Algarve 2030 — Support for Business Creation and Modernization

The Place-Based Incentive Scheme — Innovation and Modernisation to Increase Production and Create New Companies and Businesses, under the Algarve 2030 Regional Programme, is a financing instrument designed to foster business investment, regional economic diversification, and the competitiveness of micro and small enterprises.

Through Call ALGARVE-2026-5, companies can benefit from non-repayable grants to carry out small-scale productive investments aimed at creating new business activities or expanding and modernising existing ones.

The incentive aims to contribute to a more diversified, innovative, and resilient regional economy by promoting economic activities capable of adding value, strengthening production chains, and reducing dependence on traditional sectors.

The call covers two main investment categories:

• Creation of micro and small enterprises: projects submitted by companies active for less than five years at the date of application.

• Business expansion or modernisation: projects submitted by companies active for five or more years, focused on strengthening or transforming their operations.

Projects must relate to the industrial sector or fall within the priority areas of the Smart Specialisation Strategy for the Algarve (EREI Algarve), namely Ocean Economy, Terrestrial Endogenous Resources, Cultural and Creative Industries, Health, Well-being and Longevity, Environmental Sustainability, and Digitalisation and Information and Communication Technologies.

Funding can cover the acquisition of productive equipment, technologies, software, investments in facilities, specialised technical services, and other expenses directly related to project execution, subject to eligibility criteria.

The maximum funding rate is 60% of eligible expenses, depending on the investment location and applicable bonus criteria.

Beyond physical investment, the call values projects that introduce new products, services, or processes, maintain jobs, and contribute to regional economic growth.

Applications require a solid justification of the investment need, its alignment with corporate strategy, its contribution to economic diversification, and the financial standing of the promoter.

This is therefore a financing opportunity for micro and small enterprises seeking to establish, expand, or modernise productive activities in the Algarve through economically sustainable investments aligned with regional priorities.

Aspects requiring special attention

Submitting an investment of €25,000 or more does not guarantee eligibility. It is essential to verify sector compliance, the actual location of the establishment, the company's financial standing, the existence of at least one paid job in the Algarve, and compliance with all other regulatory requirements.

It should also be noted that the maximum 60% rate is not automatic and that funding is subject to the de minimis aid ceiling applicable to a single undertaking.

The core objective of Call ALGARVE-2026-5 is to promote the diversification of the regional productive base by supporting the creation, expansion, and modernisation of micro and small enterprises through investments capable of generating higher added value, innovation, and competitiveness.

Specific Objectives

Diversifying the regional economic structure

Encouraging the development of productive and business activities aligned with regional strategic domains, contributing to a less concentrated and more resilient economy.

Stimulating business investment

Supporting the acquisition of equipment, technologies, and other assets required to establish or modernise eligible economic activities.

Fostering innovation

Encouraging the introduction of new products, services, processes, and organisational improvements that enhance company differentiation.

Strengthening regional value chains

Prioritising projects that develop activities directly related to sectors vital to the region, including production, processing, value enhancement, and technological integration.

Preserving and creating jobs

Promoting the preservation of existing jobs and, where planned in the projects, the creation of new employment linked to the investments made.

Increasing business resilience

Contributing to technological and organisational modernisation, strengthening productive capacity, and ensuring the sustainability of economic activities.

Indicators associated with the operations

The call requires a cumulative contribution to four indicators: two output indicators and two result indicators.

The setting of targets must be consistent with the investment, the size of the company, and the realistically projected outcomes.

Micro and small enterprises carrying out or intending to carry out eligible investments in the Algarve region are eligible to apply under Call ALGARVE-2026-5.

Medium-sized and large enterprises are not covered by this call.

Specific eligibility requirements

Applicant companies must meet, among others, the following criteria:

• Have a physical establishment in the Algarve where the investment will be carried out.

• Have, at the date of application, at least one paid job, in full-time equivalent (FTE), assigned to the establishment in the region.

• Maintain organised accounts.

• Present an eligible investment equal to or greater than €25,000.

• Demonstrate appropriate funding sources to implement the project.

• Present a project consistent with the call's objectives and with industrial activity or the domains of the Algarve RIS3.

• Comply with the requirements regarding the 'Do No Significant Harm' (DNSH) principle.

• Contribute to the four required output and result indicators.

• Adhere to the established execution timeframe.

The age of the enterprise determines the framework modality: creation of enterprises with less than five years of activity, or expansion/modernisation of enterprises with five or more years.

General requirements

Pursuant to Decree-Law no. 20-A/2023 and the Specific Regulation for the Thematic Area of Innovation and Digital Transition (REITD), the applicable general conditions must also be met, notably:

• Legal incorporation and registration of the company, including the Central Register of Beneficial Owners (RCBE), where applicable.

