PORTUGAL Law and Practice Contributed by: Marta Pontes, Hélder Frias and José António Reymão Nogueira, Uría Menéndez
With regard to the registration requirements applicable to the pledge of shares and the pledge of quotas, see 5.3 Registration Process . The shares of limited liability companies by shares can be tendered as transferable securi- ties. Inventory Inventory can be granted as security for financ- ing agreements using a pledge. A pledge must meet the following conditions to be valid: • it must be granted by means of a written agreement; and • the possession of the asset must be trans- ferred to the beneficiary (pledgee) or a third party on its behalf. Bank Accounts and Receivables Under Portuguese law, different types of secu- rity can be granted, depending on the type of receivables in question. In most cases, receiva- bles are considered credit rights to be paid off under specific agreements, in which case secu- rity can be granted through a pledge over the credits. A pledge over credit rights must comply with the two following formalities: • the pledgor’s debtor must be informed of the credit transfer and identity of the pledgee; and • the legal documents required for the cred- its’ enforceability must be delivered to the pledgee. The credit rights arising from bank accounts are pledged in a similar way. The credit institution where the account is domiciled must be noti- fied to block the account and, in the case of enforcement of the pledge, to retain the specific pledged amount of funds. This process used to
be burdensome, but the reform of the Portu - guese Civil Code has simplified the formalities and requirements for enforceability of pledges over bank accounts. Under Portuguese law, two other types of secu- rity are usually used in facility agreements and take into account a different definition of the concept of “receivable” . Receivables can also be considered as one of the following. • Income of the debtor/third party itself – this income can be allocated by means of an assignment of income agreement ( consig- nação de receitas ). • Income generated by an asset belonging to the debtor/third party – this income can be subject to an assignment of revenues agree- ment ( consignação de rendimentos ), under which the proceeds generated by an immov- able or movable asset subject to registration are allocated to the repayment of the debtor’s obligations (Article 656, Portuguese Civil Code). Intellectual Property Rights Intellectual property rights can be granted as security by means of a pledge. A pledge must be registered with the Portuguese National Intel- lectual Property Institute. Real Property Real estate property can be encumbered by a mortgage. A mortgage is a special guarantee granted over an immovable asset. Movable Assets As for inventory, most movable assets (except those subject to registration) can be granted as security to financing agreements through a pledge. For movable assets subject to registra-
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