Executive summary
The acquisition of a property for construction, extension, reconstruction or change of use should not be based solely on its tax description, the area recorded at the Land Registry or informal assurances given by the seller.
Where the value of the transaction depends on the development potential of the property, the promissory sale and purchase agreement should be made conditional upon a prior information request, known in Portugal as a Pedido de Informação Prévia or PIP.
In practice, the Portuguese Legal Framework for Urban Development and Construction, commonly referred to as the RJUE, provides for two forms of PIP:
- the request provided for in Article 14(1), intended to confirm the general feasibility of the proposed development and the applicable constraints;
- the more detailed request provided for in Article 14(2), which may address the siting, volume, architectural design, uses, infrastructure, planning charges and areas to be transferred to the municipality.
The first essentially answers the question:“Is it possible to build?”The second seeks to answer:“Can this specific project be carried out?”.
For a straightforward acquisition, the first may be sufficient. Where the purchase price, financing or expected return depends on a particular construction area, number of units or permitted use, a full PIP offers substantially greater protection.
Legal framework
Prior information requests are governed by Articles 14 to 17 of the Legal Framework for Urban Development and Construction, approved by Decree-Law no. 555/99 of 16 December, as amended.
The revision introduced by Decree-Law no. 108/2026 of 29 May enters into force on 1 October 2026, pursuant to Decree-Law no. 155-B/2026 of 31 July. The new documentary requirements are set out in Ministerial Order no. 320/2026/1, which will also apply from that date.
Although the expressions “simple PIP” and “full PIP” are commonly used in practice, they are not formal statutory terms. The distinction arises from the scope and content of the request submitted under Article 14(1) or Article 14(2) of the RJUE.
The simple PIP: confirming the feasibility of the development
Under Article 14(1) of the RJUE, any interested party may request information on the feasibility of a proposed development and on the applicable statutory or regulatory constraints.
The request may address, in particular:
- planning ratios and development parameters;
- maximum building height and setbacks;
- infrastructure;
- administrative easements;
- public law restrictions;
- any other constraints applicable to the property.
Ministerial Order no. 320/2026/1 essentially requires the property’s Land Registry details, a location plan and a brief descriptive statement. Drawings intended to illustrate the proposed development are optional in this form of request.
A decision must generally be issued within 15 days following the preliminary review of the application, without prejudice to any time required for consultation with external authorities. A favourable decision binds the competent authorities in any subsequent licensing procedure or in the subsequent review of a prior communication.
A simple PIP is therefore suitable for clarifying essential issues before the acquisition. It does not, however, approve an architectural design or dispense with the subsequent planning procedure.
A favourable municipal response confirming that a house may be built does not necessarily confirm the proposed construction area, the precise location of the building, the possibility of constructing a swimming pool or the feasibility of any ancillary buildings.
The value of the municipal response will continue to depend on the quality and precision of the questions asked.
The full PIP: approving the parameters of a specific project
Article 14(2) allows the request to address, depending on the nature of the proposed development:
- building volume, alignment, height and siting;
- the architectural design and descriptive statement;
- construction area, uses and number of residential or commercial units;
- infrastructure and the respective connections;
- estimated planning charges;
- areas to be transferred to the municipality.
The documentary requirements are broadly similar to those applicable to a licensing procedure or prior communication.
They may include a georeferenced topographical survey, a site plan, the principal design, an assessment under the applicable territorial plans, identification of easements and restrictions, evidence of compliance with the relevant planning parameters and a schedule of the project’s areas and development figures.
The applicable decision period is generally 30 days, or 45 days where a land subdivision operation is concerned.
In particularly complex cases, the period may be extended once, for an equivalent period.
The legal advantage is significant.
Where a favourable prior information decision includes all the applicable matters listed in Article 14(2), it:
- binds the competent authorities;
- dispenses with further consultation of external authorities;
- exempts the development from a subsequent licence or prior communication, provided that it is carried out strictly in accordance with the terms on which it was assessed.
In return, it reduces the risk of the buyer acquiring a property on the basis of development potential that has merely been assumed rather than formally confirmed.
A PIP is not valid indefinitely
A favourable prior information decision does not preserve the development potential of the property indefinitely.
Under Article 17(5) of the RJUE, the licensing application or prior communication following a simple PIP must be submitted within two years of notification of the favourable decision or the formation of tacit approval.
Where a full PIP dispenses with further prior planning control, the development must be commenced within the same two-year period.
Once the two-year period has expired, the interested party may, on one occasion only, request confirmation that the factual and legal circumstances underlying the original decision remain unchanged.
Where those circumstances are confirmed, or where the Mayor does not respond within the statutory period of 20 days, the interested party has a further one year in which to commence the relevant procedure or development. This is not an automatic extension.
