Cyber Security by Hiscox

Seguradora Hiscox apresenta as 5 principais tendências de cibersegurança para 2024

  • Protagonistas do ano passado na segurança cibernética foram a fraude financeira, a extorsão cibernética e as vulnerabilidades em serviços e tecnologias de terceiros, entre outros.
  • De acordo com a Hiscox, representada em Portugal pela Innovarisk, algumas das principais tendências em segurança cibernética para 2024 são o aumento de ataques de ransomware com fuga de dados, IA ou a dificuldade na deteção de malware avançado.

O cenário da cibersegurança em 2023 tem sido complicado para as empresas, que têm assistido ao crescimento exponencial da ameaça cibernética. E embora tenha havido uma ligeira diminuição na incidência de ataques cibernéticos, no último ano destacou-se o aumento dos custos dos ataques cibernéticos e da sua recuperação. De facto, como se pode verificar no Relatório de Preparação Cibernética da Hiscox de 2023, o custo dos ataques cibernéticos já tinha crescido 43% em 2022, duplicando o valor face ao ano anterior. Além disso, o custo de recuperação de ataques cibernéticos de ransomware, excluindo pagamentos de resgate, aumentou 88%.

Perante as atuais dificuldades económicas e do aumento o custo de vida, outros grandes protagonistas do último ano em termos de cibersegurança foram a fraude financeira, a ciberextorsão, as vulnerabilidades em serviços e tecnologias de terceiros e o aumento da frequência do roubo de dados. Neste sentido e depois de um ano marcado por um contexto cibernético complexo, a Hiscox C3, divisão de especialistas em cibersegurança que analisa constantemente o mercado, tendências e portfólio a nível mundial, identificou os principais riscos em cibersegurança que as empresas devem levar em consideração em 2024.

Aumento do ransomware para extração de dados

Uma das principais tendências no crime cibernético observada nos últimos anos é a mudança da opção pela criptografia dos arquivos e documentos das vítimas para ameaças de extração de dados e exigências de pagamentos em troca da não divulgação das informações roubadas. Neste sentido, em 2023, segundo o Relatório da Hiscox, 46% das empresas globais com mais de 250 funcionários alegaram ter pagado o resgate para proteger os dados dos seus clientes, enquanto 42% das pequenas e médias empresas com menos de 250 funcionários alegaram que fizeram isso para proteger dados confidenciais da empresa. Além disso, constatou-se que mundialmente existem poucas empresas que tenham pago um resgate para voltarem a operar, especificamente 40%. No entanto em 2024 iremos assistir ao crescimento desta tendência e à exigência de resgates cada vez maiores em troca da não divulgação de dados confidenciais.

Aspetos positivos e negativos da inteligência artificial (IA)

A democratização de grandes modelos de linguagem (LLM) como o ChatGPT abriu em 2023 um oceano de oportunidades para os cibercriminosos que devem ser levadas em consideração. Esta tecnologia ajuda-os a desenvolver malware sofisticado e personalizado, a usar ferramentas de hacking e a redigir emails de phishing coerentes e convincentes, como o WormGTP. No entanto, nem tudo são más notícias e embora a IA possa capacitar os cibercriminosos, também pode desempenhar um papel crucial no desenvolvimento e implementação de software de segurança inovador, bem como no reforço das atuais medidas de segurança e defesa contra novas ameaças. A IA, nesse sentido, contribui para automatizar a deteção de ameaças nos serviços de email e nas redes, bem como analisar atividades e comportamentos dos utilizadores em busca de sinais maliciosos.

Fraude por desvio de pagamentos continua a ser um desafio

De acordo com dados do Relatório de Preparação Cibernética, uma em cada três empresas atacadas sofreu pelo menos um ataque cibernético que culminou em fraude de desvio de pagamento, que passou para a primeira posição global nos resultados de ataques cibernéticos. Esta técnica, que envolve táticas de manipulação ou engano para induzir os colaboradores a desviar pagamentos para contas fraudulentas, também foi classificada como o segundo resultado de ataque cibernético mais comum nos dois anos anteriores. Neste sentido, em 2024 será essencial apostar na defesa e gestão de ataques de engenharia social como o phishing por email e SMS, o ‘smishing’, através da formação de todos os colaboradores.

Gestão de ativistas políticos

Em 2023 o Comité Internacional da Cruz Vermelha (CICV) publicou os primeiros regulamentos para hackers civis envolvidos em conflitos, alertando para o aumento dos ataques cibernéticos por razões patrióticas e de defesa dos Estados, especialmente após a invasão da Ucrânia e agora o conflito entre Israel e o Hamas. Assim, grupos com motivações ideológicas atacaram, e continuarão a fazê-lo em 2024, vários sectores públicos e privados como bancos, empresas, hospitais, caminhos-de-ferro e serviços governamentais. A ameaça representada por estes intervenientes é um fator de risco a considerar em 2024, uma vez que existe a possibilidade de estes ataques cibernéticos se estenderem a organizações que não estão envolvidas nos conflitos. Por outro lado, embora nem todos estes ‘hacktivistas’ adiram a estes padrões, estabelecem um quadro ético e legal como base para condenar ações inaceitáveis, promover o hacktivismo responsável e preservar os padrões éticos essenciais na referida comunidade.

Malware avançado evita deteção

Desde a adoção generalizada de tecnologias de deteção e resposta com base em comportamentos (EDR), em 2023 foi observada uma diminuição na eficiência do software malicioso clássico, como malware ou vírus mais tradicionais. Porém, também se observa uma mudança nas estratégias dos cibercriminosos em que esses malwares utilizam táticas que não geram alertas para as vítimas e assim passam despercebidos, como a utilização de softwares comerciais para fins maliciosos, acesso remoto e transferência de arquivos. Neste sentido, prevê-se que esta evolução no funcionamento do malware continue dando origem a formas de malware mais sofisticadas e de difícil deteção.

Sobre este tema, Ricardo Pereira, subscritor de Linhas Financeiras da Innovarisk, conclui que “nos últimos anos, a ameaça da Inteligência Artificial tem estado cada vez mais presente no nosso dia-a-dia. O avanço de ferramentas como o ChatGPT facilitam a criação de conteúdo enganoso de forma bastante acessível, permitindo a prática de burlas com uma maior facilidade e menor custo para os mal-intencionados. Este é um dos aspetos que faz soar os alarmes não só no meio empresarial, mas também na nossa rotina diária, pois estamos mais vulneráveis à prática de esquemas. Por esta razão, a aposta deverá ser cada vez mais na segurança cibernética que envolve, não só os sistemas informáticos, mas também a formação e consciencialização das pessoas, que são o grande ativo das Empresas.”

Para mais informações, contactar:

Kathrin Schneider | +351 939 864 298 |

Networking lunch - sponsored by Pedra Silva Architects

We are based in Portugal, but most of our clients are not

Kindly sponsored by:

Have you ever had lunch with a bunch of strangers?

It’s an experience that can range from mildly intriguing to profoundly awkward. Yet (and luckily), the luncheon hosted by the British-Portuguese Chamber of Commerce, with the support of Pedra Silva Arquitectos, veered towards the stimulating end of the spectrum.

Set within the inviting walls of Santiago de Alfama, this wasn’t just a meal; it was a vibrant convergence of ideas and cultures, a meeting of diverse groups of entrepreneurs and professionals, a microcosm of Portugal’s own international charm. Prompted by our moderator, Chris Barton, Manuel Rosa da Silva, our gracious host from Santiago de Alfama, proposed a thought that lingered in the air: “there are many Portugals within this one border.” He challenged the conventional view of nationality, especially in the realm of business, painting it as a spectrum rather than a definite territory. We who had come together for this lunch, are embodiments of this reality, our identities not merely inherited from our home country, but actively crafted from the rich variety of experiences found in Portugal’s corners.

Take me, your narrator, as an example: though Italian by birth, Lisbon has claimed a piece of my soul, rendering me, not a Portuguese but a “Lisboner” through and through.

