The real estate market is booming in Portugal, specifically the residential segment. Contrary to what you might expect, the buying and selling of houses has not slowed down in times of pandemic. But this is a sector that has undergone constant changes over the years, particularly legislative ones. And there are new developments in the pipeline for 2022 relating to real estate brokerage. The aim is to combat fraud in the sector and unauthorized financial activities. We'll explain everything about this topic on a legal basis.
As of March 1, 2022, there is a new law to take into account, which concerns the acts that usually signify real estate deals and which binds those who draw them up, such as registrars or notaries, or lawyers or solicitors, begins by explaining the lawyer Ricardo Matos Fernandes, in this article prepared for idealista/news.
The aim of the new law (Law no. 78/2021) is to prevent and combat the exercise of unauthorized financial activity, related to products that, in their true genesis, can refer to “real fraudulent schemes practiced by people who take advantage of moments of personal or financial fragility of citizens”, writes in the draft law of the diploma published on November 24, 2021 - the “Regime for preventing and combating unauthorized financial activity and protecting consumers”.
“Unauthorized financial activity”, under the terms of this law, consists of “the attempt or practice of acts or the professional exercise of activity regulated by the legislation of the financial sector without qualification or registration, or other permissive facts legally due or outside the scope that results from the qualification, registration or these facts”.
What changes?
What changes? Conservators, notaries, solicitors, lawyers, registrars or chambers of commerce and industry are now obliged to refrain from carrying out any operation or set of operations, present or future, which they know or suspect may be associated with the attempt or exercise of unauthorized financial activity.
Thus, as of March 1, 2022, notaries, solicitors and lawyers will have to report on a platform to be made available by the Bank of Portugal (BdP) information on public deeds, notarized private documents or documents with their own recognized signature in which they intervene, with the exception of those in which they act on behalf of authorized entities, if they relate to:
- The attempt or exercise of unauthorized financial activity, namely in loan contracts or declarations of assumption or confession of debt;
- Financial leasing contracts;
- Restitutive financial leasing contracts;
- Contracts for the purchase and sale of real estate associated with a lease to the seller or transfer of ownership to the original seller;
- Contracts for the purchase and sale of real estate or movable property subject to registration that do not involve the granting of a loan by entities authorized to carry out credit activity, whenever the buyer has already been a seller of the same property, or the lease or usufruct of the real estate or usufruct of the movable property by the seller is foreseen, or the option to repurchase the property by the seller is foreseen;
- These entities are also obliged to first consult the public register of authorized entities, available on the BoP's website, and to state in the document to be concluded whether or not the act, contract or document in question is entered into as part of the exercise of a financial activity reserved for entities authorized by the BoP, disclosing the information obtained to the parties and stating it in the document;
- On the other hand, the same professionals, when intervening in acts of debt assumption or confession or loan contracts, have a duty to check with the lenders that they are not registered in the aforementioned public register of authorized entities and, if so, to obtain a declaration from the lender that they are not carrying out an activity reserved for entities authorized by the BdP and to include it in the document in question.
The new law under the microscope
“As of January 1st - the date on which the law comes into force - in civil loan contracts over 2,500 euros, delivery of the loaned amount must be made by bank instrument - check or bank transfer - and the contract must mention the date and the bank instrument used, as well as the information necessary for its documentary or computer traceability,” warns the lawyer, who works in Real Estate Law and Real Estate Mediation.
Failure to comply with these obligations is punishable by disciplinary or ethical sanctions by the competent entities or bodies, such as the IRN and the respective Orders, without prejudice to criminal or administrative sanctions.
On the other hand, within the scope of its misdemeanour powers, the BdP can only use the information contained in this database for the purposes of preventing, combating and sanctioning unauthorized financial activity, explains the lawyer.
Source: idealistanews