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(Resolutions of members of grouping)
1. Each member has one vote; however, the grouping contract can give various
votes to certain members, provided that none of them has a majority.
2. Unanimity of the members is required for the following resolutions:
a) amendment of the object of the grouping;
b) amendment of the number of votes attributed to each of them;
c) amendment of the conditions for passing resolutions;
d) extension of the duration of the grouping beyond the period stated in the
e) modification of the share of each of the members or of some of them in the
financing of the grouping;
f) amendment of any other obligation of a member, unless the grouping
contract provides otherwise;
g) any amendment to the grouping contract that is not mentioned in this
paragraph, unless the contract provides otherwise.
3. In all cases in which the law does not state that resolutions must be
passed by unanimity, the grouping contract can state the conditions of quorum
and majority for resolutions, or some of them, to be passed; if the silence of
the contract, resolutions shall be taken by majority.
4. By initiative of an administrator or upon request of a member, the
administration shall organize consultation of members in order for these to pass
1. In the absence of a provision of the contract on supervision of
management, the general meeting can appoint, for a maximum period of three
years, renewable, one or more persons to supervise the management and to give an
opinion on the accounts.
2. Supervision of the management by one or more accounting auditors or a firm
of auditors, appointed by the general meeting, is compulsory if the grouping
(Liability of holders of organs of grouping)
1. The rules that regulate the liability of holders of organs of commercial
companies towards the company, the shareholders, and third parties, are
applicable to the holders of organs of a grouping.
2. Any member has legitimacy to initiate liability proceedings in favor of
RIGHTS AND OBLIGATIONS OF MEMBERS
(Acts forbidden to members of a grouping)
The provision of article 335 on partners of general partnerships is
applicable to the members of the grouping, with the necessary adaptations.
(Participation in profits and expenses)
1. Profits arising from the ancillary activities of a grouping are considered
as profits of the members and shall be distributed among them according to the
proportion mentioned in the grouping contract or, if it is silent, in equal
2. The members of the grouping shall contribute to the payment of the excess
of expenses over income, in accordance with the proportion mentioned in the
grouping contract or, if it is silent, in equal parts.
(Right to information)
Each member has a right to obtain information on the businesses of the
grouping from the administrators and to consult commercial accounting records
and business documents.
(Transfer of participation)
1. Any member of a grouping can transfer his participation in the grouping,
or a fraction of it, either to another member or to a third party; the effect of
the transfer depends upon the unanimous authorization of the other members.
2. A member of the grouping can only create guarantees over his participation
in the grouping after obtaining the unanimous authorization of the other
members, unless the grouping contract provides otherwise; the holder of the
guarantee cannot, in any case, become a member of the grouping as a result of
(Admission of new members)
1. Admission of new members to a grouping can only take place in accordance
with the contract or, if it is silent, by an unanimous resolution of the members
of the grouping.
2. Any member can be held liable, in accordance with the following article,
for the debts of the grouping, including those resulting from activity
undertaken prior to his admission.
3. A new member can be exempted from payment of debts contracted prior to his
admission, by means of a clause of the grouping contract or of the act of
admission; this clause can only be invoked against third parties if it is
registered and published.
(Liability of members)
1. Members of a grouping are jointly and severally and without limit liable
for its debts, regardless of their nature.
2. Until the closure of the liquidation of a grouping, creditors can only
take action against a member for payment of the debts mentioned in the previous
paragraph after having claimed such payment from the grouping itself and if it
has not been executed within an adequate period of time.
EXONERATION, EXCLUSION AND DEATH OR EXTINCTION OF A MEMBER
1. A member of a grouping can exonerate himself under the terms mentioned in
the contract or, if it is silent, with the unanimous agreement of the other
2. A member of a grouping can always exonerate himself on the basis of just
3. Besides the cases mentioned in the previous paragraphs, any member can
exonerate himself if he has opposed an amendment introduced in the grouping
contract, or if more than 10 years have elapsed since his admission and the
obligations assumed by him have been fulfilled.
4. Exoneration shall take effect 20 days after its communication to the
administration, by means of a registered letter with acknowledgement of receipt.
1. A member of a grouping can be excluded for the reasons indicated in the
contract, and if he:
a) seriously breaches his obligations or provokes or threatens to provoke
serious disturbance in the functioning of the grouping;
b) ceases to exercise the economic activity for which the grouping serves as
c) is declared bankrupt;
d) is in delay in the payment of his contribution to the expenses of the
grouping, after being notified by the administration, by means of a registered
letter, to execute such payment within a stated time limit, which shall be no
less than 30 days.