Full Group - Networking Lunch 14 February 2024

The Art of Marketing Abroad: Beyond Fado, Beaches and Pasteis de Nata

A diverse crowd, united by a common challenge: reaching foreign clients from our Portuguese base. Gone were the days of simply showcasing stunning beaches and delicious pastries: masterfully moderated by Chris Barton, the conversation went beyond the simplistic notion of showcasing Portugal’s undeniable beauty, delving into the strategic depths of inbound marketing and SEO. How can you become a digital storyteller, crafting online narratives that resonate with global audiences searching for solutions?

But in a world driven by algorithms, trust remains the golden currency, making a warm introduction from a satisfied client or business partner more valuable than any search engine rankings. It was a reminder that events such as this lunch can help build a solid network of personal and professional relationships.

Finally, we addressed the art of outbound marketing and reading buying signals from other markets. In a world rife with uncertainty, Portugal’s stability emerges as a powerful asset. We are not selling dreams built on shifting sands; we are offering a haven of predictability, a launchpad for businesses and individuals seeking a solid foundation for growth. This, it dawned on us, is our unique value proposition, our opportunity to stand out in a marketplace where turbulence seems the norm.

The Talent Paradox: From Brain Drain to Global Gain?

But Portugal’s allure extends beyond stability. Many tech and tech-enabled businesses flock here, lured by another kind of gold rush: the local talent. Portugal’s solid public education system churns out a stream of skilled graduates, a rich vein of potential waiting to be tapped. This country, with its high-ranking universities and polytechnics, has become an incubator for great minds and agile thinkers.

But what about talent retention? How does a nation, celebrated for its ability to cultivate such promising individuals, ensure that these bright minds don’t just enrich foreign industries but also contribute to the local economic fabric? Some of the guests called Portugal not California, but the “Alabama of Europe”, where recent graduates look for opportunities abroad, driven by the promise of a better future, or simply by a spirit of adventure, to, sometimes, find their way back home. These emigrants, in fact, often return, bringing back not just financial resources, but valuable global perspectives and experiences. They have the potential to become the catalysts for innovation, enriching the local ecosystem with their diverse skill sets. Will this talent diaspora, initially seen as a loss, inadvertently become a source of dynamism and growth?

Ana Teodoro, Kris Manning, Elisa Tarzia, Patricia Casaburi, Rubem Galvão, Costah Bychenkov, Jon Guyett

Policy Flips and a Vision for the Country

Much like the plot twist in your favorite drama, what began as a focused dialogue on marketing strategies abroad quickly expanded into an impromptu summit on Portugal’s place in the global narrative. This pivot wasn’t just serendipitous; it was a clear indication of the depth and diversity of thought present at the table, a microcosm of Portugal’s own complex identity on the world stage.

Portugal’s dance with its historical and economic destiny is complex, marked by both bold strides and cautious steps back. The Non-Habitual Resident (NHR) regime and the golden visa program were once heralded as keystones in the arch of the country’s growth, inviting a surge of foreign investment and talent. Yet, as these policies undergo revisions and restrictions, there’s a sense of recalibration in the air. Businesses and investors alike are left to navigate the shifting sands of regulation, pondering the long-term impacts on the market’s stability and growth.

The education system stands as a testament to the country’s commitment to fostering brilliance, yet it’s at a crossroad. With a significant portion of graduates looking abroad to expand their horizons and careers, the nation faces a pivotal question: is it nurturing a workforce for its prosperity or inadvertently serving as a training ground for the global market?

Amidst these internal deliberations, external spotlights like the Web Summit have cast a glow on Portugal’s potential. This event has positioned Lisbon as a nexus of innovation, but it is not a permanent fixture. The vital conversation now is about the aftermath — ensuring that the country’s economic narrative is not solely tied to transient events but is woven into a sustainable framework of continuous innovation and attraction. Portugal must consider what pillars need to be fortified to uphold its economy and what new chapters need to be written to adapt to the inevitable changes of tomorrow.

Embracing the Paradox: A Business Haven Beyond Labels

As the conversation drew to a close, a clear consensus emerged. Despite its seemingly contradictory identity, its policy flip-flops, and its talent diaspora, Portugal is undeniably a business haven. Its beauty, stability, and vibrant community serve as potent magnets, attracting entrepreneurs and investors seeking not just profit, but a place to live and prosper.

Ultimately, the true strength of Portugal lies not in erasing its identity paradoxes, but in embracing them. It is this very “blurred” nature, this ability to be both traditional and innovative, local and global, that fuels its dynamism and attracts those seeking an alternative to the homogenized landscapes of the modern world.

Did we answer the original question that prompted us to get together? Far from it. Rather than offering a clear-cut solution on how to market ourselves abroad, the lunch served as an invitation to join the conversation, to embrace the contradictions and to contribute to the growth of a country that we all call home.

Costah Bychenkov, Luís Pedra Silva, Jon Guyett, Chris Barton, Terry Hamill, Jarred White, Gemma Hearne

Participants:

BPCC Chris Barton www.bpcc.pt
Pedra Silva Architectos Luís Silva www.pedrasilva.com
IOmergent / Sente Security Jarred White https://sentesecurity.io/
Storytailors James Dubec https://storytailors.com/
Global Citizen Solutions Patricia Casaburi https://www.globalcitizensolutions.com
Bridge-In Elisa Tarzia www.bridgein.pt
Outstanding Investment Properties Eduardo Fonseca www.oiproperties.com
CTR (Hayco Marketing) Jon Guyett https://ctr-group.com/
Teresa Patrício & Assoc Vicky Rodrigues www.tpalaw.pt
Andrew Harrison Andrew Harrison https://invisiblethreadasia.com/
Carvalho Negro Michiel Schwartz www.black-oakcapital.com
Algarve Gems Gemma Hearne www.algarvegems.com
Twine Rami Aladdin https://www.twine.my/
NewCo Roberto Mendonça www.newco.pro
Rayodata Costah Bychenkov https://www.linkedin.com/in/bychenkov/
Corporate Connection Terry Hamill https://www.corporateconnections.com/
Room Space Kris Manning https://roomspace.com/
Brightman Group Anne Brightman www.brightmangroup.com
Room Space Ana Teodoro https://roomspace.com/
Jesper Carvalho Andersen Jesper Carvalho Andersen www.jespercarvalhoandersen.com
Currencies Direct Rubem Galvão www.currenciesdirect.com/portugal
Santiago de Alfama Manuel Rosa da Silva www.santiagodealfama.com
PT-UK Govt Pen agreement

Portugal and UK agree on mutual recognition and exchange of driving licences

The UK and Portugal have signed an agreement on the mutual recognition and exchange of driving licences

An agreement that will ensure continued recognition of UK driving licences in Portugal and an ability to exchange for a Portuguese licence without taking a test has been signed, the British Embassy in Lisbon has announced.

The agreement was signed by British Ambassador to Portugal, Chris Sainty, and the Portuguese Ambassador to the UK, Nuno Brito, at the Foreign, Commonwealth & Development Office in London.

The agreement, once it enters into force, will enable holders of driving licences issued in the United Kingdom and in Gibraltar to continue to drive in Portugal on their existing licence until it expires, provided they register their Portuguese address with the licensing authority.

The agreement also provides the ability for UK and Gibraltar licence holders to exchange their licence for a Portuguese equivalent, without needing to sit a theory or practical test. There is provision for the exchange of expired licences, as long as the licence expired not more than two years before being presented for exchange, as well as for lost and stolen licences, subject to domestic procedures, the embassy explains.

It adds that the new agreement builds on existing arrangements to provide guaranteed and uniform treatment for all UK licence holders, as well as those issued in Gibraltar. The agreement is reciprocal, with Portuguese licences recognised for driving in the UK and Gibraltar and exchangeable without a test if the holder becomes resident.

The agreement will now proceed to the ratification stage in both the UK and Portugal, with the intention that it can take effect at the beginning of 2024.

“I am delighted that we have reached agreement with Portugal that will mean UK licence holders resident here can use their UK licence for the duration of its validity and, if and when necessary, exchange it for a Portuguese one without needing to take any driving test. This allows a level playing field for all UK and Gibraltar licence holders to continue driving lawfully and guarantees recognition and exchange rights for all,” said British Ambassador to Portugal, Chris Sainty.

