Law No. 11/21, of 22 April 2021, which will come into force on 19 October 2021, approves a new legal framework for security interests over movable assets, defined as guarantees on tangible and intangible movable assets and covering the pledge, movable-asset mortgages, the assignment of credit as guarantee, fiduciary transfer as guarantee, the sale with retention of ownership, and any other legal transactions whose function is to provide a guarantee on a movable asset. The new law also applies, adapted where appropriate, to definitive contractual assignments of credit and financial leasing.

The law changes significantly the legal framework applicable to rights in rem over movable assets contained in the Civil Code. Notable among the new rules are the following:

Guarantees may be created by contract, court decision or legal provision, establishing that the relevant contracts are valid and effective between the parties provided that they are a part of the documents signed by the parties. However, the guarantee may be created verbally, provided that it is followed by delivery of the relevant asset. On the other hand, the law has defined minimum requirements for the contract, and in situations where the guarantor and the debtor are distinct persons, the guarantee only becomes valid if the guarantor signs the contract creating the guarantee or delivers the asset. In cases where the contract is entered into between the third-party guarantor and the creditor, the guarantee only becomes valid with the express consent of the debtor.

The guarantee only becomes effective vis-à-vis third parties as follows:

• on the date it is made available for consultation on the website of the Central Movable Securities Registry;
• by delivery of the tangible asset or the document that confers the availability of the asset to the creditor or to a third party;
• by entering into a control agreement, when the guarantee is over a bank account or financial assets.

The priority of conventional, judicial and legal guarantees is determined by the date on which each became enforceable against third parties. The guarantee may cover one or more obligations of any kind, whether they be present or future, determined or determinable, conditional or unconditional, fixed or variable. However, if the amount of the guaranteed credit is indeterminate or variable, the relevant contract must establish the maximum amount guaranteed.

Security interests may be created over one or more movable assets, whether they be present or future, determined or determinable, tangible or intangible, fungible or non-fungible, provided that they can be transferred for consideration at the moment the security is created. Mineral and petroleum resources to be extracted may be encumbered by the holder of the right solely for the purposes of financing said exploration or extraction.

In the event of default, enforcement may be judicial or extrajudicial, while the appropriation of the asset by the creditor and the direct sale thereof are permitted, provided that it is expressly foreseen in the contract and that certain conditions are met.

Presidential Decree No. 114/21, of April 29 2021, which came into effect on the same day, created the Central Movable Securities Registry (Central de Registo de Garantias Mobiliárias, or "CRGM"), which is an electronic public service that centralizes, for the purposes of dissemination, all information on the registration of guarantees created on movable assets, also establishing the procedure for registration, alteration and consultation. Under this statute, a guarantee, and the respective assignments, is registered by the creditor, the assignee of a credit or the lessor, as the case may be, with the service responsible for the registration of ownership of the asset on which the guarantee is based, and the CRGM disseminates this information. In the case of assets that are not subject to registration of ownership, the registration is done on the IT platform managed by the CRGM.