2. Besides the case mentioned in subparagraph c) of the previous paragraph,
the exclusion can only take place by decision of the court, pronounced in
proceedings initiated by the majority of the other members, unless the grouping
contract provides otherwise.
(Death or extinction of member)
In case of death or extinction of a member of the grouping, no other person
can take his place, except in accordance with the conditions mentioned in the
grouping contract or, if it is silent, with the unanimous agreement of the other
(Liquidation of participation)
1. If a member ceases to be part of the grouping for causes other than the
transfer of his participation under the conditions mentioned in paragraph 1 of
article 507, the value of his rights and obligations shall be determined on the
basis of the patrimony of the grouping as it stands at the moment at which the
member ceases to belong to it.
2. The value of the rights and obligations of the member leaving the grouping
cannot be determined in advance.
(Liability of former member)
Without prejudice to paragraph 1 of article 520, any member who ceases to be
part of a grouping shall continue to be liable, under the conditions mentioned
in article 509, for the debts arising from the activity of the grouping prior to
the termination of his capacity as member.
(Continuation in existence)
Except if there is a provision to the contrary in the grouping contract and
without prejudice to the rights acquired by third parties in accordance with
paragraph 1 of article 507, or article 512, the grouping shall continue in
existence with the other members after one of its members has ceased to be part
of it, under the conditions mentioned in the grouping contract or determined by
unanimous resolution of the members.
DISSOLUTION AND LIQUIDATION
(Causes of dissolution)
1. An economic interest grouping is dissolved in the cases mentioned in the
law, and also:
a) by resolution of its members, passed by unanimity, if the contract does
not provide otherwise;
b) by the expiry of the time limit of its duration;
c) by the accomplishment, extinction or supervening impossibility of its
d) by the occurrence of any cause of dissolution mentioned in the contract;
e) by the unlawfulness of its object;
f) by bankruptcy.
2. Dissolution of a grouping, on the basis of subparagraphs b), c) and d) of
the previous paragraph, depends upon a resolution of the members confirming it;
if, three months after the occurrence of one of the said situations, a
resolution of the members verifying the dissolution of the grouping has not been
passed, any member can request the court to declare such dissolution.
3. A grouping shall also be dissolved by decision of the remaining member, if
the plurality of the members ceases to exist.
4. A resolution of dissolution of a grouping is subject to registration and
publication; if the administration does not arrange registration and
publication, any interested party can do so.
(Dissolution upon petition of certain persons)
1. Upon petition of any interested party or the Public Ministry, the court
shall declare the dissolution of a grouping in case of breach of article 490, or
of paragraph 3 of the previous article, except if regularization of the
situation of the grouping is possible and takes place while the judicial
decision can still be appealed.
2. The court can declare the dissolution of the grouping:
a) upon petition of a member, for a just cause;
b) upon petition of the Public Ministry or any interested party, if the
grouping breaches competition law or persistently dedicates itself, as a main
object, to a directly lucrative activity;
c) upon request of a member who has been held liable for obligations of the
grouping which were matured and in delay.
(Entry in liquidation)
1. The dissolution of a grouping implies its liquidation.
2. The liquidation of a grouping is made in accordance with the rules
applicable to commercial companies.
3. The legal capacity of a grouping continues until the closure of
(Distribution of patrimony)
The balance of the liquidation of a grouping shall be shared among the
members of the grouping, in accordance with the proportion mentioned in the
grouping contract or, if it is silent, in accordance with the proportion of
their contributions to the formation of its capital, added to any contributions
that they have paid.
LIMITATION OF ACTIONS AND DEFAULT RULES
(Limitation of actions)
1. Actions against a member to enforce liability related to debts arising
from the activity of a grouping are barred five years from the moment when the
member has ceased to be part of the grouping.
2. In case of liquidation of a grouping, the time limit mentioned in the
previous paragraph is counted from the closure of liquidation.
The rules on general partnerships shall apply to all matters not especially
regulated in this Title, with the necessary adaptations.
(Unlawful distribution of assets of grouping)
1. An administrator of a grouping who proposes an unlawful distribution of
the assets of the grouping to be considered by a resolution of the members is
punishable with a fine of up to 60 days.
2. If unlawful distribution is totally or partly executed, the penalty is a
fine of up to 90 days.
3. If unlawful distribution is totally or partly executed without a
resolution of the members, the penalty is a fine of up to 120 days.
4. The same penalty is applicable to an administrator of a grouping who
executes or causes the execution by another person of a distribution of assets
of the grouping, in breach of a valid resolution of the members of the grouping.
