Portugal. What happened in 2025?

Brief executive summary on the main legal issues of general relevance to companies in 2025. Its purpose is to provide an overview of these changes, enabling companies to identify and implement them effectively.

Banking, finance and capital markets

Savings and Investments Union

In regulatory-financial matters, we highlight the initiatives driven by the European Commission under the Savings and Investments Union (“SIU”) strategy. Read more

Within this SIU framework, key measures include (i) the “Supplementary Pensions Package”, which encompasses Recommendation (EU) 2025/2384 of November 20, 2025, on pension tracking systems, pension dashboards and auto-enrolment (OJEU L, November 27, 2025); and (ii) two proposals aimed at amending the Regulation on a Pan-European Personal Pension Product (“PEPP”), as well as directives governing the activities and supervision of employment pension funds and insurance distribution. Read more

Within the scope of the SIU, we also highlight the proposal to amend the Securitization Act (EU Securitization Framework) presented by the Commission in June 2025. Read more This reform responds to the fact that the current regime, generated by the 2008 crisis, had become excessively costly, keeping many issuers and investors out of the market. Within this context, in which there were many opinions on the Commission’s proposal from various public and private actors, we highlight the European Central Bank’s opinion. Read more

Another initiative under the SIU is the legislative package that the Commission presented in December to try to eliminate obstacles to the EU’s single financial services market, thereby unleashing its full potential. The main objectives of this package are to (a) facilitate the provision of crossborder services in the contracting and post-contracting segments; (b) improve the access and operation of investment funds and asset managers in the single market through regulatory harmonization; (c) foster technological innovation, particularly the use of distributed ledger technology; (d) standardize regulation by converting directives into regulations; and (e) enhance supervision by giving the European Securities and Markets Authority (“ESMA”) greater powers over essential infrastructure and cryptoasset services.

Cryptoassets

The decree ensuring the execution of Regulation (EU) 2023/1114 on markets in cryptoassets and amending Regulations (EU) 1093/2010 and (EU) 1095/2010 and Directives 2013/36/EU and (EU) 2019/1937 and the Decree implementing into Portuguese law Article 38 of Regulation (EU) 2023/1113 on information accompanying transfers of funds and certain cryptoassets, and amending Law 83/2017 of August 18 are awaiting publication in the Official Gazette of the Republic of Portugal.

Non-performing loans (NPL)

Decree-Law 103/2025 of September 11 was published, transposing Directive (EU) 2021/2167 and creating the Regime on the Assignment and Servicing of Bank Credits (“RCGCB”). The RCGCB applies to the assignment of credits and of contractual position in credit contracts that have been granted in Portugal by credit institutions, financial companies, payment institutions, or electronic money institutions. The rules on the assignment and servicing of credits apply to a broader range of credits than the directive and are not limited to nonperforming loans. In terms of credit management, the RCGCB regulates options granted to Member States, such as any receipt and holding by the credit servicer of funds from debtors. Read more

On December 3, the Bank of Portugal published Notice 6/2025, which regulates this regime. Read more

Portuguese Securities Market Commission (“CMVM”) regulations

Following the entry into force of the Asset Management Regime, CMVM Regulation 3/2025 was published for the purposes of adapting the prudential reporting duties of management companies and creating a specific prudential reporting duty for crowdfunding service providers.

In turn, CMVM Regulation 5/2025 amends CMVM Regulation 2/2020 on the Prevention of Money Laundering and Terrorist Financing, establishing (i) an extension of the subjective scope of reporting to providers of equity or loan crowdfunding services, which must now send the CMVM some of the information already sent in this context by obligated entities; and (ii) a range of additional information to be reported to the CMVM by obligated entities.

On Sustainable Finance, see the section on Sustainability below

Compliance

General Regime on the Prevention of Corruption (“RGPC”) platform

Following the entry into operation of the RGPC Platform in 2024, the National Anti-corruption Mechanism (“MENAC”) set February 14, 2025, as the deadline for submitting regulatory compliance information and documents by affected public and private entities (i.e., legal persons with registered offices in Portugal employing 50 or more employees and branches in national territory of legal persons with registered offices abroad employing 50 or more employees).

