Portugal's Lisbon Court of Appeal ruled on 10 February 2025 that €225 million in fines imposed on eleven of the country's largest banks for colluding in the mortgage lending market could not stand, determining that the penalties had expired under the applicable statute of limitations before they could be enforced — a decision that effectively spared the sector from one of the largest collective competition enforcement actions in Portuguese banking history.
The original fines were imposed in September 2023 by Portugal's Competition Authority, the Autoridade da Concorrência (AdC), following a multi-year investigation that found the banks had engaged in anti-competitive conduct by exchanging commercially sensitive information about mortgage pricing and terms. The appeal court's ruling is procedural rather than substantive: it does not overturn the AdC's underlying finding of collusion but concludes solely that the limitation period had elapsed, rendering the financial penalties legally unenforceable.
LIMITATION PERIOD RULED EXPIRED BEFORE ENFORCEMENT
The court determined that the limitation period for the penalties expired on 1 September 2023 — the very month in which the AdC issued its original decision. A secondary calculation, incorporating extensions to procedural deadlines that were applied across the Portuguese legal system during the COVID-19 pandemic, produced an alternative expiry date of 11 February 2024. In either scenario, the appeals court concluded that time had run out before the fines achieved a definitively enforceable status, a finding that cuts the enforcement action off on procedural grounds.
The original penalty allocations were substantial and fell disproportionately on the sector's largest players. Caixa Geral de Depósitos (CGD), the state-owned bank, faced the largest individual fine of €82 million. Banco Comercial Português (BCP) was assessed €60 million, Santander Portugal €35.65 million, Banco BPI €30 million, and Montepio €13 million. The Portuguese branch of BBVA was fined €2.5 million, with the remaining institutions in the group of eleven subject to smaller amounts bringing the collective total to €225 million.
The ruling provides immediate financial relief to all eleven institutions, none of which will now be required to pay the sums originally assessed against them unless the decision is overturned at a higher level of the judicial hierarchy. For Caixa Geral de Depósitos in particular, the €82 million fine had represented a material contingent liability that had been carried on the state-owned lender's books since the AdC determination was issued some eighteen months before the appeals court ruling.
COMPETITION AUTHORITY WEIGHS FURTHER LEGAL ACTION
Portugal's Competition Authority responded to the ruling by reaffirming that the appeals court decision was purely procedural and that its own underlying finding of anti-competitive conduct in the Portuguese mortgage market remained entirely intact. The AdC stated it was actively considering whether to pursue an appeal to Portugal's Constitutional Court, the apex body with the power to review whether the appeals court's interpretation of the applicable limitation rules conformed to the constitutional framework governing competition enforcement in the country.
The case has its origins in concerns about information-sharing practices among banks that competed for mortgage customers, conduct which the AdC determined served to restrict price competition in a market of direct relevance to millions of Portuguese households making one of the largest financial commitments of their lives. Whether the substantive finding will ever translate into actual financial consequences for any of the eleven banks now depends entirely on whether the AdC elects to pursue and then succeeds in a Constitutional Court challenge — and on whether that court ultimately takes a different view of how Portugal's limitation rules should be applied to competition enforcement proceedings of this kind and duration.