Combating money laundering and terrorist financing                         

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(A) General preventive obligations imposed on real estate entities

1. What are the main general preventive obligations imposed on real estate entities as regards the prevention and repression of money laundering and terrorist financing under the Law on Money Laundering and Terrorist Financing (hereafter the LMLTF)? 

Article 11 of the LMLTF lays down a set of general preventive obligations aimed at combating money laundering and terrorist financing, which all obliged entities must comply which when conducting their business.

Since some of these obligations have to be further developed and detailed in the law and in specific regulations to be adopted by the different financial and non-financial institutions, the general obligations are the following:

(a) Control obligation, developed in Section II of Chapter IV of the LMLTF (see Articles 12-22 of said Law);

(b) Customer identification and due diligence obligation, developed in Section III of Chapter IV of the LMLTF (see Articles 23-42 of said Law);

(c) Reporting obligation, developed in Section IV of Chapter IV of the LMLTF (see Articles 43-46 of said Law);

(d) Obligation to refrain from carrying out transactions, developed in Section V of Chapter IV of the LMLTF (see Articles 47-49 of said Law);

(e) Obligation to refuse to carry out transactions, developed in Section VI of Chapter IV of the LMLTF (see Article 50 of said Law);

(f) Obligation to keep documents and records, developed in Section VI of Chapter IV of the LMLTF (see Article 51 of said Law);

(g) Obligation of scrutiny, developed in Section VI of Chapter IV of the LMLTF (see Article 52 of said Law);

(h) Obligation to cooperate, developed in Section VI of Chapter IV of the LMLTF (see Article 53 of said Law);

(i) Obligation of non-disclosure, developed in Section VI of Chapter IV of the LMLTF (see Article 54 of said Law); and

(j) Obligation to train, developed in Section VI of Chapter IV of the LMLTF (see Article 55 of said Law)

2. Among these general preventive obligations, which of them are the object of specific rules, under IMPIC Regulation, applicable to real estate entities?

Without prejudice to the broad application of the LMLTF provisions, some of the obligations set out in the Law have been the object of regulations by IMPIC, which develop and specify the contents of the obligation, the proper conducts and the mechanisms of action and verification to be adopted by the obliged entities within the real estate sector.

This was the case of the following obligations:

(a) Control obligation, further developed in Article 4 of the IMPIC Regulation, as well as in:

(i) Article 10, as regards the appointment of the Compliance Office and its reporting to IMPIC;

(ii) Article 12, as regards the drafting and annual communication of reports on the internal channels for reporting irregularities and related occurrences; and

(iii) Article 13, as regards the implementation of restrictive measures applicable to individuals, entities or countries as established by national or international organisations, namely the United Nations (UN) or the European Union (EU);

(b) Customer identification and due diligence obligation, further developed in Articles 5-8 of the IMPIC Regulation;

(c) Obligation to keep documents and records, further developed in Article 9 of the IMPIC Regulation; and

(d) Obligation to train, further developed in Article 11 of the IMPIC Regulation.

As a specific obligation applicable to real estate entities, the reporting obligation on real estate activities provided for in Article 46º of the LMLTF has been the object of further development and detailed regulation and is specified and detailed in Articles 14-20 of the IMPIC Regulation, while Article 10 thereof also provides for additional obligations as regards reporting on the Compliance Officer ("Responsável pelo Cumprimento Normativo").

3. What is the reporting obligation provided for in Articles 43 and 44 of the LMLTF, and what are the main activities where it applies?

Strictly speaking, the reporting obligation is the obligation for the obliged entities to immediately inform, on their own initiative, the Central Bureau of Investigation and Prosecution of the Attorney General's Office (DCIAP) and the Financial Intelligence Unit (FIU)of the Criminal Police, whenever they know, suspect or have reasonable grounds to suspect that certain funds or other property, regardless of the value involved, are derived from criminal activities or related to terrorist financing.

The obligation for the obliged entities to report such cases ("suspicious transactions report") to those authorities applies not only to running acts, contracts or activities but also to all the transactions proposed to them, as well as to any attempted transactions that are in progress or have been executed, and whose characteristics and context make it possible to conclude that it is a suspicious transaction even if only when combined with or subsequent to other operations.

When an obliged entity concludes that a certain transaction is suspicions, they must report it immediately to the DCIAP and the FIU via the specific and direct channels defined by these bodies for that purpose, and must act as provided for in the LMLTF, by fulfilling a number of requirements and taking further special precautions in order to ensure the effectiveness of such reporting.

Without prejudice to the necessary consultation of the LMLTF and other relevant legal documents, you can find a comprehensive set of information on the reporting obligation at the website of the Comissão de Coordenação de Políticas de Prevenção e Combate ao Branqueamento de Capitais e ao Financiamento do Terrorismo (the national committee that coordinates the anti-money laundering and counter-terrorist financing policies, hereinafter "the AML/CTF Coordination Committee") (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the item "DEVER DE COMUNICAÇÃO".

4. What is the obligation to refrain from carrying out transactions provided for in Articles 47-49 of the LMLTF and what are the main activities where it applies?

The obligation to refrain from carrying out transactions is the obligation for the obliged entities to refrain from carrying out any present or future transaction or set of transactions which they know or suspect to be associated with funds or other assets related to criminal activities or terrorist financing.

Knowing or suspecting that a given activity or transaction (or set of transactions) might be associated with money laundering or terrorist financing will entail, in addition to an analysis of its impact and the unenforceability of a reasoned decision to refrain as soon as it is detected, immediate reporting, as in the case of a "suspicious transaction", to the DCIAP and the FIU, as provided for in Article 43 et seq. of the LMLTF.

Without prejudice to compliance, whenever possible, with the obligations to refrain, to report and to wait for any possible situation of suspension as decided by the judicial authorities, the obliged entity shall avoid any acts or conducts that might jeopardize the usefulness or efficiency of compliance with the obligation to refrain or its follow-up.

Besides the necessary consultation of the LMLTF and other relevant legal documents, you can find a comprehensive set of information on the obligation to refrain at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the item "DEVER DE ABSTENÇÃO".

5. What is the obligation to refuse to carry out transactions provided for in Article 50 of the LMLTF, and what are the main activities to which it applies?

The obligation to refuse to carry out transactions is the legal obligation for the obliged entities to refuse to start a business relationship, carry out occasional transactions or any other operations whenever they do not obtain:

(a) The identification data and their supporting documents as provided for to identify and verify the customer´s identity, his representative's and the beneficial owner's, including information to check the capacity of the beneficial owner and the ownership and control structure of the customer; or

(b) Information provided for in Article 27 of the LMLTF regarding the nature, object and purpose of the business relationship.

In connection with the obligation to refuse, it should further be mentioned that the obliged entities are also required to be particularly careful in business relationships, occasional transactions and other operations, namely when they do not obtain the identification details, means of proof or other information necessary to assess the actual risks posed by the operations they carry out.

Such situations may entail, for example, not only the need to refuse new business relationships or occasional transactions, but also to possibly bring an immediate end to any already established business relationship - in which case the obliged entities are further required to analyse the causes for not obtaining the identification details, means of proof or information specifically denied, with a view to reporting the situation as a "suspicious transaction" to the competent judicial entities or consulting them on the procedure to be adopted.

In any case, the obliged entities make and keep written records of all the findings and analyses performed, as regards the underlying reasons for not obtaining the identification details, as well as the steps they have taken.

Without prejudice to the necessary consultation of the LMLTF and other relevant legal documents, you can find a comprehensive set of information on the obligation to refuse at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the item "DEVER DE RECUSA".

6. What is the obligation of scrutiny provided for in Article 52 of the LMLTF and what are the main activities in which it applies?

The obligation of scrutiny is an obligation for the obliged entities to analyse with particular care and attention - by enhancing the level and nature of their monitoring - any conducts, activities or transactions whose characterising elements might be related to funds or other assets deriving from criminal activities or associated with terrorist financing.

In order to fully comply with and perform the obligation of scrutiny, the obliged entities shall consider the elements and characteristics of the transaction as a whole, by applying in their analysis a number of indicators such as:

- The nature, purpose, frequency, complexity, uncommonness and atypicality of the conduct, activity or transaction;

- The nature, the activity, the operating pattern, the economic and financial situation and the profile of stakeholders, as well as a possible and apparent absence of an economic goal or a lawful purpose associated with the conduct, activity or transaction;

- The amounts, the origin and the destination of the money transferred and the nature and characteristics of the means of payment used, as well as the place of origin and destination of the transaction;

- The existence or intervention of a certain type of transaction or product, or a corporate structure or a legal arrangement that might favour the stakeholders' anonymity in particular.

During the performance of the obligation of scrutiny, the assessment of how suspicious a given conduct, relationship, transaction or operation might be derives from and is primarily the result of the actions and diligence of the obliged entities, through the examination of the specific circumstances in question, in the light of the criteria required from any professional when analysing the situation. Therefore, it is not limited to nor dependent on the existence of any type of document confirming the suspicion.

It should be noted, in particular as regards the obliged entities operating in the real estate sector, that Annex C of the IMPIC Regulation provides a "List of Suspicion Indicators in the Real Estate Sector that is purely illustrative and aims to help the obliged entities in identifying risk situations and complying with the obligation to report suspicious transactions provided for in Articles 43 and 44 of the LMLTF. Obliged entities should use such indicators in conjunction with the general criteria and the joint démarches and risk assessment in any given situation.

After performing the obligation of scrutiny, if the obliged entities come to the conclusion that there is a "suspicious transaction", they should report it to the competent judicial authorities as provided for in Article 44º of the LMLTF.

However, if they come to the conclusion that the situation in question does not require that a "suspicious transaction" be reported, the obliged entities should provide in writing a detailed record of the incident, indicating the reasons why they decided not to report it, including, in particular, why they consider that there are no specific factors of suspicion, and any contacts made with judicial and police authorities during the scrutiny.

Without prejudice to the necessary consultation of the LMLTF and other relevant legal documents, you can find a comprehensive set of information on the obligation of scrutiny at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the item "DEVER DE EXAME". At the same website, you can also find a list of general and sectoral suspicion indicators (http://portalBCFT.pt/pt-pt/IndicadoresdeSuspeicao#), under the item "LISTAS/Indicadores de suspeição" which should be consulted as well.

7. What is the obligation to cooperate provided for in Articles 53 and 56 of the LMLTF, and what are the main activities in which it applies?

The obligation to cooperate is the obligation for the obliged entities to readily and fully cooperate with the DCIAP, the FIU and other judicial and police authorities, as well as the sectoral authorities and the Tax and Customs Authority, when requested.

This obligation (beyond compliance with any other obligations to provide information, details and documents applicable to regulated economic activities) entails for the obliged entities a number of duties in terms of conduct, such as:

- To provide a prompt and timely response to requests for information on the relationships, transactions or operations carried out;

- To provide in a complete manner and within the established deadlines all the information, clarifications, documents and details requested, and give remote access to them, whenever requested;

- To comply with any regular reporting obligations laid down in sectoral regulation, as well as send any other information requested on a regular or systematic basis; and

- To comply with orders and instructions addressed to them under the LMLTF, as well as take account of any recommendations issued and provide information on their status of implementation.

In particular, and as regards specifically the exercise of inspection duties and activities by sectoral authorities, the obliged entities must fully and promptly cooperate with them, namely by:

(a) Refraining from any illegitimate refusal or obstructive conduct;

(b) Enabling the inspection of any facilities used to carry out their business and related services, even if used by third parties;

(c) Ensuring direct access and enabling on-the-spot check of information details, regardless of their support;

(d) Providing copies, extracts and transcriptions of all requested documents;

(e) Ensuring the appearance and full cooperation of any representative or employee to be heard by the inspecting authority, whatever the nature of their relationship.

Lastly, it should be noted that the obligation to cooperate is of a global and permanent character and is not limited or restricted, for example, to the reporting of "suspicious transactions". Since it is a general obligation under the LMLTF, the provision of such information, documents and details in good faith shall not constitute a breach of any duty of secrecy imposed by any legislation, regulation or contract, and shall not involve the person who provides such information in any kind of liability.

