Decreto-Lei n.º 79/2017
- Tipo de Diploma:Decreto-Lei
- Páginas:3299 - 3314
Summary in plain english (Without legal value)
What is it?
This decree-law defines new rules for the Commercial Companies Code and the Insolvency and Business Recovery Code.
The Commercial Companies Code defines the rules for the creation, operation and closing of a commercial company.
Those considered to be commercial companies are:
- limited liability companies
- stock companies
- general partnerships
- limited partnerships
- limited partnership by shares.
The Insolvency and Business Recovery Code defines rules for paying creditors (people or entities to whom money is owed). This payment can be obtained:
- through a process of business recovery, for companies in financial difficulties, in which a strategy is defined to make the company viable again
- by selling the assets of individuals, companies or other insolvent entities and dividing the value obtained by its creditors.
What will change?
In the Commercial Companies Code, the following changes are made:
- it becomes clear that the official documents of the company can be signed electronically
- for limited liability companies, the process of increasing share capital by converting shareholders loans will be easier.
Shareholders' loans must be paid back by the company. When share capital is increased by converting shareholders' loans, the loans are converted into shares for the shareholder that made the loan (rather than reimbursed).
In the Insolvency and Corporate Recovery Code:
- the special revitalization process (Processo Especial de Revitalização - PER) is now only for companies (that are going through financial hardships, but not insolvent)
- for other debtors (going through financial hardships, but not insolvent), a special process for payment arrangements is created.
What are its benefits?
This decree-law is intended to:
- facilitate the share capital increase of a commercial company
- reinforce the transparency, credibility and effectiveness of rules for insolvency and business recovery
- make the sale of assets for debt repayment faster and more transparent
- make the special revitalization process (Processo Especial de Revitalização - PER) a clearer and safer tool for business recovery
- create a simple and fast way for non-business entities going through hardships to reach payment arrangements with their creditors.
When does it come into effect?
This decree-law comes into effect on July 1.