Regulatory compliance officer

On October 8, 2025, MENAC approved Guideline 1/2025, which supersedes previous guidelines on the topic, aimed at standardizing the applicable understanding regarding the appointment of the regulatory compliance officer (“RCN”). The new guideline (i) promotes greater flexibility in appointing the RCN, recognizing the organizational diversity of the entities covered by the RGPC; and (ii) clarifies that individuals equivalent to senior management may be appointed solely for the purpose of performing the RCN’s duties. Read more

Amendments to the regime on the Central Register of Ultimate Beneficial Owners (“RCBE”)

In November, Decree-Law 115/2025 entered into force, amending the legal regime on the RCBE approved by Law 89/2017 of August 21, transposing into Portuguese law the requirement for “demonstrating a legitimate interest” for any individuals or organizations seeking to access information about beneficial owners. Read more

Regarding CMVM Regulation 5/2025, see the Banking, Finance and Capital Markets Section.

Competition and FDI

Review of the foreign direct investment regime in the Union (FDI screening)

A political agreement was recently reached to review the European Foreign Investment Screening Regulation (Regulation (EU) 2019/452), enhancing the Union’s ability to identify and screen sensitive investments, harmonizing procedures between Member States and ensuring greater protection of critical infrastructure and technologies. The review establishes a common minimum of mandatory scrutiny, strengthens cooperation between authorities and the Commission, increases foreseeability for investors, and ensures a more consistent analysis of investments in technologically sensitive sectors and strategic entities across the Union.

Portuguese Competition Authority’s (“PCA”) priorities for 2025

The PCA has defined as priorities for 2025 the fight against cartels and abuses of dominant position, stringent merger control, the monitoring of digital markets and artificial intelligence (“AI”), and the use of forensic tools and AI solutions to strengthen the detection of anticompetitive practices.

Litigation and arbitration

Summonses, notifications and communications

Ordinance 10/2025/1 of January 14 regulates the digital services area of the courts, where all summonses, notifications and communications received by individuals or legal persons adhering to this service will be centralized. In force since January 15, 2025, the ordinance regulates authentication and access to each person’s reserved area, the respective rules of use and operation, as well as its security and control guarantees. This makes it viable to implement the amendments to the electronic service of individuals and legal persons introduced by Decree-Law 87/2024 of November 7. Read more

Distribution and processing of cases

Law 56/2025 of July 24 amended the control mechanisms for electronic distribution of judicial cases.

On October 9, Ordinance 350-A/2025/1 was published, regulating the electronic processing of cases before the judicial, administrative and tax courts, as well as public prosecution services, revoking the previous Ordinances 280/2013 of August 26 and 380/2017 of December 19. Ordinance 350-A/2025/1 amends certain aspects of electronic case processing, aimed at simplifying procedures and expanding the use of technologies. The use of electronic acts has been extended to the Supreme Court of Justice and the Supreme Administrative Court, thereby achieving electronic processing in all the courts. The legislative amendments introduced by Law 56/2025 of July 24 on the electronic distribution of cases have also been regulated.

International arbitration highlights

In the Cuatrecasas Arbitration Highlights publication of July 2025, we provided an overview of significant court decisions and legislative developments in international arbitration in various jurisdictions, including Chile, Colombia, Spain, Portugal, and Peru.

New amendment to the limits on subcontracting in the Portuguese Public Contracts Code (“PPCC”)

Decree-Law 66/2025 has amended the PPCC limits on subcontracting, removing the reference to a percentage of the contract price and clarifying that the contract may require certain key contractual performance requirements to be executed directly by the co-contracting party, without establishing an abstract percentage limit. Read more

Exceptional regime for public or cost-controlled housing

As part of the special public contracting measures, a special regime was established to develop public or cost-controlled housing by Decree-Law 112/2025 of October 23 (amending the PPCC and the special public contracting measures) until the end of 2026, with shorter deadlines and higher thresholds. Read more

In January 2025, the DORA Regulation (Digital Operational Resilience Act)—Regulation (EU) 2022/2554—started to apply. It introduced significant new developments for entities operating in the financial sector. This regulation aims to strengthen the digital operational resilience of financial entities, ensuring that they can withstand, respond to and recover from any kind of operational interruption, especially those related to information and communication technologies. On December 12, the Portuguese Parliament approved Parliamentary Decree 24/XVII, which ensures European legal acts regarding the financial sector’s digital operational resilience are introduced into Portuguese law. It is awaiting formal approval and subsequent publication in the Official Gazette.

