Cross-Border Succession and Portuguese Property: Why the Land Registry Still Matters

When non-resident foreign nationals own immovable property in Portugal, succession is often viewed primarily as a matter of determining the law applicable to the estate. In practice, however, that is only part of the picture.

For foreign property owners and their heirs, the central question is therefore not only who inherits the property, but also whether and when that status can be converted into definitive registered title.

The applicable succession law is only the first step

Article 21 of Regulation (EU) No 650/2012 establishes the law of the deceased’s last habitual residence at the time of death as the general connecting factor, in accordance with the principle of unity of succession.

Article 22 alternatively allows a person to choose the law of the State whose nationality they possess at the time of making the choice or at the time of death, provided that the choice is validly made and applies to the succession as a whole. This may be of particular interest to foreign property owners seeking the predictability of their national succession law.

The applicable law determines matters such as the identity of the heirs, their respective rights and shares, the rights of surviving spouses and other beneficiaries, and the administration and distribution of the estate.

However, determining the applicable law does not, in itself, ensure the registration of Portuguese property in the heirs’ names, nor does it replace the requirements necessary to establish title vis-à-vis third parties in Portugal.

It is in this distinction between the law governing the succession and the law governing the registration of the inherited property that the central issue lies.

The Regulation expressly excludes from its scope the requirements for recording rights in a register and the effects of recording or failing to record such rights. Those matters remain subject to the law of the Member State in which the register is kept, as reflected in recital 18 and Article 1(2)(l) of the Regulation.

Consequently, no determination or choice of the law applicable to the succession, however valid, removes the need to comply with the requirements of the Portuguese Land Registry Code — Código do Registo Predial, approved by Decree-Law No. 224/84 of 6 July (“CRP”).

The role of the European Certificate of Succession

Regulation (EU) No 650/2012 also established the European Certificate of Succession (“ECS”), which enables heirs, legatees, executors and estate administrators to prove their status and exercise their rights in another Member State without the need for separate recognition proceedings.

Article 69(2) provides that the ECS is presumed to demonstrate accurately the elements established under the law applicable to the succession.

Article 69(5) further provides that the certificate constitutes a valid document for the registration of succession property in the relevant register of a Member State, subject to the matters excluded from the scope of the Regulation.

In practice, the ECS reduces the need to prove succession rights separately in multiple jurisdictions and may therefore mitigate the time and costs associated with cross-border estates.

Nevertheless, the connection between the ECS and the registration of a specific property cannot be taken for granted.

Although the certificate facilitates proof of succession rights, it does not eliminate the need for registration, which remains subject to the legal and documentary requirements of the State in which the register is kept.

This distinction was addressed by the Court of Justice of the European Union in Case C-354/21, R.J.R. v Registrų centras.

The Court confirmed that the ECS may constitute a valid document for registration purposes, while the registration authority may still require compliance with the legal requirements applicable to the identification of the property under the law of the Member State in which the register is kept.

Why the European Certificate of Succession may not be sufficient

The practical effectiveness of the ECS is therefore constrained by the requirements of the relevant land registration system.

Even where the certificate establishes the heir’s entitlement to the succession, definitive registration in Portugal depends on compliance with the requirements governing the continuity of registrations, the suitability of the title presented and the precise identification of the property.

Under the Portuguese Land Registry Code, the registrar must assess whether the documents submitted are legally sufficient and whether the rights to be registered are compatible with the existing entries.

Particular attention must be paid to the continuity of the chain of title and to the correspondence between the property identified in the succession documents and the property described in the Land Registry.

Where the applicable requirements are not met, the application may be refused or the registration may be made provisionally, depending on the nature of the deficiency and on whether it can subsequently be remedied.

Until definitive registration is obtained, the heirs may be unable to benefit fully from the effects of registration vis-à-vis third parties and from the presumption arising from the registered title under Articles 5 and 7 of the CRP.

The opinion of the IRN Advisory Council in Case No. R.P. 46/2022 SJ-CC is also relevant in this context.

Although it concerned a discrepancy between the matrimonial property regime stated in the ECS and the information already recorded in the Portuguese Land Registry, rather than the identification of the property itself, it illustrates that the presumption attached to the certificate does not prevent the registrar from assessing whether its contents are compatible with the existing registry entries.

Consider, for example, a European Certificate of Succession issued in Germany which identifies one person as the sole heir under a universal succession but does not specifically list the inherited assets.

The certificate may validly establish that person’s status as heir. However, it may still be insufficient, on its own, for the definitive registration of a Portuguese property if the property is not identified in accordance with the requirements applicable to the Portuguese Land Registry or if its description does not correspond with the existing registry entries.

In such circumstances, additional documentary evidence may be required to establish the connection between the succession, the heir and the specific property.

The impact on the liquidity and value of the property

A property is not valued solely by reference to its theoretical market value. Its economic value also depends on the ability of its owner to sell, mortgage, finance or otherwise legally dispose of it within an appropriate timeframe.

Where the succession cannot be translated promptly into definitive registration, the property may become temporarily illiquid.

At the same time, taxes, condominium charges, insurance, maintenance expenses and other holding costs may continue to fall due, burdening the heirs without a corresponding return from the asset.

Unresolved succession or registration issues may also affect the conditions under which the property can be marketed.

Prospective purchasers and lenders may regard uncertainty concerning ownership or the timeframe required to complete registration as an additional legal risk.

This may delay the transaction, weaken the heirs’ negotiating position or result in a discount to the price offered for the property.

Access to financing may also become more restricted, and the asset may remain exposed to market fluctuations until it can be freely sold or encumbered.

The preservation of the property’s investment value therefore depends not only on establishing the identity of the heirs, but also on ensuring that their rights can be reflected promptly and definitively in the Portuguese Land Registry.

Final considerations

Regulation (EU) No 650/2012 and the European Certificate of Succession have undeniably simplified the administration of cross-border estates involving immovable property situated in Portugal.

However, they do not replace the legal and documentary requirements applicable to the registration of property rights in Portugal.

The precise identification of the property, the continuity of the chain of title and the compatibility of the succession documents with the existing registry entries remain essential conditions for definitive registration.

For foreign property owners and their heirs, the value of the asset ultimately depends not only on who is recognised as the heir, but also on whether and when that status can be converted into a definitive registered title.

Effective coordination between succession law and Portuguese land registration is therefore essential to preserve the legal certainty, marketability and economic value of inherited property.