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Access to the payment moratorium created by Decree-Law no. 10-J/2020, of March 26

Goal:
Suspension until 30 September 2020 of: (i) the right to revoke, fully or partially, the credit lines contracted and loans granted in the amounts contracted at the time of publication the Decree-Law no. 10-J/2020, of March 26 (“Decree-Law”); (ii) the payment of credits with payment of capital at the end of the contract, in effect at the time of publication of this Decree-Law; and (iii) the payment of capital instalments, interest and charges (or just capital) regarding credit transactions ongoing on 26 March 2020 given that the transaction’s contractual plan is extended for the same length as the suspension period.

 

Credits eligible for the payment moratorium:
All credit transactions, except for: (i) credit granted for purchasing financial instruments, (ii) credit granted to beneficiaries of tax schemes, subsidies or benefits for establishing headquarters or residency in Portugal; and (iii) credit granted via credit cards granted to companies for the individual use by corporate bodies’ members and employees.

We highlight that interest will continue to accrue and will be capitalized. Beneficiary entities can request just the suspension of capital reimbursements as a whole or partially, and guarantees are automatically extended during the suspension period.

Benefiting from the payment moratorium will not grant beneficiary entities the right to:

  1. declare a contractual breach; nor
  2. activate early maturity clauses.

 

Credits that are not eligible for the payment moratorium:

  1. credit granted for purchasing financial instruments;
  2. credit granted to beneficiaries of tax schemes, subsidies or benefits for establishing headquarters or residency in Portugal; and
  3. credit granted via credit cards granted to companies for the individual use by corporate bodies’ members and employees.

 

Companies and institutions that can subscribe to the payment moratorium:
All companies (except companies from the financial sector, as defined in no. 4 of Article no.2 of the Decree-Law), private institutions for social solidarity, non-profit organizations, entities of the social economy that have their headquarters and carry out their economic activities in Portugal, as well as sole traders and natural persons, namely in regard to mortgage loans, that meet all the following conditions:

  • On 18 March 2020, are not in arrears or in a breach of instalments for more than 90 days with the institutions, or if they are, do not meet the materiality criteria set out in the Bank of Portugal Notice No. 2/2019 and in Regulation (EU) 2018/1845 of the European Central Bank, of 21 November 2018, and that are not in a situation of insolvency, or suspension or cessation of payments, or that are already being executed by any of the institutions;
  • Have their situation regularized with the Tax and Customs Authority and Social Security – for this purpose, until 30 April 2020, the debts incurred in March 2020 are not relevant;
  • In case of natural persons, in addition to the above-mentioned conditions, those who: reside in Portugal and are in a situation of prophylactic isolation or sickness or provide care for children or grandchildren, as established in Decree-Law no. 10-A/2020, of March 13, in its current wording; or whose normal working hours have been reduced or whose employment contract has been suspended due to a crisis in the respective business; are registered unemployed at the Institute of Employment and Professional Training, I.P., as well as workers eligible for extraordinary support owing to the reduction of the economic activity of self-employed workers, under the terms of article 26 of the above-mentioned decree-law, and workers from entities whose establishment or activity has been closed as per the determinations implemented during the state of emergency period, under the terms of Article 7 of Decree No. 2-A/2020, of March 20.

 

Moratorium term:
The moratorium regime waives the settlement of pecuniary debts until 30 September 2020.

In case of the suspension of credit payments with payment of capital at the end of the contract, the above-mentioned term of the above-mentioned credit will be postponed for six months.

In case of the payment suspension regarding credits with parcelled capital reimbursements or parcelled maturity of other cash benefits, the contractual payment plan of parcelled capital, rents, interest, fees and other charges will be extended, in the future, for the same length as the suspension period.

 

Access Process:
In order to access the measures documented in the Decree-Law, beneficiary entities should submit to Haitong Bank, S.A., either by post or electronically, the moratorium application form signed by its legal representatives, along with documentation proving compliance with due tax and contributory obligations.

For more information about the payment moratorium documented in the Decree-Law (which can be consulted here), clients can contact their respective account manager or send an email to moratorias@haitongib.com.