Your company should normally be VAT registered in Portugal to report the physical movement of goods from France to Portugal. The subsequent sale of the raw materials to the client is treated as a domestic transaction subject to local VAT. Your company should therefore invoice its client with Portuguese VAT unless a local reverse charge mechanism is applicable [payment of VAT switched to the client].
Many EU countries have however implemented special measures avoiding foreign companies having to register and charge local VAT. The main issue that industry faces is that there is very little uniformity in the application of that scheme. They are many variances and different requirements in Member States to treat the supply of goods in a consignment or call-off stock .
Companies having consignment or call-off stock in various EU countries must pay attention to the following issues: