Newsletter February 2021

Legal Updates

New regime for the mutual recognition of the goods traded in another Member State

On January 13, 2021, Decree-Law No. 6/2021 came into force, implementing in the Portuguese legal system, the Regulation (EU) No. 2019/515 on the mutual recognition of goods lawfully marketed in another Member State of the European Union.

This Decree-Law implements the principle of mutual recognition, which has already been recognized by the case law of the Court of Justice of the European Union (CJEU). According to it, Member States may only restrict the marketing of goods in case such restrictions are justified in light of the Article 36 of the Treaty on the Functioning of the European Union. This means that prohibitions on quantitative restrictions on exports and imports are exempted when the situation is justified on grounds of public safety, health protection or overriding reasons of public interest recognised by the case law of the CJEU.

In order to enforce all these prerogatives, it was necessary to approve some implementing rules, such as the designation of the National Product Contact Point – Directorate General for Economic Activities.

Additionally, it should be noted that it is of the responsibility of the same entity to monitor and execute this Decree-Law.


New Law of Public Procurement in Angola

In Angola, on 22 January 2021, a new Public Procurement Law (“PPL”) came into force, Law No. 41/20 of 23 December.

It is notable that the extension of the objective and subjective scope of the PPL, which now includes administrative concession contracts, commercial contracts arising from financing, contracts signed by public law bodies and also contracts signed by public companies and public domain companies that benefit from operational subsidies or any operations carried out with funds from the General State Budget.

In addition, the referred law introduced two new contracting procedures: the Electronic Dynamic Contracting procedure, which is developed on an electronic platform and concerns the acquisition of standardized goods and services, and the Emergency Contracting procedure, a fast and simplified procedure, which is intended to cover unpredictable situations not attributable to the respective contracting entity.

It should be noted that the possibility of demanding a provisional guarantee from bidders has been eliminated. The value of the guarantee is now fixed at a minimum of 5% and a maximum of 15% of the contract price.

Law No. 41/20 has thus allowed simplification and flexibility in the formation and execution of public contracts.


Business Updates

Extension of the Extraordinary Support for the Progressive Resumption of Activity

On January 15, Decree-Law No. 6-C/2021 was published, extending Extraordinary Support for the Progressive Resumption of Activity to companies in a situation of corporate crisis, with a temporary reduction of the normal working period (henceforth NWP). Thus, employers will continue to benefit from Social Security’s contribution of 70% of the value of the compensation due to the workers with reduced NWP and, in cases when the reduction of the NWP is of more than 60%, the Social Security will contribute with 100% of the amount of said compensation.

There are some novelties in this extension: these measures will now also apply to the employer who has had a decrease in profitability of 25%; the limits for the maximum reduction of the NWP (see the new version of Article 5 (1) of Decree-Law No. 46-A/2020) have changed, being that for the employer with a decrease in profitability of 75% or more, there may be a full reduction of the NWP per worker, in the first 4 months of the year and of 75% in May and in June.

It should be noted that, regardless of the date of submission of the request for support, the employer can only benefit of said support until 30 June 2021.


Post-Brexit Exports: The REX Status

The Free Trade Agreement foresees an exemption from customs duties for the products that have its origin in the United Kingdom or in the European Union starting on January 1st , 2021, through the so-called Registered Exporter System.

This mechanism is based on the exporter status registered under the REX system, i.e. it will be mandatory to obtain this status for the emission of Certificates of Origin for products whose value exceeds EUR 6,000.00; in case the said value is lower, any exporter may do so.

The European Union exporters need to be registered for a number to be assigned to them. Even though, in Portugal, the number of exporting companies that have the REX status is reduced, it may be expected, in the upcoming months, an exponential increase in registrations with the Tax and Customs Authority.

Despite this predictable increase, some flexibility will be provided when presenting the import declaration and other documents (up to 6 months after the date of entry into force of the Agreement).