Without prejudice to the necessary consultation of the LMLTF and other relevant legal documents, you can find a comprehensive set of information on the obligation to cooperate at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the item "DEVER DE COLABORAÇÃO".

8. What is the obligation of non-disclosure provided for in Article 54 of the LMLTF, and what are the main activities in which it applies?

The obligation of non-disclosure is the obligation for the obliged entities - as well as the members of their governing bodies, those who hold managerial positions therein, their employees, representatives and other persons who provide them with services on a permanent, temporary or occasional basis - not to disclose to customers or third parties any information, documents or details relating to the investigations, analyses, examinations, actions and reporting carried out when implementing their duties as regards the prevention and repression of money laundering and terrorist financing.

Such duties of non-disclosure are particularly important, namely when it comes to disclosing to customers or third parties any information items relating to:

- The possibility, the imminence, the existence or the preparation of reporting of suspicious transactions to the judicial authorities, or any other reporting provided for in the LMLTF, or any other information related thereto;

- The possibility or existence of a criminal investigation or inquiry, as well as any other investigations, inquiries, analyses or legal procedures to be carried out by the judicial, police or sectoral authorities; or

- Any other information or analyses, either internal or external, that might jeopardize or be relevant for the execution of the tasks the LMLTF confers on the obliged entities and the judicial, police and sectoral authorities, or for the preservation of investigations, enquiries, analyses or legal proceedings and the prevention, investigation and detection of ML/TF in general.

Within this area, the obliged entities must act with the necessary caution - including in order to avoid any actions that for any reason might raise the suspicion, or alert those concerned, that proceedings might be underway to investigate suspicions of ML/TF-related practices. However, if they consider it necessary to avoid any due diligence, the obliged entities should immediately perform the reporting provided for in Article 43 of the LMLTF ("suspicious transaction"), and forward the information they have at that moment.

Without prejudice to the necessary consultation of the LMLTF and other relevant legal documents, you can find a comprehensive set of information on the obligation of non-disclosure at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the item "DEVER DE NÃO DIVULGAÇÃO".

9. Where can I obtain complete and up-to-date information on the restrictive measures applied by international bodies, namely the United Nations Security Council and the European Union, to activities carried out by obliged entities?

Restrictive measures consist of temporary restrictions to the exercise of a given right by imposing a prohibition or an obligation approved by the United Nations or the European Union with a view to pursuing the objectives as regards the international peace or security, the protection of human rights, democracy and the rule of law, the preservation of sovereignty, independence and other fundamental interests of the State, or to preventing and combating terrorism and the proliferation of weapons.

Such restrictive measures can target individuals with Portuguese nationality or residing in Portugal and other individuals who are staying or intend to come to Portugal, as well as any private or public legal person created or established in Portugal; and/or apply to property, funds and economic resources located in national territory, irrespective of the nationality, residence or head office of their owners, beneficiaries or stakeholders.

Since the obliged entities must, pursuant to Article 21 of the LMLTF, adopt the means and mechanisms necessary to ensure compliance with the restrictive measures approved by the United Nations Organization or the European Union - including their immediate consultation, apprehension, understanding and knowledge - their respective implementation and enforcement are regulated by Law No 97/2017 of 23 August 2017, which lays down sanctions for infringements of such measures (which may constitute an offence punishable with prison from one to five years).

Without prejudice to the necessary consultation of Law No 97/2017 of 23 August 2017 and of the LMLTF and other relevant legal documents, you can find a comprehensive set of information on the restrictive measures at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/enquadramento; http://portalBCFT.pt/pt-pt/content/quadro-legal), under the item "MEDIDAS RESTRITIVAS" and its sub-items.

Obliged entities can get up-to-date and reliable information on the restricted measure applied by international bodies, namely the United Nations Security Council and the European Union, at the website of the AML/CTF Coordination Committee (under the item "LISTAS", which contains links relating to "UNSC sanctioned" entities and "EU sanctioned" entities; and http://portalBCFT.pt/pt-pt/ligacoesexternas, sub-item "LIGAÇÕES SOBRE MEDIDAS RESTRITIVAS").

At present - and without prejudice to any changes that might occur in order to include new individuals or entities, or the cessation of sanctions, which should always be checked by the obliged entities -, the lists and relevant acts, search tools or information can be searched and developed by using the following links:

(a) Sanctions applied by the United Nations Security Council:

    https://www.un.org/securitycouncil/content/un-sc-consolidated-list ;

    https://www.un.org/securitycouncil/sanctions/information ;

(b) Sanctions applied by the European Union:

    https://www.sanctionsmap.eu/#/main ;

    https://eeas.europa.eu/headquarters/headquarters-homepage_en/423/Sanctions%20policy#Consolidated+list+of+sanctions ;

10. What is the "beneficial owner", regulated by the legal regime established by Law No 89/2017 of 21 August 2017?

A beneficial owner is a natural person:

- Who ultimately owns or controls the customers of those entities who are required to comply with the preventive rules on money laundering and terrorist financing; and/or

- On whose behalf a specific transaction or activity is being conducted.

In the case of corporate entities, the beneficial owner is the natural person who ultimately owns or controls a legal entity through direct or indirect ownership or control over a sufficient percentage of the shares or voting rights or participation in the capital of that legal entity; as an alternative or cumulatively, the natural person who otherwise exercises control over that legal entity; and, when nobody has been identified in the previously mentioned situations, or there are doubts about their actual quality, the beneficial owner shall be the natural person who holds a senior management position in the corporate entity.

As regards corporate entities, in order to check and establish who is the beneficial owner, some indications should be used, including:

- Indication of direct ownership, when one natural person holds more than 25 % of the customer's share capital; and

- Indication of indirect ownership, when more than 25 % of the customer's share capital are held by a corporate entity controlled by one or several natural persons; or several corporate entities controlled by the same natural person(s).

These "ownership indicators", however, do not preclude the applicability and the need to check any other relevant control indicators, and, when carrying out their obligations of due diligence and control, for instance, the obliged entities may draw their own conclusions on whether or not other natural persons are beneficial owners of a given entity.

When it comes to trusts, the following shall be considered beneficial owners and declared as such: the settlor; the trustees; the protector, if applicable; the beneficiaries or, if these have yet to be determined, the class of persons in whose main interest the trust was set up or operates; and any other natural person who retains ultimate control over the trust through direct or indirect shareholding or through other means.

When the intervention of non-corporate legal persons (like the foundations) and legal arrangements similar in nature to trusts (or comparable entities), the natural person(s) holding positions equivalent or similar to those mentioned for trusts are considered the beneficial owner(s).

Without prejudice to the necessary consultation of Law No 97/2017 of 23 August 2017 and of the LMLTF and other relevant legal documents, you can find a comprehensive set of information on the definition, determination and duties of a beneficial owner at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the items "BENEFICIÁRIO EFETIVO" and "REGISTO CENTRAL DE BENEFICIÁRIO EFETIVO".

11. What is the "Central Register of the Beneficial Owner" (CRBO), created by the legal framework under Law No 89/2017 of 21 August 2017 and regulated by Decree Order No 233/2018 of 21 August 2018 (amended by Decree Order No 200/2019 of 28 June 2019), and what are the main obligations imposed on corporate and non-corporate legal entities, equivalent persons and trusts and other legal arrangements with similar structure and functions?

The CRBO is a database containing sufficient, accurate and up-to-date information about the person or persons who - even indirectly or through a third party - own or exercise effective control over those legal entities covered by the registration obligation with a view to reinforcing transparency in business relationships and compliance with the obligations laid down in the LMLTF.

The managing body of the CRBO is the Instituto dos Registos e do Notariado, I.P. or IRN, I.P. (the Institute of Registration and Notary Affairs), which is responsible for ensuring data processing, the right of information and access and the legality of its implementation, as well as ensuring the legality of such procedures.

Legal persons in general (for example, associations, cooperatives, foundations, commercial or civil law companies, as well as any other legal entities), their representation offices, other entities pursuing their own objectives and without legal personality, trusts or other legal arrangements, are all obliged to file information on their beneficial owners with the CRBO, with a few minor exceptions.

When complying with that obligation to register with the CRBO, the obliged entities shall use the "beneficial owner declaration", by entering and authenticating, at the platform made available by the IRN, within the deadlines set by law, sufficient, accurate and up-to-date information on their beneficial owners, all the circumstances indicating such status and information on the economic interest they hold on them.

It should also be stressed that, in addition to the initial "beneficial owner declaration", information entered in the CRBO should be kept accurate and up-to-date, and, in order to reflect any changes that might occur, all entities subject to this obligation should update the information in the Register as soon as possible and at all events within a maximum period of 30 days (from the date of the event giving rise to the change).

This regime is without prejudice to other more demanding obligations of declaration or confirmation provided for in the Law, namely as regards foreign entities operating in Portugal on an occasional basis, or to the applicability of special rules at the time of extinction, dissolution or de jure/de facto cessation of the entity.

At last and also in this respect, Decree Order No 200/2019 of 28 June 2019 changed the deadlines previously in force and provides that the initial declaration by the entities subject to the CRBO and formed at the date of entry into force of this Decree Order shall be made in a phased manner, within the following deadlines:

(a) By 31 October 2019, for entities subject to commercial registration;

(b) By 30 November 2019, the other entities subject to the CRBO.

Without prejudice to the obligations imposed on them as obliged entities under the LMLTF (namely when performing their obligations of identification, due diligence or control), real estate entities are also subject, in general terms, to the obligation to determine and report the initial "beneficial owner declaration", and update and correct it whenever necessary.

Besides the necessary reading of Law No 89/2017 of 21 August 2017 and of the LMLTF and other relevant legal documents, you can also consult a set of comprehensive information on the definition, determination of and obligations regarding the beneficial owner at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the items "BENEFICIÁRIO EFETIVO" and "REGISTO CENTRAL DE BENEFICIÁRIO EFETIVO".

12. What are the main obligations, namely pursuant to Articles 29-34 of the LMLTF, of the obliged entities as regards the verification and investigation of the beneficial owner of customers, stakeholders and any other third entities with which they establish, participate or interact in business relationships, occasional interactions or other operations?

Obliged entities should be sufficiently aware of the beneficial owners of the customer or entity, according to the specific risk of money laundering and terrorist financing, in the following cases:

- When the customer, stakeholder or any other third entity participating, intervening or involved in commercial operations is a legal person or a legal arrangement; or

- When it comes to the relationship with a natural person who might be acting on behalf of a legal person or a legal arrangement.

In order to identify the beneficial owners of customers or stakeholders, the obliged entities should take all the necessary measures just before a business relationship is established or an occasional transaction takes place - and should also try to increase their knowledge about the beneficial owner of the customer or stakeholder, as well as be aware of and investigate any possible change that may occur in their respect, throughout the continuous monitoring of the business relationship or the preparation and execution of the occasional transaction.

After registration, the obliged entities have broad access to information in the CRBO on legal persons and other entities subject to the obligation to file a declaration.

In order to fulfil their obligations provided for in the LMLTF - namely as regards identification, due diligence and control -, obliged entities shall ascertain the information in the CRBO relating to the customer or stakeholder and shall consult and check it (reiterating it at appropriate intervals), notably with a view to:

- Checking whether there is any obligation to subject the customer or stakeholder, as a legal person or a similar entity, to the obligation of filing the beneficial owner declaration with the CRBO in Portugal;

- Checking whether the entity has fulfilled the obligations as regards the filing of the beneficial owner declaration with the CRBO as required - and the establishment and continuation of the business relationship or the conclusion of an occasional transaction shall be made dependent on effective compliance with the entity´s obligation to register in the CRBO;

- Investigating any divergence between information entered in the CRBO and information obtained when fulfilling the obligations provided for in the LMLTF, as well as any other omissions, inaccuracies or obsolescence they may detect - in which case, without prejudice to other possibly relevant measures and reporting, they should report such divergences, omissions or obsolescence to the managing body of the Register, the IRN, I.P..

When the customer is not required to register their beneficial owners in national territory (since the RCBO results from an initiative and harmonised action at European level and similar registers exist in the other countries), the obliged entities should make appropriate efforts to obtain from the customer or the stakeholder the information entered in the Central Register of the Beneficial Owner or any other equivalent mechanism created in other jurisdictions, when such mechanisms cannot be accessed at all or in a timely manner.

