The taxation of dividends paid by Portuguese resident companies to nonresident C.I.V.’s has become one of the most litigated and structurally significant issues in Portuguese tax law. What began as a technical discussion concerning the scope of a domestic tax exemption has evolved into a consolidated body of caselaw confirming a structural incompatibility between Portuguese tax legislation and European Union law, in particular the principle of free movement of capital. In his article, António Gaspar Schwalbach of Spear Legal, Lisbon, revisits the Portuguese tax regime applicable to dividends distributed to C.I.V.’s, and addresses the practical consequences for nonresident funds, asset managers, and custodians, including the recovery of withholding tax and indemnity interest.