Lisbon annual report 2018 IBL80-LisbonAnnualReport | Page 10

Lisbon annual report Portugal ‘one of Europe’s sexiest countries’ for investors Confidence in the country is being restored, though there could well be an increase in real estate tax rates in the near future Portugal is “one of the sexiest countries in Europe” for investment with significant opportunities in the real estate and tourism sectors, as well as in relation to the ‘golden visa’ programme, says Broseta partner Julio Veloso. It was the allure of the Portuguese market that prompted Spanish law firm Broseta to open an office in Lisbon in April 2018. While a few Spanish firms have successfully established offices in Portugal, the market has, generally speaking, proved to be relatively inaccessible to international firms. “We are aware that the Portuguese legal community is a mature market”, says Veloso, who is part of the team coordinating the new office. However, he believes the Portuguese economy offers opportunities for new entrants to the country’s legal market. Yet the country does face some economic difficulties. “It’s a complex moment for the economy”, says Álvaro Roquette, the Portuguese office’s co-managing partner. “While the macroeconomic indicators are looking positive, we can still feel the aftermath of the EU’s financial assistance programme which ended in 2014 – Portuguese companies suffered a lot and shareholders are in a weak position in terms of financial capabilities.” Investor confidence is being restored, but even confident investors ask lawyers to advise them regarding any potential changes to the country’s laws or regulations. Roquette believes there could be an increase in real estate tax rates in the near future and he is advising clients on potential scenarios. Broseta is convinced it has taken a positive step in opening an office in Portugal. “We have the energy and enthusiasm to make our new project a great success,” says Veloso. Though the economy may not have fully recovered yet, and may be subject to a slowdown, it is still performing better than some other European countries. Julio Veloso Real estate, tourism and energy sectors driving growth, but new entrants in the legal market unlikely The real estate, tourism and technology sectors are generating considerable work for Lisbon lawyers, but it is unlikely that more new players will enter the legal market, says João Caiado Guerreiro, partner at Caiado Guerreiro. “The biggest opportunities right now are clearly connected to real estate and tourism, which have experienced significant growth,” he explains. “Like any investment, deals in these sectors generate tax planning and other associated work.” Meanwhile, the technology sector is also a major source of instructions, says Caiado Guerreiro. “We see a lot of movement in technology, and there is a healthy start-up environment in Portugal, with a number of ‘unicorns’ (start-ups valued at $1 billion).” Caiado Guerreiro continues: “We’re also well-placed in the fintech sector, and we´ve seen fintech companies www.iberianlawyer.com from Denmark and Sweden move to Portugal – they need legal advice on everything, so this generates work not just for IT law experts but for tax, finance and other specialists.” New players have entered the Portuguese legal market, but Caiado Guerreiro does not believe this trend will continue: “Big law firms have discovered Portugal isn´t such a large market and some of the ones that came here had a surprise.” With the increase in competition, however, he believes a key challenge for firms is providing advice at a competitive price. Meanwhile, law firms must adapt to technological changes, although Caiado Guerreiro believes market analysts attach more importance than necessary to this issue: “I think AI [artificial intelligence] is over-hyped. It’s less relevant in jurisdictions where there isn’t such a large amount of discovery work as in common law countries.” João Caiado Guerreiro September / October 2018 • IBERIAN LAWYER • 39