Mediation Agreement

The Real Estate Mediation Agreement consists of a document whereby the mediation company (real estate agency) undertakes, through an agreed remuneration and on behalf of the client, to seek interested parties for the purchase, sale, exchange, transfer, lease or assignment of positions in contracts having as object real estate

The remuneration is only due to the mediation company if the sale of the property has been carried out or, a promissory purchase and sale contract has been signed and the mediation contract provides for remuneration at this stage.

What should be included in a Real Estate Mediation Agreement?

The Real Estate Mediation Agreement must always be concluded in writing and mention several elements, including those set out in article 16 of Decree-Law no. 15/2013 (which regulates real estate mediation activity):

  • identification of the characteristics of the property, specifying all liens and charges (liens or mortgages, for example);
  • business identification (purchase and sale or lease, for example);
  • the company's remuneration conditions, in fixed or percentage terms, as well as the form of payment, indicating the applicable VAT rate;
  • identification of civil liability insurance or financial guarantee or equivalent instrument with indication of the policy and insurance entity or, when applicable, the guaranteed capital;
  • identification of the real estate collector who, eventually, collaborated in the preparation of the contract;
  • itemized identification of any ancillary services to be provided by the company;
  • reference to the exclusivity regime, when agreed between the parties, specifying the respective effects, both for the company and the client.

How long is a Real Estate Mediation Agreement?

The contract will be valid for the term agreed between both parties, the most usual duration being 6 months (periods of 3 or 12 months are also common) and automatically renewed for a similar period (if not canceled by one of the parties with due anticipation). If the term of the contract is not mentioned in it, it is considered that it was concluded for a period of 6 months.

Who is responsible for drafting a Real Estate Mediation Agreement Contract?

It is the responsibility of the mediating company (holder of a Real Estate Mediation License) to prepare the CMI, subject to the specifications imposed by the legislation in force, and may present particular contractual clauses, provided that they have been previously approved by IMPIC - Instituto dos Mercados Públicos of Real Estate and Construction . According to Article 3 of Decree-Law No. 102/2017, if the mediation company uses the contract model with general contractual clauses, it does not need prior approval by IMPIC.

 
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