Franchising in Portugal: organising the approvals needed to open

Turning an existing business into a franchise network means distinguishing between what can be replicated and what each operator must arrange separately. The original company’s approvals should not be assumed to cover new outlets automatically. Before promising an opening date, the franchisor should map out the applicable requirements, identify who is responsible and establish how compliance will be demonstrated.

1. Separate franchising rules from the rules governing the business activity

Portugal has no specific law governing franchise agreements, nor any dedicated compulsory public registration requirement for businesses adopting this model. The agreement is based on the general rules of the Portuguese Civil Code, including freedom of contract under Article 405 and good faith in negotiations under Article 227.

There is also no specific legal obligation to provide a franchise disclosure document within a fixed period, as there is in some other countries. This does not remove the general duties to provide information and act in good faith. Codes of ethics are self-regulatory tools, not substitutes for legislation.

The absence of a dedicated franchising law does not remove the need for the approvals required for the business activity. Depending on the business, rules may apply to eligibility to carry on the activity, food safety, fire safety, health, the environment or professional qualifications. Employment, consumer protection, data protection, competition and industrial property rules also apply where relevant.

The first task is therefore to identify exactly what each new outlet will do. An approval linked to a particular entity, premises or professional should not be presumed to extend to another operator. This must be checked on a case-by-case basis, with technical or legal support where necessary.

2. Create a requirements matrix for each format

Simply copying the original outlet’s document file is not enough. It may contain outdated documents, exemptions linked to specific circumstances or approvals that do not cover the services now planned.

Start by describing each format you intend to offer: customer-facing premises, a home-visit service, a mobile operation or a service delivered entirely remotely. For each format, list the activities that will actually be carried out and the equipment that will be used.

Then build a matrix with the following fields:

• Requirement: applicable approval, notification, registration, qualification or other obligation.
• Legal basis and competent authority: where to check the rule and which authority handles the procedure.
• Holder: the operating company, premises or responsible professional.
• Compliance deadline: before fitting out, before opening or during operation.
• Evidence and validity: the document to retain, any renewal requirements and the person responsible for monitoring them.

This matrix is a management tool, not a declaration of compliance. Confirm the requirements with the relevant public authorities and check for any municipal or regional variations. Prior notification, authorisation and simple registration are not equivalent procedures.

Also identify dependencies: an application may require technical documentation or the appointment of a professional. These steps should be included in the timetable before announcing an opening date to the public.

3. Allocate responsibilities without creating false guarantees

The agreement should clarify who handles each procedure, who bears the associated costs and what assistance the franchisor provides. The contractual allocation of tasks does not, in itself, change the responsibilities that the law assigns to each party.

For example, the franchisor may provide a document checklist and suggest consultants, while the franchisee remains responsible for submitting applications relating to their company. If technical support is included, describe its limits: preparing documentation does not guarantee a favourable decision by the competent authority.

Also set out how to deal with delays, additional requirements or an inability to meet an essential requirement. The set-up timetable and opening commitments should reflect these dependencies, without presenting estimated administrative processing times as guaranteed deadlines.

When communicating with prospective franchisees, avoid phrases such as ‘all licences included’ if the future operator still needs to take action. Explain what has been prepared, what depends on them and what requires an external decision.

4. Introduce a document check before opening

Create a pre-opening check that is separate from the outlet’s commercial or visual assessment. Its purpose is to confirm that the evidence required to begin the planned operation is in place.

Appoint someone to coordinate this check and record the documents received, outstanding matters and technical validations. If a mandatory requirement remains unmet, the brand’s internal approval cannot override it. If only some services can legally begin, confirm that this is permissible before temporarily restricting the service offering.

After opening, maintain a renewal calendar and notify the relevant authorities of significant changes, such as new services, equipment or responsible professionals. Where staff are employed, employment obligations and obligations towards Portugal’s Social Security system must also be met.

Practical conclusion: before offering the business as a franchise, prepare a requirements matrix, assign responsibilities and require evidence of compliance. Replicating the brand does not mean replicating its approvals.