In any event, carrying out consultations or démarches in relation to information on the beneficial owners included in the RCBO or an equivalent register/mechanism does not exempt the obliged entities from performing the other identification and diligence procedures laid down in the LMLTF, namely those designed to investigate and confirm that someone is a beneficial owner.

Lastly, in general terms, obliged entities shall keep a written record of all measures to comply with Articles 29-34 of the LMLTF, including any means used to ascertain the quality of beneficial owner, which shall be kept and maintained to be made available to judicial or sectoral authorities whenever so requested.

Without prejudice to the necessary consultation of Law No 89/2017 of 21 August 2017 and of the LMLTF and other relevant legal documents, you can also consult a set of comprehensive information on the definition, determination of and obligations regarding the beneficial owner at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the items "BENEFICIÁRIO EFETIVO" and "REGISTO CENTRAL DE BENEFICIÁRIO EFETIVO".

13. What are the main obligations imposed on obliged entities as regards the prevention of breaches of the limits to the use of cash provided for, in general terms, in Article 63-E of the General Tax Law (amended by Law No 92/2017 of 22 August 2017) - both for its commercial transactions and in complying with their duties as obliged entities under the legal framework on preventing and combating money laundering and terrorist financing?

Article 63-E of the General Tax Law (following the amendments introduced by Law No 92/2017 of 22 August 2017) sets upper limits to the use of cash.

That Article prohibits in particular cash payments or receipts for amounts equal to or higher than EUR 3,000 (or its equivalent in other currency) in any kind of transactions; or for amounts equal to or higher than EUR 10,000 (or its equivalent, if the payment is made by natural persons who are not resident in Portugal, and, cumulatively, are not acting as businessmen or traders. Such amounts should be considered both in single payments and on an aggregated basis when multiple payments are made in association with the sale of assets or the provision of services.

On the other hand, for payments relating to invoices or equivalent documents for an amount equal to or higher than EUR 1,000 euros (or its equivalent in another currency), IRC (corporation tax) and IRS (personal income tax) taxpayers who keep accounts or are required to do so must use means of payment that enable the identification of the recipient (namely, bank transfer, not negotiable cheque or direct debit).

These rules are relevant for obliged entities that carry out real estate activities as regards their specific operations and commercial activities, where they should take precautions and act in such a way that they themselves respect this number of obligations and do not make or accept payments in cash thus failing to comply with the law.

But they are particular relevant for the obliged entities with real estate activities generally subject to the obligations provided for in the LMLTF, because, pursuant to Article 10 of this Law, when carrying out their professional activity, those entities are explicitly required to refrain from concluding or in any way take part in any business that may result in an infringement of the limits to the use of cash as laid down in specific legislation.

Without prejudice to the necessary consultation of the LMLTF and Article 63-E of the General Tax Law and other relevant legal documents, you can also consult a set of comprehensive information on the definition of and obligations regarding the maximum limits to the use of cash at the website of the AML/CTF Coordination Committee (http://portalBCFT.pt/pt-pt/content/perguntas-frequentes-0), under the item "UTILIZAÇÃO DE NUMERÁRIO".

(B) General preventive obligations applicable to entities with real estate activities covered by the IMPIC Regulation

B.1.) Obligation to perform customer identification and customer due diligence

Relevant Provisions

LMLTF | Article 23-42, 68-71, Annexes II and III

IMPIC Regulation | Articles 5-8

Normal Measures:

14. What is the customer identification and due diligence obligation?

It is the obligation for the obliged entities to follow identification and due diligence procedures - with regard to customers, their representatives and the beneficial owners - in the following cases:

(a) When establishing a business relationship;

(b) When carrying out occasional transactions:

- amounting to EUR 15,000 or more (whether the transaction is executed in a single operation or in several operations which appear to be linked);

- constituting a transfer of funds of more than EUR 1,000;

- amounting to EUR 2,000 or more (whether the transaction is executed in a single operation or in several operations which appear to be linked;), in the specific case of (i) concessionaries of operation of casino games, (ii) concessionaries of operation of bingo halls, (iii) payers of winnings from betting and lottery (iv) entities covered by the Legal Framework for Online Gambling and Betting;

(c) When there is a suspicion that the transactions might be linked to money laundering or terrorist financing, regardless of their value or any exception or threshold;

(d) When there are doubts about the veracity or adequacy of previously obtained customer identification data.

15. When the legislation or regulations on preventing ML/TF are amended, should the obliged entities adopt/update the identification and due diligence procedures regarding their former customers?

In this case, the obliged entities should check whether the previously adopted identification and due diligence procedures are appropriate, sufficient and up-to-date, considering the risks of ML/TF specifically associated with those customers and the requirements laid down in the new legal or regulatory framework in force.

Where they conclude that those procedures are inappropriate, insufficient or outdated, taking into account the degree of risk of ML/TF specifically identified, the obliged entities should address the detected insufficiencies as soon as possible.

16. How do the obliged entities verify the identity of their customers who are natural persons or of the respective representatives, if any?

The identification shall be made by collecting and recording the following identification elements:

(a) Photograph;

(b) Full name;

(c) Signature;

(d) Date of birth;

(e) Nationality as indicated in the identification document;

(f) Type, number, date of validity and the issuing body of the identification document;

(g) Tax identification number (VAT number) or, where it does not exist, the equivalent number issued by a competent foreign authority;

(h) Occupation and employer, if any;

(i) Full address of permanent residence and, if different, of tax domicile;

(j) Place of birth;

(k) Other nationalities not indicated in the identification document.

For representatives, the obliged entities shall also verify the document that empowers them to act on their customer's behalf.

17. How do the obliged entities verify the identity of their customers who are legal persons or legal arrangements and of their respective representatives?

The identification shall be made by collecting and recording the following identification elements:

(a) Business name;

(b) Object;

(c) Full address of the head office and, where applicable, of the branch or permanent establishment, as well as, if different, any other address of the main places of business;

(d) Legal person number or, where it does not exist, the equivalent number issued by a competent foreign authority;

(e) Identity of holders who have holdings representing 5% or more of the capital or the voting rights;

(f) Identity of members of the board of directors or an equivalent body, as well as other relevant senior officials with management powers;

(g) Country of incorporation;

(h) CAE Code (code according to the Classification of Economic Activities), code of the institutional sector or any other code of similar nature, where it exists.

For representatives, the obliged entities shall also verify the document that empowers them to act on their customer's behalf.

18. What evidence can be used to confirm the identification elements of a natural person?

Obliged entities shall always require the production of valid identification documents, which shall include the following identification elements:

(a) Photograph;

(b) Full name;

(c) Signature;

(d) Date of birth;

(e) Nationality as indicated in the identification document;

(f) Type, number, date of validity and the issuing body of the identification document.

Confirmation of these identification elements shall be made as follows:

1. Whenever customers and their representatives have the necessary elements and indicate their intention to do so to the obliged entity, confirmation shall be made using the following means (to be provided by the obliged entity):

(a) Electronic access to the citizen card through the Public Administration interoperability platform, with the prior permission of the holder of the documents or his/her representative;

(b) Digital Mobile Key;

(c) Interoperability platforms between information systems issued by public services, pursuant to Regulation (EU) No 910/2014 of the European Parliament and of the Council of 23 July 2014.

2. Where it is not possible to use any of the means mentioned in paragraph 1, confirmation shall be made through:

(a) A reproduction of the original identification documents, in physical or electronic support;

(b) A certified copy thereof;

(c) Access to the respective electronic information of equivalent probative value, namely:

- by using mechanisms that provide qualified certification, under the conditions to be determined by regulation;

- by collecting and checking the electronic data with the competent entities responsible for their management.

19. In order to confirm the identification of a customer or the respective legal representative and stakeholder, can I obtain a copy of the corresponding identification card? What should I do if the customer refuses to provide a copy of the identification document?

Law No 7/2007 of 5 February 2007 (that creates the citizen card) provides in Article 5(2), in the context of the prohibition of retention and reproduction of the citizen card, that it is equally prohibited the reproduction of the citizen card in a photocopy or any other means without the holder's consent, except in cases expressly provided for by law or by a decision of a judicial authority.

For the purposes of enforcing the LMLTF, the request to check or reproduce a citizen's card is duly covered by Articles 24 and 25(1) and (4)(a). There is, therefore, a legal provision supporting the request for both the production of this document by the persons involved in the occasional transaction or the business relationship concerned, and the reproduction of the original identification documents in physical or electronic support.

Therefore, the law provides for the possibility both to request the production of those documents and the retention of the documents obtained when accomplishing the identification and due diligence obligation, thus fulfilling the safeguard provided for in Article 5(1) of the citizen card regime.

If, nevertheless, some resistance still exists on the part of the customer/stakeholder to be identified, the obliged entity shall record in writing the data contained in the citizen card and shall attach a piece of information explaining that the customer/stakeholder refused/resisted to provide a copy of the identification document, in order to justify the procedure.

It should also be noted that, in addition to the above described interpretation, Recital 11 of Directive (EU) 2016/680 of the European Parliament and of the Council of 27 April 2016 provides that a body or entity shall be allowed to collect and process personal data in order to comply with a legal obligation to which it is subject.

Such permission to collect and process personal data is also provided for in the General Data Protection Regulation (Regulation (EU) No 2016/679 of the European Parliament and of the Council of 27 April 2016, in Recital 51 and Article 13(2)(e)) - "(?)Such personal data should not be processed, unless processing is allowed in specific cases set out in this Regulation, taking into account that Member States law may lay down specific provisions on data protection in order to adapt the application of the rules of this Regulation for compliance with a legal obligation or for the performance of a task carried out in the public interest or in the exercise of official authority vested in the controller."

This situation can naturally apply to real estate entities in order to prevent and combat money laundering and terrorist financing.

20. What evidence can be used to verify the identification details of legal persons and legal arrangements?

Obliged entities should always require the submission of (i) the legal person identification card, (ii) an excerpt from the Commercial Register or (iii) a comparable document from an independent reliable source, when the respective head office is located outside the national territory, in order to confirm the following identification details:

(a) Business name;

(b) Object;

(c) Full address of the head office and, where applicable, of the branch or permanent establishment, as well as, if different, any other address of the main places of business;

(d) Legal person identification number or, where it does not exist, the equivalent number issued by a competent foreign authority;

One of the following means should be used to confirm those identification details:

(a) Interoperability platforms between information systems issued by public services, pursuant to Regulation (EU) No 910/2014 of the European Parliament and of the Council of 23 July 2014.

(b) A reproduction of the original identification documents, in physical or electronic support;

(c) A certified copy thereof;

(d) Access to the respective electronic information of equivalent probative value, namely:

- by using mechanisms that provide qualified certification, under the conditions to be determined by regulation;

- by collecting and checking the electronic data with the competent entities responsible for their management.

VERIFICATION OF IDENTITY

21. What should the obliged entities do if the electronic identification means do not include some of the required identification details?

In such cases, the obliged entities should collect the missing identification details through other admissible complementary means.

22. What should the obliged entities do when they have doubts about the content, reliability, timeliness, accuracy or sufficiency of the supports that confirm the identification details submitted?

In such cases, the obliged entities should take the steps deemed appropriate to fully confirm the identification details.

23. When should the obliged entities verify the identity of their customers and the representatives?

As a rule, the verification of identity should take place before the establishment of a business relationship or the conduction of any occasional transaction, i.e., before the conclusion of the promissory contract or the public deed (in this case, the obliged entities should check whether the identification details provided are updated even if such details have already been collected in the context of a previous occasional transaction).

In the specific case of a business relationship, the verification of identity may exceptionally be completed after the commencement of the relationship, provided that all the following conditions are met:

(a) It is necessary to postpone the verification in order to avoid any interruption in the normal conduct of the business;

(b) Postponing the verification is not forbidden by any law or regulation applicable to the obliged entity;

(c) The situation in question poses a reduced risk of ML/TF, clearly identified as such by the obliged entity;

(d) The obliged entities take appropriate measures to manage the risk associated with that situation, namely by limiting the number, type or amount of the transactions that can be carried out.

When postponing the confirmation of the identification details of their customers or the respective representatives, the obliged entities should complete the procedures for the verification of the identity as soon as possible.

