Choose the legal form of the company

• It is held by a single individual or natural person;
• The designation or commercial name should be the full or abbreviated civil name of the individual entrepreneur and may include, or not, an expression alluding to the business or the way you intend to disclose your company in the business environment;
• Individual entrepreneurs who do not exercise a commercial activity, but who have a profitable economic activity, may have a denomination, or expression that refers to the branch of activity, in accordance with the conditions provided for in Article 39 of Decree-Law No. 129/98, of 13 May;
• There is no mandatory minimum amount of share capital;
• There is no separation between personal and business assets, so the entrepreneur's own assets are allocated to the exploitation of the economic activity;
• The liability is unlimited, and the entrepreneur is liable for the debts incurred in the course of the activity with all the assets that make up his/her assets.

For the creation of this company’s legal form, the following steps should be taken:

• Complete the statement of beginning of activity in a local office or through the Portal das Finanças (Finance Portal)
• Make the registration in Segurança Social (Social Security).

The company created with the legal status of Individual Limited Liability Establishment (E.I.R.L.) has the following characteristics:

• It is held by a single individual or natural person;
• The designation must be composed by the civil name, in full or abbreviated, of the entrepreneur. This name may or may not be added to the reference to the branch of activity, plus the mandatory addition of Individual Limited Liability Establishment or E.I.R.L. (paragraph 3 of art. 2 of Decree-Law no. 248/86, of 25 August, and paragraph 1 and 2 of art. 40 of Decree-Law no. 129/98, of 13 May)
• The share capital may not be less than €5,000 and may be paid up in cash, goods or rights that may be subject to attachment. However, the cash portion may not be less than 2/3 of the minimum capital (paragraph 1 and 3 of art. 3 of Decree-Law no. 248/86, of 25 August)
• There is a separation between the entrepreneur's personal assets and the assets allocated to the undertaking, so that the entrepreneur's own assets are not allocated to the operation of the economic activity;
• Only the assets associated with the economic activity are liable for the debts resulting from the economic activity. In the event of the bankruptcy of the entrepreneur, and where it is proved that there was no complete separation of assets, the bankrupt shall be liable with all his assets for the debts incurred.

In order to create this company’s legal form, please contact the service desks of Instituto dos Registos e do Notariado.

A sole proprietorship by shares has the following characteristics:

• It has a single shareholder who owns the entire capital;
• The amount of share capital is freely fixed in the articles of association, corresponding to the sum of the shares subscribed by the shareholders.
• The corporate name of these companies must be formed by the expression "Sociedade Unipessoal" or the word "Unipessoal" before the word "Limitada" or the abbreviation "Lda".

This type of company can be created through the Empresa Online or in person at the desks of the Empresa na Hora.

The company created with the legal status of a General Partnership has the following characteristics:

• It does not require a mandatory minimum amount for the share capital, since the partners are unlimitedly liable for the company's social obligations;
• The designation may consist of the full or abbreviated name, surname or business name of all, some or at least one of the members, followed by the mandatory addition by the full "e Companhia", abbreviated and "Cia" or any other that indicates the existence of more members, namely "e Irmãos" (and Brothers);
• It is a company with unlimited liability in which the partners are liable for unlimited and subsidiary liability in relation to the company and jointly and severally with each other.

The company created with the legal status of a Private Limited Company has the following characteristics:

• It has more than one shareholder;
• The amount of corporate capital is freely established in the articles of association, corresponding to the sum of the subscribed quotas by the partners;
• The name of these companies can be composed by the full or abbreviated name of all, some or one of the partners, by an expression alluding to the branch of activity or by joining both previous elements, followed by the mandatory addition "Limitada" in full or abbreviated "Lda";
• The liability of the partners is limited to the share capital. Only the company's assets are liable to creditors for the company's debts;
• The memorandum of association may establish that one or more partners, in addition to being liable to the company, are also liable to the company's creditors up to a certain amount.

This type of company can be created through the empresa online [Online Company] or in person at the desks of the Empresa na Hora [Company On The Spot].

The company created with the legal status of a Public Limited Company has the following characteristics:

• Requires a minimum of five partners, usually referred to as shareholders, even though it is possible to form a public limited company with a sole partner as long as the partner is a company;
• The share capital must be at least of 50.000 €, which will be divided into shares with the same nominal value;
• The partners’ or shareholders’ liability is limited to the value of the shares subscribed;
• The company name may be composed by the name of all, some or one of the partners, a name in particular or a mix of two names, followed by the mandatory addition “Sociedade Anónima” in full or abbreviated “S.A”.

This type of company can be created through the Empresa Online or in person at the desks of the Empresa na Hora.

The legal form Limited Partnership has the following characteristics:

• There are two types of partners, limited partners and general partners;
• Limited partners have limited liability, that is, they are only liable for their capital contribution;
• General partners, on the other hand, have unlimited liability. In other words, they are liable for the company's debts, unlimited and jointly and severally with each other, under the same terms as the partners of the company in a collective name;

The company's name is formed by the name of at least one of the partners, and by the addition "Em Comandita" or "Comandita por Ações".

This type of company can be created through the Empresa Online or in person at the desks of the Empresa na Hora.

Cooperatives are autonomous, non-profit-making legal persons of free incorporation, with variable capital and composition, which aim to satisfy the economic, social or cultural needs and aspirations of their members and have the following characteristics:

• Their objective is to satisfy the interest of their members in obtaining certain goods at prices lower than those of the market, or to sell their products by eliminating intermediaries from the market;
• The number of members shall be variable and unlimited, but may not be less than five in the case of a first-degree cooperative, nor less than two in the case of a higher-level cooperative (cooperatives which join in the form of unions, federations and confederations);
• The liability of the members of the cooperatives shall be limited to the amount of the capital subscribed by the cooperative member;
• The statutes of the cooperative may provide that the liability of the cooperative member shall be unlimited or limited regarding some and unlimited in relation to the others.

The entity responsible for the cooperative sector in Portugal is the António Sérgio Cooperative for the Social Economy, which provides all the necessary information on cooperatives.

Cooperatives can be created by public deed, through a Notary Office.

The Association is defined as a group of people who meet with common objectives and interests. Despite being effectively endowed with assets and carrying out financial transactions, this type of organisation is developed on a non-profit basis, since when the members wish to make a profit, they can choose to set up a company.

The Association comprises three bodies:

• General Assembly: it is the highest body of the association and is responsible for the approval of plans, by-laws and reports, being directed by a Board that may have the following configuration: a chairperson, member and secretary;
• Board: with a managing function, has a minimum of 3 members, which can be set as: a chairperson, secretary and treasurer;
• Audit Committee: it controls the accounts and should be composed of an odd number of members, including a chairperson.

It is also mandatory to note that associations are free to pursue their goals without interference from public authorities and cannot yet be dissolved by the State.

Learn how to creat a Associação na Hora.

If you have a business and want to expand to another European country(in this case, the 28 EU member states plus Iceland, Liechtenstein and Norway), you could consider creating a European Company (SE).