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The Exchange of Tax Information Portal is an initiative of the Global Forum on Transparency and Exchange of Information for Tax Purposes. The Global Forum conducts peer reviews of its member jurisdictions' ability to co-operate with other tax administrations in accordance with the internationally agreed standard. The standard provides for exchange of information on request where it is foreseeably relevant to the administration and enforcement of the domestic tax laws of the requesting jurisdiction. Effective exchange of information requires that jurisdictions ensure information is available, that it can be obtained by the tax authorities and that there are mechanisms in place allowing for the exchange of that information. The Global Forum's peer review process examines both the legal and regulatory aspects of exchange (Phase 1 reviews) and the exchange of information in practice (Phase 2). The EOI Portal will track the development of these peer reviews, including changes that jurisdictions make in response to the Global Forum's recommendations.

Peer Review: Portugal Phase 2 Review

This report for Portugal has been published on 16 Mar 2015. You can buy this report, or browse it online below.

Skip directly to the Executive Summary. You may also want to view the tables of determinations and ratings.


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Determinations and Recommendations

Jurisdictions should ensure that ownership and identity information for all relevant entities and arrangements is available to their competent authorities. (ToR A.1)
Determination Factors Recommendations
The element is in place, but certain aspects of the legal implementation of the element need improvement.   Although tax filing obligations are in place for the reporting of ownership information in relation to bearer shares, these reporting mechanisms may not sufficiently ensure that the owners of such shares can be identified within the stipulated timeframes under the tax filing obligation regime.  Portugal should legally ensure that appropriate reporting mechanisms are in place to effectively ensure that owners of bearer shares can be identified in a timely manner in all cases. 
Phase 2 Rating Factors Recommendations
Largely Compliant.      
Jurisdictions should ensure that reliable accounting records are kept for all relevant entities and arrangements. (ToR A.2)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Compliant.      
Banking information should be available for all account-holders. (ToR A.3)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Compliant.      
Competent authorities should have the power to obtain and provide information that is the subject of a request under an exchange of information arrangement from any person within their territorial jurisdiction who is in possession or control of such information (irrespective of any legal obligation on such person to maintain the secrecy of the information). (ToR B.1)
Determination Factors Recommendations
The element is in place.   There are some uncertainties as to whether the professional secrecy applicable to lawyers and solicitors may unduly restrict the access to information by the competent authorities.  Portugal should ensure that the professional secrecy law applicable to lawyers and solicitors conforms with the standard and does not unduly restrict the access to information by the competent authorities. 
Phase 2 Rating Factors Recommendations
Partially Compliant.   During the review period, Portugal rarely accessed bank information directly from the banks in order to reply to an exchange of information request. The Portuguese competent authority interpreted the conditions in its domestic law for lifting bank secrecy narrowly and in many instances failed to initiate the process to access bank information in order to reply to requests for exchange of information. Although Portugal states it revised its internal procedures in May 2014 and amended its access powers regarding bank information as of 1 January 2015, both changes are very recent and are further complicated by the fact that the streamlining of its access powers in article 63B only apply to, and insofar as, requests for banking information pertain to periods after 1 January 2015.  Portugal should ensure that its access powers and procedures concerning the access to bank information are effective in relation to all requests for bank information, irrespective of when the relevant operations and transactions took place. 
The rights and safeguards (e.g. notification, appeal rights) that apply to persons in the requested jurisdiction should be compatible with effective exchange of information. (ToR B.2)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Compliant.      
Exchange of information mechanisms should provide for effective exchange of information. (ToR C.1)
Determination Factors Recommendations
The element is in place, but certain aspects of the legal implementation of the element need improvement.   A significant number of agreements for the exchange of information signed over the past four years are not yet in force and have not been ratified by Portugal.  Portugal should ensure that its exchange of information mechanisms are brought into force expeditiously. 
Phase 2 Rating Factors Recommendations
Partially Compliant.   During the review period, Portugal did not provide banking information in respect of a significant number of requests, as the EOI team interpreted the standard of foreseeably relevance in this respect narrowly and considered that many requests were not duly justified and/ or documented in the light of the standard of “foreseeably relevance” or, if they were, did not meet the requirements provided under Portuguese law to derogate bank secrecy.  Portugal should ensure that it implements the condition of foreseeably relevance in line with the international standard in all cases. 
The jurisdictions' network of information exchange mechanisms should cover all relevant partners. (ToR C.2)
Determination Factors Recommendations
The element is in place.     Portugal should continue to develop its exchange of information network with all relevant partners and take all steps necessary to bring concluded agreements into effect expeditiously. 
Phase 2 Rating Factors Recommendations
Compliant.      
The jurisdictions' mechanisms for exchange of information should have adequate provisions to ensure the confidentiality of information received. (ToR C.3)
Determination Factors Recommendations
The element is in place.      
Phase 2 Rating Factors Recommendations
Compliant.      
The exchange of information mechanisms should respect the rights and safeguards of taxpayers and third parties. (ToR C.4)
Determination Factors Recommendations
The element is in place.   There are some uncertainties as to whether the professional secrecy applicable to lawyers and solicitors may unduly limit the access to information.  Portugal should clarify the scope of the professional secrecy applicable to lawyers and solicitors to ensure consistency with the standard. 
Phase 2 Rating Factors Recommendations
Compliant.      
The jurisdiction should provide information under its network of agreements in a timely manner. (ToR C.5)
Determination Factors Recommendations
The assessment team is not in a position to evaluate whether this element is in place, as it involves issues of practice that are dealt with in the Phase 2 review.      
Phase 2 Rating Factors Recommendations
Largely Compliant.   In a number of cases, Portugal has not provided status updates within the 90 day period.  Portugal should provide status updates to its EOI partners within 90 days where relevant. 
Portugal’s lack of internal processes and guidance with respect to requests for banking information have led to delays in answering requests for this type of information in a number of cases.   Portugal should put in place adequate processes and guidance to ensure that all requests for banking information are answered in a timely manner.