Decree-Law 125/2025 transposes the NIS2 Directive into Portuguese law and imposes diligence and supervision with personal liability for willful misconduct or gross negligence, requiring documented decisions and the integration of cybersecurity into top-level management. Essential, important and relevant public entities must register on the platform and meet the deadlines for incidents with a significant impact. Read more

In February, the first obligations of the Artificial Intelligence Act—Regulation (EU) 2024/1689—entered into force, such as the prohibited practices and the AI literacy obligation. Read more

On November 19, the European Commission presented the Digital Package, a set of legislative initiatives designed to simplify the regulation of the European digital ecosystem, strengthen technological competitiveness, and make it easier for companies and administrations to operate in a more coherent and less fragmented digital market. Read more

This package includes the Proposed Digital Omnibus Regulation on AI to facilitate its progressive application, strengthen legal certainty, and reduce compliance burdens, especially for small and medium-sized enterprises and those defined as small mid-cap companies. One of the most significant changes affects article 4, the current version of which requires providers and those responsible for deploying AI systems to ensure AI literacy. It is important to bear in mind that, at this stage, the changes described in the Digital Omnibus regarding AI are only proposals. The Digital Omnibus will now enter the legislative process and, before it can enter into force, will have to be approved by the Council of the EU and the European Parliament following trilogue negotiations. Read more

Energy

Electricity

Procedures for licensing storage facilities

Order 1859/2025 of February 10 established new procedures for licensing electrical storage facilities using a previously allocated reserve capacity for injection into the Public Service Electricity Grid (“RESP”), including the alteration of the technology of photovoltaic electrogenerating plants and separate or co-located storage. Read more

Joint Order 2/2025, issued by the Portuguese Environment Agency (“APA”) and the Directorate-General for Energy and Geology, clarified the rules regarding the procedures associated with the licensing (Environmental Impact Assessment) of electricity storage facilities.

Public consultation on the transposition of the Electricity Market Design (“EMD”) Directive

On October 23, 2025, the decree-law proposal transposing Directive 2024/1711 of the European Parliament and of the Council of June 13, 2024 (EMD Directive) into Portuguese law was submitted to public consultation, amending the current wording of Decree-Law 15/2022 of January 14 to improve the design of the electricity market and strengthen consumer rights.

High-demand areas

Decree-Law 120/2025 altered the exceptional procedure for allocating grid connection capacity to electricity consumption facilities in high-demand areas, introducing adjustments to the regime established by Decree-Law 80/2023.

Global system management procedures manual

The Energy Services Regulatory Authority (“ERSE”) Directive 7/2025 approved the new Procedure Manual for Global System Management, renewing the regulation of the provisions applicable to the operation of the Global Technical System Management activity carried out by the transmission system operator. This specifically pertains to safety criteria, the operation of the National Electricity System and the rules for the functioning of the system services markets.

