Glossary of the CPCV

Glossary - Essential Terms in the Preliminary Sale and Purchase Agreement

The Preliminary Purchase and Sale Agreement (CPCV) is one of the most important instruments in the real estate transaction process. This glossary brings together the main legal, technical and fiscal terms associated with the CPCV, explaining their meaning and implications clearly and accessibly. From contractual clauses to taxes, legal documents and the parties involved, this compilation aims to help buyers, sellers and industry professionals better understand the essential elements of this type of contract.

Use this glossary as a reference to clarify any doubts and ensure greater security at all stages of buying or selling a property.

Agreement between two parties (promising buyer and promising seller)
Agreement between two parties (promising buyer and promising seller) in which they undertake to enter into a definitive purchase and sale agreement for a property in the future.

Arras
Another designation for the sign, with the same legal value in the context of the CPCV.

Bank Statement
Additional guarantee provided by a bank that ensures the performance of a specific obligation by the client.

Conditional Sale and Purchase Agreement
Agreement between two parties (promising buyer and promising seller) in which they undertake to enter into a definitive purchase and sale agreement for a property in the future.

Urban Property Register Extract
Document issued by the Tax Authority that identifies the property for tax purposes.

Legal capacity
The legal capacity of the parties to enter into a contract. Minors or persons under guardianship, for example, do not have full capacity to sign a CPCV without a legal representative.

Certidão de Teor
Official document certifying the content of a property register for a property at a given moment, including the chain of owners, encumbrances, and inscriptions.

Permanent Property Certificate
Official document summarising the legal situation of a property (owners, mortgages, liens, etc.).

Energy Performance Certificate
Mandatory document in real estate transactions indicating the energy efficiency of the property.

Assignment of Contractual Position
Transfer of the position of one of the parties (usually the buyer) to a third party, with the consent of the other party.

Penalty Clause
Contractual provision that establishes a sum to be paid in the event of default, in addition to or in lieu of the deposit.

Termination Clause
Clause allowing the automatic termination of the contract if a certain condition is not met by one of the parties.

Suspensive Condition
Clause that makes the effectiveness of the contract conditional on a future and uncertain event (e.g., bank credit approval).

Counterparty Consent
Formal acceptance of contractual changes, such as assignment of contractual position or alterations to the Preliminary Purchase and Sale Agreement.

Land Registry Office
Public service where acts relating to property ownership are registered.

Contract with Qualified Digital Signature
Electronically signed contract, with valid certification in Portugal, having legal value equivalent to in-person notarisation.

Lease Agreement with Option to Purchase
Agreement in which the tenant can purchase the property after a rental period, with or without a preliminary purchase and sale agreement involved.

Property Agency Agreement
Agreement entered into between the seller and the real estate agency, which defines the terms of the agency agreement. May influence clauses in the preliminary sales agreement.

Conditional Termination Agreement
Contract that is in effect from the beginning, but may be terminated if a specific condition occurs in the future.

Private Agreement
Contract concluded between the parties without the intervention of a public entity (notary, registry office), with legal validity, provided it is signed by both parties.

Notarially Recognised Private Agreement
Private contract with the signatures witnessed in person by a notary or solicitor, providing greater legal certainty.

Deed of Promise with Mutual Agreement of Termination
Agreement to terminate the CPCV with the consent of both parties, avoiding penalties.

Irrevocable Promissory Contract
Type of CPCV in which the parties commit definitively, without the possibility of unilateral revocation. It may have stricter legal implications.

Mortgage
A loan granted by a banking institution for the acquisition of a property. It can be a suspensive condition in the Promissory Sale and Purchase Agreement.

Identification Documents of the Parties
Documentation required for CPCV validation: Citizen Card, NIF (tax identification number), commercial registration certificate (for companies), among others.

Pleading Documents
Documents required for the signing of the CPCV or deed (e.g. property registry certificate, property tax booklet, usage license, etc.).

Legal Fees
Expenses associated with the formalisation of the purchase, such as IMT, IS, registrations, deed, among others.

Deferred Writing
Informal or contractual agreement that allows for the postponement of the final deed, often due to reliance on financing or document regularization.

