Setting-up of institutions

Authorisation

The setting-up of credit institutions, financial companies or payment institutions is subject to prior authorisation.

As a rule, the competent authority is Banco de Portugal, save for exceptional situations where this power has been conferred on the Ministry of Finance.

Applications for authorisation shall be accompanied by the following elements regarding the institution to be set up:

• Characterisation of the type of institution to be set up
• Draft of the articles of association
• Programme of operations
• Geographical location
• Description of the internal organisation
• Description of human, technical and material resources
• Prospective accounts for each of the first three business years
• Identity of the founder members, indicating the number of shares subscribed by each
• Documentary evidence on the adequacy of the shareholder structure to the stability of the institution
• Statement of commitment to the effect that on the date of setting-up the amount of capital stock required by law has been deposited with a credit institution
• Description of the corporate governance arrangements, which include a clear organisational structure with well defined, transparent and consistent lines of responsibility, effective processes to identify, manage, monitor and report the risks it is or it might be exposed to and adequate internal control mechanisms, including sound administrative and accounting procedures. These arrangements, processes and mechanisms shall be comprehensive and proportionate to the nature, scale and complexity of each credit institution activities.

Concerning payment institutions, the applications for authorisation shall be accompanied by the elements indicated in Article 11 of the Legal Framework of Payment Institutions and Payment Services.

Regarding its founder members, the application shall be further accompanied by:

• Documents indicated in Notice of Banco de Portugal No 5/2010.
• In the case of founder members who are legal persons (under the terms of Article 17 (2) of the Legal Framework of Credit Institutions and Financial Companies):
  • Articles of association
  • List of the members of the management board
  • Balance sheet and accounts for the last three years
  • List of the partners who have a qualifying holding
  • List of the undertakings in which the legal person in question has a qualifying holding
  • Explanatory memorandum of the structure of the group to which that legal person belongs

Additional information

Banco de Portugal may request additional information to the applicants and make the inquiries deemed necessary.

Registration

Credit institutions shall not commence their activity without being subject to a special registration with Banco de Portugal. Registration covers the items laid down in Article 66 of the Legal Framework of Credit Institutions and Financial Companies and Article 21 of the Legal Framework of Payment Institutions and Payment Services.

The members of the boards are subject to the suitability, availability and professional qualification requirements laid down in Articles 30 to 33 of the Legal Framework of Credit Institutions and Financial Companies. The application shall be filed pursuant to Instruction No 30/2010 and the attached questionnaire.