e-Business and Technology


Madeira is a hub for several international optical submarine cables allowing interconnectivity with national and international SDH networks and providing significant advantages in terms of quality, cost, bandwidth and scalability.


e-Business and Telecommunication Activities in Madeira


Madeira is an obvious choice for companies in the areas of telecommunications and for e-business companies considering, on the one hand, its reduced taxation and, on the other hand, the quality of its telecommunications infrastructure and its condition of major hub for fiber optic cables with its geographic cross-roads’ location.




Corporate and Personal Taxation

Companies engaged in international technological activities, such as e-business, e-commerce, telecommunications, or software development, which are set up within the IBC of Madeira, will have access to a very competitive tax regime, including a low corporate tax rate of 5% and a withholding tax exemption on all payments made to non-Portuguese residents.

In addition, tax incentives also exist for qualified workers who move to Madeira to work in these companies. In fact, the Portuguese non-habitual tax resident regime allows for a reduced personal income tax rate applicable to a list of high-value-added professions, amongst which are ICT Technicians, ICT Technologists, Specialist Physicists, Mathematicians, Engineers, and related Technologists and General Managers and Executive Managers.

Non-habitual resident status may be requested by professionals who have not been residents in Portugal within the previous five years and will be applicable for a period of 10 years. To be considered a resident, the professionals must remain for 183 days a year or have a primary home in Portugal.



Infrastructures for ICTs and eBusiness

Madeira benefits from the existence of several hosting services providers, amongst which MEO’s CTM Data Center, a modern dedicated building designed to host telecommunications and data equipment, such as Data Centres and Internet Service Providers, among others. The Data Center offers an uninterrupted power supply, an intrusion and fire detection system, a specialized air conditioning system, a computerized access control system, a redundant telecommunications network, and technical support by dedicated personnel.

Madeira is also a hub for several international optical submarine cables, operated by the Submarine Cable Station also hosted in the Data Centre, allowing interconnectivity with national and international SDH networks and providing, as such, significant advantages in terms of quality, cost, bandwidth, and scalability.

Another available infrastructure is the Internet Gateway provided by Marconi Internet Direct (MID), which offers international Internet access without any kind of contention and uses diversity in the access to international backbones. The IP platform has its international connectivity distributed by: 3 PoPs (London, Amsterdam, and Paris), peering connections with hundreds of major international ISPs and IP transits to Europe and the USA.

Madeira has full fiber optical cable coverage and, from June 2022, has also completed its 5G coverage in all municipalities, thus becoming the first region in the country with full coverage of this 5th generation broadband by NOS, a Portuguese operator.

The full 5G coverage has allowed low latencies and higher connection speeds and has contributed to the setting up of technology companies in the IBC of Madeira and to the growth of the local Digital Nomad community.





Local Technology and Teaching Organizations

R&D and tech-supporting organizations have been created in Madeira in recent years with the purpose of incentivizing the development of a local tech hub, as well as contributing to achieving the EU’s Digital transition targets and, in conjunction with the local University, promoting the creation of a pool of local qualified professionals in this sector.

ARDITI is the local agency for R&D and technological development, with various research units, including the ITI – Interactive Technology Institute and MARE – The Sea and Environmental Science Centre. In addition, ARDITI supports and funds local investigation and science projects.

StartUp Madeira supports local entrepreneurship projects with innovative potential, also acting as an Incubator and Co-work facility, with a European Business Network certification.

Madeira’s University (Uma) offers several degrees in the field of ICTs, amongst which are Computer Networks and Systems; Information Systems Technology and Programming; Telecommunications; and Computer Engineering. This offer is complemented by various other degrees, including Business and Administration and Accounting and Taxation.

Additionally, Carnegie Mellon Portugal has implemented, at a national level, a partnership programme with several universities (including UMa), R&D centres and companies with the mission to place Portugal at the forefront of innovation in key focused areas of ICTs.



EU Funds and Regional Incentives

The applicable EU funding programs for Madeira for the period 2020-2030 are managed by IDERAM - Instituto de Desenvolvimento Empresarial under specific pre-established categories, amongst which there are dedicated incentives for the development and reinforcement of R&D, innovation, and the implementation of advanced technology.



The Local Tech Community

There are approximately 200 companies currently in the ICT sector operating from the IBC of Madeira.

These companies operate in diverse areas such as e-commerce, audiovisual production, telecommunications, software and ap development, digital marketing, VOIP services, CMOS image sensor technology, semiconductors, chip design, and IT consulting, amongst others.

The countries of origin are equally diverse, with companies originating from countries such as South Africa, Germany, Austria, Belgium, Brazil, Ecuador, Spain, the U.S.A., Finland, France, Israel, The Netherlands, Norway, and the UK, amongst others.



Support Services and Business Environment

All types of high-quality support services are available in Madeira - an efficient network of computer-related companies, legal advice as well as financial and administrative support.

There is availability of highly - qualified professionals and, on the other hand, there are no restrictions on the employment of foreign qualified staff.

All the relevant EU directives on e-commerce have been transposed into Portuguese law, such as e-commerce’s legal framework, e-signature, and e-invoicing.

The operational costs are low, as compared to other European locations, and telecommunication costs are at the level of the EU average.

