Litigation and international arbitration analysis and projections for 2026 in Portugal

As in previous years, we set out our views on the main developments and trends expected to shape litigation and international arbitration in Portugal in 2026.

1. Civil litigation

2. Criminal and administrative offences

3. International arbitration

4. Digital law and AI

5. Insolvency and restructuring

6. General contractual clauses and consumer litigation

7. Collective actions and unfair competition

8. European litigation

9. ESG litigation

10. Energy sector litigation

1. Civil litigation

Portugal is expected to introduce civil procedure reforms in 2026 to speed up proceedings, strengthen electronic case processing and tighten the supervision of courts' use of artificial intelligence (AI) tools.

• In civil procedure, measures to streamline proceedings are expected to be strengthened in 2026, as political and judicial stakeholders advocate for justice system reforms. The admissibility of “atypical" motions submitted by the parties is important here, as is the scope for challenging first-instance decisions on matters of fact. This is intended to speed up civil proceedings while ensuring parties' right to effective judicial protection.
• The electronic processing of proceedings is also expected to be further strengthened in line with the new regulations in this area (Ordinance 350-A/2025/1) and the default process for serving companies is now electronic (Decree-Law 87/2024 of 7 November). However, not all legal entities currently adhere to this standard.
• Increased control and supervision of the courts' use of AI tools is expected in 2026, particularly with regard to the delivery of judgments in cases where using AI is permitted. This follows a series of cases in 2025 where rulings were delivered that referenced fabricated case law due to an inadequate review of procedural documents.

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2. Criminal and administrative infringements

The Portuguese Government announced a significant criminal justice reform to reduce the duration and complexity of criminal proceedings, increase practical oversight and strengthen compliance and anti-corruption mechanisms. This reform could lead to administrative infringement proceedings under the General Corruption Prevention Regime.

• On 11 December 2025 the Portuguese Government announced at least 14 significant measures to be immediately implemented as part of the criminal justice reform. These measures aim to reduce the duration of criminal proceedings (including complex cases), which will involve strengthening judges' powers during the trial phase and reorganising the investigation, preliminary hearing and appeal phases. Further procedural changes will also take place regarding indictment, defence, simplified notifications, witness numbers, prior indication of essential evidence, extending the effects of confessions for more serious crimes, and fines for procedural acts intended to delay proceedings while ensuring compliance with constitutional guarantees.
• This reform of the justice system will also affect traditional confiscation regimes, including extended asset forfeiture associated with criminal convictions. This will continue to apply to targeted persons even if they are not defendants. The concept of forfeiture is expected to be redefined and the specific defence rights of affected third parties clarified. In this regard, the law may allow for the confiscation of assets unrelated to the offence or in cases where criminal proceedings are discontinued, subject to compliance with constitutional guarantees.
• The abovementioned criminal justice reform will also involve strengthening measures and resources to prevent and combat offences associated with cybercrime, forest fires, corruption and other financial crimes, including in the healthcare sector, namely with the creation of a commission to combat fraud in the National Health Service.
• Law 67/2025 of 24 November amended article 215 of the Criminal Code to broaden the definition of unlawful occupation of property. Now, merely invading or occupying (with the intent of asserting ownership, possession, use or easement not protected by law, a court ruling or an administrative decision) is an offence, regardless of whether there is violence or a serious threat. We therefore expect criminal complaints in this area to rise.
• The independent administrative entity for monitoring and evaluating the effectiveness of the corruption prevention regime in Portugal, MENAC, has been increasingly active overseeing the implementation of the General Corruption Prevention Framework (“GCPF"), among other duties related to this law. This may lead to an increase in administrative proceedings and fines for non-compliance.

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3. International arbitration

In 2026, Portugal is expected to remain a highly attractive jurisdiction for international arbitration, following the consistent consolidation of case law, institutional maturity and deeper integration into other Portuguese-speaking markets. The country's position as a leading arbitration centre is further reinforced by the predictability of higher-court decisions, the appeal of Lisbon as an arbitration venue and the dynamism of both the national and international business communities.