5. If serious economic or moral damage is caused in any of the cases
mentioned in paragraphs 3 and 4, which the perpetrator could foresee, to any
member who has not given his assent to the fact, to the grouping, or to a third
party, the penalty is imprisonment up to one year and a fine of up to 60 days,
or only a fine of up to 120 days.
(Unlawful refusal of information)
1. A grouping administrator who refuses or causes the refusal by another
person of consultation of documents that the law requires to be made available
to interested parties in preparation for resolutions of the members of the
grouping, or refuses or causes the refusal of the sending of documents for this
purpose, when due by law, or sends or causes the sending of such documents
without satisfying the requirements and the time limits stated in the law, is
punishable with imprisonment of up to three months and a fine of up to 60 days,
unless a more serious penalty is applicable in accordance with other legal
2. A grouping administrator who refuses or causes the refusal by another
person of information that he is obliged to provide in accordance with the law
and that has been requested from him in writing, is punishable with a fine of up
to 90 days.
3. If, in the case of paragraph 1, serious economic or moral damage, which
the perpetrator could have foreseen, is caused to any member who has not given
his assent to the fact, or to the grouping, the penalty is imprisonment of up to
one year and a fine of up to 60 days or only a fine of up to 120 days.
4. If, in the case of paragraph 2, the fact was committed for a reason that
does not point to a lack of zeal in defending the rights and legitimate
interests of the grouping and of the members, but only a mistaken understanding
of the object of such rights and interests, the perpetrator is exempt from the
1. Whoever, being in accordance with the law obliged to provide to other
persons information on matters of the activity of the grouping, provides it in a
untruthful manner, is punishable with imprisonment up to three months and a fine
of up to 60 days, unless a more serious penalty is applicable in accordance with
other legal provision.
2. The penalty mentioned in the previous paragraph shall apply to whoever, in
the circumstances there described, maliciously provides incomplete information
which may lead the addressees to mistaken conclusions of an identical or similar
effect as would false information on the same object.
3. If such fact is practiced with intention to cause economic or moral damage
to any member who has not consciously contributed to the same fact, or to the
grouping, the penalty is imprisonment up to six months and a fine of up to 90
days, unless a more serious penalty is applicable in accordance with other legal
4. If serious economic or moral damage, which the perpetrator could have
foreseen, is caused to any member who has not consciously contributed to the
fact, to the grouping, or to a third party, the penalty is imprisonment of up to
one year or a fine of up to 120 days.
5. If, in the case of paragraph 2, the fact was committed for a serious
reason, which does not point to a lack of zeal in defending the rights and
legitimate interests of the grouping and of the members, but only a mistaken
understanding of the object of such rights and interests, the judge can decide
on a special reduction of the penalty or exempt the perpetrator from it.
(Obstruction to supervision)
An administrator of a grouping who obstructs or hinders, or leads another
person to obstruct or hinder acts necessary to the supervision of the activity
of the grouping, executed by persons who, in accordance with the law, the
grouping contract, or judicial decision, have the duty to exercise supervision,
in the terms and forms prescribed by law, or by persons acting under the orders
of those who have such duty, is punishable with imprisonment up to six months
and a fine of up to 120 days.
(Exercise of directly lucrative activity)
The administrators of a grouping found in the circumstances mentioned in
paragraph 3 of article 491 are punishable, individually, with a fine of up to 60
1. The facts described in articles 522 to 525 are only punishable if
2. An attempt to commit facts for which articles 522 to 525 foresee
imprisonment, or imprisonment and a fine, is punishable.
3. Intention to obtain benefit for himself, the spouse, or persons related by
consanguinity or affinity up to and including the third degree, is always
considered as an aggravating circumstance.
4. If, before criminal proceedings have been initiated, the perpetrator of a
fact described in articles 522 to 525 has fully compensated the economic damage
and has given sufficient satisfaction for the moral damage caused, without any
further illegitimate damage to third parties, such damage shall not be
considered in determining the applicable penalty.
Consortium is the contract by which two or more individuals or collective
persons, who exercise an economic activity, bind among themselves to undertake a
certain activity or to make a certain contribution, in an organized manner, with
the purpose of achieving any of the objects mentioned in the following article.
A consortium shall have one of the following objects:
a) performance of legal or material acts, preparatory to a certain work or to
a continuous activity;
b) execution of a certain project;
c) supply of goods similar or complementary among them, produced by each of
the members of the consortium, to third parties;
d) research into or exploitation of natural resources;
e) production of goods that can be shared, in kind, among the members of the
1. The contract is subject to written form, which can be a private document,
unless another form is required by the nature of the goods with which the
members contribute to the consortium.
