May 2017


Public consultation on the creation of loan funds within the Portuguese legal framework.

The Securities Market Commission (“Comissão do Mercado de Valores Mobiliários” or "CMVM") launched a public consultation on the possibility of creating loan funds (“fundos de créditos”) within the Portuguese legal framework (link).

The public consultation, which will be open until 30 June 2017, aims to consult the opinion of market players, investors and the general public regarding the possibility for Collective Investment Undertakings (“Organismos de Investimento Coletivo” or "OICs") to originate and lend directly to companies, through loan funds.

For the purposes of this consultation paper, CMVM has considered, in particular, the legal framework of Member States which provide for loan origination by funds, such as Germany, Spain, France, Ireland, Italy and Malta, as well as the Opinion of the European Securities and Markets Authority (“Autoridade Europeia dos Valores Mobiliários e dos Mercados” or "ESMA") entitled "Opinion - Key principles for a European framework on loan origination by funds" (link).

Loan funds can be defined as the funds that aim, exclusively or as a main purpose, to provide credit directly to borrowers – loan origination (“originação de créditos”) –, or to participate in a partnership for the provision of credit, or to acquire loans originated by banks or other entities, by means of the assignment of credits – loan participation (“participação no crédito”).

CMVM has pointed out the following goals for the creation of loan funds: (i) to eliminate competitive disadvantages for national entities vis-à-vis entities from other Member States which can market these vehicles in the European Union, (ii) to reduce the excessive reliance on the banking system, (iii) to provide alternative measures of financing to bank credit, and (iv) to promote alternative forms of financing for small and medium-sized enterprises (“SMEs” or “PMEs”) through the streamlining of funding mechanisms.

Capital Markets Union ("CMU"), as well as the European Commission, has been working in order to create a harmonized European system for loan funds. Nevertheless, this goal has not yet been achieved.

Consequently, it seems appropriate to discuss the possibility of implementing loan funds within the Portuguese legal framework, until a harmonized European system is adopted by the European institutions, similarly to what has occurred in other Member States.

Furthermore, CMVM has submitted other queries on this subject to public consultation, specifically: (i) the structure, purpose and typology of the loan funds, (ii) the target investors, (iii) the type and requirements for the managing entities, (iv) the maximum limit for the maturity of the loans, (v) the eligible borrowers, (vi) the diversification requirements, (vii) the indebtedness of the loan funds, (viii) the specific duties of information, (ix) the supervision of the loan funds, and (x) the performance of stress tests.

Responses to the public consultation must be sent to CMVM by 30 June 2017 (by email:, by post: Rua Laura Alves, 4, 1050-138 Lisboa, or by fax: +351 21 353 70 77/78).

Should you have any comments or suggestions regarding the issues mentioned above, please feel free to contact us.

Pedro Ferreira Malaquias
Corporate / M&A Department
Partner. Lisbon office
+351 210 308 661

Mafalda Almeida Carvalho
Corporate / M&A Department
Senior Associate. Lisbon office
+351 210 920 102

The information contained in this Newsletter is of a general nature and does not constitute legal advice