“The agreement was reached after an extended period of technical negotiations between London and Lisbon, with the continued and active cooperation of the Portuguese Government and the Institute of Mobility and Transport (IMT), to whom I would like to express my gratitude. The result is an agreement that simplifies driving requirements for UK and Portuguese licence holders travelling, working and living in each of our countries, demonstrating a shared commitment to our deep and enduring people-to-people links.”

Mr Sainty added: “We are now working hard with the Portuguese Government to bring the agreement into effect as quickly as possible, replacing the existing interim arrangements. We will provide further updates in due course via our Living in Portugal Guide on the GOV.UK website, as well as through the Embassy’s social media channels.”

Text & Photo:
The Portugal Resident

PNL - human creativity vs AI

Will Human Creativity outlive AI?

Power Networking Guests

In another of our series of brainstorming think-tank lunches we organised a gathering to debate the resilience of human creativity in the face of evolving Artificial Intelligence (AI) in business. Over two dozen entrepreneurs, representing various sectors and perspectives, openly discussed their concerns and how they are coping with the rapid advancement of AI in their respective industries. They particularly emphasised the impact on human creativity and their teams.

Professionals from fields ranging from music to architecture, hotel management to retail, and even preschool education to academia, energy, insurance, and investment, shared their experiences and discussed the AI tools they utilise in their business operations. The primary objective was to identify best practices that help preserve human creativity amidst the increasing intrusion of AI in the workplace.

Within the preschool education sector, there was a notable concern about assisting children in critically evaluating information they encounter on social media and discerning reliable sources on the internet. Furthermore, academia has recognised the potential of paid versions of ChatGPT, enabling students to undertake remarkable projects, consequently necessitating a shift in the teaching paradigm.

Several companies confessed that they would cease hiring interns for routine tasks such as creating presentations or summarising meetings, as these tasks can now be accomplished using AI features, resulting in enhanced work efficiency. The current challenge lies in managing fast thinking (automatic and intuitive) in favour of slow thinking, which is crucial for making significant strategic decisions.

The consensus reached by most participants was that there is no longer a distinct “Future of Work.” Consequently, hiring practices must prioritise candidates with skills in data management and the practical use of AI tools for end-users. The recruitment process has also undergone changes, with candidates completing tasks using ChatGPT, requiring companies to verify their authenticity and confirm that they were completed by individuals rather than machines.

Additionally, it was interesting to observe that the new generation includes individuals who resist manipulation by AI, while others comfortably coexist with it. The concept of photography has evolved into the broader realm of image production, and there is an inherent need for symbols or markers that aid people in distinguishing between what is real and what has been created using AI.

The need for regulation emerged as a prominent theme, with unanimous agreement among participants. The future may involve the certification of individuals or experts responsible for ensuring the ethical and responsible use of AI.

For customers, the current challenge lies in choosing between products or services created with AI or those crafted by human hands. Here, the customer’s preferences still hold sway.

The point worth noting is that the challenge for managers is no longer seeking solutions to problems, as AI rapidly provides them. Instead, the challenge lies in identifying problems in an era characterised by misinformation. The utilisation of creativity will no longer be a prerequisite for problem-solving, as AI will handle it automatically.

AI will elevate the question of “How?” to new heights, compelling the exercise of responsibility and wisdom in an age where wisdom has become scarce, and knowledge has been diluted by information overload.

BPCC CEO, Chris Barton acknowledged Rui Catalão as the inspiration for the theme, Luís Silva of Pedra Silva Arquitectos for sponsoring the pre-lunch drinks, Mafalda Marques of Massive Media for writing the summary and Manuel Rosa da Silva and his incredible team at Santiago de Alfama for hosting the event in such style.

We welcome suggestions for themes for future editions of these brainstorming think-tank lunches at which we address issues impacting on the constantly evolving business landscape.

Participants:

BPCC Chris Barton
Pedra Silva Arquitectos Luís Silva
Atelier Rui Catalão Rui Catalão
Microsoft Manuel Dias (CTO Microsoft)
Galp Frederico Cabral
Farfetch Greg Sherwin
Unipartner Fernando Reino da Costa
Nova SBE / Singularity Programme Diogo Lobo de Carvalho
Streetdrone Beatriz Astride Lopes
Telles Pedro Vidigal Monteiro
Kenton Thatcher Photography Kenton Thatcher
MDS Mario João Vinhas
Area 67 Thiago Barrionuevo
Jesper Carvalho Andersen Jesper Carvalho Andersen
Loja do Gato Preto Carolina Afonso
The Lisboan Martin Harris
Mind Bridges Marisa Lago
Massive Media Mafalda Marques
Carverlon John Gale
Rayo Data Constantine Bychenkov
Santiago de Alfama Manuel Rosa da Silva
British Medals

David Wright – British Empire Medal for services to the Royal British Legion in Portugal.

David Wright

Lisbon Area Representative and lately Vice-Chairman, the Portugal and Atlantic Islands Branch of the Royal British Legion, receives a BEM [British Empire Medal] for services to the Royal British Legion in Portugal.

David Wright is recognised for an outstanding and sustained contribution to the Royal British Legion in Portugal. For many years, as the Vice-Chairman of the Portugal Royal British Legion branch and Lisbon area representative, he has been the driving force behind numerous initiatives to support British veterans and their families living in Portugal, such as the Poppy Appeal, monthly members’ lunches and in particular, for his planning and delivery of the highly successful Remembrance Sunday events in Lisbon.  He has also voluntarily supported other organisations in the Lisbon area with his time and energy with significant benefits to the British and wider community in the Lisbon area, and to the UK’s reputation in Portugal. 

On learning of his award, David Wright said: Receiving this award is an extraordinary honour. I am deeply grateful and humbled to be recognised in this way. It is also very much a testament to the support and encouragement I have received from my family, friends, and colleagues along the way. We have enjoyed some great times together.”

Sander Van Gelder

Former Vale do Lobo owner Sander van Gelder dies aged 85

Sander van Gelder, the Dutch entrepreneur best known for turning the Algarve’s luxury resort Vale do Lobo into a success story, passed away on Sunday (May 14), at the age of 85, in the Netherlands.

Born in Amsterdam in 1937, Mr van Gelder discovered Vale do Lobo during a holiday in the mid-1970s. His initial goal was simply to purchase a holiday, but after having recognised the resort’s potential, he decided to buy it and moved to Portugal in 1977.

“At that time, the image of Portugal wasn’t famous as the revolution had shaken the credibility of Portuguese institutions. But although specialists advised against investing economically in the country, I decided to take a risk,” the entrepreneur told Correio da Manhã over 20 years ago.

The resort was run under his ownership for the next 30 years, a period in which an 18-hole golf course and many facilities including bars, restaurants and shops were built.

Vale do Lobo went on to thrive, cementing its place in the so-called Golden Triangle consisting of Vilamoura, Quinta do Lago, and, of course, Vale do Lobo. His work at Vale do Lobo was recognised by the Portuguese government which awarded him a ‘Gold Medal of Touristic Merit’ in 2004.

In 2007, Mr van Gelder sold Vale do Lobo to a group of Portuguese and international investors, including the largest national bank Caixa Geral de Depósitos.

Alda Filipe, presently Regional Director at Kronos Homes who worked alongside Mr Sander van Gelder for many years, has elaborated on the impact that the entrepreneur had on the region as a whole.

“A truly exceptional person has passed away. We must honour and remember the extraordinary legacy of Mr. Sander van Gelder, the beloved ‘father’ and visionary behind Vale do Lobo Resort for over 30 years (1977-2007),” she said.

“Mr van Gelder’s dedication, leadership, and entrepreneurial spirit were the driving forces behind the remarkable success of Vale do Lobo. With his unparalleled insight, he envisioned a community that seamlessly blended luxury, natural beauty, and a vibrant lifestyle.

For three decades, Mr. van Gelder guided Vale do Lobo with unwavering commitment, nurturing its growth and transforming not only the place but also the entire Algarve region into a world-renowned destination.”

Alda Filipe added: “On a personal level, I had the privilege of working closely with Mr van Gelder for many years, and he had an immense impact on my life, both personally and professionally. He not only served as my mentor but also challenged me to push beyond my limits, encouraged me to embrace new opportunities, and inspired me to strive for excellence. Together, we shared countless unforgettable moments.

“The legacy left by Mr. van Gelder is enormous and will forever remain present in Vale do Lobo and in the lives of all those who had the privilege of crossing his path.”