2. Lack of a public deed, when required, shall only cause the total nullity
of the transaction if the final part of article 285 of the Civil Code is
applicable, and if it is not possible to apply article 286 of the said Code, so
that the contribution is converted into the simple use of the goods of which the
transfer requires that form.
1. The terms and conditions of a contract shall be freely agreed by the
parties, without prejudice to the imperative norms of this Title.
2. If achievement of the contractual object involves the payment of any
contribution, it shall consist in a tangible good or in the use of a tangible
3. Contributions in money are only allowed if the contributions of all
members are of such nature.
(Duties of members of consortium)
Besides the general duties arising from the law or stipulated in the
contract, each member of a consortium shall:
a) refrain from engaging in competition with the consortium, except to the
extent to which he is expressly allowed to;
b) supply to the other members of the consortium and especially to its
leader, if there is one, all information requested regarding or relevant to the
good execution of the contract;
c) allow examinations to activities or goods which, according to the
contract, he is bound to render to third parties.
(Prohibition of common funds)
It is not permitted to create common funds in any consortium.
(Amendment to contract)
1. Amendments to a consortium contract require the agreement of all
contracting parties, except if the contract dispenses with it.
2. Amendments shall follow the form used for the contract.
3. Except if there is an agreement to the contrary, a contract is not
affected by changes of administration or shareholders of the members, if these
are collective persons.
(Types of consortium)
A consortium can be external or internal.
A consortium is said to be external if the activities or the goods are
supplied directly to third parties by each of the members, with express
invocation of such capacity.
(Guidance and supervision board)
1. A contract of external consortium can foresee the creation of a guidance
and supervision board, to which only members can belong.
2. If the contract is silent:
a) the resolutions of the board shall be passed by unanimity;
b) the resolutions of the board, passed by unanimity or with the majority
required by the contract, bind the consortium leader, as instructions from all
its principals, provided that they remain within the scope of the powers
attributed to or conferred upon it;
c) the board has neither powers to decide on the amendment or rescission of
contracts concluded in the framework of the consortium contract, nor to decide
on transactions with the purpose of preventing or terminating litigation.
In external consortium contracts one of the members shall be appointed as the
consortium leader; he shall, in this capacity, exercise both the external and
internal functions contractually attributed to him.
(Internal functions of consortium leader)
In the absence of a contractual stipulation defining them, the internal
functions of the consortium leader consist in the duty to organize cooperation
among the members in the performance of the object of the consortium, and to
promote measures necessary for the execution of the contract, with the diligence
of an ordered and systematic manager.
(External functions of consortium leader)
1. If not granted by means of power of attorney, only by means of contractual
stipulation or by unanimous resolution of the members it is possible for the
leader of the consortium to be conferred powers to:
a) negotiate, conclude, amend or extinguish contracts concluded with third
parties in the framework of the consortium contract;
b) receive from third parties any statements related to the execution,
amendment or extinction of contracts;
c) address to such third parties statements relating to acts mentioned in the
d) receive from the said third parties any amounts due from them to members
of the consortium, as well as to demand from third parties the performance of
their obligations towards any of the members of the consortium;
e) ship merchandise;
f) in specific cases, hire economic, legal and accounting consultants or
others appropriate to needs, and to remunerate such services;
g) representation in court, including receiving citations, and effecting
transactions in order to prevent or terminate litigation.
2. The powers of representation mentioned in the previous paragraph are
deemed to be exercised in the interest and in the name of all members, unless
they can be specifically related to one of them.
(Amounts handed to consortium leader)
In an external consortium, the amounts handed to the respective leader, or
retained by him with the permission of the interested party, are considered as
supplied to the former under the terms and for the effects of subparagraph a) of
article 1093 of the Civil Code.
(Trade name of external consortium)
1. The members of an external consortium can designate themselves
collectively, joining all their names or firms, with the addition 'consortium
of...' ['Consórcio de...'] or '...in consortium' ['...em consórcio']; however,
only members who have signed documents in which the name is used or the members
on behalf of whom the leader of the consortium has signed, using powers granted,
are liable towards third parties.
2. All members are jointly and severally liable towards third parties for
damage resulting from the adoption or use of trade names of the consortium
likely to cause confusion with other existing ones.