• Higher courts maintain a consistent pro-arbitration stance on three fronts: (i) arbitral awards are rarely set aside, protecting the stability and finality of arbitral decisions; (ii) foreign arbitral awards continue to be recognised, in line with international best practices, which provides legal certainty for parties choosing Portugal as the jurisdiction to support cross-border arbitration; and (iii) decisions by first-instance courts declining to hear cases when there is a valid and effective arbitration agreement are upheld, reaffirming the principle of competence-competence and the primacy of the arbitral tribunal in resolving disputes.
• The growth of international arbitration in Portugal is also driven by business dynamism and the demand for faster and more specialised decisions. Compared to the court experience, arbitration offers tailored procedural timetables, efficient evidence management and greater predictability of proceedings, critical factors for sectors that require expeditious decision-making and when there is a strong cross-border component.
• The growth trend in arbitration cases from Portuguese-speaking countries – namely Brazil, Angola, Mozambique and Cape Verde – continues, with a robust pipeline for 2026. This growth is driven by specific initiatives, such as the Intensive Course for Arbitrators organised by Portugal's Commercial Arbitration Centre's (CAC) Mozambique Internationalisation Commission, held on 19 and 20 May 2025 at ISCTEM. This training is aimed at lawyers who wish to develop or consolidate their practical skills in commercial arbitration. It has a significant impact on the Portuguese-speaking legal and business community by generating substantial activity and fostering trust in Portugal as the seat of arbitration and CAC as the administering institution.
• The evolving and growing adoption of AI solutions will also affect the arbitration landscape in 2026. Arbitration professionals and institutions in Portugal have been incorporating generative and assisted AI tools into a wide variety of tasks. They have also updated their cybersecurity and confidentiality policies to encourage transparent disclosure of AI use and promote specific training to mitigate risks and safeguard the integrity of the arbitration process.
• Finally, the arbitrator community is becoming more diverse, with an increasing number of Portuguese professionals becoming increasingly involved in international arbitration. This evolution reflects greater diversity of profiles and sectoral specialisations, enriching the arbitration offering and increasing independence and technical quality. It also contributes to the competitiveness of the Portuguese market in the global dispute resolution landscape.
• In summary, favourable case law, a robust institutional framework, cultural and linguistic proximity to Portuguese-speaking markets, and an increasingly diverse arbitration community all suggest that Portugal will become a progressively important international seat of arbitration in 2026.

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4. Digital law and AI

Developments are expected in 2026 in the various collective actions (often referred to as “class actions" in the US) for damages pending in Portugal against big tech, particularly on whether defence-raised dilatory objections are procedurally viable. Conversely, an increase in cybersecurity-related litigation is anticipated as the law transposing Directive (EU) 2022/2555 of the European Parliament and of the Council of 14 December 2022 on measures to ensure a high level of cybersecurity across the EU (the NIS 2 Directive) comes into effect.

• There are currently collective actions pending in Portugal against some of the world's largest tech companies, such as Google (Play Store), Apple, Sony (PlayStation), TikTok and Meta. These actions are all backed by third-party litigation funding, and more are expected in 2026, in a sector where regulatory change is a constant and regulators are heavily involved.
• At the root of this proliferation of lawsuits is the combination of active consumer associations supported by international litigation funders in Portugal, and a legal framework that facilitates the filing of collective actions in consumer law matters.
• 2026 may bring new case law developments and greater clarity on procedural issues affecting the viability of collective actions. This includes (i) specific consumer associations' standing, (ii) third-party litigation funders' independence and conflicts of interest, and (iii) the admissibility of some collective actions due to a lack of homogeneity in the collective allegedly represented, as well as (iv) the need for a mandate from consumer associations for collective actions seeking compensation in personal data matters.
• The enforcement of the Digital Services Regulation (Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022) is underway, and there are new developments in cybersecurity, with the transposition of Directive (EU) 2022/2555 of the European Parliament and of the Council of 14 December 2022 on measures to ensure a high common level of cybersecurity across the EU (the NIS 2 Directive). New developments and disputes related to security breaches and companies' implementation of this legislation are expected in 2026. This legislation aims to strengthen national digital security by creating rules for companies and public bodies.
• Finally, while the phased implementation of the European AI Regulation (Regulation (EU) 2024/1689), which is expected to begin on 2 February 2025, is likely to bring new developments and potentially litigation, the main market players have so far been slow to react. In addition, recent legislative setbacks such as the European Commission's proposal to postpone the entry into force of specific parts of the AI Regulation until 2027, have hindered progress. 