The time limit must therefore be taken into account in the promissory sale and purchase agreement.
Where the acquisition is conditional upon a favourable PIP, the contractual timetable must allow sufficient time not only to complete the purchase, but also to prepare the licensing application, submit the prior communication or commence the development before the effects of the PIP expire.
A favourable PIP with most of its validity period already elapsed does not have the same economic value or provide the same protection to the buyer.
A PIP may be requested before the acquisition
A prior information request may be submitted by any interested party, even if that party does not yet own the property.
In that case, the owner and the holders of any other rights in rem must be identified and will be notified by the municipality of the commencement of the procedure, under Article 14(3) and (4) of the RJUE.
This allows the PIP to be coordinated with the promissory sale and purchase agreement, avoiding a situation in which the buyer first acquires the property and only afterwards discovers what may actually be built.
Structuring the promissory sale and purchase agreement
A Portuguese promissory agreement is governed by Article 410 of the Portuguese Civil Code and may be structured freely by the parties, within the limits of the law, under the principle of contractual freedom set out in Article 405.
The requirement to obtain a PIP may be structured in two principal ways.
Condition precedent
The parties may agree that the principal effects of the agreement, including the obligation to sign the final deed of sale, will only arise if a favourable PIP meeting specified requirements is obtained.
This approach is supported by Article 270 of the Civil Code, which permits the effects of a legal transaction to be made conditional upon a future and uncertain event.
It provides a high degree of protection to the buyer, but may leave certain contractual obligations in a state of suspension that must be carefully regulated.
Immediately binding agreement with a right of termination
Alternatively, the agreement may become immediately binding, securing the property for the buyer, while granting the buyer a contractual right to terminate if the PIP is not obtained within the agreed period or does not meet the minimum agreed parameters.
A contractual right of termination is permitted by Article 432(1) of the Civil Code.
This structure is generally more suitable where the buyer wishes to bind the seller immediately but is not prepared to assume the final planning risk.
“Favourable PIP” is not sufficiently precise
The agreement should objectively define the required planning outcome, including:
- The form of PIP to be submitted and the matters it must address.
- The minimum construction and footprint areas.
- The minimum number of residential or commercial units.
- The required uses, such as residential, tourism, retail or services.
- The permitted building volume, number of storeys, swimming pool, ancillary buildings or parking.
- The maximum acceptable areas to be transferred to the municipality, planning charges and other development costs.
- The period for submitting and obtaining a decision on the request.
- Which party will bear the technical and administrative costs.
- The seller’s duty to cooperate and provide access to the property.
- The consequences of an unfavourable or only partially favourable decision.
A decision may be formally favourable and still render the investment economically unviable. The municipality assesses compliance with planning law. It does not guarantee the profitability of the project, which is probably just as well.
Treatment of the deposit
Under Article 441 of the Civil Code, any sums paid by the prospective buyer to the prospective seller under a promissory sale and purchase agreement are presumed to constitute a deposit, even where they are described as an advance payment or payment on account.
The agreement should therefore expressly provide that, if the agreed PIP is not obtained, the amount paid will be refunded to the buyer in full, without application of the statutory penalties for breach.
Article 442 provides that a breach attributable to the buyer may result in the loss of the deposit, while a breach attributable to the seller may require repayment of twice the amount received.
Failure to obtain a PIP, where treated as an objective risk of the transaction, should not be confused with a contractual breach by either party.
The agreement should also regulate cases in which the PIP is not obtained because one of the parties fails to cooperate.
While a condition remains pending, the parties are subject to duties of good faith and may not improperly prevent the condition from being satisfied, as follows from Articles 272 and 275 of the Civil Code.
Which form of PIP should be chosen?
A simple PIP will normally be sufficient where the buyer wishes to clarify a specific issue, such as: whether an existing house may be extended; whether a swimming pool may be constructed; whether a particular use is permitted.
A full PIP should normally be preferred where:
- the price of the land depends on the permitted construction area;
- the project involves several units;
- there is uncertainty concerning siting, volume or areas to be transferred to the municipality;
- the project depends on external financing or investment;
- the acquisition is intended for property development;
- the buyer intends to proceed without a subsequent licensing procedure or prior communication.
The practical rule is straightforward:
The more the purchase price depends on the proposed development, the more detailed the PIP should be.
A simple PIP confirms a possibility. A full PIP seeks to convert that possibility into an urban development project with defined and legally recognised parameters.
In a property investment, that distinction should be addressed before signing the final deed and, preferably, before paying any substantial deposit.
Text updated in August 2026, taking into account the revision of the RJUE introduced by Decree-Law no. 108/2026 of 29 May, entering into force on 1 October 2026.