24. What instrument can I adopt to collect mandatory details in order to comply with the identification and due diligence obligation as regards the stakeholders in the occasional transaction or the business relationship?

Real estate entities can adopt the preparation of a questionnaire for completion by the customer or their legal representative and the other stakeholders in the transaction in order to comply with the identification and due diligence procedures provided for in the LMLTF.

25. Where a real estate brokerage agreement is shared with another entity, who is responsible for complying with the identification and due diligence obligation?

Complying with the preventive obligations is the responsibility of all the real estate entities involved in the transaction, irrespective of whether it is the entity that recruited the customer or the entity that was directly contacted by the customer to promote the intended transaction.

26. Where two real estate agencies with separate customers (buyer and seller/tenant and landlord) participate in a real estate transaction or a lease agreement, are the two entities required to perform the identification and due diligence procedures for all the parties involved?

Both entities are required to perform the identification and due diligence procedures in accordance with the common rules, with regard both to their customer and to the other stakeholder or party in the property transaction in which they participate.

Due Diligence Procedures:

27. In addition to the identification procedures, what other type of procedures should the obliged entities adopt in the context of this specific obligation?

Obliged entities should also adopt the following due diligence procedures:

(a) Obtain information on the purpose and intended nature of the business relationship;

(b) Obtain information on the origin and destination of the funds handled in the context of a business relationship or an occasional transaction, when this is justified by the risk profile of the customer or the characteristics of the transaction;

(c) Conduct ongoing monitoring of the business relationship to ensure that the transactions being conducted throughout the course of that relationship are consistent with the obliged entity's knowledge of the customer's business and risk profile, including, where necessary, the origin and destination of the funds handled.

Simplified Measures

28. Can the obliged entities adopt simplified measures of identification and due diligence?

Yes. They can do it when they identify a demonstrably low risk of ML/TF in business relationships, occasional transactions or operations they conduct, as long as:

- that identification is based on an appropriate risk assessment, performed by the obliged entities themselves or by their respective sectoral authorities;

- the simplified measures to be applied are proportionate to the identified low risk factors.

29. Is it possible to find in the law any example of situations indicating a potentially lower risk of ML/TF?

Yes. Without prejudice to other situations listed by the respective sectoral authorities, the LMLTF includes in its Annex II a list of factors and types indicating a potentially lower risk of ML/TF. This list:

- is only illustrative in nature and does not constitute a closed list of the cases that may represent a lower risk of ML/TF;

- is not intended to induce obliged entities to assign - in an automatic way - a low risk to any business relationship, occasional transaction or specific operation that can be included in the above mentioned situations (while assigning the degree of risk of ML/TF should result from a case by case assessment of the factual circumstances of the particular case).

Therefore, according to the LMLTF, it is the following illustrative factors that potentially represent the lowest risk:

(A) Risk factors related to the customer:

- companies whose shares are admitted to trading on a regulated market and, by virtue of the rules of that market, the law or other binding instruments, are subject to information obligations that guarantee an appropriate transparency as regards their respective beneficial owners;

- public administrations or publicly owned companies;

- customers residing in lower risk geographical areas (see below "Risk factors related to the geographical location").

(B) Risk factors related to the product, service, transaction or distribution channel:

- life insurance contracts and pension funds or savings products of a similar nature where the annual premium or contribution is reduced;

- insurance policies for pension schemes if there is no surrender clause and the policy cannot be used as collateral;

- a pension, superannuation or similar scheme that provides retirement benefits to employees, where contributions are made by way of deduction from wages and the scheme rules do not permit the assignment of a member's interest;

- limited and clearly defined financial products or services designed to increase the level of financial inclusion of certain types of customers;

- products where the risks of ML/TF are controlled by other factors, such as the imposition of charging limits or the transparency regarding their holders, possibly including certain types of electronic money.

(C) Risk factors related to the geographical location:

- European Union Member States;

- third countries with effective systems to prevent and combat ML/TF;

- countries or jurisdictions identified by reliable sources as having a low level of corruption or other criminal activities;

- third countries that, according to reliable sources, such as mutual evaluation or detailed assessment or follow-up reports, are subject to obligations relating to the prevention of and fight against money laundering and terrorist financing that are consistent with the revised FATF recommendations and implement those obligations effectively.

30. Is it possible to find in the law any examples of simplified measures of identification and due diligence?

Yes. Article 35(4) of the LMLTF includes a list of possible simplified measures (without prejudice to others that prove to be best suited to the specific identified risks and/or others with a specific content defined by the competent sectoral authorities), namely:

- checking the identification of the customer and the beneficial owner after establishing a business relationship;

- reducing the frequency of updates to the details collected when performing the identification and due diligence obligation;

- reducing the intensity of the ongoing monitoring and the depth of the analysis of transactions, where low amounts are involved;

- not collecting specific information and not implementing specific measures to understand the object and nature of the business relationship, where it is reasonable to assume the object and nature of the type of transaction carried out or business relationship established.

31. Does the implementation of simplified measures exempt the obliged entities from monitoring transactions and business relationships?

No. Even in those cases where simplified identification and due diligence measures have been adopted, the obliged entities should monitor the transactions and business relationships in order to enable the detection of unusual or suspicious operations.

32. Is there any situation where the obliged entities are prevented from adopting simplified identification and due diligence measures?

Yes. Simplified measures can never be adopted in the following situations:

- there are suspicions of money laundering or terrorist financing;

- enhanced identification and due diligence measures should be adopted;

- the competent sectoral authorities so decided.

Enhanced Measures

33. In which situations should the obliged entities adopt enhanced identification and due diligence measures?

As a complement to normal identification and due diligence procedures, the obliged entities should adopt enhanced measures when complying with this obligation:

(a) Where the obliged entities themselves or their respective sectoral authorities identify an enhanced risk of ML/TF in the business relationships, occasional transactions or operations they are conducting.

(b) When any of the situations provided for in the following Articles of the LMLTF (irrespective of the degree of risk of ML/TF connected with the particular case) is in question:

- Article 37 (high-risk third countries);

- Article 38 (distance contracts);

- Article 39 (politically exposed persons and political or public officeholders);

- Article 69 (beneficiaries of life-insurance contracts);

- Articles 70 and 71 (correspondent relationships).

(c) In any other situations designated to that effect by the competent sectoral authorities, including through the identification of natural or legal persons or legal arrangements that may justify the adoption of such measures.

34. In parallel with the situations explicitly provided for in the LMLTF as justifying the mandatory adoption of enhanced measures, is it possible to find in the law any examples of situations indicating a potentially higher risk of ML/TF?

Yes. Without prejudice to other situations listed by the respective sectoral authorities, the LMLTF includes in its Annex III a list of factors and types indicating a potentially higher risk of ML/TF. This list:

- is only illustrative in nature and does not constitute a closed list of the cases that may represent a higher risk of ML/TF;

- is not intended to induce obliged entities to assign - in an automatic way - a high risk to any business relationship, occasional transaction or specific operation that can be included in the above mentioned situations (while assigning the degree of risk of ML/TF should be result from a case by case assessment of the factual circumstances of the particular case).

Therefore, according to the LMLTF, it is the following illustrative factors that pose the potentially highest risk:

(A) Risk factors related to the customer:

- business relationships taking place under unusual circumstances;

- customers residing or carrying out an activity in areas of a higher geographical risk (see below "Risk factors relating to the geographical location");

- legal persons or legal arrangements that have the custody of personal assets;

- companies with nominee shareholders or whose capital is represented by bearer shares;

- customers that carry out activities involving cash transactions intensively;

- ownership and control structure of the customer appearing to be unusual or over-complex, taking into account the nature of the business conducted by the customer.

(B) Risk factors related to the product, service, transaction or distribution channel:

- private banking;

- products or transactions that might favour anonymity;

- payments received from third parties unknown or not associated with the customer or with a business carried out by the customer;

- new products and new commercial practices, including new distribution mechanisms or payment methods, as well as the use of new or developing technologies, for both new products and existing ones.

(C) Risk factors related to the geographical location:

- third countries that, according to reliable sources, such as mutual evaluation or detailed assessment or follow-up reports, do not have in place effective systems to prevent and combat ML/TF (without prejudice to the provisions of the LMLTF relating to high-risk third countries);

- countries or jurisdictions identified by reliable sources as having a significant level of corruption or other criminal activities;

- countries or jurisdictions subject to sanctions, embargoes, other restrictive measures or additional counter-measures imposed namely by the United Nations or the European Union;

- countries or jurisdictions that provide financing or support to terrorist activities or acts, or have terrorist organisations operating in their territory.

35. Is it possible to find in the law some examples of enhanced identification and due diligence measures?

Yes. Article 36(6) of the LMLTF includes a list of possible enhanced measures without prejudice to others that prove to be best suited to the specific identified risks and/or others with a specific content defined by the competent sectoral authorities), namely:

- obtaining additional information on customers, their representatives or beneficial owners, as well as on planned and performed transactions;

- taking additional steps to confirm the information obtained;

- obtaining senior management approval for establishing business relationships and carrying out occasional transactions or any other transactions in general;

- stepping up the depth or frequency of procedures to monitor the business relationship or certain transactions or set of transactions with a view to detecting possible suspicion indicators and the subsequent fulfilment of the reporting obligation provided for in Article 43 of the LMLTF;

- reducing the time intervals for updating information and other details collected when performing the identification and due diligence obligation;

- monitoring the follow-up of the business relationship by the Compliance Officer referred to in Article 16 of the LMLTF or any other employee of the obliged entity who is not directly involved in the business relationship with the customer;

- requiring that the first payment relating to a given transaction be made through a traceable means from an account opened by the customer with a financial institution or any other entity legally empowered to this effect, which is not located in a high-risk third country but demonstrably implements equivalent identification and due diligence measures.

36. What enhanced measures should the obliged entities adopt if high-risk third countries are involved?

Obliged entities should, in any circumstance, adopt effective enhanced measures in proportion to the existing risks whenever they establish relationships, carry out occasional transactions, conduct operations or otherwise have relations with natural persons, legal persons or legal arrangements established in high-risk third countries.

Obliged entities should also adopt enhanced identification and due diligence measures:

- in the context of business relationships, occasional transactions or operations with natural persons, legal persons or legal arrangements established in other jurisdictions as may be identified by sectoral authorities, based in disclosures made by the FATF or other reliable sources;

- in any other situations where the obliged entities themselves - based in disclosures made by the FATF, other reliable sources or other information provided by sectoral authorities - identify an enhanced geographical risk, according to a risk-based approach.

37. What enhanced measures should the obliged entities adopt in the context of distance contracts?

Where a business relationship is established or an occasional transaction is conducted without the customer or his/her representative being physically present, the verification of the documents referred to in Article 25(1) and (5) of the LMLTF should be made:

- according to the provisions of Article 25(2) to (4) for natural persons;

- according to the provisions of Article 25(6) for legal persons or legal arrangements.

Additionally, obliged entities shall adopt any other enhanced measures that might be necessary to address the specific risk identified, namely:

- taking additional steps to confirm the information collected; or

- requiring that the first payment relating to a given transaction be made through a traceable means from an account opened by the customer with a financial institution or any other entity legally empowered to this effect, which is not located in a high-risk third country but demonstrably implements equivalent identification and due diligence measures.

38. What enhanced measures should the obliged entities adopt in relation to politically exposed persons and other political or public officeholders?

In the context of business relationships or occasional transactions with customers, representatives or beneficial owners who are politically exposed persons, the obliged entities should (in addition to the normal identification and due diligence procedures):

(a) Identify the quality of "politically exposed person", acquired before or after the establishment of the business relationship or the execution of the occasional transaction, on the basis of the information procedures or systems provided for in Article 19 of the LMLTF;

(b) Make sure that a top management member is involved in the approval of:

- the establishment of business relationships or the execution of occasional transactions;

- the continuity of business relationships where the acquisition of the quality of "politically exposed person" is subsequent to the establishment of such relationships.

(c) Take adequate measures to know and confirm the source of wealth and the source of funds that are involved in business relationships, occasional transactions or any other transactions in general, for which purpose the following definitions shall apply:

- "wealth" means all the assets making up the sources of richness of the politically exposed person; and

- "funds" means the amounts or assets specifically allocated to the business relationship established or the occasional transaction or operation carried out with the politically exposed person.

