PORTUGAL Law and Practice Contributed by: João Gonçalo Galvão, Carolina Cardoso Alves, Miguel Paquete and Mafalda Oliveira Cordeiro, CS’Associados
2.7 Soil Pollution or Environmental Contamination
• capacity and authority; • binding nature of the agreement with no contraven - tion; • lawful title, possession and ownership; • non-existence of charges or encumbrances, or limits to use or transferability; • suitability and validity of all licences; • compliance with applicable legal provisions; • non-existence of hazardous or dangerous sub - stances, as well as of defects; • non-existence of pending or threatened litigation or disputes; • non-existence of debts, including taxes, charges and fees; and • corporate aspects (for share deals). Post-transaction protection for the buyer is usually put in place via a combination of specific indemnities and compensation for breach of the representations and warranties. The seller’s liability may be subject to time and value limitations (including minimum thresholds and caps), though so-called fundamental warranties are normally not subject to any limitations. It is not uncommon for W&I insurance policies to be put in place in mid to high-value deals. 2.6 Important Areas of Law for Investors Investors should be aware of the civil law governing ownership and title over real estate, but also of the requirements for licensing, construction and usability. Tax aspects are also paramount, such as tax costs entailed by the acquisition and ownership of real estate, as well as the taxation applying to operation proceeds and exit. Corporate aspects should also be considered, either in the case of share deals or regarding the setting up and structuring of special purpose vehicles (SPVs). Concerning asset operation, investors should con - sider not only the regime applying to their lease and other forms of assigning their use or operation (par - ticularly of commercial schemes), but also the frame - work applying to tourist-related assets.
Environmental responsibility rests with those persons or entities that caused or did not take the necessary steps to avoid or mitigate environmental damage. As such, acquisition of real estate in Portugal does not automatically entail any responsibility for historical environmental contamination or pollution of non-exca - vated contaminated soils and permanent buildings with a permanent connection to the ground. However, once contaminated soil is excavated, it will be consid - ered as waste produced by the property owner, who will then be responsible for handling and processing it. Moreover, although responsibility for mitigation of soil contamination rests with the persons or entities that caused or failed to avoid or mitigate the contamina - tion, these may be in practice impossible to identify or to hold accountable, especially when the contamina - tion is remote historically, in which case the owner will have to ensure the required mitigation is carried out as a legal condition for developing the asset. 2.8 Permitted Uses of Real Estate Under Zoning or Planning Law Most municipalities have online platforms that detail the land management instruments governing a par - ticular parcel of real estate, which, when combined with an analysis of the applicable regulations, makes it possible to understand the permitted uses. If the municipality does not have such a platform, it should in any case provide information to any inter - ested parties regarding applicable land management instruments and the permitted uses, either through exercise of a right to information or through requests for prior information. Developers may enter into planning agreements with the municipality for drafting, revision and amendment of specific municipal plans. 2.9 Condemnation, Expropriation or Compulsory Purchase All public entities and concessionaires for public ser - vices are entitled to expropriate land.
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