(Sharing of amounts received for activity of an external consortium)
1. In an external consortium of which the object is mentioned in
subparagraphs b) and c) of article 529, each of the members shall directly
receive the amounts due from third parties, excepting the provisions of the
following paragraphs and without prejudice to the joint and several liability
among the members of the consortium that may have been stipulated with third
parties, and without prejudice to the powers granted to any of such members by
2. Members of a consortium can stipulate in the respective contract a
distribution of the amounts receivable from third parties different from that
resulting from the direct relations of each one with the third party.
3. In the case of the previous paragraph and in connection with relations
among the members, the difference payable by one of them to another is deemed to
be received and detained for the account of the member who is entitled to it in
accordance with the consortium contract.
4. The previous paragraph also applies whenever the performance of one of the
members of the consortium does not have material autonomy, in relation to a
third party, and the remuneration is therefore included in the amounts received
from the third party by another member or members.
(Sharing of proceeds of activity of an external consortium)
1. In an external consortium of which the object is mentioned in
subparagraphs d) and e) of article 529, each member shall directly acquire part
of the products, without prejudice to paragraph 3.
2. The contract shall stipulate the moment at which the ownership of the
products is considered to be acquired by each member of the consortium; in the
absence of stipulation, usage shall be observed or, in its absence and depending
on the case, the moment at which the products enter the warehouse or leave the
premises where the economic operation took place.
3. The consortium contract can stipulate that products acquired by a member
in accordance with paragraph 1 shall be sold, for his account, by another
member, in which case the rules of the mandate shall apply.
(Relations with third parties)
1. In the relations of the members of an external consortium with third
parties, the former are not presumed to be jointly and severally liable, either
actively or passively.
2. Stipulation of fines or other penal clauses in contracts with third
parties, payable by all members of the consortium, does not imply a presumption
of joint and several liability of the members regarding other active or passive
3. The obligation to compensate third parties for facts generating civil
liability is restricted to those members of the external consortium to whom, by
law, such liability is imputable, without prejudice to any internal stipulations
regarding the distribution of such liability.
A consortium is internal if:
a) the activities or the goods are supplied to one of the members of the
consortium and only this one establishes relations with third parties;
b) the activities or the goods are supplied directly to third parties by each
member of the consortium, without express invocation of such capacity.
(Participation in profits and losses of internal consortium)
Article 555 shall apply if the contracting parties to an internal consortium
have agreed a participation in profits or losses, or both.
TERMINATION OF CONTRACT
(Extinction of consortium)
1. A consortium is extinguished:
a) by unanimous agreement of its members;
b) by the attainment of its object or as a result of it becoming impossible;
c) by the expiry of the time limit stated in the contract, if it is not
d) by the extinction of the plurality of its members;
e) by any other cause mentioned in the contract.
2. In the absence of any of the cases mentioned in the previous paragraph,
the consortium shall be extinguished 10 years from the date of its conclusion,
without prejudice to any express extensions.
(Exoneration of members)
1. A member of the consortium can exonerate himself from it if:
a) it is impossible for him, without fault, to fulfill the obligation to
undertake a certain activity or to perform a certain contribution;
b) the cases mentioned in subparagraphs b) or c) of paragraph of 2 of the
following article have occurred, in relation to another member, producing
important damage, and not all members agreed to rescind the contract regarding
the non-performing party.
2. In the case of subparagraph b) of the previous paragraph, a member who
exonerates himself from the consortium has the right to be compensated, under
general rules, for the damage arising from his exoneration.
(Rescission of the contract)
1. A consortium contract can be rescinded, in relation to any of the
contracting parties, by means of written statements from all the other
members, if there is just cause.
2. It is considered as just cause for rescission of a consortium contract in
relation to any of the contracting parties:
a) the declaration of bankruptcy;
b) a breach, serious in itself or by its repetition, with or without fault,
of duties of members of the consortium;
c) the impossibility, with or without fault, to fulfill the obligation to
undertake a certain activity or to make a certain contribution.
3. In the cases of subparagraphs b) and c) of the previous paragraph,
rescission of the contract does not affect the right to any compensation that
may be due.
ASSOCIATION IN PARTICIPATION CONTRACT
(Concept and regime)
1. An association in participation contract is that by which a person is
associated to a commercial enterprise exercised by another person, the former
participating in the profits, or in the profits and losses, resulting from such
exercise to the latter.
2. Participation in profits is an essential element of the contract;
participation in losses can be excluded.
3. Matters not regulated in the following articles are governed by agreement
of the parties and by the provisions applicable to other contracts, according to
the analogy of the case.
