The same regulations and principles applied in any Portuguese company is also applied to any company incorporated under the Madeira Free Trade Zone Legislation.
The most common used types of company are:
Private Limited Liability Company / Limitada ("LDA")
In this type of society, the share capital is represented by quotas and the value of each quota can vary.
Currently, (since 2011) the law predicts that it can consist in any value, as long as it is not inferior to 2€.
The “Limitada” company also requires at least two partners with shared quotas which may or may not be equal.
Stock Corporation / Sociedade Anónima ("SA")
The companies registered under the S.A. jurisdiction have a minimum paid up share capital requirement of € 50,000.
The capital of such companies is represented by shares of a minimum of € 0.01 each.
The original subscriber shares must be registered but thereafter bearer shares are allowed.
The minimum number of shareholders is five, although it is possible to have only one shareholder, provided that it is a society.
Pure Holding Company / Sociedade Gestora de Participações Sociais ("SGPS")
The Pure Holding Company may be incorporated as either a Limitada company or an S.A. company with the share capital structure depending on the requirements of the client.
A Pure Holding Company is limited to holding investments in other companies and manage those investments.
Restrictions on Trading
Companies are not allowed to undertake any business that is not specified in their constitution.
They also cannot undertake the business of banking, insurance, assurance, reinsurance, fund management and asset management (other than their own assets), only with prior consent and licensing.
Financial Statement Requirements
In accordance with the Portuguese accounting rules, the accounts must be prepared in the Portuguese language.
The fiscal year normally ends on the 31st of December, so the accounts must be approved before the 31st of March of the following year by the shareholders. A tax form is filled in (Modelo 22) and delivered to the tax athorities before the end of May. Another form must be filled (IES) and delivered before the 15th of July for the same purposes.
Regarding the directors, it is usual to appoint two directors to a Limitada company and three to a S.A.
They can be from any nationality and it is not required to have a permanent residence in Madeira.
€ 1000 Application Fee and € 1,800 Annual fee.