,000 or more; iv) merchants dealing in goods of high unit value, namely gold and other precious metals, precious stones, antiques, aircraft, boats and motor vehicles, when the payment is made under the same terms as in the previous paragraph; v) other merchants and service providers dealing in goods or providing services, when the payment of the transaction is made in cash and the value is EUR 3000 or more, regardless of whether the payment is made through a single transaction or several transactions.
  
  

In the non-financial sector, it is made clear that merchants who deal in goods of high unit value are considered to be obliged entities when the payment is made in cash, if the value is EUR 3000 or more, or through another means of payment, if the value is EUR 10,000 or more.

Other merchants and service providers are subject to the obligations provided for the prevention of money laundering and terrorist financing when the payment is made in cash and the value is EUR 3000 or more.

To ensure increased transparency regarding the identification of the beneficial owner, changes have been made to the Legal Rules of the Central Register of the Beneficial Owner and related legislation. The information on beneficial owners will now be made available in the corresponding registries of the other Member States, through the European Central Platform.

Importantly, the criterion for assessing the status of beneficial owner is now the ownership or control, directly or indirectly, of a sufficient percentage of units or securities in circulation in the collective investment undertakings.

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