(Plurality of associates)
1. If various persons bind themselves to the same associating party, in a
single association in participation, the former are not presumed to be jointly
and severally liable towards the latter, either actively or passively.
2. The exercise of the rights to information, supervision and intervention in
the management by the various associates shall be regulated in the contract.
3. In the absence of the regulation mentioned in the previous paragraph, the
rights to information and supervision can be exercised individually and
separately by each of them; the assent required by subparagraphs b) and c) of
paragraph 1, and by paragraph 2 of article 556, shall be given by the majority
of the associates.
1. The contract of association in participation is not subject to a special
form, with the exception of the form that may be required by the nature of the
goods with which the associates contribute.
2. However, the clause according to which an associate is excluded from
paying for losses of the business, as well as the clause which, in relation to
such losses, states an unlimited liability of the associate, can only be
evidenced in writing.
3. Paragraph 2 of article 530 applies to the contract of association in
(Contribution of associate)
1. An associate shall perform or bind himself to perform a contribution of a
patrimonial nature which, if it consists in the creation or transfer of a right,
shall pass to the ownership of the associating party.
2. The contract can exclude the contribution of the associate, if he
participates in losses.
3. The contract can stipulate that the contribution mentioned in paragraph 1
shall be replaced by a reciprocal participation in an association between the
same persons, agreed simultaneously.
4. A value in money shall be contractually given to the contribution of the
associate; however, an appraisal can be judicially made, upon request of the
interested party, if necessary for the purpose of the contract.
5. Unless there is an agreement to the contrary, delay by the associate shall
suspend the exercise of his legal or contractual rights, but does not prejudice
the possibility to claim his obligations.
EXECUTION OF CONTRACT
(Participation in profits and losses)
1. The possibility to claim, and the amount of, the participation of an
associate in profits or losses, shall be determined in accordance with the rules
of the following paragraphs, unless a different regime arises from an agreement
of the parties or from the circumstances of the contract.
2. If only a criterion to determine the participation of the associate in
profits or in losses is stipulated, the same criterion shall apply to determine
the participation of the associate in losses or profits.
3. If the participation cannot be determined in accordance with the previous
paragraph, but the contributions of the associating party and of the associate
are contractually appraised, the participation of the associate in profits and
losses shall be proportional to the value of his contribution; in the absence of
such appraisal, the participation shall be half of the losses or half of the
profits, but an interested party can judicially request an equitable reduction,
in accordance with the circumstances of the case.
4. The participation of an associate in the losses of operations is limited
to his contribution.
5. An associate shall participate in the profits or losses of operations
pending at the date of the beginning or termination of the contract.
6. The participation of an associate refers to the results of the accounting
determined in accordance with the criteria set by the law or arising from
commercial usage, taking into account the circumstances of the enterprise.
7. Losses suffered in previous accounting periods shall be deducted, up to the
associate's limit of liability, from the profits which are payable to the
associate in a certain accounting period, in accordance with the law or with the
(Duties of associating party)
1. Besides other duties arising from the law or from the contract, the
associating party has the following ones:
a) to act, in running his enterprise, with the diligence of an ordered and
b) to preserve the essential bases of the association, in such manner as an
associate could expect them to be preserved, in accordance with the
circumstances of the contract and the functioning of similar enterprises;
namely, in the absence of assent from the associate, he is not allowed to
terminate or to suspend the functioning of the enterprise, to substitute its
object or to modify the legal form of its operation;
c) not to engage in competition with the enterprise in which the association
was contracted, unless under terms expressly allowing such competition;
d) to provide to the associate information justified by the nature and the
object of the contract.
2. The contract can stipulate that certain management acts shall not be
practiced by the associating party without previous consultation of or assent
from the associate.
3. The associating party is liable towards the associate for any damage that
the latter may suffer as a result of management acts practiced in breach of the
contractual stipulations allowed by the previous paragraph, without prejudice to
other penalties foreseen in the contract.
4. Changes of shareholders or of management of the associating company are
irrelevant, unless the law or the contract provide otherwise.
(Rendering of accounts)
1. An associating party shall render accounts at the times legally or
contractually stated for the associate to claim his participation in profits or
losses, and also in relation to each annual accounting period of duration of the
2. Accounts shall be rendered within a reasonable time limit after the end of
the period to which they refer; if the associating party is a commercial
company, the time limit for the presentation of accounts to the general meeting
shall apply for such purpose.
3. Such accounts shall indicate clearly and precisely all operations in which
the associate is an interested party and shall justify the amount of the
participation of the associate in the profits or losses, if it is to take place
at that moment.