A science park and regional innovation centre have recently been implemented on the island with the purpose of promoting and implementing new technologies.



Flight Connections

Madeira’s International Airport has several national and international flight connections, making Madeira easily accessible with over 4 million passengers in 2022.

International flights typically take between 3 to 4 hours - whereas Lisbon is a 90m flight - and connect Madeira to international cities such as New York, Amsterdam, Basel, Berlin, Brussels, Copenhagen, Dusseldorf, Edinburgh, Frankfurt, Glasgow, Hamburg, Helsinki, Lisbon, London, Lyon, Madrid, Manchester, Munich, Nantes, Oslo, Paris, Oporto, Stockholm, Stuttgart, Vienna and Zurich, amongst others.



Moving to and Living in Madeira

As part of the E.U., European Union entrepreneurs and workers are free to move, live and work in Madeira. In addition, Portugal has recently introduced the D2 Visa, aimed at non-EU entrepreneurs who intend to engage in investment activities in Portugal, through the establishment of a business activity.

To apply, amongst other requirements, the candidates must incorporate a company in Portugal. The process to obtain a D2 Visa must be initiated at a Portuguese Consulate through the submission of a business plan, amongst other documentation, and should take between 30 to 60 days.

Likewise, a streamlined Digital Nomad Visa has also been introduced in 2022 with the possibility of a Temporary Stay Visa, valid for one year, or a Residence Permit for Digital Nomads for longer periods. These Visas allow an individual to work as a self-employed freelancer or an online business owner. Both are applied for by the main applicant at a Portuguese Consulate.

Madeira has been voted 'Best Island Destination in the World' and received several national and international awards and distinctions in recent years, due to its quality of life due to its preserved nature and tourism heritage.

Madeira is located 900 km southwest of Lisbon and 600 km off the Moroccan coast on the same latitude as Marrakesh, contributing to a temperate climate all year round. The archipelago, with a total population of 267,785 inhabitants, has the city of Funchal as its most important centre.

Madeira enjoys a great quality of life, having a mild climate, one of the safest living environments in the world as well as one of the lowest costs of living in the European Union. Funchal, is a cosmopolitan city, while the unspoiled interior of Madeira is characterized by abundant vegetation and spectacular scenery. Residents on the island enjoy a vast range of leisure activities, such as golf, surfing, sailing, fishing, horse riding, and mountain climbing, complemented by a diversified network of hotels and restaurants. The existence of numerous foreign communities living in Madeira is a good illustration of the island’s appealing lifestyle.




In order to benefit from the preferential tax regime of the International Business Centre of Madeira, companies must be subject to a licensing process.

An application (in the Portuguese language) is submitted to S.D.M., the official concessionaire of the IBC of Madeira, in two copies, addressed to the Regional Government of Madeira in the name of an existing company, in Portugal or abroad, or of a company to be incorporated. Branches of existing companies may also be licensed.

The licence application must be submitted in accordance with articles 18º and 19º of the Regulation approved by the Regional Regulatory Decree n.º 21/87/M, of the 5th of September, and by Article 36º-A of the Tax Incentives Statute.

All relevant information concerning the activity to be performed by the company must be included in the licence application, namely:

  • Company name and address;
  • Activity to be undertaken and respective NACE code (European nomenclature of the economic activity);
  • The total value of the investment;
  • Indication of the number of jobs to be created.

In the case of a successful application, the licence is deemed to be granted in favour of the company once the applicant furnishes proof of the formation and registration of such company. All documents in support of the licence application must be duly translated into Portuguese and legalised.

Please consult the Legislation and our Document Library for details on the relevant law and pro-forma documents, namely examples of licence applications.



Applicable fees

Companies licensed to operate in the IBC of Madeira will be subject to license and annual fees which are set by Order n.º 222/99, of the 28th of December published by the Regional Government of Madeira.

Service-oriented companies formed as Lda. and performing telecommunications or e-business activities will be subject to an application fee of €1,000 and to an annual fee of €1,800.



Company Formation

Among the various legal structures available according to Portuguese law, investors have generally chosen the share company (S.A.) and the private limited company (Lda.). Also available is the branch, often used to operate within the legal framework of Madeira's IBC.

Private limited companies (Lda.) may be incorporated with a single shareholder and a minimum capital of €1 (one Euro) per shareholder. This type of company does not need to appoint directors; the minimum requirement is to appoint a manager who, by law, has the power to undertake the management of the company.

Share companies (S.A.) may also be incorporated with a single shareholder and a minimum capital of Euro 50,000. The management of these companies must be guaranteed by a board of directors made up by the number of members defined in the bylaws of the company. If the share capital does not exceed Euro 200,000, these need only one director.

Branches, on the other hand, have no minimum capital requirements.

Shareholders of IBC companies may be an individual or a company, national or foreign. According to Portuguese Law, shareholders may also be the managers or directors of the company or may choose to appoint an individual to act as manager of the company.

Companies must keep the head office in Madeira, whilst branches are required to maintain legal representation.

Companies are formed in the IBC of Madeira through the use of the Private Deeds Registry Office with full exemption from fees and notary costs. Before incorporation, a name approval certificate and a provisional identification card must be requested to the National Company Registrar (RNPC). The public deed will be performed on the date indicated by the notary office.




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