Gas

Amendment to the National Gas Transport Grid Regulation (“RNTG”):

• Order 2791/2025 of February 28 approved the review of the regulation, establishing provisions concerning the characteristics of renewable or low-content carbon gas injected into the public gas grid, as well as aspects of integrating hydrogen production into the RNDG. This includes defining a new methodology for calculating the capacity for hydrogen injection into the RNDG, differentiated by grid zone, based on local consumption and the maximum incorporation percentage (10%).
• Order 3264/2025 of March 13 approved the review of the regulation, establishing technical and safety conditions for injecting renewable and low-carbon content gas into the RNTG. This includes criteria for 100% hydrogen gas pipelines and the methodology for calculating injection capacity. Read more

Electric mobility

New legal regime on electric mobility

Decree-Law 93/2025 of August 14 approved the new legal regime on electric mobility, revoking Decree-Law 39/2010 and aligning the national framework with the Alternative Fuels Infrastructure Regulation. This decree-law introduces an in-depth transformation of the previous model, promoting greater flexibility, competition and openness to new business models. Read more

ERSE has launched a public consultation to regulate this regime. Read more

Renewables

PNEC 2030

Resolution of the Parliament of the Republic 127/2025 updated the National Energy and Climate Plan 2030 (PNEC 2030), establishing the new energy and climate transition guidelines for Portugal until 2030, aligning the country with European decarbonization objectives. Read more

Public consultation: National renewable energy targets

The decree-law proposal partially transposing the RED III Directive and establishing new national targets for renewable energy was submitted for public consultation on September 25. It sets a minimum target of 49% share of renewables in gross final energy consumption by 2030, with specific sectoral targets for buildings, industry, heating, cooling, and transport. Read more

Offshore renewable energy auction

Order 4752/2025 of April 21 established the centralized sequential model for the offshore wind production development tender, aimed at achieving the 2 GW target by 2030. It also establishes deadlines for presenting a detailed proposal and preparing the tender documents. Read more

Allocation plan for offshore renewable energy

Resolution of the Council of Ministers 19/2025 of February 7 approved the Allocation Plan for Offshore Renewable Energies, identifying areas of maritime space for the installation of 2 GW of offshore renewable energy capacity by 2030. Read more

New rules for gas and hydrogen: Decree-Law 79/2025

Decree-Law 79/2025 introduced new rules for gas and hydrogen as part of the reform of the regulatory framework for renewable hydrogen included in the REPowerEU Plan of the Recovery and Resilience Plan. Read more

Biomethane Action Plan Monitoring Group

Order 1604/2025 of February 4 set up the Biomethane Action Plan Monitoring Group 2024–2040, ensuring the effective implementation of the Biomethane Action Plan, specifying the established action plan and setting clear goals for incorporating biomethane into the public gas network. Read more

Biomass power plants

Ordinance 425/2025/1 regulated the terms of the tender for allocating injection capacity reservation titles in the RESP for new biomass power plants.

Extension of licensing deadlines

Order 170/MAEN/2025 approves a final extension of 12 months for the deadlines for obtaining the production and operating licenses envisaged in Decree-Law 15/2022.

Tax

State Budget Law 2025

Law 45-A/2024 of December 31 confirmed most of the measures initially envisaged in the law proposal, including the reduction of the corporate income tax rate, the incentive for company recapitalization, and the extraordinary support scheme for electricity and gas costs. Read more

Productivity and balance sheet bonuses

The State Budget Law 2025 introduced an exemption from personal income tax and social security for productivity and performance bonuses, profit-sharing and balance-sheet bonuses, capped at 6% of an employee’s annual basic salary, subject to a salary increase of at least 4.7%. The Portuguese tax authorities have issued clarifications regarding the application of this exemption, particularly regarding the concept of annual basic salary, the voluntary and non-regular nature of bonuses, and the withholding tax procedure. Read more

New VAT rules

Decree-Laws 33/2025, 34/2025 and 35/2025 of March 24 were published, introducing significant changes to the VAT regime, reflecting alignment with European directives. The amendments concern the location of online cultural services, the profit margin regime applicable to objects of art, the extension of the cash VAT regime (entering into force on July 1, 2025), and the reformulation of the exemption regime for small businesses. Read more

VAT groups

Law 62/2025 of October 27 introduced the regime on VAT groups, effective from July 1, 2026. This regime enables the consolidation of VAT balances individually calculated by companies in the same group, promoting efficiency in cash management and administrative simplification. Read more