Text & Photo:
The Portugal Resident

UK Border Control

Border Target Operating Model – alterações no controlo de fronteiras no Reino Unido

O Governo britânico publicou, no dia 5 de abril, um draft sobre o novo modelo de funcionamento das fronteiras (The Border Operating Model ou BTOM), aplicável a todas as importações do Reino Unido, não apenas às da União Europeia.

A proposta pretende definir a gestão das fronteiras do Reino Unido após o termo do período de transição do Brexit. O objetivo do BTOM é facilitar o fluxo regular de bens e pessoas através da fronteira, garantido simultaneamente a segurança e o cumprimento dos requisitos legais.

O documento propõe várias alterações em três componentes principais:

  1. Pessoas: o governo planeia recrutar e formar pessoal adicional nas fronteiras, a fim de assegurar a existência de recursos humanos suficientes para fazer face ao aumento previsto da procura. Para o efeito, será necessário proporcionar formação adicional aos trabalhadores existentes e introduzir novos instrumentos e tecnologias que ajudem no desempenho das funções de forma mais eficaz.
  2. Processos: visa racionalizar os procedimentos nas fronteiras e reduzir a necessidade de controlos físicos sempre que possível. Isto inclui o desenvolvimento de novos procedimentos e normas para melhorar a eficiência e reduzir os tempos de processamento, bem como o investimento em novas tecnologias e sistemas para apoiar estes esforços.
  3. Tecnologia: envolve a implementação de novos sistemas e tecnologias para apoiar o fluxo de bens e pessoas através da fronteira, incluindo novos sistemas digitais para gerir as declarações aduaneiras e a utilização de novas tecnologias, como o reconhecimento facial e a leitura biométrica, para melhorar a segurança nas fronteiras e reduzir a necessidade de controlos físicos.

Saiba mais sobre o Border Target Operating Model e as alterações propostas para as importações aqui.

Francisco Sottomayor

The landscape of Portugal’s hospitality and residential tourism market

Portugal’s continued popularity as a holiday destination, despite consolidation, has been reflected in the growth of hotels and hotel resorts since 2017, with record numbers of new hotels coming onto the market in 2022. But is the market now saturated. The British-Portuguese Chamber of Commerce invited the CEO of Norfin, Francisco Sottomayor to shed some light on the matter.

In recent years Portugal has been highly acclaimed in the international media and amongst tourism commentators and influencers worldwide, having received countless distinctions and awards as a tourism destination such as the World Travel Awards ‘Europe’s Leading Destination 2022’.

In fact, the weight of tourism on Portugal’s GDP leapt from13% to 15% between 2016 and 2019 – a record year in which almost 28 million visited Portugal. However, with the onset of the Covid-19 pandemic, that figure fell down 10% of GDP in 2021 with fears that the destination had peaked and could return back to numbers seen before the boom years.

That fear was unjustified and tourism numbers bounced back in 2022 to achieve almost as high numbers as in 2019 – a year earlier than had been projected by local industry associations and experts.

Francisco Sottomayor

The number of overnight stays by tourists has also increased significantly over the past decade. Between 2011 – the year in which Portugal had to ask the IMF for financial help – and 2018 overnight stays enjoyed a Compound Annual Growth Rate (CAGR) of 5.5%, while in 2018, 2019 and 2022, the number of overnight stays has remained constant at 57-58 million.

From 2018 to 2022, the number of beds in Portugal grew at a CAGR of 3.1%, which resulted in a slight decrease in occupancy in 2022 on 2019. Nevertheless, last year the Portuguese hospitality market recovered to pre-pandemic levels, achieving a record year in terms of revenues (Revpar +13% on 2019)) and Average Daily Rate (ADR) across all regions. (Lisbon +8.9%), Algarve +17.5%, Porto and the North +7.7%, Madeira +34%)

This encouraging data from Portugal’s National Statistics Institute, which recorded an average national spend in hotels per person of €56.2 per night (+13.8%), had more to do with increased average prices because of inflation (+16.4%) than it did with room take-up rates which actually fell 2.2% or 1.2 points to 54.1% in 2022.

Portugal’s tourist distribution

Lisbon, Porto and the Algarve are the main epicentres of Portugal’s tourism market, driving most of the sector’s growth, with the Algarve accounting for one-third of national hospitality supply in number of beds, being the only region in which the largest slice of overnight stays are foreign (The UK being Portugal’s biggest market in the region at 27%).

However, in terms of growth, the north of Portugal has enjoyed some of the greatest success in recent years with Porto now one of the fastest growing tourist destinations in Europe with average overnight stays and RevPAR at 3.1% and 2.5% in the last three years. RevPAR increased 7.7% or €3.3 on 2019 to a record €46.2, with an average daily spend increase up 13.5% or €11.1, more than compensating a fall in take-up rate of 5.1% (2.7 points) to 49.2%.

The Algarve was also the region which most suffered from the effects of the Covid-19 pandemic, with the number of overnight stays dropping by 64% YoY in 2020. Initial forecasts had suggested a full recovery to pre-pandemic levels in 2023-2024, however, the Portuguese hospitality market outperformed expectations with almost a full recovery last year.

A challenging environment for tourism investment

However, the Covid-19 pandemic, the energy crisis, high construction costs, inflation, high interest rates and the war in Ukraine, all of which combined together to create a perfect storm, have not made the prospects for investment in Portugal’s tourism sector easy.

Norfin CEO Francisco Sottomayor predicts the start of a slowdown in revenues, although how far would depend on how economies reacted to inflation.

Growth in tourist numbers would also depend on how quickly Portugal’s government decided on a new international airport for the Greater Lisbon Metropolitan Region which would impact on investment in hotels growth from large multinational operators in the market, since greater airport capacity inevitably would mean more tourists and more tourists require more hotels.

“I don’t like saying that we are a small market, but the truth is that we are and although there is a lot of capital that wants to enter the Portuguese market, the opportunities are less than they were”, said Francisco Sottomayor, who has been at the helm of Norfin (now part of the Arrow Group), a real estate asset management company with 22 years in the Portuguese market and some €1.5Bn of assets currently under management.

Norfin is one of the largest real estate investment managers in Portugal. So far this year it led the acquisition of assets at Herdade da Aroeira (a gated community 30 minutes from Lisbon), while in 2022 it began construction of the Monview apartments development in Miraflores, joined Whitestar in officially launching another apartment development, Antas Green, in Porto, the residential development Lisbon Heights, the new Campo Novo neighbourhood in Lisbon, the Oriente Green Office Campus development also in Lisbon, and announced that it had €500 million to invest in hospitality over five years.

Its existing diverse portfolio includes, the Office Park Expo (Campus da Justiça, a complex that serves as a “Justice Centre”) and is a reference on the Iberian Peninsula, and the Prata Living Concept and Metropolis, all in Lisbon.

Francisco Sottomayor joined Norfin in March 2020 where he is also responsible for real estate business at Arrow Portugal, after a long and illustrious career in asset, development and project management, which included being Head of Development at CBRE Portugal for 11 years, and director of asset management at Parque Expo, the company that was responsible for the design and implementation of the largest integrated urban regeneration project in Lisbon, today called Parque das Nações.

Addressing a group of select business people at the British-Portuguese Chamber of Commerce event in April, Francisco Sottomayor said: “There has been a lot of doubts as to whether the Portuguese market has the capacity to continue to grow at recent rates, but Portugal has remained as and will continue to be a relevant destination, and despite higher air fairs, because of the relatively short times it takes to get to its main European tourist markets.” (Spain, UK, Ireland, Germany, France, Holland and Scandinavia)

Sala Peq-Almoço Norfin

Boom in new hotels

The transaction volume of hotels in the Portuguese hospitality real estate market has been nothing short of staggering over the past years, going from €53 million in 2017 – the year the tourism boom began — to €904 million in 2022.

“We have a hospitality market that is very consolidated terms of hotels, 60 of our hotels in Portugal are independent, but from these we will likely see a transfer from individual operators to more professional operators, with a refurbishment and upgrade of the Portugal’s existing hotels,” he said.

The most important real estate hospitality transactions were made by international private equity firms, however asset management,

insurance, and real estate companies have also been involved in some of the big ticket deals since 2019.