(d) Ensure an ongoing and enhanced monitoring of business relationships, particularly with a view to identifying any transactions that should be reported as provided for in Article 43 of the LMLTF.

(e) Adopt other enhanced measures or step up measures referred to in points (b), (c) and (d), whenever the specific enhanced risk of the business relationship or occasional transaction is particularly high.

39. Are the enhanced identification and due diligence measures adopted in relation to politically exposed persons also extended to other persons connected with them?

Yes. Enhanced identification and due diligence measures provided for in Article 39 of the LMLTF shall also apply to business relationships or occasional transactions with customers, representatives or beneficial owners who are:

(a) Close family members of the politically exposed person, such as:

- parents and children of the politically exposed person;

- spouse or life-partner of the politically exposed person;

- spouses or life-partners of parents and children of the politically exposed person.

(b) Persons who are known to be close associates of politically exposed persons, such as:

- any natural person who is known to share ownership of a legal person or a legal arrangement with a politically exposed person;

- any natural person who owns the (or some of the) share capital, or holds voting rights, of a legal person, or the wealth of a legal arrangement, who are known to have as their beneficial owner a politically exposed person;

- any natural person who is known to have business, commercial or professional relationships with a politically exposed person.

B.2.) Control obligation

Relevant Provisions

LMLTF | Article 2(1)(n)(t)(u) and (a(a)) and Articles 12-22

IMPIC Regulation | Article 10

Circular No 2/2019 of 24 June 2019

40. What is the control obligation?

It is the obligation for the obliged entities to establish and apply, effectively and in an ongoing basis, the appropriate policies, procedures and controls in order to:

- manage the ML/TF risks which the obliged entity is or might be exposed to;

- comply with the legal and regulatory provisions on the prevention of ML/TF;

- ensure compliance with the restrictive measures concerning the freezing of assets and economic resources adopted by the United Nations Security Council or the European Union and relating to terrorism, the proliferation of weapons of mass destruction and the financing thereof.

41. Should all the obliged entities adopt the same policies, procedures and controls to prevent ML/TF?

No. Policies, procedures and controls that constitute the internal control system should be proportionate to the nature, size and complexity of the obliged entity and the activity it is conducting.

However, obliged entities should at least include the following measures in their internal control system:

Definition of an Effective Risk Management Model

Appointment of a Compliance Officer Development of policies, procedures and controls regarding the customer acceptance Definition of appropriate continuous training programmes for the entity's staff Development of policies and procedures as regards personal data protection Establishment of formal systems and processes for the collection, processing and storage of information

42. Should the obliged entities assess their ML/TF prevention system on a regular basis?

Yes. Obliged entities should monitor, through regular evaluations, the quality, adequacy and effectiveness of their policies, procedures and controls to prevent ML/TF.

43. How should the obliged entities manage the risks of ML/TF?

The management of risks of ML/TF is based on three fundamental pillars: risk identification, risk assessment and risk mitigation. Therefore, the obliged entities should:

(a) Identify the specific risks of ML/TF related to their specific operative reality, including the risks associated with:

- the nature, size and complexity of the business being conducted;

- the respective customers;

- the business areas developed, as well as the products, services and operations provided;

- the distribution channels of the products and services provided, as well as the means of communication used to contact with customers;

- the countries or territories of origin of the obliged entity's customers, or where they reside or otherwise carry out their business;

- the countries or territories where the obliged entity operates, directly or via third parties, whether they belong to the same group or not.

(b) Assess the risk of ML/TF associated with their specific operative reality, namely by establishing:

- the degree of likelihood and impact of each risk correctly identified, taking into account, to this effect, all the relevant variables within the context of its operative reality, including the purpose of the business relationship, the level of assets deposited per customer or the volume of transactions carried out and the regularity or duration of the business relationship;

- the overall risk of the obliged entity and, if applicable, of the respective business areas, to be assessed on the basis of the weighting of each specific risk identified and assessed;

(c) Define and adopt the means and procedures of control that are appropriate to mitigate the specific risks identified and assessed, by adopting particularly enhanced procedures when there is an enhanced risk of ML/TF;

(d) Review, at regular intervals appropriate to the identified risks, or with the regularity established in regulations, the topicality of risk management practices referred to in the preceding points, so that they adequately reflect any changes in the specific operative reality and the risks associated with it.

Obliged entities should also:

(a) Adapt those ML/TF risk management practices (and their upgrades) to the nature, size and complexity of their structure and the business they carry out;

(b) Take into account the risks identified in:

- information made available by sectoral authorities in order to facilitate risk assessments to be conducted by the obliged entities;

- the reports and opinions referred to in Article 8(4) of the LMLTF, as well as in their updates;

- any other information relevant to conduct national ML/TF risk assessments and their updates, namely those indicated by sectoral authorities (by publishing them in their websites or by any other means) or by the AML/CTF Coordination Committee (at www.portalBCFT.pt);

(c) Include in documents and records detailed information on:

- the risks related to the specific operative reality of the obliged entity and how they were identified and assessed;

- the adequacy of the control means and procedures designed to mitigate the identified and assessed risks, as well as how the obliged entity is monitoring their adequacy and effectiveness;

(d) Keep these documents and records as provided for in Article 51 of the LMLTF and make them permanently available to sectoral authorities.

When the specific risks related to a given activity sector covered by the LMLTF are clearly identified and understood, sectoral authorities may, through regulation:

- dispense with individual and documented risk assessments or allow that such assessments be carried out in a simplified manner to be defined by the respective sectoral authority;

- establish alternative procedures other than individual or simplified risk assessments.

The Compliance Officer

44. Who should be the Compliance Officer?

The Compliance Officer should be a member of the top management of an obliged entity, or a person treated as such, appointed by its board of directors, who shall be responsible for supervising compliance with the existing legal and regulatory framework on preventing ML/TF. According to Article 2(1)(n) of the LMLTF, the "top management" of an obliged entity includes any manager or employee who has sufficient knowledge of the exposure of the concerned entity to ML/TF and holds a sufficiently high position in hierarchy to make decisions that affect the exposure to the risk, and is not necessarily a member of the board of directors.

Obliged entities should ensure that the Compliance Officer is a person of good repute with the appropriate professional qualifications and willingness, and should assess in advance whether these requirements are met, and provide the results of such assessment to the sectoral authorities, if they so request.

The Compliance Officer shall be the privileged contact person between the company and IMPIC in the area of preventing and combating ML/TF.

Without prejudice to the provisions of special legislation, the sectoral authorities may:

(a) Subject to prior authorisation the appointment of the Compliance Officer and establish the conditions for his/her re-assessment;

(b) Call back the assessment of the adequacy of the Compliance Officer, on the basis of:

- circumstances that had already occurred when the appointment took place or others, in case they consider that those circumstances have been the object of a clearly deficient evaluation by the obliged entity;

- any supervening circumstances that might substantiate the unsuitability for the post;

(c) Decide on the measures required to ensure an effective management of the risks of ML/TF, including, where necessary, the temporary suspension from duties and the setting of a time limit for replacing the Compliance Officer.

45. What real estate entities are required to appoint a Compliance Officer?

Pursuant to Article 16(1) of the LMLTF and Article 10 of the IMPIC Regulation, real estate entities shall appoint a member of their top management or equivalent, who must have the powers and competences necessary to supervise compliance with the legal framework on preventing and combating ML/TF, where the concerned entity is:

(a) A limited company or a sole trader with more than five employees under an employment contract or as service providers;

(b) A public limited company.

Real estate entities shall ensure that the appointed person fulfils the requirements of good repute, professional qualification and willingness provided for in Article 16(3) of the LMLTF.

As regards the entities that carry out activities in the sector, IMPIC has repeatedly favoured an interpretation according to which all the employees performing their functions in the commercial or customer services within the company should be considered for the purpose of complying with the obligation to appoint the Compliance Officer.

Although lawyers, accountants and staff with tasks not related to ML/TF are essential for the company's life, they will not be tasked with monitoring the occasional transaction or the business relationship that has been established. Therefore, all the employees with competencies in the commercial area, who are frequently in contact with the customer, as well as the company's legal representatives and managers shall be taken into account.

46. Can the tasks of the Compliance Officer be assigned to an entity outside the organisation (e.g. a lawyer, a consultant, an auditor)?

There is no rule in the LMLTF or in IMPIC Regulation preventing the assignment of the Compliance Officer's tasks to an entity outside the organisation through a contract for the provision of services. However, it is important to recall that the Compliance Officer is very important and should play a fundamental role both in the internal control of ML/TF procedures and in reporting the non-conformances or irregularities and in correcting them, in their readiness for service, as well as the privileged contact with the regulatory and investigation entities in this respect.

47. How and when should the appointment of the Compliance Officer be reported to IMPIC?

The appointment of the Compliance Officer provided for in Article 16(8) of the LMLTF shall be reported within 60 working days from the date of the appointment using an electronic form (Point 3 of Annex A) that is available on the IMPIC's website.

Along with that form the appointment document and the respective declaration of acceptance by the appointed person shall also be forward, which must include the following information:

(a) Full name of the appointed person;

(b) Nationality as indicated in the identification document of the appointed person;

(c) Tax identification number (VAT number) of the appointed person;

(d) Type, number, date of validity of the identification document of the appointed person;

(e) Contact number and email address of the appointed person;

(f) Date of appointment;

(g) Contractual link;

(h) Brief description of the tasks performed by the appointed person;

(i) Indication of the position and signature of the appointing person and the appointed person in the declaration of acceptance of the appointment.

If the Compliance Officer has already been appointed at the date of the entry into force of this Regulation, the reporting provided for in Article 10(3) of the IMPIC Regulation shall be done within 60 working days from the date of its entry into force (Circular No 2/2019).

Where the obliged entity should appoint the Compliance Officer but had not done that when the IMPIC Regulation entered into force, it should do it and report it within 60 working days from the date of the entry into force of said Regulation.

48. What should be done if there are changes in the appointment of the Compliance Officer?

Where there are changes in the appointment made by the obliged entity or relating to the appointed person or any of the elements mentioned in Article 10(3) of the IMPIC Regulation, the real estate entity shall report those changes within 20 working days from the date of their occurrence, under the conditions and by the means provided for therein.

49. Are the financial entities with real estate activities required to report their Compliance Officer to IMPIC?

Financial entities with real estate activities are not covered by the obligation to report the appointment of their Compliance Officer to IMPIC, as the IMPIC's scope of intervention is limited to the provisions of Article 46 of the LMLTF. However, given the relevance of his position, the role he plays in the verification of internal compliance with the rules on preventing and combating ML/TF and in the institutional relationship with the regulatory entities, it is considered good practice to mention the Compliance Officer in Point 3 of Annex A of the IMPIC Regulation.

To conclude, the appointment of a Compliance Officer is optional for financial entities.

Reporting of Irregularities

50. What should the employees of the obliged entities do where they become aware of serious facts that violate the LMLTF or its implementing IMPIC Regulation, or infringe the policies, procedures and controls internally established to prevent ML/TF?

People who become aware of such facts, by reason of their duties at the obliged entity, namely under Article 16 of the LMLTF, must report them to the supervisory body of the obliged entity or, in the absence of such body, to the Board of Directors.

In order to report such irregularities, the obliged entities should create internal specific, independent and autonomous channels that adequately ensure the reception, processing and storage of reports concerning those facts. These internal channels should:

- be proportionate to the nature, size and complexity of the obliged entity's activity;

- ensure the confidentiality of the reports received and the protection of the personal data of the whistle-blower and the person suspected of having committed the infringement, pursuant to Law No 67/98 of 26 October 1998.

The obliged entities should also:

- keep - pursuant to Article 51 of the LMLTF - the notifications made and the reports resulting therefrom, and make them permanently available to the sectoral authorities;

- provide the sectoral entities - under the conditions and with the frequency defined by them - with information they may request about the existing internal channels, as well as the notifications received and their processing;

- refrain from any threats or hostile actions and, in particular, any unfavourable or discriminatory labour practices against the person who makes such communications, which cannot, on their own, be used by the obliged entity to justify any disciplinary, civil or criminal proceedings against that person (unless the communications are deliberately and clearly unfounded).