4. If the associating party does not render accounts, or if the associate
does not accept the accounts presented, the special procedure for presentation
of accounts regulated in the Civil Procedure Code shall be used.
5. The participation of the associate in profits or losses can be immediately
claimed if the accounts were judicially presented; in the contrary case, the
participation in losses, to the extent that it exceeds the contribution, shall
be paid within a time limit of no less than 15 days from the demand by the
TERMINATION OF CONTRACT
(Extinction of association)
An association is extinguished by the facts foreseen in the contract, and
also by the following:
a) complete accomplishment of the object of the association;
b) impossibility to accomplish the object of the association;
c) by intention of the heirs, or the expiry of a certain period of time after
the death of a contracting party, in accordance with the following article;
d) by the extinction of a collective person which is a contracting party, in
accordance with article 560;
e) confusion of the positions of associating party and associate;
h) bankruptcy of the associating party.
(Death of associate or associating party)
1. The death of either an associating party or an associate shall cause the
consequences mentioned in the following paragraphs, unless there is a
contractual stipulation providing otherwise, or an agreement between the
associating party and the heirs of the associate.
2. The death of the associating party or of the associate does not extinguish
the association in participation, but either the surviving party or the heirs of
the deceased can extinguish it within 90 days from the date of the decease.
3. If the liability of the associate is unlimited, or higher than the
contribution paid or promised by him, the association shall be extinguished 90
days after the decease, unless the heirs of the associate declare within this
time limit that they want to continue as associates.
4. If the association is extinguished, the heirs of the associate shall not
pay for losses incurred after the date of the decease.
(Extinction of associate or of associating party)
1. The provisions of the previous article apply to the extinction of a
collective person associate; for this purpose, the person or persons who, in the
liquidation, become entitled to the position that the collective person had in
the association, shall be considered heirs.
2. An association is terminated by the dissolution of the collective person
associating party, unless the contract provides otherwise, or if the
shareholders of the collective person pass a resolution according to which,
during the liquidation, it shall continue its activity; in the latter case the
association terminates at the moment of extinction of the collective person.
3. If the association is terminated by the dissolution of the collective
person associating party, but if the dissolution is revoked by a resolution by
shareholders, the association shall continue without interruption, if the
associate so wishes, by means of a declaration addressed to the counterpart
within 90 days from gaining knowledge of the revocation.
4. The heirs of the extinguished collective person are liable for any
compensation that may be due to the other party.
(Rescission of contract)
1. Contracts agreed for a specific period of time or which have as
object specific operations can be rescinded by any of the parties, if a just
2. If such cause consists in an action committed with fault by one of the
parties, such party shall compensate any damage caused by the rescission.
(Denunciation of contract)
1. Contracts whose duration is not specified and with an object which does
not consist in specified operations can be denounced by one of the parties, with
an advance notice of six months, after 10 years from their conclusion.
2. A party who denounces a contract in breach of the advance notice mentioned
in the previous paragraph is obliged to compensate the counterpart for the
EXTERNAL ACTIVITY OF AN ENTERPRISE
COMMERCIAL OBLIGATIONS IN SPECIAL
(Rules applicable to unilateral acts of commerce)
An act is regulated by the provisions of commercial law regarding all parties
even if the act only is of a commercial nature regarding one of the parties,
with the exception of the provisions that apply only to entrepreneurs.
(Integration of offer)
All sufficiently precise information or advertising transmitted in any form
or by any means of communication in relation to goods and services offered or
presented shall bind the entrepreneur who made it or used it, and it shall be
part of the contracts that come to be agreed.
1. In contracts agreed between commercial entrepreneurs in the exercise of
their respective enterprises, the parties are bound by the usage to which they
consent and by the practices established between them.
2. Except if there is an agreement to the contrary, it is understood that the
parties consider applicable to a contract, or to its conclusion, any and every
usage of which they had or should have had knowledge.
3. For the purposes of the previous paragraph, a usage is considered to be
any practice or way of acting which, being regularly observed in a certain place
or in a certain commercial activity, is such as to justify the expectation that
it will be observed in the contract at issue.
(Non-necessity of form in certain acts)
1. Those provisions of the Civil Code that impose a need to observe a written
form regarding a bond, a promise of performance, or a recognition of debt, do
not apply if these acts are practiced by an entrepreneur in the exercise of his
2. The previous paragraph does not apply to small entrepreneurs.
(Joint and several rule)
Except if there is an agreement to the contrary, the co-obliged under
obligations arising from the exercise of an enterprise are jointly and severally
(Joint and several liability of giver of bond)
The giver of a bond regarding commercial obligations is jointly and severally
liable with the respective debtor, even if he is not a commercial entrepreneur.