Tax measures – Housing

Law Proposal 47/XVII/1, aimed at authorizing the government to approve tax relief measures to promote the supply of housing, is currently being processed by parliament. The proposal authorizes the government to amend central tax codes and regimes, including VAT, PIT, CIT/TBS, and MPTT, as well as approving three distinct regimes: (i) partial VAT refund on construction works for primary and permanent residences (ii) rental investment contracts, and (iii) simplified affordable rent scheme. Read more

Real estate and urban development

Housing

Ordinance 265/2025/1 of July 11 introduced the third amendment to the regime on controlled-cost housing, adjusting the parameters for calculating the promotion cost against the increase in construction costs, the value of land, and energy requirements, with an emphasis on urban rehabilitation and public contracting procedures. Read more

On December 16, the European Commission presented the first European Affordable Housing Plan.

It proposes a European Strategy for Housing Construction, promoting a more productive and innovative sector. The package also includes a communication and Council recommendation on the New European Bauhaus, which supports sustainable and affordable projects. The review of state aid rules will facilitate support for social and affordable housing. The Commission will collaborate to simplify planning and licensing rules, as well as to prepare a new legislative initiative on short-term letting.

Tax measures - housing - see Section on Tax above

Exceptional regime on public or affordable housing - see Section on Public Contracts above

Annual rent update coefficient for 2026

Notice 23174/2025/2 of September 19 was published, establishing the coefficient for the annual updating of rents for 2026 at 1.0224, corresponding to an increase of 2.24%, applicable to all lease types (buildings and land), unless the parties have contractually agreed on a different updating criterion. Read more

Temporary accommodation for construction

Decree-Law 123/2025 of November 21 updated the 1965 regime, establishing the main requirements applicable to temporary accommodation for displaced construction workers. The law exempts work on adapted buildings or temporary buildings from prior urban development checks, aiming to liken this accommodation to a satellite facility of the construction site. Read more

Short-term letting in Lisbon

On December 2, the Lisbon Municipal Assembly approved the second amendment to the Municipal Regulation on Short-term Letting, published through Notice 29926-A/2025/25. The review aligns the municipal regime with the amendments established in Decree-Law 76/2024 and strengthens local management instruments, creating three more scales in the model for regulating containment areas: municipality, parish and neighborhood. In areas of absolute and relative containment, as a general rule, no new registrations are allowed. It also establishes ineligibility for new registrations in real estate subject to a residential rental contract within the previous five years. In the containment areas, transferring the registration in the “house” and “apartment” categories causes it to expire. Read more

Review of the General Regime on Urban Development and Building (“RJUE”)

On December 2, the government presented Law Proposal 48/XVII/1 to Parliament: It authorizes the government to review the regime on the licensing of urban development operations, as well as to amend the legal regime on urban development and building, and the legal regime on urban rehabilitation. However, this text may be adjusted during the parliamentary process. Also, until the parliamentary approval of the law proposal and subsequent publication of the authorized decree-law, the version of the RJUE resulting from the Simplex (Decree-Law 10/2024 - see Guide to the Urban Development Simplex) remains applicable.

Soil monitoring and resilience directive - see Section on Sustainability below

Strengthening criminal law protection for real estate - see Section on Criminal Law below

Labor

Absences due to endometriosis or adenomyosis

Law 32/2025 was published, creating a specific regime for justified work absences for employees suffering from severe and debilitating pain caused by endometriosis or adenomyosis during their menstrual period. Read more

Cooperation protocol for regulated labor migration

A cooperation protocol for regulated labor migration, establishing an expedited procedure for analyzing and deciding on visa applications for foreign citizens to work in Portugal was signed by the Directorate-General for Consular Affairs and Portuguese Communities, the Asylum, Migration and Integration Agency (“AIMA”), the Immigration and Border Coordination Unit of the Internal Security System, and the Institute of Employment and Professional Training. The protocol, which entered into force on April 15 for the signatories, was intended to facilitate the process for hiring immigrants, responding to the employee shortage in various sectors by ensuring ethical recruitment practices. Read more