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5. Insolvency and restructuring

Portugal is expected to continue to experience a high number of insolvencies and corporate restructurings, especially in the industrial sector, in 2026.

• In 2025, the number of corporate restructurings and insolvencies in Portugal decreased gradually compared to 2024, with the manufacturing sector continuing to be the most affected.
• This trend is expected to reverse in 2026, with an increase in the number of restructurings and insolvencies, particularly in the industrial sector (textiles, moulds, footwear, furniture, automotive components, etc.). This forecast is primarily based on external factors, namely the protectionist measures taken by the US and competition from Asian producers, particularly China. However, it is also based on internal factors, mainly the high level of Portuguese company debt combined with the short-term need to repay loans granted during the COVID-19 pandemic, which is likely to cause serious cash-flow difficulties.
• From a regulatory perspective, a significant development occurred in this area in 2025 with the approval of the new Bank Credit Transfer and Management Framework, which transposes Directive (EU) 2021/2167. This new framework is expected to substantially impact the largely unregulated secondary market for non-performing bank loans, as well as credit servicing, which will now be supervised by the Bank of Portugal. In parallel, the government is considering amending the insolvency framework to facilitate the execution of corporate restructuring agreements and safeguard their economic viability. These initiatives may result in legislative action in this area in 2026.

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6. General contractual clauses and consumer litigation

As in 2025, 2026 will be another year of intense litigation, mainly due the increased activity of consumer associations and the growing visibility of third-party financing, which makes it easier to bring cross-border collective actions, including those involving qualified foreign entities. There will, however, still be some level of individual litigation in consumer matters and general terms and conditions.

• In 2026, increased litigation around general contractual clauses and consumer matters is expected to continue, particularly with regard to unfair commercial practices, misleading advertising and non-compliance with e-commerce regulations.
• The main drivers of this trend are, firstly, the growing scrutiny of e-commerce-related practices by the Food Safety Authority (Autoridade de Segurança dos Géneros Alimentícios, ASAE) and secondly, the emergence of consumer associations specialising in these matters. These associations increasingly rely on the collective action mechanism and seek to replicate in Portugal litigation strategies developed in other jurisdictions, such as the UK or the US.
• These associations, which often have international ties, have already initiated numerous legal actions and are expected to continue this strategy across a wide range of sectors, from banking to food retail. They are targeting diverse types of conduct, including standard contractual clauses, non-compliance with labelling standards, and misleading advertising.
• In addition, Decree-Law 114-A/2023 of 5 December – which in transposing Directive (EU) 2020/1828 on collective actions for the protection of consumers has introduced a more permissive framework – has significantly contributed to the rise in consumer litigation. This is particularly significant given the specific framework of private litigation funding in this context, despite ongoing in-depth legal debates on issues such as standing and conflicts of interest, as discussed further below.

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7. Collective actions and unfair competition

As anticipated, 2025 was an eventful year, in terms of both the number of new follow-on and stand-alone collective compensation actions and significant developments in case law. These developments are expected to shape the debate in 2026, highlighting two key issues (i) the independence of consumer associations from third-party litigation funders and (ii) potential conflicts of interest between these funders and the consumers they claim to represent. Resolving these issues will be crucial in determining the legal standing of highly active consumer associations such as Ius Omnibus and Citizens' Voice.