• Regularised tax and social security status.

• Regularised status regarding the refund of public support.

• Legal qualification to carry out the activity.

• Balanced economic and financial standing and financing capacity.

• No legal impediments to accessing support.

• Absence of insolvency status and overdue wages.

• Compliance with the rules against double financing.

The application must be accompanied by the required supporting documentation, including accounting and financial records, labour documentation, and declarations of commitment.

Important: eligibility depends on the joint assessment of the company, the economic activity, and the proposed investment.

Eligible region

The call covers the Algarve region (NUTS II).

The relevant location corresponds to the company's physical establishment where the investment will be made.

It is not sufficient for the company to have a registered office or a virtual rental address in the Algarve. An effective operational facility associated with the operation must be proven.

Sectors covered

The call supports investments in the industrial sector or in activities directly related to the domains of the Regional Smart Specialisation Strategy:

Alignment with strategic domains must demonstrate an effective relationship with transformative actions and the objectives of the investment.

The mere occasional use of regional resources is not sufficient to establish a meaningful link to the value chain.

NACE/CAE and excluded activities

The call excludes activities within the tourism sector, expressly identifying the following CAE Rev. 4 codes:

The presence of references to tourism activities in the RIS3 transformative actions does not override these express exclusions.

Projects integrated into strategies led by Local Action Groups (LAGs), supported by the EAFRD or EMFAF, are also ineligible.

Sectoral eligibility must be confirmed through the CAE Rev. 4 and, above all, the activity actually carried out as part of the project.

Call ALGARVE-2026-5 supports business investments aimed at creating, expanding, and modernising productive activities and businesses aligned with the Algarve's economic development priorities.

Investments must contribute to diversifying the productive base, introducing innovation, and strengthening business competitiveness.

Creation of micro and small enterprises

Projects promoted by companies with less than five years of activity that aim to develop new eligible business activities are supported.

The investment may include setting up and operating productive capacity, acquiring equipment and technologies, and implementing the resources necessary for the activity.

The application must demonstrate business viability, the necessity of the investments, and the contribution to the regional economy.

Expansion of business activity

Operations by companies with five or more years of activity seeking to expand their business are eligible.

The investment must have a specific business purpose and contribute to the development of the activity, without being limited to standard equipment replacement.

Technological and productive modernisation

The call supports investments that promote company modernisation through the incorporation of equipment, technologies, software, and improvements in production processes.

Modernisation must be linked to objectives of competitiveness, differentiation, efficiency, or innovation.

Development of new products, services, or processes

Projects may include investments required for introducing new products, services, processes, or organisational improvements, provided they are directly related to the eligible activities.

This contribution is particularly important because innovation is part of the output indicators set out in the call.

Investments linked to regional priorities

Operations related to the transformative actions of RIS3 Algarve are also eligible, including, where sectoral requirements are met:

• Technologies and solutions for the blue economy.

• Valorisation of endogenous resources and product development.

• Creative production and technological solutions.

• Development of health products and technologies.

• Digital technologies and ICT solutions.

• Resource efficiency and circular economy.

Being included in one of these areas does not waive the requirement to demonstrate a direct link between the investment, the economic activity, and the intended results.

Key conditions

Investments must be necessary, proportionate, and consistent with the work plan, comply with expenditure eligibility rules, and be carried out at the establishment covered by the application.

Investments involving routine maintenance or standard replacement, as well as expenses associated with normal business operations, are not eligible.

Call ALGARVE-2026-5 provides funding for expenses directly related to the implementation of the investment project, pursuant to Article 76 of the Specific Regulation for the Climate and Digital Transition and the specific conditions set out in the call.

Productive machinery and equipment

Expenses for the acquisition of machinery and equipment necessary for the activity carried out are eligible, including costs directly attributable to their installation and commissioning.

Equipment must be related to the project's objectives and be used at the establishment where the operation takes place.

IT equipment and software

IT equipment and the software necessary for its operation can be funded, as well as intangible assets related to the technological modernisation of the company.

Regarding software, the call establishes an important restriction: only perpetual licences are eligible.

Expenses under subscription, rental, update, or recurring renewal schemes are not eligible.

Intangible assets and technology transfer

Investments in patent rights, licences, non-patented technical knowledge, and standard or purpose-built software are eligible.

These assets must be amortisable and integrated into the company's assets.

Construction and refurbishment of facilities

Expenses for building construction, refurbishment works, and other construction may be supported, provided they are duly justified by the operation's objectives.

Eligibility depends on demonstrating the necessity of the works, their relationship to the investment, and compliance with applicable licensing or prior control requirements.

