Portugal Enacts Tech Free Zones to Gain Crypto Prominence

Portugal has continued to try and establish itself as a crypto haven. Building on top of the previous boons traders and miners have, Portugal now offers Technological Free Zones, where businesses have eased legislation and regulations in the testing of new technologies.

Striving For A Digital Economy

Attempting to stimulate the economy and drive innovation forward, Portugal has recently approved a nation-wide plan to encourage the digitalization process within several fields. On the 21st of April, the country published the “Digital Transitional Action Plan.” This plan involves providing incentives and infrastructure for entrepreneurship, innovation, and competition, as well as enterprise internationalization within the country. The plan proposes multiple ways to do so, as well.

Digitalization, in and of itself, has been a recurring topic when it comes to the discussion of economic strategies. However, due to the COCID-19 pandemic, the subject matter has been put in the spotlight. This comes as both public and private entities striving to minimize the losses that the mandated lockdowns across the world have caused. The plan itself consists of three main strategies, having been highlighted within a summary published by VdA Legal Partners, a Portuguese law firm.

Going For Crypto

There are several strategies to boost Portugal’s digitalization; however, the crypto industry has taken a keen interest in one in particular. Portugal will soon develop Technological Free Zones, or ZLT, within its borders. As one would imagine, the crypto sphere is quite keen on this, as this would allow for provisions within the country to incentivize more activity from the crypto industry within the country.

The Portuguese government had already been making tax breaks for crypto issuance and trading. With these new ZLTs, however, it seems that the country will double down on its crypto-friendly outlook. These ZLTs will help facilitate research activities for companies testing or otherwise using blockchain networks, among other technologies.

The Finer Mechanisms

Helena Mendonca stands as a principal consultant within VdA Legal Partners. Mendonca gave a statement addressing the importance that these ZLTs could possibly be for the country. She explained that these ZLTs would allow the legal and regulatory mandates to be made more flexible, all for the purpose of testing. This can be likened to exemption or experimentation laws focusing on test-friendly environments. At the very least, there will be a mechanism added where regulatory authorities supervise or assist the various tests.

This, in turn, would be much like innovation hubs or regulatory sandboxes. These frameworks for tests, should they be created, holds several benefits. The first would be facilitating test performance, which in turn would allow for better assessment. These assessments would be in regard to the commercial or technical viabilities of technical solutions.