That was my first thought as well. But when you consider that a load of Portugese people started following them, all talking to each other in Portugese and they entered a Portugese restaurant where all the customers and staff were Portugese, I don't see how this could be in France. Unless of course there was some form of "Little Portugal" set-up happening.
Plus, I'm pretty sure that in his broken Portugese, Colin Firth says "I will inhabit here with you in Portugal or you can inhabit with me in England."