Portugal's 2025 Election: Political Shifts and Implications for the Golden Visa Program

Election Results and Political Landscape

Portugal has just concluded its third snap general election in three years with the Democratic Alliance (AD), led by incumbent Prime Minister Luís Montenegro, securing victory with 32.7% of the vote, winning 89 seats in the 230-seat parliament. While this represents an improvement from their previous position, the AD still falls short of the 116 seats needed for an absolute majority.

The election has produced significant shifts in Portugal's political landscape. The Socialist Party (PS), traditionally one of the two dominant political forces, received 23.4% of the vote (58 seats), one of the worst results in the party's 52-year history, prompting leader Pedro Nuno Santos to announce his resignation on election night.

Perhaps the most notable outcome is the continued rise of Chega ("Enough"), a far-right party formed just six years ago. Chega secured 22.6% of the vote and 58 seats, matching the Socialists' seat count and potentially positioning itself as the main opposition party once votes from abroad are fully counted. This represents a significant breakthrough in Portuguese politics, effectively ending the long-standing two-party dominance.

For the first time since Portuguese democracy was restored in 1976, the two largest parties combined hold less than two-thirds of parliamentary seats. Conversely, right-leaning parties together now control two-thirds of seats - a critical threshold for constitutional changes.

Political Context and Government Formation

This election was triggered after Montenegro's minority government failed to survive a confidence vote in March 2025. The vote came amid controversy surrounding a data protection consultancy that Montenegro founded in 2021 and later transferred to his family members, raising questions about potential conflicts of interest.

Montenegro has consistently denied any wrongdoing and used the election as an opportunity to "end the atmosphere of permanent insinuations and intrigues." Voters appear to have largely dismissed the opposition's criticisms, instead punishing the Socialists for their role in bringing down the government.

The election campaign focused on several key issues affecting Portuguese citizens, including:

• Housing crisis and soaring rental prices
• Public services under strain
• Safety concerns
• Immigration policies
• Economic challenges, with an average monthly wage of €1,602 (£1,346)

Despite Montenegro's victory, forming a stable government will be challenging. The Prime Minister has repeatedly refused to form a coalition with Chega, stating that the party "isn't reliable in its thinking" and "behaves like a political weathervane." Similarly, the Liberal Initiative, which could provide additional support to the AD, has rejected any arrangement that would help bring Chega into power.

Potential implications for the Golden Visa Program

The recent election results could have important implications for the future of the program:

1. Potential Stricter Requirements: The AD coalition had announced intentions to propose changes to naturalization requirements before the election. These would include extending the minimum period of residence and requiring more "effective presence" in Portugal for citizenship eligibility.
2. Program Stability: While the AD has historically supported the Golden Visa program (the Social Democratic Party originally introduced it), the current political climate might lead to additional modifications. However, a complete elimination of the program seems unlikely under an AD government.
3. Focus on Social Impact: The recently announced "Social Golden Visa" or "Solidarity Visa" initiative aims to channel private capital into social investment for immigrant integration and affordable housing projects. This aligns with the AD's emphasis on investments that deliver tangible benefits to Portuguese society. Although mentioned over 12 months ago, nothing has happened on this initiative.
4. Implementation Challenges: Given Montenegro's minority government status, implementing significant changes to the Golden Visa program will require building consensus across parties. This political fragmentation might slow down any major reforms.

For current Golden Visa holders and applicants in progress, it's worth noting that previous program changes have not been retroactive. Those who initiated their investments under previous rules have maintained their status under those terms.

How quickly would we see a change? 

It is important to note that any change to the rules governing the program must pass through an extensive process. Based on the historical precedent and current political situation, if the AD government decides to proceed with changes to the Golden Visa program:

1. The legislative process would likely begin in late 2025 or early 2026 (after forming a stable government)
2. Parliamentary approval might take 3-6 months, especially given the need for broader consensus
3. Following presidential approval, a 3-6 month transition period would likely be established
4. Full implementation would occur approximately 12-18 months after the initial proposal, sometime in 2027/28

Importantly, existing Golden Visa holders would be grandfathered under the rules that applied when you received your visas, though you might face different requirements if you later apply for citizenship under updated naturalization laws.

For our investors in the Golden Visa program

Here are the key takeaways:

1. Program Stability: The Golden Visa program continues to be a major source of FDI into Portugal and is supported by the winning party and other right-wing parties (Chega and Partido Liberal) that together will have around 70% of the seats in parliament. The political fragmentation of a coalition government will continue to provide a window of stability for current and near-term applicants.
2. Potential for Changes: The AD coalition had previously announced intentions to propose plans to tighten naturalization requirements, including extending the minimum period of residence and requiring more "effective presence" in Portugal for citizenship eligibility. With their election victory, these proposals may advance, although implementation would likely take 12-18 months due to the legislative process.
3. Minority Government Challenges: As the AD will govern with a minority, any major changes to immigration policies will require support from other parties, which will slow down or moderate reforms.
4. No Retroactive Application: Historically, changes to the Golden Visa program have NOT been applied retroactively to existing visa holders. Those who have already secured their visas or have applications in process should be protected by transitional provisions, though this is always determined on a case-by-case basis in the legislation itself.
5. Anticipate Improvements: Contrary to the previous government led by the Socialist Party (PS) until beginning of 2024, the current AD government looks serious to improve significantly the immigration bureau (AIMA), efficiency, a trend that should continue with the new government.
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   For any questions related to the Portugal Golden Visa program, please reach out to hello@tejoventures.com