Decree-Law 187/2002, of 21 August 2002, sets up the legal regime of a new type of funds, the so called "venture capital funds" (Fundos de Sindicação de Capitais de Risco – "FSCR").
Up until the approval Decree-Law 187/2002, the Portuguese venture capital market was restricted to a small number of large international and local financial investors, thus reducing start-ups access to capital unless they had strong financial back up.
FSCRs are collective investment vehicles that will be investing in securities issued by start-ups. Through FSCRs, the government wants to create a regulatory regime for funds specialising in securities issued by small and medium sized companies, promoting the incorporation of start-ups with innovative projects as well as to give to exiting SMEs access to wider financial markets. From the investors’ point of view, venture capital funds will offer diversified investment opportunities that will allow them to spread investment risk.
FSCRs shall be governed by Decree-Law 187/2002 as well by the regulations applicable to other securities investment funds.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
© Macedo Vitorino e Associados – September 2002