51. For the entities with real estate activities, what does the IMPIC Regulation establish as regards the reporting of irregularities?

Sectoral authorities may demand their respective obliged entities to produce a report, under the conditions and with the frequency defined by those authorities, including a description of the channels referred to in Article 20(1) the LMLTF and a brief indication of the reports received and their respective processing.

The IMPIC Regulation states that, for the purposes of Article 20(7) of the LMLTF, the obliged entities, shall draft an annual report containing:

(a) A description of the specific, independent and anonymous channels that internally ensure, in an appropriate manner, the reception, processing and storage of the reports of irregularities related to any violations of the LMLTF, the IMPIC Regulation and the policies, procedures and controls internally defined for the prevention of ML/TF;

(b) A brief indication of the internal reports received and of their processing.

Where the real estate entity is not required to appoint a Compliance Officer, because of its size and structure, the report should be drafted by their legal representative, by the sole trader or the appointed employee, and contain the elements referred to in the preceding point.

The reports referred to in Article 20 of the LMLTF, as well as the reports resulting therefrom shall be kept as provided in Article 51 of the LMLTF and made permanently available to IMPIC.

The Compliance Officer shall also ensure compliance with the provisions of paragraphs 3 and 4 of Article 20 of the LMLTF.

52. Where no irregularities are reported as regards compliance by the entity with the procedures provided for in the LMLTF and the IMPIC Regulation, is it necessary to draft any document?

In such cases, only a document has to be prepared by the Compliance Officer, the legal representative, the sole trader or the appointed employee, mentioning the existence of specific channels of communication and the non-existence of internal reports of irregularities in the adopted procedures.

53. When fulfilling the control obligation are the obliged entities required to make sure that the data of the entities relating to the restrictive measures applied by international bodies, namely the United Nations Security Council and the European Union, are kept up-to-date?

Yes, the entities are required to update the data relating to compliance with the restrictive measures applied, namely as regards the business relationship.

IMPIC shall immediately provide, by email, all the associations representing the real estate and construction sectors with information on the restrictive measures applied by the abovementioned international bodies.

B.3.) Obligation to train

Relevant Provisions

LMLTF | Articles 11(1)(j) and 55

IMPIC Regulation | Article 11

54. What is the obligation to train?

It is the obligation for the obliged entities - in a manner proportionate to their risks and the nature and size of their activity - to ensure that their managers, workers and other employees whose tasks are relevant for the purpose of preventing ML/TF have an adequate knowledge of the obligations resulting from the LMLTF and its regulations, by implementing specific and regular training activities that are appropriate for each activity sector and qualify them to, at all times, recognize those transactions that might be associated with ML/TF and act in accordance with the existing legal framework.

55. Is there any specific provision for new employees?

In the case of the newly hired employees whose tasks are directly relevant for the prevention of ML/TF, the obliged entities should, immediately after their admission, provide them with adequate training on the policies, procedures and controls internally defined in this respect.

56. Where the obliged entity is a natural person carrying out his professional activity as an employee of a legal person, who shall be responsible for complying with the obligation to train?

In such cases, this obligation lies with the legal person.

57. What requirements should the training activities on preventing ML/TF meet?

The training activities provided by the obliged entities to their employees - irrespective of whether they take place internally or externally - should:

(a) Be undertaken by persons or entities of recognised competence and experience in the field of preventing and combating ML/TF;

(b) Be preceded by a favourable opinion of the Compliance Officer appointed in accordance with Article 16(1) of the LMLTF, when such position exists in the organizational structure of the obliged entity.

58. What other obligations are imposed on the obliged entities in the context of the obligation to train?

The obliged entities should keep up-to-date and complete records of the internal and external training activities undertaken, by retaining them in accordance with Article 51 of the LMLTF and making them permanently available to the sectoral authorities.

59. What specificities have been introduced by the IMPIC Regulation as regards the obligation to train?

Training remains mandatory in slightly different ways than those provided for in Regulation No 282/2011 previously in force, with a focus on the requirement for the training programme to include an area dedicated to methods and mechanism for implementing the sectorial and individual risk analysis in the real estate sector (Article 55).

Furthermore, training requirements are adapted to suit the structure and size of real estate entities as follows:

- Entities with 1-5 employees - one training activity every two calendar years;

- Entities with 6-10 employees - one training activity every calendar year;

- Entities with more than 10 employees shall ensure, on a rotating basis, that their employees receive adequate training - at least one training activity every calendar year - and that the Compliance Officer will always be present in all those activities.

The complete and up-to-date record of the training activities referred to in the LMLTF is also provided for in Article 11(7) of the IMPIC Regulation.

Pursuant to Article 21 of the IMPIC Regulation, the recipients of the training provided for in Article 11 thereof, who have been admitted or appointed after the entry into force of this Regulation are only bound to comply with the provisions contained in said Article six months after their admission, designation or appointment.

B.4.) Obligation to keep documents and records

Relevant Provisions

LMLTF | Articles 11(1)(f) and 51

IMPIC Regulation | Article 9

60. What time limits for the retention of documents and elements should the obliged entities meet when complying with the record retention procedures?

The LMLTF and the IMPIC Regulation lay down a seven-year time limit for the retention of the documents and elements supporting compliance with the preventive procedures and obligations.

61. Can I record and retain in digital form the collected documents and elements?

Yes, the documents obtained from customers and stakeholders, as well as others obtained during the course or at the completion of the business relationship or the occasional transaction can be stored in physical or digital support and should be made permanently available to the authorities with competence in matters of ML/TF, namely to IMPIC, upon request.

62. When a real estate transaction is completed, can a customer or a participant in the business demand the destruction of the documents and the erasure of the data provided to the obliged entity in the context of the identification and due diligence obligation laid down in the LMLTF?

The right to erasure ("right to be forgotten") is provided for in Article 17(3)(b) of Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016, which states that such right shall not apply to processing necessary for the performance of a task carried out in the public interest or in the exercise of official authority vested in the controller provided for in the LMLTF, as regards the procedures for the retention of the elements collected in that context.

B.5.) Reporting obligations regarding real estate activities

Relevant Provisions

LMLTF | Articles 46(1) to (4), 89 and 91

IMPIC Regulation | Articles 14-20

Circular No 2/2019 of 24 June 2019

I - Mandatory reporting to IMPIC by real estate entities:

63. What entities are obliged to report real estate activities to IMPIC?

Regardless of their financial or non-financial nature, those entities that carry out the following real estate activities or provide real estate brokerage services; purchase, sale, purchase for resale or barter of real estate; and lease of immovable property.

64. Are unincorporated partnerships obliged to report real estate activities?

Yes, if they carry out a real estate activity, they are required to comply with the obligations provided for in the LMLTF.

65. As part of my company's business, I purchase, sell and/or lease immovable property but these activities are not included in the description of the company's object. Am I obliged to comply with the obligation to report real estate activities according to the IMPIC Regulation?

Yes, since the concept of real estate activity provided for in Article 2 of the LMLTF and in Article 1 of the IMPIC Regulation means, in practice, carrying out material acts corresponding to real estate brokerage, purchase, sale, purchase for resale or barter of immovable property, lease and real estate development, it should be reported after the date of the first material act implementing these activities.

66. What information must the financial or non-financial entities with real estate activities report to IMPIC?

- The date on which the real estate activity commenced (as declared for tax purposes), as well as the access code to the permanent certificate of the Commercial Register or the excerpt from the Commercial Register (in case the reporting entity does not possess such permanent certificate), by using the form set out in Annex A "Reporting a Real Estate Activity".

The date on which a new real estate activity commenced should also be reported to IMPIC.

- The appointment of the Compliance Officer (Responsável pelo Cumprimento Normativo):

The appointment of the Compliance Officer should be reported through the form set out in Annex A, "Comunicação de Atividade Imobiliária" (Reporting a real estate activity), Group 3. IDENTIFICAÇÃO DO RESPONSÁVEL PELO CUMPRIMENTO NORMATIVO (Identification of the Compliance Officer).

- The details relating to each real estate transaction in which they take part; and

- The details of each lease contract entered into for a monthly rent of EUR 2,500 or more, through the form set out in Annex B, "Reporting of Details of a Real Estate Transaction or a Lease Contract".

II - Obligation to report the date on which the real estate activities commenced (Annex A):

67. Do I need to report the commencement of a new real estate activity, for example the lease of immovable property, to IMPIC?

Yes. Even those entities that, in compliance with the provisions of a previous legislation, have already reported the date of commencement of one or more real estate activities to IMPIC and had already commenced (or are going to commence) the activity of leasing immovable property should also report the respective date of commencement by using the form set out in Annex A - "Reporting a Real Estate Activity", in accordance with Article 46(1)(a) of the LMLTF in conjunction with Article 14(1)(a)of the IMPIC Regulation.

68. Is it necessary to report the termination of a real estate activity to IMPIC?

No. Entities carrying out real estate activities are only obliged to report the date on which they commenced their activities. However, after terminating their activities they still have to comply with a number of legal requirements, namely the obligation provided for in Article 46(1)(b) of the LMLTF to report the details of each real estate transaction and lease contract. After terminating the activity, the entity shall have two months to report the transactions in which it took part over the last half year. Pursuant to Article 20(1) of the IMPIC Regulation, the real estate transactions and lease contracts that took place during the first half of each year should be reported until 31 August of the same year and those that took place during the second half should be reported until the last day of February of the following year.

69. What entities are exempted from reporting the date of commencement of a real estate activity?

- Financial entities with real estate activities;

- Entities with real estate activities that, in the context of their licencing process, have delivered the declaration of the commencement or change of activity to IMPIC.

This exemption only applies to real estate brokerage services - where these entities carry out other real estate activities, the respective date of commencement should be reported to IMPIC; and,

- Entities that, in compliance with the provisions of previous legislation, had already reported the commencement of a real estate activity to IMPIC.

However, the date of commencement of a new real estate activity (or the date of commencement of a leasing activity) should be reported to IMPIC.

70. Are the entities exempted from reporting the date of commencement of activity obliged to register online on IMPIC's website?

Yes. Prior to the first reporting of details of a real estate transaction or a lease contract they have performed, the financial entities with real estate activities and the entities providing real estate brokerage services should register online on IMPIC's website (www.impic.pt) and submit the form set out in Annex A "Reporting a Real Estate Activity" after filling it in. Therefore, where the economic operator reports the details of a real estate transaction or a lease contract, the fields in Group 1 - Identificação da Entidade Comunicante (Identification of the reporting entity) will already be completed (with the data entered in the form "Reporting a Real Estate Activity").

It should also be mentioned that the form set out in Annex A "Reporting a Real Estate Activity" can also be used to update the data of the reporting entity (name, address, etc.) as after their submission the update of such elements is immediate in a new form as that set out in Annex B "Reporting the Details of a Real Estate Transaction or Lease Contract".

71. Is it possible to change the data of the reporting entity by using the form set out in Annex A "Reporting a Real Estate Activity"?

Yes, the form set out in Annex A "Reporting a Real Estate Activity" can be used to change the data entered in Group 1. IDENTIFICAÇÃO DA ENTIDADE COMUNICANTE. (name, address, etc.) After submitting this form, the update of these elements in the form "Reporting the Details of a Real Estate Transaction or a Lease Contract" is immediate.

72. What is the time limit for reporting the date of commencement of real estate activities to IMPIC?

The date of commencement of a real estate activity, as well as the code of access to the permanent certificate of the Commercial Register (or the excerpt from the Commercial Register, if the reporting entity does not possess a permanent certificate), should be reported within no more than 60 working days from the date reported to the Tax and Customs Authority as the date of commencement of the real estate activity(ies).

73. How can I attach documents to the form set out in Annex A "Reporting a Real Estate Activity"?

Through the option "Anexar" (Attach) in group 5 of the form.

74. What types of digital file formats are accepted for attachments to the form set out in Annex A "Reporting a Real Estate Activity"?

The following formats are accepted: doc, docx, pdf, jpg, png, jpeg, gif, txt and tif.

