Auction activity in Portugal has proliferated in recent years, partly due to the unfavorable economic situation that began in 2008, a situation that has led auction companies to play an increasingly decisive role in liquidation, foreclosure and business insolvency.
This situation has led to the emergence of some players in this activity, deprived of a period of preparation and adaptation necessary for the correct development in the sector, to the detriment of the public and private interests that the activity requires. In this sense, suitability and qualification requirements were established to operate in the sector, taking into account the nature and need for transparency that it requires. Thus, it is necessary to obtain a prior authorization, granted by the General Directorate of Economic Activities (DGAE).
In addition, there is an obligation to contract civil liability insurance, a financial guarantee, or an equivalent instrument, in order to guarantee adequate compensation and cover possible damages derived from the exercise of the activity.
To control the validity of the authorization, the DGAE collects and analyzes the elements that can be obtained unofficially and, in case of doubt, can notify the interested parties so that they can send, within a period that cannot be less than 20 days, the rest necessary elements.
The expiration of the authorization document determines the resolution of the auction contracts in force, signed by the auctioneer for the exercise of the activity in the national territory.
For transparency reasons, the DGAE is in charge of organizing and registering auction companies and making available on its website the list of auction companies authorized to carry out operations and their public service establishments, therefore:
- The competition and qualification requirements established for those involved in auction activities will be subject to prior authorization from the Directorate General for Economic Activities (DGAE).
The activity of the auctioneer may only be carried out in national territory by individuals or groups, being duly authorized by the DGAE and complying with the suitability conditions.
In summary (legal obligations):
- The contracting of civil liability insurance, financial guarantee, or equivalent instrument, to guarantee the correct compensation and cover the damages derived from the exercise of the activity;
- The drafting of the auction service contracts, the definition of a set of obligations of the company towards customers and recipients, some obligations of registration and publication of information, as well as rules applicable to electronic auctions, which are carried out in accordance with more recurring way.