Studies and technical services

Studies, diagnostics, audits, marketing plans, and architectural and engineering services essential to the project's implementation are eligible.

Cap: up to 15% of the application's total investment.

Specialised consultancy

Specialised services provided by external consultants are eligible, provided they do not constitute recurring or standard operational business activities.

The costs of monitoring and executing the application, including the involvement of certified accountants or statutory auditors in validating expenses, are subject to a specific cap of €3,000.

The preparation and drafting of the application do not constitute eligible expenses.

Certification, trademarks, and industrial property

Expenses for the certification of products, processes, or services are eligible, as well as costs for designing and registering new trademarks, when directly related to the operation.

Indirect costs

The call provides for indirect costs via a flat rate of 7% of total eligible direct costs, in accordance with the applicable simplified cost option.

Vehicles

The purchase of vehicles may only be considered in exceptional, duly justified circumstances, provided they are essential and directly allocated to the production process.

Passenger vehicles are not eligible. Restrictions regarding the use of fossil fuels also apply.

Ineligible Expenses and Main Exclusions

Non-eligible expenses include, in particular:

• Recoverable VAT.

• Purchase of land or real estate.

• Purchase of used goods.

• Working capital.

• Standard operating and maintenance costs.

• Routine replacement investments.

• Periodic software subscriptions and renewals.

• Application preparation costs.

• Own-account work carried out by the company.

• Financial charges, interest, fines, and penalties.

• Operating costs directly associated with export activity.

• Expenses not supported by fiscally valid documentation.

Timeline rules

Expenses must, as a rule, be incurred and paid after the application has been submitted, without prejudice to the exceptions expressly provided for in the REITD.

Carrying out investments prematurely may jeopardize the operation's eligibility.

Call ALGARVE-2026-5 provides funding in the form of a non-repayable grant through the ERDF.

The funding rate depends on the territorial location of the investment and any applicable uplift bonuses.

Base rates

Applicable uplifts

The maximum funding rate is 60%, even when the sum of the base rate and the theoretically applicable uplifts exceeds this threshold.

The awarding of uplifts is subject to demonstrating compliance with the respective requirements and is not automatic.

Financial thresholds

Funding falls under Regulation (EU) 2023/2831 on de minimis aid.

The €300,000 limit takes into account aid covered by this regime granted to the single undertaking during the relevant period, meaning previously received support must be verified.

The total budget of €5 million corresponds to the overall amount available for the call, not the maximum funding per individual project.

Payment modalities

The call provides for advance payment, reimbursement, and payment against invoice mechanisms, pursuant to the applicable regulatory rules.

The specific payment modality applied depends on the conditions and procedures defined for the operation's implementation.

Applications submitted to Call ALGARVE-2026-5 are evaluated using the Project Merit (PM) indicator, which weighs four core criteria.

Evaluation formula

Scores are awarded on a scale from 1 to 5.

A — Strategic Alignment

This criterion assesses the project's alignment with regional priorities and its contribution to program indicators.

A1 — Alignment with the Algarve RIS3

Alignment with a RIS3 transformative action is evaluated as follows:

A2 — Contribution to indicators

The call features a matrix that combines job maintenance with the introduction of new products, services, or processes.

B — Quality

Assesses project consistency, the justification of needs, the adequacy of the investment plan, and its contribution to business competitiveness.

It is especially important to demonstrate that the proposed expenditure is necessary and proportionate to the intended results.

C — Implementation Capacity

Assesses the company's capacity to execute the operation, considering the elements outlined in the call's merit scoring grid.

Demonstrating financial viability, investment organization, and available resources is of particular importance.

D — Impact

Assesses the expected effects of the project, in accordance with the sub-criteria set out in Annex A-4.

Representing 40% of the overall score, this is the most heavily weighted evaluation criterion.

Minimum score and ranking

The minimum merit score cannot be lower than 3.00 points, and eligible applications are ranked in descending order based on the merit score achieved.

Approval also depends on the application's relative ranking and the available budget.

In the event of a tie, priority will be given first to the score in criterion B, and subsequently to the date and time of submission.

Technical note: the full sub-criteria for B, C, and D must be verified against the complete grid in Annex A-4 before final publication. Unconfirmed formulas or scores are not assigned here.

The application period for Call ALGARVE-2026-5 runs, according to the document provided, from 30 April 2026 to 15 January 2027.

Schedule

Application stages

1. Eligibility assessment

Verification of company size, location, CAE (economic activity code), economic and financial standing, and project framework.

2. Investment definition

Structuring objectives, identifying eligible expenses, justifying needs, and defining expected results.

3. Document preparation

Annex A-1 requires, among other elements:

• Supplementary declaration of commitment.