Amendments to the Foreigners Act

Law 61/2025 introduced significant amendments to the regime on entry, stay, exit, and removal of foreigners from Portuguese territory, particularly for (i) the creation of a visa for seeking qualified work; (ii) new rules on family reunification, requiring, as a general rule, two years of valid residence by the holder; (iii) amendments to the Community of Portuguese Language Countries regime, which now requires a residence visa; (iv) a new residence permit for entrepreneurship; and (v) clarification of jurisdictional protection for AIMA decisions and omissions. Read more

Prohibition on dismissal for outsourcing is not unconstitutional

The Constitutional Court decided, by judgment of July 2, 2025, not to declare unconstitutional the rules in articles 10.3 and 338-A.1 and 338-A.2 of the Portuguese Labor Code, considering that the restrictions imposed on the freedom of private economic enterprise were proportional given the protection of other constitutionally enshrined fundamental rights. The decision upheld the prohibition on outsourcing in the 12-month period following the termination of an employment contract due to collective redundancy or elimination of a position. However, this is one of the points that is expected to be reversed by the labor law reform. Read more

Authority for Working Conditions (“ACT”) inspections

During 2025, ACT launched several inspections, particularly regarding equal pay for men and women, as well as verifying compliance with the employment quota for people with disabilities. Read more More recently, the ACT announced priority inspections for the end of the year, focused on three critical areas: (i) equality and non-discrimination; (ii) equal pay for men and women, with inspections taking place between 2025 and 2026, aimed at employers with more than 50 employees and a gender pay gap of more than 5%; and (iii) health and safety in high-risk activities, with a focus on the construction and extractive sectors. In our Post, we summarize what is at stake and how companies can ensure that they are complying with their obligations related to these matters.

Life sciences

On December 11, 2025, the European Parliament and the Council reached a provisional agreement for the reform of European pharmaceutical legislation.

At a national level, 2025 was also marked by initiatives aimed at managing the availability of critical medicines:

• Regulations on the management of availability: The pharmaceutical authority, Infarmed, approved new regulations on the management of availability of medicinal products and transaction control, reinforcing stock monitoring and management mechanisms. Read more
• Exceptional price review 2026: As in previous years, the government has once again adopted specific criteria to prevent the erosion of prices for essential and low-cost medicines. Read more 

On March 25, 2025, Regulation (EU) 2025/327 entered into force, establishing the European Health Data Space (EHDS) and creating the foundations for more secure, transparent and interoperable access to health data in the Union. Read more In September, the Portuguese government established a working group dedicated to setting the deadlines for the retention of health data stored in hospital information systems. Read more

On March 19, 2025, Decree-Law 23/2025 was published, reformulating the rules for introducing cosmetic products to the Portuguese market, representing a paradigm shift for operators in the sector. Read more

Lastly, we would also like to emphasize that Regulation (EU) 2021/2282 on health technology assessment has been applicable since January 12, 2025. Read more here. On November 9, 2025, this regulation was supplemented by Implementing Regulation (EU) 2025/2086, which details the procedures for joint clinical assessments of medical devices. Read more

Strengthening criminal protection for real estate

Law 67/2025 of November 24 amended the Criminal Code and the Code of Criminal Procedure to strengthen criminal protection for unlawfully occupied real estate. The law eliminated the requirement of violence or serious threat as a necessary ingredient for the crime of usurpation of real estate, and these circumstances became aggravating factors of the crime. It also introduced the possibility of punishment for the attempted offense and expanded the list of coercive measures, allowing judges to impose on defendants the obligation to immediately restore the property to its rightful owner. Read more

Corporate

Professional attributes certification system (“SCAP”)

In January, Ordinance 6-C/2025/1 entered into force, introducing several changes to the SCAP’s terms and conditions of use, aimed at simplifying processes, improving electronic service procedures and incentivizing digital processing. The main changes include the automatic attribution and certification with the commercial registry of the business attributes of directors, managers or officers; the possibility of using a qualified signature, with certification of the status of director, manager, officer or attorney-in-fact, to submit acts of registration and the beneficial owner; the possibility of authentication, with certification of the status of director, manager or officer, to receive electronic summonses and notifications; and free certification of the status of director, manager or officer. Read more