Undoubtedly, the biggest deals were Project Crow by the US private equity firm Davidson Kempner involving 18 properties for €850 million, the US asset management firm Invesco with the Tivoli Portfolio for €313 million, the Spanish private equity company Azora which purchased a Pestana hotel building in the Algarve (€307 million), Palminveste real estate company with the Real Hotels portfolio (€300 million), and the US Carlyle private equity company with the Penha Longa Resort, Lisbon (€100 million).

Despite the pandemic and economic uncertainly caused by inflation and high interest rates — which led to the postponement and/or rethinking of many hotel projects — hotel openings are expected to add 11,320 keys to the sector with 130 new hotel projects to 2025, of which 37 will be in the Lisbon Metropolitan Area, the big players being SIG – Sani & Ikos Resorts (5), Hyatt (5), Radisson (4), Melia (5), Mercan (3), and Marriott (5), among others.

That said the Portuguese hospitality sector is still very fragmented, 84% of hotels are either part of a small family business or a small hotel chain. Portuguese owners control two of the country’s largest hotel groups, Pestana (73 – 5.4% of all hotel beds) and Vila Galé (25 – 1.2% of all hotel beds).

Other Portuguese hotel groups in the top 20 that are important in the market include Hoti/Meliá (19 units), SANA (13 units), VIP (12 units), Discovery – DHM (16), Turim (16), Porto Bay (12), Dom Pedro (7), NAU (10), Fénix HF (9), and Luna (13).

The Residential and Branded Resorts market

Without a doubt one of the markets that has most grown over the past few years is the residential resorts market with sales volume increasing by around 20% in 2022 compared with the same period in 2021.

The greater diversification of nationalities in the various destinations coupled with the strengthening of the British in their traditional market of the Algarve can be seen in the context of increased sales of homes in gated resorts, with this 20% growth in units sold translating into one of the highest activity levels seen in this sub-sector since 2017.

Albufeira-Loulé and the Atlantic Coast accounted for one-third of sales each, Barlavento and Sotavento also had around 20% each. Regarding average price, Albufeira-Loulé posted average sale prices of €4,625/m2, while Barlavento and the Atlantic Coast registered sales of around €3,000/m2 and €3,800/m2 respectively.

But with the end of the Golden Visa programme by which overseas non-EU citizens purchased the right to residency in exchange for a property investment of €500,000 or over, how far will Portugal’s residential resorts be damaged in terms of demand and will the large equity and real estate funds rethink their residential tourism strategies linked to hotels and hotel resorts?

Pedro Fontainhas, the CEO of the Portuguese Association of Residential Tourism and Resorts (APR) admitted that it had received calls from clients and investors who had suspended their investments since the government made its announcement on February 16.

According to Pedro Fontainhas, the Government had ended the remaining parts of the programme linked to real estate investment that had been left out when the Government terminated it in Lisbon, Porto and along large swathes of the Algarve coast a year before.

The resorts industry head points out that tourism units are not the same as housing in urban areas like Lisbon, but rather a parallel real estate offer integrated into a resort offering a number of tourism services and aimed at temporary use for both the Portuguese and foreigners.

“Unfortunately, the damage has been done and we don’t understand the arguments as to why the Government would want to end the Golden Visas for tourism. For many hotels, the end of the programme will not have a big impact, but there are many tourist projects that were designed specially to work for hotels with branded residences with the Golden Visa in mind, which is in my view one of the intelligent ways for investors in tourism to qualifying their offer of integrated products” he said.

The APR head believes that the Golden Visa offered in exchange for a property within a hotel resort had a positive effect of reducing the demand for temporary homes, and adds that the Government’s measure is senseless because “we’re once again showing the total instability of our legal and tax system which conveys a poor image of Portugal and its government.”

It is a concern that Norfin can relate to since one of its new developments is a tourism development close to the beach at Carcavelos, in a branded residences format which will be associated to an international hotel chain, work on which started this year — a project that will not be able to benefit from Portugal’s Golden Visa programme which had already been scrapped along the Estoril/Cascais coast in 2022.

Chronic staff shortages

Portugal’s tourism sector is vital in terms of employment, employing around 20% of Portugal’s workforce either directly or indirectly.

And if traditionally hospitality is badly paid in any country, in Portugal it is particularly poorly paid ranging from €36,293 per annum at the top end and as little as €10,897 at the bottom, depending on region, experience, qualifications and number of years in service.

Even more stark is the difference in salaries that men get compared to women with a good salary for men considered €45,407 compared to women’s salaries of €22,431 according to averagesalarysurvey.com

Poor pay, coupled with long and unsociable hours, and the high cost of accommodation saw many in the industry who had been laid off during the Covid-19 pandemic use the time to re-skill. The result is that they voted with their feet and left the profession leaving Portugal’s hotels understaffed by around 20,000 and forced to bring in employees from other Portuguese speaking countries to fill the vacancies.

It was an issue addressed to the Norfin CEO at the BPCC event, admitting that hiring and keeping qualified staff was an issue while “our workforce doesn’t want to do shift work, so we don’t have any alternative but to recruit staff from overseas”.

The second problem for hotels is putting staff up, particularly in out-of-town areas like Comporta in the Alentejo. In the Algarve some hotel chains have resolved the problem by providing accommodation at affordable rent. Either way, providing accommodation is “fundamental for the sector” and Portugal’s sustainability as a tourist destination. “We have had the absurd situation in the Algarve where in August some hotels have had to reserve some of their room stock to accommodate the staff!”

The Chinese and US markets

Although the Chinese market has had some influence in Lisbon and Porto, Francisco Sottomayor says that Chinese visitor numbers are low and have had a residual impact in the Algarve. “The Chinese market is not really very relevant for us”.

On the other hand, the US market, being a large market with a high spend per head, has potential to have a big impact in Lisbon, Porto and other regions too.”

The Norfin CEO noted the remarkable increase in US tourists to Portugal which was extremely relevant and had practically been non-existent a few years ago. For example, according to the Portuguese tourist board Turismo de Portugal, between January 2022 and November 2023 overnight stays from US holidaymakers in Portugal posted a growth of 353% while the number of guests increased 360% to 1.1 million tourists. (200,000 more than in 2019)

Americans, he said, primarily were motivated by short stays in several countries to discover Europe, but the potential of the American market for Portugal’s tourism sector was huge. “The Americans tend to go where there are US hotel chains and I think the fact that large chains are moving into or expanding in Portugal (Sheraton, Marriott and Hilton) is a sign the recognise this.

Of course, part of this success has to with the work on marketing campaigns and investment the Portuguese tourist department has made in the US market, and which had been tremendously successful, but had also been the fruit of public-private cooperation between Turismo de Portugal, the airlines such as TAP, and the large hotel groups.

“There is also something in Portugal too that reminds the Americans in their collective memory of how Florida and California were in the 1950s and 1960s and which they can identify with, particularly in the seniors market. It might be a very small part of the market, but given the sheer size of the US market, a small part is significant for Portugal”, he concluded.

Text and photos:
Chris Graeme
Essential Business

Crypto Coins

The impacts of crypto in business

Most people think they know what crypto currencies and blockchain are. But do they really know how it will impact business and what are the ramifications for the future? Essential Business eavesdropped on a webinar organised by the British-Portuguese Chamber of Commerce who invited Hugo Volz Oliveira from the instituto new.economy and lawyer Fernando Pereira Pinto from RMV & Associados to find out more.

The Portuguese Government rejected two bills to tax crypto in 2022, but a new bill is now on he books to tax and regulate crypto assets starting from this year.

“Under current Portuguese tax law, capital gains from crypto investments are seen as a form of payment — a currency, but not an asset — and are not taxed so long as they do not serve as an individual’s main source of income. This is a result of a lack of legislation rather than an active policy by Portuguese lawmakers”, says Hugo Volz Oliveira, secretary-general of the New Economy Institute, a Portuguese nonprofit founded by leading Web3 companies and backed by the Near blockchain, the web browser Brave and several Portuguese universities.

Hugo Volz Oliveira

Hugo says that the New Economic Institute is a fintech and crypto sector lobbying association which strives to keep Portugal crypto friendly and help consolidate its position as the crypto and blockchain hub which it has become in recent years.

