Pure Holdings (SGPS) can be incorporated either as public limited companies or private limited companies and be subject to their legal framework except to the extent that it conflicts with the Holdings (SGPS’) specific legal regime (below).
The name of Holding (SGPS) companies must contain the terms «sociedade gestora de participações sociais» or the initials SGPS, any of the foregoing being deemed as sufficient indication of their corporate purpose.
The sole corporate purpose of Pure Holding companies is the management of shareholdings in other companies as an indirect manner of carrying out an economic activity.
The holding of equity interests in a company is deemed as an indirect form of carrying out such company’s activity if it is not occasional (the interests are held for more than a year) and the interests held, by themselves or with the interests held by other companies controlled by the Holding, represent at least 10% of the share capital with a right to vote.
Holding companies are allowed to provide technical management services to its subsidiaries, under written agreement which should provide the terms of remuneration.
Holding companies can acquire and hold quota interests or shares in any companies including foreign companies.
Holding companies can only acquire or hold equity interests below 10% of the share capital with voting rights in a subsidiary in the following cases:
- Up to the amount corresponding to 30% of the aggregate value of all equity interests representing at least 10% of the share capital with voting rights of subsidiaries which were reported as financial investments in the last approved balance sheet;
- When the price for which each equity interest purchased is not lower than 5 million Euros, as per the last approved balance sheet;
- When the interests are acquired as a result of a company merger or splitting;
- When the interests are held in a company with which the Holding has entered into a subordination contract.
Holding companies must appoint and have a certified official auditor or a certified official auditing company from start-up, who is required to report to the General Tax Inspectorate all breaches imputable to the Holding company, of which they become aware.
Holding companies must provide the General Tax Inspectorate a list of all shareholdings included as financial investments in the last approved balance sheet, every year by June 30.
Subsidiaries cannot acquire shares or quota interests in the Holding company or in another Holding company within interests in the same Holding, except if they are acquired for free, by award within court enforcement proceedings brought against its debts or through the allocation of assets of a company in which it holds equity interests.
Holding companies cannot:
- Acquire or own real estate, except as necessary for their premises or those of a company in which they hold more than 10% of the share capital (the purchase value reported in the balance sheet cannot exceed 25% of the capital of the Holding), or if awarded in court enforcement proceedings brought against its debtors or acquired by a global transfer under Article 148 of the Companies Code within the winding up of a company held by the Holding;
- Sell or encumber equity interests in the year following their acquisition, except if the interests are exchanged for other interests, or if the price obtained is reinvested in the acquisition of other interests within six months, or if the purchaser is a company controlled by the Holding, as per Article 486.1 of the Companies Code;
- Grant loans except to companies controlled by them under Article 486 of the Companies Code or in companies in which they hold equity interests (if the companies are not controlled by the Holding, the loan can only be granted for up to a maximum value of the equity interests held by the Holding, as reported in the last approved balance sheet, save if the case it is granted under a shareholder loan agreement).