Unilateral termination of a commitment to guarantee granted on a blank promissory note

The Portuguese Supreme Court of Justice Judgment 1/2025 of January 8 standardized caselaw to allow a guarantor that ceases to be a shareholder or shareholder-director of the company subscribing the promissory note (livrança) to unilaterally terminate their commitment up to the time the promissory note is completed. Read more

New incentives for startups

In February, the government approved Ordinance 49/2025/1, which establishes the Specific Regulation for the Startup Competitiveness Incentive System. The incentive system applies in mainland Portugal and is aimed at micro enterprises and SMEs, including startups that meet the requirements of the respective legal regime. Read more

Adjustment of size criteria for micro, small, medium, and large companies or groups

In December, Decree-Law 126-B/2025 entered into force, transposing Commission Delegated Directive (EU) 2023/2775 and amending Decree-Law 158/2009 of July 13, which approved the Accounting Standardization System, updating the balance sheet and net turnover thresholds for micro, small, medium, and large companies, as well as for groups. The decree-law also defines the types of groups, including the express introduction of medium-sized groups and the clarification of the thresholds for small, medium and large groups, ensuring that the national framework is aligned with European standards and recent economic developments.

Changes to the RCBE - See Section on Compliance above.

Sustainability

Environment

National Energy and Climate Plan 2030 

As mentioned in the Energy section above, the Portuguese Parliament approved the update of the National Energy and Climate Plan 2030 (“PNEC 2030”), which is Portugal’s main energy and climate policy instrument for 2021–2030. Read more

EU sets binding climate target of 90% by 2040

The European Commission has published a proposal to amend Regulation 2021/1119/EU (“European Climate Law”) to set a binding climate target in the EU to reduce net greenhouse gases by 90% by 2040, compared to 1990 levels, as an intermediate step toward achieving climate neutrality in 2050. Read more

First voluntary carbon market methodology

On October 23, 2025, the first methodology for the Portuguese Voluntary Carbon Market (“VCM”) was approved, and the computer platform for registering the VCM also started operating, meaning the conditions for the VCM to truly start are in place. Read more

Amendment to the legal regime on industrial emissions

Decree-Law 89/2025 of August 12 completes the transposition of Directive (EU) 2010/75/EU on industrial emissions. The main amendments are new powers for the APA to adopt general binding rules; reinforcement of the duty to provide immediate information in the event of an environmental accident; reinforced monitoring requirements; provision for extraordinary environmental inspections; mandatory review of environmental licenses every seven years; and mandatory content of incineration/co-incineration licenses. Read more

CBAM: Amendments to the Carbon Border Adjustment Mechanism

Regulation (EU) 2025/2083, published on October 17, 2025, amends the Carbon Border Adjustment Mechanism (“CBAM”), simplifying its application from January 1, 2026. The main amendments are de minimis exemption for imports of up to 50 tonnes per year, simplification of the calculation and verification of emissions, extension of the deadline for submitting the annual CBAM declaration to September 30, and adaptation of the penalty procedure. Read more

Soil monitoring and resilience directive

On November 26, 2025, Directive 2025/2360 was published, which constitutes the first legal framework at the European level for the protection, assessment and sustainable management of soil. Its obligations are aimed at Member States—not private individuals—although its implementation has practical consequences in land use planning, risk management, and real estate operations and, with greater intensity, in sectors such as infrastructure, energy, agrifood, and industry. Read more

Waste: Packaging

Regulation (EU) 2025/40, published on January 22, 2025, establishes new requirements for packaging and packaging waste in the EU. This regulation introduces the minimization of unnecessary packaging, mandatory deposit and return systems, and requirements for all packaging to be recyclable by 2030. It also reinforces extended producer responsibility, impacting packaged products and packaging in the EU market. It entered into force on February 11, 2025, and will apply from August 12, 2026. Read more