• As noted in our previous outlook, we anticipated that 2025 would bring in Portugal (i) continued growth in the number of collective actions, (ii) further developments in the case law of the higher courts, and (iii) greater clarity on the permissibility of third-party litigation funding used by the most active consumer associations, namely Ius Omnibus and Citizens' Voice. This clarification was expected to emerge from the practical application of the rules introduced by Decree-Law 114-A/2023 of 5 December, which transposed Directive (EU) 2020/1828 on collective actions for consumer protection, in particular those governing the independence of consumer associations and the management of conflicts of interest involving third-party litigation funders.
• These predictions have now been fully realised. In addition to several new collective actions being filed in 2025, most notably by Ius Omnibus against various car manufacturers (the Volkswagen/Porsche Group, BMW, and Nissan/Renault) and a number of pharmaceutical companies (Stada, Haleon, Merck, Ratiopharma, Perrigo, Moreno, Vicks and Angelini), there have also been important developments in case law that are likely to shape the landscape in 2026.
• Firstly, significant developments occurred in the collective actions brought by Ius Omnibus against various banks, in a case that became known as the Bank Cartel.
  On the one hand, the Lisbon Court of Appeal upheld the banks' appeal against the Competition Authority's ruling. That decision had previously been upheld by the Santarém Competition, Regulation and Supervision Court (TCRS), but was ultimately declared time-barred. This immediately affected the EUR 225 million fine imposed on the banks and will certainly have implications for the private enforcement of the collective actions brought by Ius Omnibus. These actions had been suspended pending the outcome of the public enforcement proceedings and will now resume.
  On the other hand, at the end of the year, the TCRS handed down a ruling on the Abanca case. In its judgment, the court adopted robust and critical reasoning regarding the influence of lawyers and litigation funders on Ius Omnibus, as well as potential conflicts of interest between the association and the consumers it represents. Ultimately, the court decided to refer these issues to the Court of Justice of the European Union (CJEU) for a preliminary ruling, which is expected to clarify these issues decisively.
  Accordingly, 2026 is expected to be shaped by the preliminary ruling proceedings, which are likely to have a decisive impact on the viability – or otherwise – of the current collective litigation model in Portugal, which remains heavily dependent on funding provided by international litigation funds.
  Regarding other compensation claims in the banking sector, following the proceedings brought by the Competition Authority, these cases will inevitably be affected by the pending referral to the CJEU. In relation to claims concerning corporate lending, the defendant was acquitted, but this judgment has been appealed.
  Further preliminary references on similar issues are also pending in cases relating to infringements in the large-scale retail sector. Developments at the CJEU are expected to play a central role over the next two years, with consumer associations likely to use this period to address some of the shortcomings in their actions that have already been identified by domestic courts.
• In fact, Portugal stands out in the European landscape as the country with the second-highest volume of collective compensation actions in terms of claim value, with a total value of EUR 45.8 billion – representing approximately 23% of all such actions. Only the UK has a higher volume, and Portugal ranks ahead of significantly larger economies such as the Netherlands and Germany.[1] This highlights the significant economic interests at stake in this type of litigation, as well as the potential distortive effects of such high volumes.
• In this context, we predict that Portugal will remain one of the most dynamic European countries in terms of collective action in 2026. This is driven by favourable legislation, the opt-out system applicable to most collective actions – except those for damages in the field of data protection. Other factors include the existence of assertive consumer associations supported by third-party litigation funding and, of course, by the enforcement action of the European Commission and the Portuguese Competition Authority.
• In terms of case law, the initial Supreme Court of Justice rulings in the Truck Cartel case confirmed the decisions of the Lisbon Court of Appeal[2] , which had rejected the claimants' proposed damage quantification, setting the surcharge at 5% through a judicial estimate pursuant to Article 17(1) of the Damages Directive (Directive 2014/104/EU of the European Parliament and of the Council of 26 November 2014) and Article 9(2) of Law 23/2018 of 5 June, which transposes the directive.
• In the same context, it is also worth noting the Lisbon Court of Appeal's ruling of 28 May 2025,[3] which rejected the claimant's appeal and lodged and upheld the TCRS' ruling.[4] This was the first time that the surcharge had been reduced from 5% to 3% of the lorries' price, on the basis of the pass-on defence. According to this defence, the companies purchasing the trucks had passed on at least some of the additional costs they incurred to their own customers through higher service prices.
• In terms of public enforcement, significant developments are also expected. 2024 and 2025 saw judicial and constitutional decisions that seemed to resolve the long-standing debate about the legality of the seizure of e-mails by the Competition Authority, by making such seizures conditional on prior authorisation by a criminal investigating judge. Despite the fact that preliminary rulings proceedings are still ongoing on whether requiring a court order is compatible with the principle of effectiveness, the Competition Authority is likely to resume several of the ongoing investigations that were on hold pending case law outcomes. For example, after the validity of the evidence seized in the private hospitalisation investigation was called into question, the case was resumed using only valid evidence. According to public information, the Competition Authority has since focused its enforcement efforts primarily on employment-related matters, which are a priority area.
• Some recent European Commission decisions may also trigger collective action in Portugal.
• Finally, the active application of the Digital Markets Act (DMA) and the Foreign Subsidies Regulation (FSR) at the EU level in 2025 is also likely to lead to increased litigation involving competition, economic freedom and industrial policy issues.