This success was thanks, in part, to the Covid-19 pandemic and the Non-Habitual Resident tax regime. However, it was also due to the lack of a clear taxation framework resulting in a lot of expats deciding to move to Portugal and setup their companies and tap into the local talent scene.

In 2022 an amendment was put forward that would compel tax authorities to tax capital gains from personal crypto investments beyond €5,000 ($5356).

The other was to have imposed a flat rate tax of 28% on all crypto gains, which is the normal capital gains tax in Portugal for residents. But final version of the 2022 budget, didn’t include these bills when approved by the Portuguese parliament.

Then things changed. The Government announced a new proposal for taxing cryptos in October 2022, which was to be included in the budget for 2023. However,  Portuguese Finance Minister Fernando Medina decided to hold off until policymakers in Brussels reached a new European consensus on the matter.

That consensus was finally reached last Thursday when the EU Parliament voted 517 in favour and 38 against to pass the Markets in Crypto Act, or MiCA. The legislation, which seeks to reduce risks for consumers buying crypto assets, will mean providers can become liable if they lose investors’ crypto-assets.

In Portugal, under Category C of its tax regime, sales of crypto owned for less than 365 days will now be taxed at a flat tax rate of 28% on the capital gain when made for fiat money, or at progressive tax rates between 14,5% and 53% if the income is received by a Portuguese tax resident who choose to aggregate it.

The New Economy Institute, which Hugo Volz Olivera is the Secretary and a Founding member,  was created in 2021 to present a single “face” to the government with clear and coherent arguments. However, its member had been working in the space even before Bitcoin was created in 2009.

The association started with just 20 members, but has been growing rapidly in the Portuguese community. Its strategy has three vectors: to educate and influence key stakeholders and the public, transform and shape favourable regulation and legislation, and help build strong relations both locally and globally.

“We work with crypto and some of our customers are really interested in knowing what the future holds but this is a journey on which we are all learning together,” he says. 

But for those who are still new to the world of crypto, it is worth starting off by explaining some of the basic terms.  

BlockChain

What is blockchain?

Blockchain is the most popular application of distributor ledger technology. It is just a way to keep a ledger of entries for accounting in a distributed way with all participant guardians in the network keeping a copy of that ledger to ensure they agree its content. Basically, it is the latest evolution of accounting. It is a linear change that organises transactions in blocks of transactions lining them through mathematical formulae called hash (Grouped into hash tables) and using public key encryption (cryptography). It is tamper proof. 

The core idea is not actually new, but the technology is. For example, in Medieval times tally sticks with notches were widely used as an alternative to currency to record bilateral exchange and debts, particularly in England when silver currency ran short in certain reigns (Henry IV and V for example). 

The longer part was called ‘stock’ and was given to the party which had advanced money (or other items) to the receiver. The shorter portion of the stick was called a ‘foil’ and was given to the party which had received the funds or goods.

Using this technique each of the parties had an identifiable record of the transaction. It is where the word ‘stock’ originates from and the idiomatic saying ‘it just doesn’t tally up’ when someone is telling a lie or half truth, or that something doesn’t make sense.

What is Bitcoin?

Bitcoin (BTC) is a cryptocurrency, a virtual currency designed to act as a currency or measure of value and a form of payment outside the control of any one person, group, or entity, thus removing the need for third-party involvement in financial transactions. The first prototype was created in 2009. However, it is NOT fiat money. 

“Bitcoin was not always secure. Today it is because of the size of the network and it is almost impossible to hack,” says Hugo. 

Bitcoins

What is crypto?

Crypto is a digital currency in which transactions are verified and records maintained by a decentralised system using cryptography, rather than by a centralised authority like a central bank. Decentralised cryptocurrencies such as Bitcoin now provide an outlet for personal wealth that is beyond restriction and confiscation.


Crypto started with Bitcoin, a concept unveiled to the world in 2009 in the aftermath of the financial crisis. Satoshi Nakamoto is the pseudonym used by the creator (or creators) of Bitcoin. The identity of Satoshi Nakamoto is not publicly known. One of the first major public investigations ended with Dorian Nakamoto being identified as Bitcoin’s creator, but he continues to decline the claim.

Put simply, it is just a computer network in a similar way that the Internet is also a computer network. It enables the user to exchange the Bitcoin or other digital currencies without having to rely on an intermediary such as a bank. It is why it is sometimes referred to as peer to peer digital cash.

What made it different from previous peer-to-peer transactions was that it was the first to solve a number of issues related to trust and it did so through Blockchain technology.

Today there are many other cryptocurrencies which are smaller, the most commonly known being Etherium, Dodge, Tether, BNP, USDC, XRP, Cardano and OKB.

Data Miners

What are miners?

These are the people validating the blocks while mining is the process of creating new digital coins with miners being incentivised to act in the interest of the network.

Bitcoin mining is the process by which new bitcoins are entered into circulation. It is also the way the network confirms new transactions and is a critical component of the blockchain ledger’s maintenance and development. “Mining” is performed using sophisticated hardware that solves an extremely complex computational math problem. The first computer to find the solution to the problem receives the next block of bitcoins and the process begins again.

Are crypto currencies money?

Although crypto it is called a currency, they are actually tokens or units of measure or units of account  and not money from a legal perspective. The only thing that can be called money in the Euro Zone is the Euro for now. When you owe money, you have a specific type of currency units that can be used to settle the debt. For example, you cannot pay your taxes in bitcoin. Cryptos can be seen as a store of value but not actual money because it is not backed by any assets, such as gold or silver — but neither is the US dollar. However, the US dollar is backed by the federal government and the Euro by the European Central Bank. Cash money and crypto are different because crypto is decentralised and not backed by any government or institution.

Crypto coins and tokens – what is the difference?

Crypto coins are designed to be used as currency, while crypto tokens are intended to represent an interest in an asset and facilitate transactions on a blockchain. 

Crypto tokens and cryptocurrencies share many similarities, but cryptocurrencies are intended to be used as a medium of exchange, a means of payment, and a measure and store of value.

Crypto tokens, on the other hand, are often used to raise funds for projects and are usually created, distributed, sold, and circulated through an initial coin offering (ICO) process, which involves a crowdfunding round.

The single most important concern about crypto tokens is that because they are used to raise funds, they can be and have been used by scammers to steal money from investors. People like Hugo and other experts in the crypto world are working hard at different levels to ensure this can’t happen.

Crypto tokens operate on a blockchain, which acts as a medium for the creation and execution of decentralised apps and smart contracts. The tokens are used to facilitate transactions on the blockchain. In many cases, tokens go through an ICO and then transition to this stage after the ICO completes.

While crypto tokens generally facilitate transactions on a blockchain, they also can represent an investor’s stake in a company or serve an economic purpose, just like legal tender. This means token holders can use them to make purchases or trades just like other securities to make a profit.

Non-Fungible Tokens

Non-fungible tokens are unique cryptographic tokens. They are digital watermarks that can be used to establish provenance and ownership of many types of assets, from tweets to artwork and real estate.

The market for NFTs is still nascent. As physical assets increasingly become digitised, it is expected to multiply in the future.

Physical money is fungible. It can be exchanged at parity: one unit of physical currency is always equal to another unit. This fungibility characteristic makes money an ideal medium for daily transactions.

As their name indicates, non-fungible tokens cannot be exchanged at parity with each other. Instead, they are used for unique artefacts with unequal valuations. For example, it is difficult to establish the price for a valuable painting.

Non-fungible tokens are ideal for business transactions that do not have the frequency or rapidity of daily transactions. For example, an NFT can be used to digitally encode attributes pertaining to paintings to speed up the transactions, confirming when the painting was made, if there are counterfeits, and if it has the artist’s signature.

The new European regulations will not be viewing NFTs as crypto assets unless they are issued in a way that they are seen as regular tokens, in which case under the new MiCA regulation they will be viewed under the crypto-asset category.

White Papers

One thing that will become mandatory when creating a cryptocurrency is the issuance of a comprehensive document outlining the technical and economic aspects of a specific cryptocurrency. This is called a white paper. (Nothing to do with UK parliamentary legal bills)

It is typically written by the cryptocurrencies development team or core members and serves as a guide for potential investors, miners and users. 

