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Portugal’s failure to transpose the EU NPL Directive leaves an impact on the local market

Portugal
06/12/2024
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Although the deadline for transposing the NPL Directive was 29 December 2023, Portugal has not yet transposed this EU directive on non-performing loans into national law.

Portuguese political parties have expressed their intent to approve the relevant legislation in the new parliament, but currently there are no drafts or working documents. In this context, one Portuguese party presented a draft resolution to Parliament (Projeto de Resolução n.º 46/XVI/1.ª), which recommends that the government transpose the NPL Directive as a matter of national urgency. 

In this interim situation, the directive states that entities in any EU member state that carry out services pursuant to national law servicing activities after 30 December 2023 were allowed to continue carrying out such servicing activities until 29 June 2024 or until such entities obtain the relevant authorisation pursuant to the NPL Directive, whichever came first.

In addition, any member state that already has an equivalent or stricter legal framework for servicing activities than the one set forth in the NPL Directive may allow entities already carrying out servicing activities under such legal frameworks on 30 December 2023 to be automatically recognised as authorised servicers by the national provisions transposing the NPL Directive.

These provisions have allowed for provisional servicing activities in Portugal, but lawmakers appear to understand the necessity of transposing the NPL Directive into Portuguese law. Whether this will translate to action in the upcoming parliament remains to be seen.

For more information on NPL servicing in Portugal, contact your CMS client partner or these CMS experts.

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