75. What documents are to be attached to the form set out in Annex A "Reporting a Real Estate Activity"?

The documents to be attached are the following:

- Appointment and declaration of acceptance of the Compliance Officer: Document appointing the Compliance Officer and the respective declaration of acceptance by the appointed person;

- Excerpt from the Commercial Register: Those entities that do not possess the permanent certificate of the Commercial Register should attach an excerpt from the Commercial Register;

- Power of Attorney issued to a Lawyer, a Solicitor or any other person: where the reports are electronically authenticated by means of a professional certificate of a lawyer or a solicitor, or by means of a qualified digital certificate of the citizen card of any other mandated individual person, as the person responsible for completing the "report" and on behalf of the reporting entity, a power of attorney should be attached.

76. Are all fields in the form set out in Annex A, "Reporting a Real Estate Activity" mandatory?

All fields marked with (*) are mandatory and it is possible to click on the field number to consult the filling instructions.

77. Can the excerpt of the Commercial Register be sent in hard copy?

The access code to the permanent certificate is the preferred option as it is easy to obtain and cheaper than the hard copy. Furthermore, the reporting referred to in Article 46(1)(a) of the LMLTF is made through the form "Reporting a Real Estate Activity", and when the reporting entity is a legal person it is necessary to indicate the code in the field "Código de acesso à Certidão Permanente do Registo Comercial" (Access code to the permanent certificate of the Commercial Register), which is mandatory for commercial companies.

78. Where can I get the access code to a permanent certificate?

In a Commercial Register office or one of the following websites: www.eportugal.gov.pt; www.empresaonline.pt ; www.portugal.gov.pt and www.portaldocidadao.pt .

79. What should I do if I have trouble inserting the CAE code (main economic activity code) or the CIRS (professional activity code) in the form "Reporting a Real Estate Activity"?

You should put the cursor on the window "PopUp CAE" or "PopUp CIRS", as appropriate, and click; wait for a new window to open and then insert the CAE or the CIRS of the reporting entity in the field "CAE Identificador:" (CAE Identificator) or "CIRS Identificador:" (CIRS Identificator); chose "pesquisar" (search) and "selecionar" to select the name of the activity in question; the go back to the form and the field will be filled.

80. What should I do to cancel a form set out in Annex A "Reporting a Real Estate Activity" that has already been submitted?

The request for cancellation should be signed by the representative of the reporting entity responsible for submitting the initial form by indicating his/her name and the number of his/her identification documents. The details that allow for the identification of the Reporting and the reporting entity should also be indicated, in order to enable the IMPIC services to unambiguously cancel the form submitted (e.g. indicate the reference A/XXXXXXXXX/XX/XXXX). Any request(s) should be sent to the following email address: informa.lei83@impic.pt

III - Obligation to report the appointment of the Compliance Officer - Group 3 of Annex A

81. How can I attach the appointment document and the declaration of acceptance by the person appointed as the Compliance Officer?

Through the option "Anexar" (Attach) - "Nomeação com termo de aceitação do Responsável pelo Cumprimento Normativo" (Appointment of and declaration of acceptance by the Compliance Officer), in Group 5 of the form set out in Annex A, "Reporting a Real Estate Activity".

IV - Obligation to report details of each real estate transaction and lease contract concluded for a monthly rent of EUR 2,500 or more (Annex B)

82. Which real estate transactions should be reported?

All the real estate transactions performed, i.e. those that result in a transfer of ownership, made by means of a public deed or an equivalent private document, as long as they take place in the context of the real estate activity conducted by the reporting entity.

83. Which real estate transactions and lease contracts are not covered by the reporting obligation provided for in Article 46(1)(b) and (3) of the LMLTF?

Taking account of the legal nature of the operations and the matrix setup of the associated risk, the real estate transactions and lease contracts that are not covered by the reporting obligation provided for in Article 46(1)(b) and (3) of the LMLTF are the following:

- Compulsory purchase in the public interest;

- Tax execution procedures;

- Real estate sales by tender in enforcement procedures;

- Private negotiation procedures by order of a Judicial Court, made by tender in enforcement procedures;

- Donation contracts;

- Promissory contracts;

- Lease contracts whose monthly rent amounts to less than EUR 2,500, after the entry into force of the IMPIC Regulation (Circular No 2/2019);

- Lease contracts whose monthly rent amounts to EUR 2,500 or more, concluded until 30 June de 2019;

- Contracts for the exploitation of local accommodation establishments (Decree-Law No 128/2014 of 29 August 2014, amended by Law No 62/2018 of 22 August 2018);

- Contracts for the use of shops in a commercial complex;

- Contracts for the transfer of shares in a company.

84. I have bought, sold or leased an immovable property to be used as the main office of my company. Am I obliged to report the details of the respective real estate transaction or lease contract?

Real estate transactions and lease contracts concluded by entities without real estate activities that are intended for the functional activity thereof (as in this example) do not need to be reported to IMPIC. However, should the purchased/leased property be used for another purpose, namely for resale, property development, leasing or any other form of exploitation resulting in its subsequent transaction, that would actually entail the exercise of a real estate activity. As soon as this happens, the entity shall, without prejudice to other obligations, perform the reporting obligations with IMPIC (reporting of the real estate activity and the details of each real estate transactions or the lease contracts carried out regarding the immovable property concerned or any other property).

85. Am I obliged to report the details related to the financial leases that I have concluded?

Entities carrying out real estate activities are not obliged to report details relating to financial leases. However, they are obliged to report the details of the transaction that led to the conclusion of a financial lease.

86. Do I have to report the details related to the transfer contracts that I have concluded?

Given that transfer contracts are contracts relating to the purchase and sale of commercial or industrial establishments, the details of such transactions should not be reported, except when the building concerned is an integral part of the establishment and gives full ownership of that immovable property.

87. Do I have to report the details related to properties exchanged under a transfer in lieu of payment of a debt?

Yes. Immovable property exchanged under a transfer in lieu of payment of a debt is subject to the reporting obligation as follows:

Date of the transaction: the date on which the immovable property is transferred;

Amount: (Overall) value of the property;

Type of Payment: [select the option] OMP (Other Means of Payment), by describing the situation in the blank space reserved for this purpose, identified by "Qual" (Which): "dação em ?????" (transfer in ?????) .

88. What is the last deadline for reporting to IMPIC the details of each real estate transaction and each lease contract whose monthly rent amounts to EUR 2,500 or more?

The reporting is bi-annual; for real estate transactions and lease contracts made:

- during the first half of each year, the last deadline for reporting to IMPIC is on 31 August of the same year;

- during the second half of each year, the last deadline for reporting to IMPIC is on the last day of February of the following year.

89. When should the details of each real estate transaction and each lease contract be reported?

The reporting can take place during the half year immediately upon conclusion of the business, and the time limit is two months after the end of the corresponding half year. Pursuant to Article 20(1) of the IMPIC Regulation, real estate transactions and lease contracts concluded in the first half of each year should be reported by 31 August of the same year and those concluded during the second half of each year should be reported by the last day of February of the following year.

90. And what if the real estate entity has not carried out any real estate transaction or a lease contract whose monthly rent amounts to EUR 2,500 or more during that period of time?

The real estate entity is not required to make any reporting, given that, according to Article 46(1)(b) of the LMLTF, the reporting obligation only applies to the details of the real estate transactions and lease contracts concluded.

91. Is it possible to report the details of each real estate transaction or lease contract after the time limit established in Article 20(1) of the IMPIC Regulation?

In case the elements of a real estate transactions or lease contract have not been reported within the time limit (1st half year by 31 August and 2nd half year by the last day of February of the following year) they must be reported as soon as possible (even out of time).

92. Am I obliged to report the details of lease contracts concluded before the entry into force of the IMPIC Regulation (26 June 2019) whose monthly rent amounts to EUR 2,500 or more?

Circular No 2/2019 of 24 June 2019 approved by the Governing Board of IMPIC states that only the details of the lease contracts whose monthly rent amounts to EUR 2,500 or more, concluded after the 1st July 2019, are subject to the reporting obligation provided for in Article 46(1)(b) and (3) of the LMLTF and Article 20 of the IMPIC Regulation, while the contracts concluded before that date are not covered by such obligation.

93. When should I report the details of a lease contract of immovable property whose monthly rent amounts to less than EUR 2,500 but later on is updated and raised to EUR 2,500 or more?

The elements of the lease contract of immovable property should be reported to IMPIC only within the time limit that corresponds to the half year in which the value of the monthly rent reaches or exceeds the amount of EUR 2,500 provided for in the LMLTF, and such reporting is not mandatory on the date of the conclusion of the contract whose amount is below that limit. This means that reporting becomes mandatory in the half year in which the value of the monthly rent becomes equal to or higher than EUR 2,500, and should be done within the time limit provided for in the IMPIC Regulation, according to the half year in which this occurs.

94. Are the entities that develop activities of purchase and sale, property development or leasing of immovable property obliged to report details relating to the involvement of a real estate broker in the transaction or in the lease contract?

No. The reporting entity is not required to report details relating to the involvement of entities that carry out real estate brokerage in the transaction or the lease contract, because the LMLTF establishes that these entities are also required to report the details relating to the real estate transactions and the lease contracts brokered by them.

95. How can I attach documents to the form set out in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract"?

Through the option "Anexar" (Attach) in Group 5 of the form.

96. What types of digital file formats are accepted for attachments to the form set out in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract"?

The following formats are accepted: doc, docx, pdf, jpg, png, jpeg, gif, txt and tif.

97. What documents are to be attached to the form set out in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract"?

NB: Files containing purchase contracts and lease contracts of immovable property should be attached only when requested by IMPIC.

The documents to be attached are the following:

- Power of Attorney issued to a Lawyer, a Solicitor or any other person: where the reports are electronically authenticated by means of a professional certificate of a lawyer or a solicitor, or by means of a qualified digital certificate of the citizen card of any other mandated individual person, as the person responsible for completing the "report" and on behalf of the reporting entity, a power of attorney should be attached.

- This power of attorney should only be attached to the 1st (first) reporting made in each half year and shall be effective only during that period of time.

98. Which elements must be included in the Power of Attorney?

The identification of the principal and the agent; the content of the mandate and the period of the validity of the mandate. In the case of the form "Reporting the Details of a Real Estate Transaction or a Lease Contract" this power of attorney should only be attached to the 1.st reporting made in each half year and shall be effective only during these periods of time.

99. Is it necessary to retain the details related to the real estate transactions and the lease contracts concluded? How long?

Yes. Entities with real estate activities should retain all the details relating to compliance with the identification and due diligence obligations and to the confirmation and recording of the transactions carried out, so that they can be reconstructed. These details should be retained for a period of seven years.

For those entities that carry out the real estate activity, copies of the public deeds, or the equivalent private document, of the purchases and sales or the lease contracts they have brokered can be stored together with the real estate brokerage agreements concluded.

100. What to do when the real estate broker has difficulty in obtaining all the elements required?

The real estate broker is obliged to ask the parties involved in the transaction the necessary information for complying with the obligations provided for in the LMLTF and in the IMPIC Regulation, and these parties must provide that information. Whereas that legislation aims at establishing a system to combat ML/TF, the refusal by any of the parties involved in the transaction to provide that information may constitute an indication of those crimes and as a result it has to be reported to the competent authorities and the conclusion of the transaction has to be refused.

101. Where entities with real estate activity only accompanies a transaction until the moment when the promissory contract is concluded (and do not accompany it from then until the deed), are they obliged to report that transaction?

Yes, because, regardless of the scope of the services contracted, i.e. regardless of whether they undertook to accompany the transaction until the deed or not, they have brokered a transaction that eventually was materialised; they should, therefore, report all the purchase and sale transactions.

102. What type of real estate activity should be indicated by the entities that carry out a real estate brokerage?

They should identify the transaction according to the object of the real estate brokerage agreement they concluded with the customer. Where the reporting entity concluded a real estate brokerage agreement with the owner of a building, with a view to selling it, and the sale actually took place through a deed or an equivalent private document, the entity should report the transaction as a "Venda" (Sale).

