Monday, 04 July 2011 09:46

Spanish in-house lawyers monitoring Portuguese developments

Spanish businesses will be among those most affected by Portugal’s financial assistance package

Current events in Portugal will inevitably have a knock-on effect in Spain and specifically for those Spanish businesses already with operations in the country, participants at a recent Iberian Lawyer In-House Club debate heard.
“The country remains fundamentally stable but nonetheless faces considerable challenges around investor confidence as a result of the lack of efficiency of the State and the competitiveness of many of its businesses,” said João Santos, Director of Market Risk at Barclays in Lisbon.
“There is a tradition of good corporate governance but the State needs a deeper framework of change. The Government is being forced to sell its majority and preferential holdings in many major entities in order to free up capital and encourage greater liberalisation.”
The European Union (EU), European Central Bank (ECB) and International Monetary Fund (IMF) have agreed to commit up to €78bn to Portugal, equivalent to 45 percent of GDP, to help resolve its ongoing financial troubles and to restore liquidity to the country’s banks.
“Nobody would have wished for the current situation but one positive is that we finally have a recovery plan. Businesses now though need to assess what lies ahead, to adapt to the changes we are likely to see or to capitalise on any new opportunities presented,” said Jorge Santiago Neves, Partner with Gómez-Acebo & Pombo in Lisbon, and who acted as co-Moderator of the debate alongside Gonzalo Fernández Atela, Chief Administration Officer at RBC Dexia Investor Services España.
“Over the next two years we are likely to see the largest fiscal restructuring Portugal has ever experienced, if executed properly the country and its major businesses should emerge in a far better shape. For those companies and investors that see Portugal as strategically important it presents an almost once in a lifetime opportunity,” added fellow Lisbon-based Lawyer Guilherme Figueiredo.
The Government is to sell its holdings in companies such as Galp, EdP and REN while the national airline TAP and airports operator ANA are to be privatised along with a number of other entities, including potentially the railway operator CP and the Post Office.
Some in the country may be looking to the former Portuguese colonies of Angola and Brazil as possible sources of new investment, but it is Spain that is the country’s largest trading partner. An estimated 1,400 Spanish companies are active in Portugal, accounting for nine percent of GDP, and it is these businesses that have the most to lose or gain from the reforms, say some.
“Many foreign investors can afford to stay clear of Portugal but for Spanish business the country remains strategically important, either to develop an Iberian footprint or as a conduit into the rapidly expanding markets of Brazil or Angola,” says Santiago Neves.
With the planned recapitalisation of the domestic banks, the forced divestment of non-core operations, and the mandatory privatisation of the nationalised Banco Português de Negócios (without a minimum price) it may be Spanish banks that are among the major beneficiaries. “As a sector we may be particularly well positioned to capitalise on funding arbitrage opportunities,” suggested Rui Mesquita, Director of Business Services at La Caixa.
Nonetheless some continue to highlight ongoing risks, including the interdependency of the major banks and listed companies, but also the willingness of many in Portugal to open up to further Spanish investment. “We are still unsure whether the foreign investment that the country needs will be welcomed or resented,” said one Madrid-based Fund Manager.
Subtle legal amendments are also proposed to help increase new international investment, including the Insolvency Law to better favour secured creditors, to leasehold laws to encourage real estate investors, and amendments to the tax collection and adjudication systems, as well as a review of the Public Procurement Code and the potential renegotiation of the largest public-private partnership and concessions schemes.
The medicine being proposed by the EU, ECB and IMF may not prove palatable to all but it is required, say some.
“Previously there was a sense that the country was living from one day to the next and experiencing one crisis after another. There is no doubt that the next few years will be tough but at least we have a potential way out. We already see international investors monitoring events but no-one wants to commit until there is greater certainty ahead,” concluded Santiago Neves.

The Latin American Lawyer
N.22 • November 2021

IL98 cover SP IL94 cover EN
 

Iberian Lawyer
N.109 • November 2021

IL98 cover SP IL94 cover EN

IBLLabourAwardsPortugal 202112 300x250 Finalists

UIAMadrid 300x100

IL LatamAwards STD 300x100 1

UIAMadrid 300x100

IL LatamAwards STD 300x100 1

IL LatamAwards STD 300x100 1

IpTmtAwardsSpain 2021 300x100 finalists 1

IL LatamAwards STD 300x100 1

IPTMTAwardsPT 2021 300x250 Vincitori

This website uses cookies

We use cookies to ensure that we give you the best experience on our website. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on the IberianLawyer website. However, you can change your cookie settings at any time. Learn more

I agree

What do I need to know about cookies?

A cookie is a small text file that’s stored on your computer or mobile device when you visit a website. We use them to:

  • Remember your preferences
  • Tailor our sites to your interests.

There are different types of cookies

First party cookies

These are set by the website you’re visiting. And only that website can read them.  In addition, a website might use a separate company to analyse how people are using their site. And this separate company will set their own cookie to do this.

Third party cookies

These are set by someone other than the owner of the website you’re visiting. 

Some IberianLawyer web pages may also contain content from other sites like Vimeo or Flickr, which may set their own cookies. Also, if you Share a link to a IberianLawyer page, the service you share it on (e.g. Facebook) may set a cookie on your browser.

The IberianLawyer has no control over third party cookies.

Advertising cookies

Some websites use advertising networks to show you specially targeted adverts when you visit. These networks may also be able to track your browsing across different sites.

IberianLawyer site do use advertising cookies but they won’t track your browsing outside the IberianLawyer.

Session cookies

These are stored while you’re browsing. They get deleted from your device when you close your browser e.g. Internet Explorer or Safari.

Persistent cookies

These are saved on your computer. So they don’t get deleted when you close your browser.

We use persistent cookies when we need to know who you are for more than one browsing session. For example, we use them to remember your preferences for the next time you visit.

Other tracking technologies

Some sites use things like web beacons, clear GIFs, page tags and web bugs to understand how people are using them and target advertising at people.

They usually take the form of a small, transparent image, which is embedded in a web page or email. They work with cookies and capture data like your IP address, when you viewed the page or email, what device you were using and where you were.

How does the Iberian Lawyer use cookies?

We use different types of cookies for different things, such as:

  • Analysing how you use the IberianLawyer
  • Giving you a better, more personalised experience
  • Recognising when you’ve signed in

Strictly Necessary cookies

These cookies let you use all the different parts of Iberian Lawyer. Without them services that you have asked for cannot be provided.

Some examples of how we use these cookies are:

  • Signing into the IberianLawyer
  • Remembering previous actions such as text entered into a registration form when navigating back to a page in the same session
  • Remembering security settings which restrict access to certain content.

Performance cookies

These help us understand how people are using the IberianLawyer online, so we can make it better. And they let us try out different ideas.
We sometimes get other companies to analyse how people are using the IberianLawyer online. These companies may set their own performance cookies You can opt out of these cookies here.Some examples of how we use these cookies are:

  • To collect information about which web pages visitors go to most often so we can improve the online experience
  • Error management to make sure that the website is working properly
  • Testing designs to help improve the look and feel of the website.
Cookie nameWhat it's for
Google DoubleClick The IberianLawyer uses Google DoubleClick to measure the effectiveness of its online marketing campaigns.Opt-out of DoubleClick cookies
Google Analytics From time to time some IberianLawyer online services, including mobile apps, use Google Analytics. This is a web analytics service provided by Google, Inc. Google Analytics sets a cookie in order to evaluate use of those services and compile a report for us.Opt-out of Google Analytics cookies