• Social Security payroll declaration for the month prior to the application.

• List of human resources supporting documentation.

• 2025 IES (Simplified Corporate Information) or alternative accounting documentation provided for in the call.

• Proof of funding sources.

• Permanent commercial registry certificate.

• Documentation regarding licensing.

• Proof of the legitimate right to use the premises.

• DNSH self-assessment.

• Declaration regarding autonomous enterprise or single undertaking, for de minimis purposes.

For operations involving construction works, architectural projects, prior notices, technical declarations, and climate resilience documents may be required.

4. Registration and update on the Balcão dos Fundos portal

The beneficiary must be registered and authenticated on the platform, keeping the company's profile information up to date.

5. Application form preparation

Filling in the technical, economic, and financial information, indicators, investment plan, and any other required elements.

6. Electronic submission

The application is submitted via the Balcão dos Fundos.

7. Evaluation and decision

The call establishes an assessment period of 60 business days following the close of the applicable phase, subject to any statutory suspensions and extensions.

8. Acceptance of the decision

In the event of approval, the beneficiary must formalise acceptance through a qualified digital signature of the acceptance term within the stipulated period of 30 days.

Execution Deadline

The operation must be implemented within a maximum period of 18 months, which may be extended by up to a further six months, subject to justification and acceptance by the Managing Authority.

Approval of the application entails compliance with technical, financial, administrative, and regulatory obligations during project execution and following its completion.

Investment execution

The beneficiary must carry out the approved investments, adhering to the objectives, budget, timetable, and conditions set out in the funding decision.

Significant amendments to the operation may be subject to authorisation and a new decision by the Managing Authority.

Achievement of indicators

The company must meet the agreed targets relating to job retention, introduction of innovation, and economic or employment outcomes.

The call establishes a mechanism to assess the degree of achievement of the indicators.

Maintaining the full funding rate requires the average degree of achievement to reach at least 85%.

Where the achievement level is lower, penalties may apply:

Failure to meet core objectives, particularly in cases where the degree of achievement is below 40%, may lead to the revocation of the grant under statutory terms.

Financial and reporting obligations

The company must maintain supporting documentation for expenses, payments, investments carried out, and any other elements necessary for verifying the operation.

Incurred expenses must comply with eligibility rules and the procedures applicable to payment claims.

Environmental sustainability

Investments must comply with the DNSH principle and all other applicable environmental requirements.

Where infrastructure with a lifespan of at least five years is planned, requirements demonstrating climate resilience must be observed.

Publicity and communication

Beneficiaries must ensure appropriate recognition of the funding received, including the mandatory visual emblems and references to Algarve 2030, Portugal 2030, and the European Union.

Information regarding the operation must be published on the applicable communication channels, including the company's website.

For operations where the funded eligible cost exceeds €500,000, the call requires the production of a promotional video of the operation lasting at least one minute.

Failure to comply with communication obligations may result in a funding reduction of up to 3% of the approved European fund contribution.

Monitoring and verification

The beneficiary must provide all information and documents required for the review of payment claims, administrative checks, and any audit procedures.

Compliance with all obligations must be maintained throughout the entire applicable statutory period.

Applying to the Algarve 2030 Territorial-Based Incentive Scheme requires thorough preparation, particularly in proving company eligibility, classifying economic activities, substantiating investments, and assessing project merit.

Inov4You – Business Consulting, Lda., specialising in business investment incentives since 1993, supports companies at every stage of the process—from the initial assessment to monitoring the execution of the investment.

Eligibility assessment

We analyse the company size, facility location, economic activity code (CAE), economic and financial requirements, and the investment's alignment with the call.

Project structuring

We support the definition of business objectives, the organization of the investment plan, and the demonstration of its contribution to innovation, economic diversification, and competitiveness.

Alignment with RIS3 Algarve

We assess how the project aligns with the regional strategy's domains and transformative actions, identifying the technical elements required to substantiate its alignment.

Business plan and financial analysis

We prepare the economic and financial elements needed to demonstrate the investment's feasibility, funding capacity, and expected results.

Merit assessment

We analyze the selection criteria and identify opportunities to enhance the technical quality of the application, paying particular attention to economic impact and the coherence of the investments.

Preparation and submission

We organize the required documentation, prepare the technical and financial content, and monitor the application submission on the Balcão dos Fundos platform.

Execution monitoring

We provide support in organizing expenses, payment requests, fulfilling indicators, and meeting regulatory requirements.

Looking to set up, expand, or modernize your business in the Algarve?

Contact Inov4You and request an eligibility assessment for your project. Our team can review your investment's framework, financing terms, and the requirements needed to prepare a robust, well-founded application.