Posted on by Juan Carlavilla

Portugal and its definition of PEP

Portugal and its definition of PEP. Photo by Luis Feliciano.

Following the trend of other European Union member states such as Spain, France, or the Netherlands, the Portuguese jurisdiction also defines politically exposed persons — PEPs —. Similar to other countries in the region, this definition and the regulatory framework in the area of anti-money laundering derives from European directives, along with the influence of the Financial Action Task Force (FATF) on this matter.

The Portuguese regulations establish their definition of politically exposed persons in Law No. 83/2017 — Measures to Combat Money Laundering and Terrorism Financing. This law consolidates many European directives and thus serves as a fundamental regulatory pillar in Portugal for preventing money laundering and terrorism financing.

In Article 2, paragraph 1, subsection (cc), the categories of individuals considered politically exposed persons are defined. Additionally, subsection (gg) addresses “holders of other political or public positions.” Furthermore, Portuguese law has a specific article — Article 39 —, which outlines certain elements to be considered when establishing relationships with PEPs. Among these is the need to “detect the status of ‘politically exposed person,’ acquired before or after the establishment of the business relationship or occasional transaction.”

Moreover, Portuguese regulations also require enhanced due diligence measures for the family members of PEPs, as well as for those closely associated with them.

In Portuguese law, the family members of a PEP include: i) the spouse or domestic partner, ii) relatives up to the second degree, either by blood or marriage, and iii) common-law unions of relatives.

The definition of a closely associated person is tied to the PEP’s commercial relationships. If someone shares ownership of a legal entity with a PEP or shares voting rights in a social entity, or has a business relationship with a PEP, that person is considered to be closely associated.

List of PEPs in Portugal

The political positions that hold PEP status are:

  1. Heads of State, Heads of Government, and Government members, including Ministers, Secretaries, and Deputy Secretaries of State or equivalent;
  2. Members of Parliament or other parliamentary chamber members;
  3. Members of the Constitutional Court, Supreme Court of Justice, Supreme Administrative Court, Court of Auditors, as well as members of supreme courts, constitutional courts, courts of auditors, and other higher judicial bodies in other states and international organizations;
  4. Representatives of the Republic and members of the self-government bodies of autonomous regions;
  5. The Ombudsman, members of the Council of State, and members of the National Data Protection Commission, the Superior Council of the Judiciary, the Superior Council of Administrative and Fiscal Courts, the Attorney General’s Office, the Superior Council of the Public Prosecutor’s Office, the National Defense Council, the Economic and Social Council, and the Media Regulatory Authority;
  6. Heads of diplomatic missions and consular offices;
  7. General officers of the Armed Forces and the Republican National Guard (GNR) in active service, as well as Chief Superintendents of the Public Security Police (PSP);
  8. Mayors and council members with executive functions of municipal councils;
  9. Members of the governing and supervisory bodies of central banks, including the European Central Bank;
  10. Members of the governing and supervisory bodies of public institutes, public foundations, public establishments, and independent administrative entities, regardless of their denomination;
  11. Members of the governing and supervisory bodies of entities belonging to the public business sector, including regional and local business sectors;
  12. Members of the executive leadership bodies of national or regional political parties;
  13. Directors, deputy directors, and board members or individuals exercising equivalent functions in an international organization.

Portuguese law also defines “holders of other political or public positions” — Article 2.1 (gg) —, as per Law No. 52/2019, which includes:

  1. The President of the Republic;
  2. The President of the Assembly of the Republic;
  3. The Prime Minister;
  4. Members of the Assembly of the Republic;
  5. Government Members;
  6. The Republic’s Representative in Autonomous Regions;
  7. Members of the self-government bodies of the Autonomous Regions;
  8. Members of the European Parliament;
  9. Members of the executive bodies of local corporations;
  10. Members of the executive bodies of metropolitan areas and inter-municipal entities;
  11. Members of the executive bodies of political parties at national and regional levels;
  12. Candidates for the Presidency of the Republic;
  13. Members of the Council of State;
  14. President of the Economic and Social Council;
  15. Public managers and board members of a corporation who exercise executive functions;
  16. Members of the executive boards of public enterprises, when appointed by the State;
  17. Members of executive bodies in regional or local business sectors;
  18. Members of the management bodies of public institutes;
  19. Members of the administrative body of an independent administrative entity;
  20. Holders of high-level management positions at the first and second levels and their equivalents, and senior officials in municipalities and municipal services, when applicable;
  21. Chiefs of staff of the members of the governments of the Republic and regional governments;
  22. Representatives or advisors mandated by the State and regional governments in processes involving public asset concessions or divestments.

For holders of other political or public positions who do not qualify as PEPs — such as candidates for the Presidency of the Republic — Portuguese law mandates detecting such positions and adjusting enhanced due diligence measures based on the risk.

Below are the main sources used by Pibisi to identify PEPs in Portugal:

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