Deed of Sale
Final deed of sale and purchase, executed before a notary or registrar, which formalises the transfer of ownership.

Public Deed of Sale and Purchase
Legal instrument, drawn up before a notary or registrar, which formalises the transfer of ownership.

Funding Approved / Pre-approved
Situation in which the bank confirms (or anticipates) that the buyer has sufficient credit for the purchase, which may be a condition in the CPCV.

Off-plan housing
Property sold during the project or construction phase, with delivery to take place in the future.

Mortgage
A charge on property in favour of a creditor (usually a bank), normally associated with a mortgage.

Municipal Property Tax
Annual tax charged to the property owner, calculated on the tax valuation.

Municipal Property Transfer Tax
Tax paid on the purchase of a property, calculated on the transaction value or the VPT (whichever is higher).

Breach of Contract
A situation in which one of the parties fails to fulfil the obligations stipulated in the contract, which may result in the loss of the deposit (buyer) or double the amount returned (seller).

Stamp Duty
Tax levied on various acts, including the purchase of real estate. It is paid at the time of the deed.

Building Permit
Planning permission issued by the local council that allows the commencement of construction of a property.

Licence to Use
Document issued by the town council proving that the property can be legally inhabited.

Estate Agency
Service provided by licensed companies or agents to mediate the purchase and sale of properties. The CPCV can be signed with or without mediation.

Contractual Penalty
Additional amount stipulated in the preliminary sale and purchase agreement to be paid in case of default, in addition to the loss of the deposit.

Fraction Number
Identifier for an individual unit (e.g., flat) within a building held in common ownership.

Seller Party / Buyer Party
Promissor-vendedor and promissor-comprador.

Seizure
A judicial seizure of assets to guarantee the payment of a debt. A property that has been seized may be restricted from sale.

Floor Plan
Technical drawing representing the layout of the property's spaces. May be required during the CPCV or credit process.

Property Possession
The moment the buyer gains use and control of the property, usually after the deed. In a preliminary purchase and sale agreement (CPCV), there may be clauses authorising early handover.

Essential Deadline
Deadline by which, once passed, the other party is entitled to terminate the contract (e.g. deadline for property deed).

Deadline for writing
Agreed period between the parties for the execution of the definitive contract after signing the CPCV.

Power of attorney
Legal document authorising another person to act on behalf of one of the parties, which can be used to sign the CPCV (promissory contract of purchase and sale) or the deed.

Purchaser
The person who commits to buying the asset described in the contract at the time of the definitive contract's conclusion.

Promising Seller
A person who undertakes to sell the asset described in the contract at the time of the execution of the definitive contract.

Horizontal Property
Legal regime that allows the division of a building into autonomous units (flats, shops), with common and private parts.

Full ownership
Situation where the owner holds all rights over the property: use, enjoyment, and disposal (sale).

Signature Recognition
The act of authenticating the signatures on the contract, usually done at a notary, which provides greater legal certainty to the document.

Land Registry
Registration at the Land Registry which makes the new owner officially recognised as such.

Joint and Several Liability
"Joint and Several Liability Clause".

Sign
The sum paid at the time of signing the CPCV (Promissory Sale and Purchase Agreement) as a guarantee of the transaction. It serves as an advance payment and as a penalty in case of default.

Contract Simulation
An illegal situation in which the contract appears to be different from what is intended. This can occur when the value declared in the preliminary sales contract (CPCV) is lower than the real value, in order to pay less tax.

Usufruct
A real right that allows someone to use and benefit from a property belonging to another person, without being able to sell it.

Transaction Value
The total amount agreed between the parties for the purchase and sale of the property.

Reserve Price
A symbolic amount paid to secure the “reserve” of a property before signing the Preliminary Sale and Purchase Agreement (CPCV). It does not, in itself, have legal value as a preliminary contract, but it can generate obligations if there is a signed document.

Taxable Value
The value attributed by the Finance Ministry to the property for tax purposes (IMI, IMT, etc.), which may differ from the sale value.

Collateral Residual Value
The amount that can be retained under the preliminary Purchase and Sale Agreement (CPCV) in case of early handover of the property, to guarantee the fulfilment of subsequent obligations (e.g., completion of works).