103. What to do where the transactions are shared between two companies that provide real estate brokerage services?

The reporting of the details of the real estate transaction or the lease contract should be made by the entity that concludes the real estate brokerage agreement and brokers the transaction that results in the signing of a purchase contract or a lease contract. However, if the two entities conclude a real estate brokerage agreement with the two parties in the transaction (the purchaser and the seller), they both should report the transaction. The only difference is in the identification of the type of transaction that was carried out, as one entity will report the sale (the one that concluded the real estate brokerage agreement with the seller of the property) and the other will report the details concerning the purchase.

104. Where a company has more than one establishment (shop) is it possible for each establishment to make their own reporting of details of real estate transactions and lease contracts?

No. Pursuant to Article 46(1) of the LMLTF, the obligation to report, on a bi-annual basis, the details of the real estate transactions and lease contracts concluded is on the entities that carry out real estate activities, regardless of the number of establishments they have.

105. Are all fields in the form set out in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract" mandatory?

All fields marked with (*) are mandatory and it is possible to click on the field number to consult the filling instructions.

106. When stakeholders with the same status (purchasers/sellers or tenants/landlords) are married, is it necessary to identify both spouses?

Yes. Regardless of the legal relationship between the persons involved in the transaction, they all should be identified as indicated in the purchase contract or the lease contract concluded. The form set out in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract" includes the option "ADICIONAR INTERVENIENTE" (Add Stakeholder) intended for the identification of other persons involved in the transaction (when the purchaser and/or sellers and the tenants and/or landlords are two or more entities).

107. How should the fields relating to the "Representante" (Representative) in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract" be completed when some details of the identification documents, namely the number and date of validity, do not appear in the public deed or the equivalent private document?

This situation is addressed by the option "Outro" (Other) in the field "Documento de identificação:" (Identification document). Since the following fields are alphanumeric, it is possible to describe the situation; the field NIF (VAT number) to identify the representative is not mandatory and can be left empty. However, it should reproduce as much as possible the data that appear in the purchase contract.

108. When should the fields relating to the "Representante" (Representative) in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract" be completed?

Whenever one of the parties involved (the purchaser or the seller; the tenant or the landlord) is a legal person or, in the case of a natural person, when this is represented by an attorney.

109. Is it necessary to obtain the tax identification number of foreign nationals involved in real estate transactions?

As the owner of real property in Portugal, any foreign national must have a tax identification number and, as such, the reporting entities must take action in order to obtain that information.

110. How should the field "Tipo de pagamento" (Type of payment) in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract" be completed for a transaction where payment was not made in full?

For those transactions where payment was not made in full, you can select the option "OMP" (Other Means of Payment) as the means of payment, and then describe the situation in the blank space designed for that purpose and identified as "Qual" (Which).

111. What to do to report a real estate transaction in which a Real Estate Investment Fund is involved through a Real Estate Fund Management Company? Who shall be responsible for reporting the details of the real estate transaction or the lease contract in which a Real Estate Investment Fund is involved?

Where a Fund or a non-personalized entity is involved, the obligation to report the real estate activities lies with and must be performed by the respective managing entity, the real estate fund management company.

Taking into account the structure of the models approved as Annex A and Annex B to the IMPIC Regulation, it is considered that the real estate investment fund management company should be the reporting entity and should identify as a stakeholder (purchaser/seller; tenant/landlord) in the transaction the real estate investment fund it manages. Through the option "Adicionar Representante" (Add Representative) provided in the form, the fields should be completed with the elements of the representative of the entity/stakeholder that is a party in the transaction - with the details of the company that manages the fund. And, again, through the option "Adicionar Representante" (Add Representatuve), the name of the natural person who represents it should be added. [Where the "fund management company" is represented by two attorneys, this process should be repeated through the option "Adicionar Representante" (Add Representative)].

112. Where in the same act, purchase contract or lease contract 10 properties were exchanged with different customers, is it necessary to complete and submit 10 different forms Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract"?

The entity will have to submit as many forms Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract" as the number of purchase contracts and lease contracts concluded. Given that this form is structured in such a way that only the details of one real estate transaction or one lease contract can be recorded, it is necessary to complete one form for each real estate transaction formalised through a public deed (or an equivalent private document), or for each lease contract concluded.

However, where more than one property or a part thereof has been exchanged or leased in the same act (same transaction) the reporting entity may choose one of the following modalities to complete the form:

(a) If the exchanged/leased properties have common characteristics (value, similar address and share) the information relating to their identification can be aggregated in the same group of fields. E.g. R. XXXX, Blocks Nos, 10/11/12?; 1 Left/ 2 Left/ 3 Left... [Recommended for situations where many properties are exchanged in the same transaction].

(b) If the exchanged/leased properties have different characteristics, the option "ADICIONAR IMÓVEL" (Add property) should be used to identify those properties. The option "ADICIONAR IMÓVEL" (Add property) is designed to identify more exchanged/leased properties. [Recommended for the identification of building units].

113. What to do when the following error message appears "A entidade comunicante tem de ser interveniente no negócio jurídico" (The reporting entity must be a party in the transaction)?

Where the form is completed online it is necessary to identify the two persons involved in the transaction (the purchaser and the seller or the tenant and the landlord), and check whether the type of transaction identified corresponds to the type of transaction actually performed by the reporting entity. For example, if the reporting entity took part in the transaction as the seller, the type of transaction to be reported is "VENDA" (Sale).

114. How can the details recorded and submitted in the form set out in Annex B - "Reporting the Details of a Real Estate Transaction or a Lease Contract" be corrected or cancelled?

The details recorded in the form set out in Annex B - "Reporting the Details of a Real Estate Transaction or a Lease Contract" can be corrected by the reporting entity within 15 days from their submission. This option is available in "ÁREA RESERVADA > SERVIÇOS ONLINE > COMUNICAÇÃO DE ATIVIDADES IMOBILIÁRIAS > COMUNICAÇÕES SUBMETIDAS > COMUNICAÇÃO DE ELEMENTOS DE TRANSAÇÃO IMOBILIÁRIA OU CONTRATO DE ARRENDAMENTO > "EDITAR" (Reserved area > Online services > Reporting real estate transactions > Reporting of details of a real estate transaction or a lease contract > Edit).

On expiry of that period (15 days after submission), the details submitted in the form set out in Annex B - "Reporting the Details of a Real Estate Transaction or a Lease Contract" can be corrected and cancelled only by IMPIC upon request from the reporting entity.

In order to correct of the details recorded in the form "Reporting the Details of a Real Estate Transaction or a Lease Contract" submitted, the reporting entity may also choose to complete and submit once more the form set out in Annex B, "Reporting the Details of a Real Estate Transaction or a Lease Contract", an then ask IMPIC to cancel the form previously submitted, and take account of the time limit established in the IMPIC Regulation for the reporting.

Requests for correction and cancellation must be subscribed by the representative of the reporting entity responsible for submitting the first reporting by indicating his name and the number of his identification documents. It is also necessary to indicate the elements that enable the identification of the reporting, as well as the reporting entity, so that the services of IMPIC are able to unequivocally correct or cancel the reporting submitted (E.g. indicate the reference T/XXXXXXXXX/XX/XXXX). The request(s) should be sent to the following email address: informa.lei83@impic.pt.

115. How can I cancel a "Reporting the Details of a Real Estate Transaction or a Lease Contract" (Annex B) already submitted?

The request for cancellation has to be signed by the representative of the reporting entity responsible for submitting the initial reporting, indicating his name and the number of his identification documents. The details that enable the identification of the Reporting as well as the reporting entity should also be indicated in order for the services of IMPIC to unequivocally cancel the reporting submitted (E.g. indicate the reference T/XXXXXXXXX/XX/XXXX). The request(s) should be sent to the following email address: informa.lei83@impic.pt

116. What happens when the reporting of the details of a real estate transaction or a lease contract is not made through the electronic form set out in Annex B with the digital certification?

Since 1 July 2010, the mandatory reporting forms - reporting of the date of commencement of the activity and reporting of elements related to real estate transactions - are authenticated by electronic means through a qualified digital certificate. Failure to comply with that obligation breaches the provisions of Article 46 of the LMLTF and can entail administrative offence proceedings against the breaching entity.

117. How can I report a real estate transaction with a usufruct contract?

In this case, it is enough to identify one of the parties to the contract - the bare owner (the person who owns the immovable property, the object of the usufruct), and there is no need to identify the other party - the beneficiary (or usufructuary). The amount of the transaction to be indicated should correspond to the overall value of the exchanged property, regardless of whether separate values have been assigned to it or not.

118. How should a barter transaction be reported in the form set out in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract? [example of how to complete some fields of the form]

For transactions where a property or properties is/are the object of a barter, it is necessary to indicate the number of entire properties and/or parts of properties and identify all the properties exchanged, including the bartered property(ies), through the option "ADICIONAR IMÓVEL" (Add property) in the electronic form. Note that the value to be indicated in field "(25)* Montante:" (Amount), should correspond to the property with the highest value. If the same value has been assigned to the bartered properties, only the value of one of them should be indicated. The value assigned to each property should be indicated in fields "(30)* Valor do Imóvel:" (Value of property), of Group 3.3. IDENTIFICAÇÃO E LOCALIZAÇÃO, INDIVIDUAL DE CADA IMÓVEL TRANSACIONADO / ARRENDADO OU DA SUA PARTE. ] (Separate identification and location of each exchanged/leased property or a part thereof)

Example of how some fields should be filled in:

3.2. IDENTIFICAÇÃO DA TRANSAÇÃO: (Identification of the transaction)

(23)* N.º de imóveis (inteiros) (Nr. of (entire) properties: and/or (24)* N.º de partes de imóvel (Nr. of parts of a property): Indicate the number of all properties exchanged in the same transaction. [the value indicated in this field corresponds to the sum of all properties indicated in field (29)* N.º de imóveis indicados no Grupo 3.3. IDENTIFICAÇÃO E LOCALIZAÇÃO, INDIVIDUAL DE CADA IMÓVEL TRANSACIONADO / ARRENDADO OU DA SUA PARTE (Nr. of properties indicated in Group 3.3. Separate identification and location of each exchanged/leased property or a part thereof)].

(26)* Tipo de pagamento utilizado (Type of payment used): In the case of a barter transaction, the means of payment shall be enabled "(28)* Valor do imóvel permutado (€)": (Value of the bartered property (€)), where the value assigned to the property in question should be indicated; where different values have been assigned to the exchanged properties, other type(s) of payment used in the transaction should be selected and their value(s) indicated.

3.3. IDENTIFICAÇÃO E LOCALIZAÇÃO, INDIVIDUAL, DE CADA IMÓVEL TRANSACIONADO / ARRENDADO OU DA SUA PARTE. (Separate identification and location of each exchanged/leased property or a part thereof)

119. How should I fill in field "(24)* N.º DE PARTES DE IMÓVEL" (Nr. of parts of property) of the form set out in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract"

Field "*(24)* N.º DE PARTES DE IMÓVEL:" (Nr. of parts of property) must be completed whenever parts of properties are exchanged. This option is available for those - less common - situations where parts of one property are exchanged, for example where a property has been divided into parts, but this will have to be recorded in the purchase contract or the lease contract concluded. If this is the case, field "(29)* Valor da parte de imóvel (%) no Grupo 3.3 - IDENTIFICAÇÃO E LOCALIZAÇÃO, INDIVIDUAL, DE CADA IMÓVEL TRANSACIONADO / ARRENDADO OU DA SUA PARTE (Value of the part of property (%) in Group 3.3. - Separate identification and location of each exchanged/leased property or a part thereof) should be filled in; and the part(s) of the exchanged or leased property(ies) should be inserted in numerical form as a percentage (value in percentage).

120. Is it possible to enter data in the form set out in Annex B "Reporting the Details of a Real Estate Transaction or a Lease Contract", then suspend or complete and sign the registration and submit it at a later date?

Yes. At the end of the form, you can find the option "Guardar Rascunho" (Save Draft) that allows for the storage of the data recorded so that the form can be completed, signed or submitted later. To access the data recorded (draft) in the form set out in Annex B, "Reporting the Details of a Real Estate Transaction or a Lease Contract", you select the button "Escolher ficheiro" (Select file); open the file [Abrir] (Open); and then select the button "Carregar" (Download), to retrieve the already filled form, confirm/complete the data introduced, sign the form with a qualified digital certificate and submit it.


03/04/2020