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8. European litigation

The trend of increased preliminary rulings and litigation on State aid is expected to continue in 2026, alongside growth in litigation on consumer, technology and digital issues. This is expected as a result of the EU's legislative expansion into these areas, including the DMA, the Digital Services Act (“DSA") and the AI Act.

• In 2026, we expect to see an increase in the volume of European litigation, mainly in specific areas such as consumer affairs, data protection, technology and the digital sector. This is partly because, as mentioned, these sectors are rapidly evolving and transforming, and are experiencing legislative reform and strong regulatory scrutiny.
• As in 2025, we expect an increasing number of requests for preliminary rulings to be submitted to the CJEU by Portuguese courts. In specific areas (e.g. competition, consumer affairs, taxation), courts are increasingly referring cases for preliminary rulings, and raising questions on how concepts under regulations and directives are to be interpreted in a wide range of areas, including those related to consumers, misleading advertising and data protection.
• A number of important preliminary referrals are currently pending on matters such as evidence, access to documents, the compatibility of competition rules with the applicable sport framework, in relation to standing to bring private enforcement actions, conflicts of interest and class representation.
• This trend seems to be common to most Member States, resulting from increased legislative activity, the issuance of more guidelines and the implementation of European rules that apply at a national level.

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9. ESG litigation

In the coming years, we expect to see litigation related to new ESG issues, following the evolution of European law, especially through collective action. Portugal's favourable opt-out system for this type of action could drive the growth of this litigation.

• Environmental protection associations, such as Quercus and Zero, and consumer associations such as Ius Omnibus and Citizens' Voice, have been particularly active in this area. In 2023, the associations Associação Último Recurso, Quercus and Sciaena filed a collective action asking the Portuguese State to adopt the necessary measures to reduce greenhouse gas emissions by at least 55% from 2005 levels by 2030 (excluding land use and forests).
• Although an increase in litigation in this area is expected, there has however been a global slowdown in ESG momentum. ESG issues are no longer a priority for the US under the new Trump administration, and Europe may follow the same trend. In 2025, EU Directive 2025/794 postponed the deadline for companies' sustainability reporting and due diligence obligations and delayed the sustainability reporting directive (EU Directive 2022/2464) by two years. The European Commissioner for Transport, Apostolos Tzitzikostas, has also recently stated that the European Commission may soon backtrack on the total ban on internal combustion engines in 2035.

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10. Energy sector litigation

Environmental administrative litigation in the energy sector is expected to increase in 2026, particularly with regard to large-scale renewable energy projects, especially solar projects.

• In recent years, the Public Prosecution Service has scrutinised environmental licensing more closely by challenging environmental impact statements and subsequent licensing decisions based on alleged violations of environmental standards, land use planning instruments or special natural resource protection regimes.
• This is largely the result of growing pressure to develop land due to the rapid expansion of solar projects, as well as greater public and institutional scrutiny of how environmental impact assessments are conducted, particularly with regard to analysing alternatives, considering cumulative impacts and ensuring projects are compatible with environmental and land protection regimes.
• In 2026, we expect there to be more litigation of this type, either initiated directly by the Public Prosecutor's Office to safeguard legality and conflicting interests, or triggered by complaints from environmental associations and other stakeholders.
• This could lead to an increase in administrative actions challenging the legality of environmental approvals that have already been granted, even at an advanced stage of project development.
• This is likely to result in increased legal uncertainty and delays in the implementation of energy projects, highlighting the importance of robust environmental assessment and licensing procedures, as well as solid technical and legal bases for administrative decisions.
• In the medium term, the administrative courts are expected to be called upon to rule more systematically on the balance between energy transition objectives and environmental protection requirements. This will contribute to consolidating case law in this area and have a direct impact on how future energy-sector investments are structured and timed.

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[1] See article available at: Volume of European class actions continues to grow as UK tops market ahead of Portugal - The Global Legal Post

[2] See Supreme Court of Justice ruling of 13 February 2025, case 54/19.6YQSTR.L1.S1 and Supreme Court of Justice ruling of 3 July 2025, case 67/19.8YQSTR.L1.S1.

[3] See Lisbon Court of Appeal Judgment of 28 May 2025, case 58/19.9YQSTR.L1-PICRS.

[4] TCRS ruling of 20 April 2024, case 58/19.9YQSTR.?