Rita Pereira de Abreu, Senior Associate, has written an article for Advocatus examining the impact of recent European and arbitral decisions on the taxation of corporate financing in Portugal. The article highlights the potential of these developments to reduce the cost of capital and strengthen the competitiveness of the national business landscape.
In the article, the lawyer analyses the role of stamp duty as a disincentive to raising external financing, both because it applies to the granting of credit, guarantees and commissions and due to the legal uncertainty surrounding its application, which negatively affects access to international debt markets.
The article also highlights the growing relevance of alternatives to traditional bank financing, such as bond issues and commercial paper, which fall within the scope of the European Capital Duty Directive and are intended to remove tax obstacles to capital raising.
It further examines recent decisions of the Court of Justice of the European Union and of tax arbitration tribunals in Portugal that exclude the taxation of commissions and, in certain cases, guarantees associated with securities issuance transactions, while noting that the issue remains legally contentious.
Advocating a functional interpretation of EU law, the article stresses that capital mobilisation is inseparable from effective risk-mitigation mechanisms and underlines the importance of a definitive clarification of the applicable legal framework, with a structural impact on the cost of financing for Portuguese companies and clear benefits for businesses and investors.
- Read this article here.
