PORTUGAL Law and Practice Contributed by: João Gonçalo Galvão, Carolina Cardoso Alves, Miguel Paquete and Mafalda Oliveira Cordeiro, CS’Associados
restructuring scenarios where new debt is ranked with priority. Under the Portuguese Insolvency Code, the so-called Special Revitalisation Procedure allows new financing under a recovery plan to be given preferen - tial treatment over existing secured debt. Moreover, under the Extrajudicial Business Recovery Regime, new financing can be given priority subject to credi - tors’ agreement. 3.8 Lenders’ Liability Under Environmental Laws Please see 2.7 Soil Pollution or Environmental Con- tamination . 3.9 Effects of a Borrower Becoming Insolvent Security interests do not automatically become void upon insolvency. However, security created within the two years prior to an insolvency may be voided if deemed fraudulent or preferential, especially if granted for pre-existing debt. Furthermore, cases in which the debtor provided in rem guarantees for pre-existing obligations or other obligations replacing them, or simultaneously with incurring new guaranteed obligations, respectively within six months or 60 days prior to the commence - ment of insolvency proceedings, may be settled in favour of the insolvency estate. Secured creditors cannot enforce their security during insolvency proceedings, but may provide input on the type of sale and minimum price of the encumbered asset, having also the right to request to acquire the real estate. Creditors that benefit from statutory liens rank before secured creditors, which otherwise retain priority over the secured asset, above common and subordinated creditors. Security interests granted as part of new financing during insolvency proceedings are generally upheld to encourage business recovery. 3.10 Taxes on Loans Both lenders and borrowers involved in real estate mortgage loans are subject to stamp duty, levied on the value of the loan (tax rates varying as per loan
maturity) or, if the mortgage is not granted simultane - ously with the loan being entered into, on its maximum secured value (rates also varying as per mortgage duration). Furthermore, notarial/authentication fees will apply in respect of the deed or private document titling the mortgage incorporation, as well as LRO fees for registration. At time of writing, there are no publicly available indi - cations of pending or proposed changes to the exist - ing tax regulations concerning mortgage or mezzanine loans in Portugal. At the time of writing, land use, development, design and construction are regulated by the General Regu - lation for Urban Constructions (approved by Decree- Law 38382 of 7 August 1951), by specific legislative and governmental acts regarding engineering pro - jects, and by municipal plans. The General Regulation for Urban Constructions will be deemed revoked from 1 June 2026. Until this date, the Portuguese Government is required to prepare a Construction Code that will consolidate all technical rules applicable to construction projects. 4. Planning and Zoning 4.1 Planning and Zoning Framework The municipalities set the regulation for development and designated use of individual parcels of real estate through municipal plans, namely master plans, urbani - sation plans or detailed plans. These plans are binding on private parties and public entities in the context of project development, and are issued in accordance with the Legal Framework for Land Management Instruments approved by Decree-Law 80/2015 of 14 May. The municipal master plan must be approved and applied in all municipalities and sets the general zon - ing rules applicable to different areas within its juris - diction. The urbanisation plan and the detailed plan are appli - cable to specific areas of a municipality. The first enhances the municipal master plan land use rules
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