The title of this thread is 100% correct. Kate McCann did admit and accept in her book 'Madeleine' that private investigations in Portugal were illegal.
It should be pointed out however that this statement was incorrect.
From Madeleine.
"Our first investigators, the Spanish company Método 3, began working for us in October. With private investigations technically illegal in Portugal, we felt the closest we could get would be a firm from somewhere on the Iberian Peninsula, which would have the advantage of familiarity with local systems, culture and geography and the best network of contacts in the region."
Private investigations were not illegal in Portugal even in 2007 but private criminal investigations were considered illegal in that such had no basis in Law whilst an official police investigation was ongoing.
This was the understanding of Antonio Martins, president of the National Association of Portuguese Judges and Carlos Anjos, the head of Portugal's criminal police federation. Mr Martins is on record as stating that private detectives and even the McCanns themselves could be accused of "obstruction of justice" while Mr Anjos stated that Portugal does not have legislation in this area and that private detectives do not intervene in criminal cases. He added that private detectives are only tolerated in civil cases.