Foreign exchange authority
Banco de Portugal is the foreign exchange authority of the Portuguese Republic.
As such, Banco de Portugal shall be responsible in particular for the licensing and overseeing of external payments whenever required in accordance with the Treaty on European Union and for defining the principles governing foreign exchange transactions.
Within the scope of its participation in the European System of Central Banks, Banco de Portugal regulates the functioning of the foreign exchange market and oversees foreign exchange activities and operations (basically, the buying and selling of foreign currency and transfers from or to foreign countries denominated in foreign currency).
Banco de Portugal is entrusted with the investigation, inquiry and decision regarding foreign exchange administrative offence proceedings, as well as the inclusion of contracts relating to non-financial institutions’ manual currency exchange transactions in a special registry (Notice of Banco de Portugal Nº 13/2003 - in Portuguese only).
External economic and financial operation
External economic and financial operations are acts and trades irrespective of their nature, which give rise or may give rise to receipts or payments between residents and non-residents.
In line with the Treaty on European Union, these operations may be negotiated and settled freely, without prejudice to any exceptions on the grounds of serious political reasons or urgency.
Applicable legislation: Decree-Law No 295/2003 of 21 November 2003, as amended by Decree-Law No 61/2007 of 14 March 2007 (in Portuguese only).
Foreign exchange operations
Foreign exchange operations are, in principle, intermediated by an entity authorised to carry out foreign exchange activities.
However, residents may carry out directly or through any means of payment denominated in foreign currency, their payments/receipts to/from non-residents or net-off their obligations towards non-residents. Residents may also incur debts or grant loans among themselves in foreign currency or in units of account used in international payments and clearing.
Residents and non-residents may open and operate bank accounts in Portugal, held in authorised institutions, denominated in euros, foreign currency, gold or units of account.
Residents in Portugal may also open and operate accounts with non-resident institutions.
Any natural person entering or leaving Portuguese territory, originating or terminating in a territory outside the European Union, and carrying an amount of cash equal to or exceeding €10,000 must declare the said amount to the customs authorities. If these cash movements are carried out with European Union Member States, the said amount must be declared only if requested by the customs authorities.
Applicable law: Decree-Law No 295/2003 of 21 November 2003; as amended by Decree-Law No 61/2007 of 14 March 2007 (in Portuguese only).
Rules governing the buying and selling of foreign currency
The entities that buy and sell foreign currency may freely negotiate the exchange rates and applicable fees. However, these entities must display in a visible place updated information on exchange rates, fees and commissions charged on foreign exchange transactions.
For information purposes, Banco de Portugal publishes euro reference exchange rates on a daily basis and exchange rates for an additional set of currencies. The euro reference exchange rates are the responsibility of the European Central Bank.
Legislation and regulations: Notice of Banco de Portugal Nº 1/99 amended by the Notice of the Banco de Portugal Nº 11/2006 (in Portuguese only).