A good white paper should explain how the technology will work, so if you can’t articulate what problem the project solves and how it does so, the white paper is not considered good. You need to lay out a compressive description of the activity to provide to your customers.

What is MiCA?

The EU’s new MiCA regulation, which demands these white papers, is a way to protect customers and the financial institutions against abuses and illicit activities that up until now have not been regulated.

If you go over certain limits of crypto transactions, either as a stable coin or project, there are certain restrictions aimed at mitigating system risk by ensuring that the systems are distinct and ensure that crypto does not negatively impact the banks as was the case with Silicon Valley Bank.

The impact for MiCA in Portugal is that if you get a licence in Spain, you can operate in Portugal. If you get one in Portugal, you can operate in the Netherlands and the other EU countries, which will incentivise efficient licensing processes. 

Either way, MiCA means that regulation has arrived and is here to stay, but regulations are also becoming more complex and lawyers will be of the essence to give legal advice.

While until now crypto currencies are not money, under the new MiCA framework with stablecoins* (*A cryptocurrency which has a value that is pegged or tied to another currency, commodity or financial instrument) and e-money being issued on the blockchain, it will, in the opinion of Fernando Pereira Pinto of RMV & Associados, become money eventually and could become a new norm for settling transactions.

Crypto Price volatility

How do businesses account for crypto price volatility?

Just as in finance where you have swaps to deal with financial volatility, in crypto it is the same. You can short your long positions on future markets and so are hedged. All of the traditional financial instruments have now been developed in crypto if businesses don’t want the volatility. In other words it is like any other financial or non-financial asset and companies need to balance and spread the risk in their portfolios accordingly.

Is crypto a valid payment method in Portugal?

Fernando Pinto stresses it is not legal tender or an official currency and you cannot pay your taxes with it. However, if someone accepts it as a means of payment it can be used to settle a transaction.

How is crypto taxed in Portugal?

Although a tax framework was approved for taxing companies dealing in crypto assets in November 2022, to come into practice in 2023,  until December that year there had been no clear tax regime for the taxation of crypto assets for individuals. “We had not got the news that the Government and tax authorities wanted to change the situation regarding IRS tax on capital gains made from crypto transactions by individuals, despite some things like gold, art and wine trading not being subject to individual IRS taxes”, says Hugo.

“Portugal was forced by the European Union to close the loophole since most of the other countries in the EU had a tax framework”. Slovenia was the only country apart from Portugal to have 0% taxes, while Bulgaria and Rumania had 10% taxes on individual capital gains on crypto asset transactions, with Croatia at 12%, and Czech Republic, Greece and Hungary at 15%”, he adds.  

For the future the EU wants to create a harmonised tax regime for crypto, but this could take time to develop. Outside the EU there are countries which offer a very attractive tax regime on crypto like Switzerland, UAE, Lichtenstein, Singapore and the UK included, the latter making plans to make London a global crypto marketplace and the financial capital of the crypto world.

“We in Lisbon are in direct competition with London now; a partnership of 700 years seems to be doomed by the crypto domain”, he jokes.

At present the main tax regime is on capital gains, paying 20% taxes unless you hold the asset for 365 days in which case you pay 0% on net capital gain.

However, if you sell a crypto and exchange it for another crypto currency you pay no taxes. You can make a profit by selling Bitcoin to a stablecoin – a stablecoin, as explained before, is a digital currency that is pegged to a “stable” reserve asset like the US dollar or gold. Stablecoins are designed to reduce volatility.

An example would be to sell crypto in exchange for a stablecoin, wait for 365 days, and then sell it for fiat currency and in that case any profit would not be taxed. 

Companies that provide services related to cryptocurrency, on the other hand, are taxed on capital gains on a scale between 28 and 35 percent.

In Portugal, if you trade bitcoin as your primary source of income, you must file a tax return and pay taxes on your earnings.

Fernando Pinto says that some aspects to take into consideration to determine if your trade activity will be considered as your profession by the Portuguese tax authorities are: the frequency of your trade (on a daily/weekly/monthly basis), how many trading platforms you’re using, your profit level, and your main activity to generate income from.

If you are an individual trading on a regular basis you get taxed on the applicable brackets (Category B) for personal income.

There is still work to be done on clarifying reporting requirements, and this work is being done with the Ministry of Finances so that by later this year the rules will be clearer so that individual know in April 2024 when they have to report their crypto profits and transactions. “We know it will be fairly simple and the goal is to make it attractive for everyone who is engaged in crypto in Portugal”.

Another aspect to be taken into consideration is the FIFO rule which stands for “first in first out.” It is a rule that has applied to Forex trading since 2009. For crypto, it would mean that, of a given coin, you would have to sell your oldest holdings first and newest holdings last. In other words, for tax purposes, the FIFO method considers that the first coins you purchased are also the first coins you sold when calculating the cost of goods sold (COGS) and associated taxes on profits. 

But if the first one you bought was over one year ago, you would have to report that, but it would be subject to 0% tax. This is very attractive for long-term investors and will steer people away from day trading and speculative trading since most people, unless they really know what they are doing, lose money from that. For those who are speculative traders, they can benefit from the 7.2% tax up to a maximum of €200,000 per year.

Can you buy houses with crypto?

It is now possible to buy a property with bitcoin in Portugal. The first time this happened was in May 2022, when an investor bought a Portugal crypto house in the northern city of Braga. However, as Fernando Pinto points out, you are not actually buying a property with crypto currency, you are swapping  crypto currencies for a house. For a purchase and sale agreement you need money, otherwise you are just swapping or doing a ‘permuta’ as it is called in Portugal. 

The IMT, which is the big tax on real estate purchases in Portugal, is only charged on the difference of the value of the assets being swapped.

That means that if you sell a house foe €1.5 million, the buyer offers the equivalent of €1.2 million in digital currency you only are taxed on the difference. In other words you just pay the 0.8% stamp duty.

Buy House

However, the tax authorities will tax the person on their capital gains they have made for any transaction, houses or other, and so will get their money one way or the other in the end.

Was is the practical extent of crypto in corporate finance?

Cryptocurrency can also help improve financial transparency and reduce corruption by creating a decentralised and transparent ledger, which can help to increase trust in financial systems globally. The use of smart contracts can help automate the execution of financial agreements and reduce the need for intermediaries.

Crypto also provides a new avenue for enhancing a host of more traditional Treasury activities, such as: Enabling simple, real-time, and secure money transfers, helping strengthen control over the capital of the enterprise, and managing the risks and opportunities of engaging in digital investments.

“Right now it is an emerging field so there are no mature or sophisticated corporate finance platforms based on crypto, but they are emerging, with many banks and other financial institutions doing trials and pilots. It can be about improving the financial infrastructure, with better and faster settlement, and certain countries are using blockchain (ratter than crypto) for this because it is transparent and trustworthy”, explains Hugo.

here have been some cases where Etherium has been used to settle international trade finance deals, and to settle ledgers of finance and credit in different countries.

It should also be noted that a positive result of crypto when it arose in 2009 is that if forced the banks to come with easy digital payments systems for customers to use, an example being MB Way in Portugal.

Crypto and the metaverse

One aspect that is heard a lot and baffles the ordinary man in the street is the relationship between the Metaverse and cryptocurrencies. 

The metaverse is a vision of what many in the computer industry believe is the next iteration of the internet: a single, shared, immersive, persistent, 3D virtual space where humans experience life in ways they could not in the physical world.

Investors have so far generally been favouring Bitcoin, Ethereum, Solana and Bicance Coin. However, since the rise of the metaverse, the crypto world as become even more diverse.

Users of the metaverse can develop a digital life similar to the one they know in the physical world. However, they have no real banknotes or coins. The concepts of metaverse and cryptocurrencies are linked by the need to operate with a virtual currency with which to make transactions in this digital space. 

Cryptocurrencies are the money of the virtual world, and are therefore necessary to buy land, art, clothes or even experiences. In this way, a property in the metaverse can increase or decrease in value just as it does in the real world. In addition, major luxury brands such as Balenciaga, Gucci and Louis Vuitton have already entered this new dimension. 