Waste: Textiles and food

On September 26, 2025, the OJEU published Directive (EU) 2025/1892 of September 10, amending Directive 2008/98/EC on waste. The new directive establishes strengthened measures for the textile and food sectors, identified as resource-intensive sectors likely to cause negative environmental impacts. Read more

General regime on waste management

On May 22, 2025, Decree-Law 81/2025 was published, introducing significant amendments to the General Regime on Waste Management, approved by Decree-Law 102-D/2020 of December 10. The amendments introduced include the broadening of the definition of “municipal waste” and the introduction of the definition of “non-hazardous waste”, the strengthening of responsibility for waste management, the integration of methods for measuring food waste levels, limitations on the incineration and landfilling of recyclable waste, the strengthening of the regime applicable to hazardous waste, and strengthened conditions for the end-of-waste status. The decree-law entered into force on May 23. Read more

Integrated waste management system for the specific packaging and packaging waste stream (“SIGRE”)

The new Regulation for Allocation and Compensation Mechanisms under SIGRE, issued by the Water and Waste Services Regulatory Authority (ERSAR), was published. In force since September 25, 2025, the new rules apply from January 1, 2026. The main objectives are digitization of the ACM’s operation, standardization and unification of procedures, and methodological simplification and transparency. Read more

Circular economy

The ISO has published the standard ISO 59040:2025 - Circular economy: Product circularity datasheet, which establishes a general methodology for exchanging information that supports the interoperability of information related to the circular economy, facilitating the consistent and verifiable communication of circularity attributes between manufacturers, distributors, customers, and waste managers. It also enables purchasing and design decisions aligned with circularity and improving traceability and comparability throughout the product’s lifecycle.

Sustainable finance

In January, the CMVM published an updated Sustainability Guide to help supervised entities comply with sustainable finance regulations.

In February, the CMVM published the Annual Circular on Financial Intermediation and Crowdfunding for 2025, which highlights various ESG measures aimed at improving sustainability and transparency in the financial market. Read more

In February, the CMVM published the Annual Circular on Asset Management, describing several key initiatives related to ESG measures. These include the integration of sustainability risks into asset management practices, stronger disclosure and reporting requirements for sustainability-related information, and the implementation of ESG ratings regulations from July 2026. 

Following the entry into force of the Regulation on European Green Bonds (“EUGB”) on December 21, 2024 (Read more), the first operations in 2025 were conducted under this framework, inaugurating the use of the new standard. These included the first operation simultaneously combining the EUGB label with alignment with the International Capital Market Association (“ICMA”) Green Bond Principles, demonstrating the practical coexistence between the European legal regime and voluntary market standards.

Also, the Loan Market Association (“LMA”) and the ICMA have strengthened and updated their frameworks for ESG-labeled financial products with the Transition Loan Principles (LMA) and the 2025 Climate Transition Bond Guidelines (ICMA). Read more

The European Commission has presented its proposal to review the Sustainable Finance Disclosure Act, known as SFDR 2.0, to simplify its regulation, strengthen investor protection and combat greenwashing. Read more

Omnibus I

The EU is conducting an in-depth review of the legislation on corporate sustainability reporting and sustainability due diligence (Read more). Given the scale of this reform, a postponement and flexibilization of some obligations was approved in 2025 through the Stop-the-Clock Directive (Read more) and the Quick Fix Act (Read more).

At the substantive level, (i) a simplification of the environmental taxonomy—applicable from January 1, 2026—was approved (Read more), (ii) the European Financial Reporting Advisory Group presented its proposal for simplifying the ESRS to the Commission on December 3; and (iii) on December 16, 2025, the Parliament approved a provisional agreement between MEPs and EU governments to update the rules on sustainability reporting and corporate due diligence. Sustainability reporting will be required of companies with more than 1,000 employees and a net annual turnover of more than €450 million. Only large companies with more than 5,000 employees and a net annual turnover of more than €1.5 billion will have to comply with the due diligence obligation. The directive must now be formally approved by the Council. It will then be published in the Official Journal and enter into force 20 days later. The due diligence rules will apply from July 2029. 

For more information, please contact our specialists through the Knowledge and Innovation Area.