CPCV in Portugal: Key Legal Rules for American Buyers

Promissory Contract of Purchase and Sale (CPCV):

Updated Legal Framework and Essential Rules

The Promissory Contract of Purchase and Sale (CPCV) is one of the most important instruments in Portuguese real estate law. Its relevance becomes evident whenever the buyer and seller reach an agreement on the essential elements of a future property transfer, establishing from the outset the fundamental terms of the transaction.

1. Purpose and Content of the CPCV

The CPCV sets out, in a binding manner, the conditions under which the final deed will be executed. It typically includes:

• the price and payment terms

• full identification of the property

• essential deadlines

• guarantees and obligations of each party

• conditions for the handover of the property (traditio rei)

As an intermediate step, the CPCV provides legal certainty, reducing risks and protecting both parties until the final deed is executed.

2. Formal Requirements: Notarised Signatures

Portuguese law is unequivocal regarding the formal requirements for a valid CPCV involving real estate. The contract is only valid if:

• it is signed by both parties, and

• the signatures are notarised in person.

Under Article 410(3) of the Portuguese Civil Code, the document must also include:

• the in‑person notarisation of the signatures of the promisor(s), and

• certification of the existence of the use licence or construction licence for the property.

The legislator’s intention is clear: to ensure the identity and authority of the signatories and to confirm that the property complies with legal documentation requirements, preventing illegal construction or the absence of a valid licence.

3. Consequences of Missing Signature Recognition

Failure to comply with this formality results in mixed invalidity of the contract. However, this invalidity may be remedied later, for example, by obtaining the required use or construction licence.

Portuguese case law consistently affirms that Article 410(3) establishes an imperative rule, designed to protect the promissory buyer given the significant financial and patrimonial interests involved. The notarisation requirement reinforces:

• the solemnity of the act

• the parties’ awareness of their obligations

• the overall legal security of the transaction

4. Waiver Clauses: Are They Valid?

It is common for parties to ask whether they can include a clause in the CPCV that waives the need for notarised signatures or prevents either party from invoking the resulting nullity.

The answer is unequivocal: they cannot.

Case law has repeatedly confirmed that:

• Article 410(3) is a rule of public interest and mandatory nature

• any clause attempting to waive the notarisation requirement is null and void

• any clause preventing a party from invoking nullity is also null, under Article 220 of the Civil Code

Likewise, a clause that automatically classifies such an invocation as abuse of rights is invalid, as this assessment must always be made on a case‑by‑case basis.

5. When Can There Be Abuse of Rights?

Despite the mandatory nature of the rule, abuse of rights may occur when:

• both parties knowingly dispense with the formal requirement

• they execute the contract for months without raising objections

• and only later does one party invoke nullity for convenience

In such cases, courts may consider the behaviour contrary to good faith.

6. Impact of the SIMPLEX Reforms: Article 410 Remains Unchanged

Although the SIMPLEX legislative package introduced significant changes in urban planning — including the removal of the obligation to present the use licence in property transfer deeds — Article 410(3) of the Civil Code was not amended.

Therefore, the use or construction licence is still required for the notarisation of signatures in a CPCV.

Conclusion

The CPCV remains a fundamental instrument in Portuguese real estate transactions, requiring strict compliance with formal and documentary requirements. The notarisation of signatures and certification of the property’s licence are mandatory legal safeguards designed to protect both parties and ensure the legality of the transaction.