In this context, metaverse and cryptocurrencies function just like official currencies and the physical world. And although the transactions are virtual, the acquisition of virtual currency is the result of a purchase or sale transaction with real currency.  

“The metaverse right now is enabling companies to promote their services in this digitised world. People are locking their savings into this and trying to capitalise on them in the metaverse.

Regulations

Regulatory framework in Europe

Regulating the crypto economy has always been a contentious topic, never more so than when FTX, the third largest ‘stock’ market of crypto assets collapsed and sent the value of currencies like Bitcoin tumbling.

But trading platforms like FTX, like a stock market, is just an interface with that market and has little to do with the technology or the applications of the crypto economy. The collapse of FTX was not down to a failure in technology or an apparent lack of regulation. Indeed, approved regulation already exists which could have prevented the meltdown if it had been in force.

Hugo says that on the one hand, regulation must be dissociated from new technologies, including the decentralised networks on which the crypto economy is based – such as Bitcoin, Ethererium or even the Internet – the regulation of entities that bridge the gap between crypto assets and the real economy – namely centralised exchanges and custody platforms.

The latter have already subject to considerable controls in the field of publicity and prevention of capital laundering and the financing of terrorism, with the supervision of various central banks since 2018.

But these operators have adopted traditional structures, such as financial institutions and payments institutions (like the banks and SIBS in Portugal) which are already regulated.

On the other hand, once the sector’s interaction with the financial system has been resolved, there is a general consensus, even among purist supporters, that the regulation of the crypto economy must involve, above all, the protection of consumers and investors and the mitigation of risks.

In both cases there is the new European Regulation of the Cryptoassets Market or MiCA, preparation on which began in 2018 and was completed in 2024. 

This regulation, which came into force this year, and will be applicable from 2024, sought to balance the development of innovation and financial stability with an approach tailored for the different risks in the industry.

The main principle covers investment products, stablecoins and the entities that provide services with crypto assets, i.e., markets and custody platforms.

It is important to note that MiCA would not have been able to prevent the collapse of FTX since, for the time being, it is a European regulation and FTX was based between Antigua and Barbados  and the Bahamas. However, FTX served Europe through a subsidiary licensed in Cyprus, meaning MiCA could have theoretically guaranteed that the funds of the accounts of EU citizens would be segregated from FTX own funds.

And although MiCA is a good first step to establish a clear regime, even if it is not yet simple, there is still a long way to go in terms of preparation so that regulators realise that this new system is not like the traditional one. This is because the crypto economy is based on different fundamentals – like own custody of funds and transparent access to distributed networks – and so therefore should not be regulated in the same way, except markets like stock markets and equivalent financial institutions, which should be regulated as such. 

In either case Europe is leading the way in the evolution of regulations which started to counter money laundering and financing terrorism. Europe will be the first major jurisdiction to have a coherent regime focused on protecting users, setting clear rules for stablecoins, exchanges, custodians, and hopefully prevent any future fiascos such as FTX.

Regulatory framework in Portugal 

Until now, Portugal has been considered as a ‘crypto-friendly’ country, not because the Portuguese government created a tax friendly regime for income derived from these assets, but because of a lack of any regulation at all.

Crypto has really taken off in Portugal as can be understood from the amount of crypto events that take place, not just the smaller events that take place on a weekly basis, but also the large International conferences that are hosted in Lisbon.

However, the interest from investors so far has been mainly from overseas, with the Portuguese not investing much in crypto. In 2020 only 1% invested, whereas in the UK it is 5%. Although Portugal does have some homegrown startups, most of the companies ecosystem is from overseas, but the market is maturing.

Of course, Portugal has already had an anti-money laundering regime for many years, and people who provide crypto services need to register with the Bank of Portugal.

The future of cryptocurrencies

Smart contracts

Launched in 2014, smart contracts are code written into a blockchain that executes the terms of an agreement or contract from outside the chain. It automates the actions that would otherwise be completed by the parties in the agreement, which removes the need for both parties to trust each other.

It is essentially putting contracts into code digitally. Somewhat like a vending machine they run on a blockchain and cannot be activated without someone activating them. The main platform for these contracts is Etherium (it’s currency is called Ether or ETH) and was built to enable smart contracts.

It is likely that they will eventually replace modern platforms, so Air BnB, Uber and Spotify are good examples of these that impacted the world. Today they are for profit companies, but in the future they could be socialised smart contracts owned by everyone, and their managers who run them like associations, receiving a salary. The potential lies in reducing transaction costs, middle men and enhancing efficiency.

Hugo says that one major beneficiary of this system would be finance because it is already digital, particularly banks and their business deals with the transfer of value, which are already on the Internet. This technology could overtake Fintechs which are still run for profit and are still similar to the big banks. However smart contracts would extract the fat and make them more nimble.

Text: Chris Graeme
Essential Business

Google-edpR

Google and EDP Renewables sign framework to develop 650MWp of distributed solar energy in the USA, marking the largest US corporate sponsorship of distributed PV

Framework agreement signed between technology giant and leading renewable energy company focuses on the development of around 650 MWp (500 MWac) in local energy communities across six US States. Companies will promote environmental justice through an initiative that provides benefits to nearly 25,000 low-to-moderate income families.

Google and EDP Renewables (EDPR), through EDPR NA Distributed Generation (EDPR NA DG), the distributed solar generation business unit of EDP Renewables North America, have signed a framework agreement targeting the development and installation of more than 80 distributed solar PV projects with around 650 MWp (500 MWac). This is the largest corporate sponsorship for distributed generation signed between two companies in the United States, according to S&P Global and BloombergNEF (BNEF) data, in what can also become the biggest distributed generation deal closed by EDPR with a client to date.

The first solar projects will begin development in Ohio, where Google ​operates a data center campus in New Albany and a Google Cloud region in Columbus. The projects will extend to a total of six US States. EDPR NA DG will be responsible for the development, construction, and operation of the solar PV parks, with the first projects being targeted to be operational by the end of 2024.

The portfolio will also be partially funded by Google’s acquisition of Impact Renewable Energy Certificates (RECs), an instrument that certifies that a given buyer has the rights to the environmental and social benefits of the renewable electricity produced by a renewable project.

Google began collaborations with EDPR nearly two years ago to develop a clean energy initiative that promotes energy equity and reduces energy burden under an open book transaction model – the ImpactRec. The agreement aims to democratize access to cleaner energy, making its benefits accessible to underserved communities. These local energy projects will also reduce electricity bills for about 25,000 low-to-moderate income families. The beneficiaries will be identified in due course as the projects are developed.

As with other RECs, ImpactRECs are generated and eligible in the energy market. However, this model which was developed by Google and EDPR NA DG certifies direct investment in local energy communities, solely focused on providing support to low-moderate income families.

 What we heard through interviews with local community leaders and Environmental Justice advocates was that the disproportionate impact of high energy burden remains a primary barrier to an equitable energy transition. Partnering with EDPR NA DG, we aim to reduce energy burden in the communities where we operate, while progressing toward our 24/7 carbon-free energy goal,” said Sana Ouji, Energy Lead, Google. “We are grateful to EDPR for their partnership, collaboration and steady focus on our shared mission, and excited to have the opportunity to contribute to our data center communities by extending the benefits of our clean energy investments.”

“We are pleased to sign this framework agreement that will allow us to develop a substantial number of renewable energy projects, while taking care of underserved communities. The much-needed transition to cleaner ways of producing and using energy must leave no one behind, and this partnership with Google allows us to do just that, by making electricity cleaner and more affordable to more families”, states Miguel Stilwell d’Andrade, EDP’s CEO.

In addition to the ImpactREC purchase, the program includes the creation of a community impact fund valued at $12 million. The fund focuses on initiatives reducing energy poverty in the communities where the projects are built. Google and EDPR NA DG are committed to localized social and economic justice as part of the transition to a greener future. 

The focus on decentralized solar energy projects is one of EDP’s’ main areas of growth and investment for the coming years. The company currently has around 1.4 GW of decentralized solar energy projects installed globally and a target of 3 GW additions for the 2023-26 period. In the United States, where it acquired a leading company in the distributed solar energy market in 2021, EDP Renewables develops this business through EDPR NA Distributed Generation, with over 220 MWp of operational assets, spanning more than 440 projects across 20 North American states.