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Cross-Border Estate Planning – Making a Will

 by Dennis Swing Greene

If you are a Foreign Resident in Portugal, married to a foreigner, have foreign source income, or assets in a foreign jurisdiction, Cross-Border Planning is a must. Anytime foreign laws are introduced into a plan or dispute; complexity is introduced. Because legislation is so different in the international arena, planning becomes essential to meet one’s goals, take advantage of opportunities and avoid nasty surprises along the way.

Estate Planning can be a complex process, and as a key part of the process, it is always advisable for property owners to make a Will in Portugal that deals exclusively with the assets located in Portugal. Making a Portuguese Will reduces expenses and avoids needless delays in the execution of the estate.

A Portuguese Will does not replace but rather supplements your existing Will in your home jurisdiction. Otherwise, if someone dies intestate (without a Will), there are no guidelines as to how the assets are to be distributed.

In Portugal, a Will is read in accordance with one’s Personal Law (Lei Pessoal), a concept in Civil Law roughly equivalent to Domicile in Common Law jurisdictions. Under the Portuguese Civil Code, an individual’s Personal Law is determined by nationality. For those who have not established a Domicile of Choice in Portugal, the Will is read under the rules of the country of origin. To be recognised as valid, the will must be reviewed by a “competent authority” (usually an attorney in the respective jurisdiction) who issues a declaration stating that the documents are in harmony with the law of origin.

There are several types:

Testamento Público: The most common is the Public Will which is dictated to the notary by the individual who then drafts the document in the presence of the author and two witnesses. The Will is signed by the individual and recorded by the Notary.

Testamento Cerrado: The Closed Will is drafted by the individual or by his/her solicitor and notarised. The Notary only recognises the document and does not keep a copy, the safekeeping of which is entrusted to the individual.

Testamento Internacional: Under the Washington Convention of 1973, any country which adopts the Convention agrees to recognise as valid in its jurisdiction a will prepared in accordance with the provisions of the Act. Portugal is a party to this Convention. While quite simple and straightforward the other forms of Wills are usually preferable regarding simplicity and economy.

Next week we will look at Forced Heirship.


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