1. The interest rate in commercial matters is the default rate, without
prejudice to a written stipulation to the contrary regarding methods for its
determination and variation of rates.
2. In credits of a commercial nature, 2% shall be added to the rate
determined in accordance with the previous paragraph in case of delay by the
debtor, without prejudice to special laws.
1. An entrepreneur who, in the exercise of his enterprise, concludes
contracts or renders services in the name of a third party, has the right to
claim remuneration, even in the absence of an agreement; in the case of a
deposit, he can claim the usual deposit fees.
2. An entrepreneur can also charge interest from the date at which funds were
disbursed in the form of loans, advances or any other expenses that he has
(Obligations of entrepreneur who refuses mandate)
1. An entrepreneur wanting to refuse a commercial mandate that is proposed to
him by another entrepreneur with whom he maintains commercial relations, must
communicate this immediately to the principal; however, he is obliged to carry
out, until the principal takes action, all the measures necessary for the
conservation of any merchandise that may have been sent to him, provided that he
is secured as to the payment of such expenses as he may need to incur.
2. If the principal takes no action after having received such communication,
the entrepreneur to whom the merchandise was sent can deposit it for the account
of the respective owner, under general rules, and can sell any merchandise that
it is not possible to preserve, as well as the merchandise necessary to pay
expenses that he has incurred.
3. The non-performance of any of the obligations mentioned in the previous
paragraph creates for the entrepreneur an obligation to compensate any damage
caused to the principal.
(Death of principal)
If the exercise of the enterprise is continued, a mandate for the practice of
legal acts related to the exercise of a commercial enterprise is not
extinguished by the death of the principal, without prejudice to the right of
the agent or the heirs to revoke it.
(Duty of diligence)
In fulfilling obligations arising from the exercise of his commercial
enterprise, a debtor is obliged to act with the diligence required of an ordered
and systematic commercial entrepreneur.
If an obligation resulting from the exercise of a commercial enterprise has
as object goods determined only generically, the debtor must deliver goods of a
quality no lower than the average.
(Deposit of goods sold)
1. In sales of movable goods made by a commercial entrepreneur in the
exercise of an enterprise, if a buyer refuses or fails to take delivery of the
goods bought, the seller can deposit them, for the account and at the expense of
the buyer, under the terms regulated in the Civil Procedure Code.
2. The seller shall immediately communicate the deposit made to the buyer.
(Enforcement procedure resulting from non-performance by buyer)
1. In the sales mentioned in the previous article, if the buyer fails to pay
the price, the seller can resell the goods for the account and at the expense of
2. Resale shall be done by an auctioneer in the usual terms; the seller is
obliged to give timely notification to the buyer regarding the day, time and
place of the resale.
3. In the case of goods subject to rapid deterioration, the seller can
proceed with a sale by private negotiation, giving immediate notice to the
4. If the price obtained in the resale is not sufficient to cover the agreed
price plus the amount of any damage arising from the non-performance, the seller
has the right to claim the difference from the buyer; if the price obtained
exceeds the agreed price plus the value of any damage suffered, the difference
shall belong to the buyer.
(Enforcement procedure as result of non-performance by seller)
1. If the object of a sale agreed between commercial entrepreneurs in the
exercise of their respective enterprises is fungible goods and the seller does
not fulfill his obligation, the buyer can have the goods bought without delay at
the expense of the seller, being obliged to communicate such sale immediately to
2. The buyer has the right to claim from the seller the difference between
the agreed price and the value of the expenses he incurred with the purchase, as
well as any damage suffered.
CONTRACT FOR SALE OR RETURN
A contract for sale or return is that by which one party delivers one or more
movable goods to the other, who is bound to pay the price, unless he returns the
goods within a set time limit.
(Impossibility of return)
A party who has received goods is not released from the obligation to pay the
agreed price if the return of the goods in the condition in which they were
received has become impossible, even for a cause not imputable to him.
(Disposal of goods)
1. Any acts of disposal of the goods by a recipient are valid; but his
creditors cannot judicially seize such goods while their price has not been
2. The party who has delivered the goods cannot dispose of them until they
have been returned to him.
A supply contract is that by which a party binds himself to supply goods to
another, continuously or periodically, against the payment of a price.
(Quantity of supply)
1. If the quantity to be supplied is not determined, it is deemed to
correspond to the normal needs of the client, taking into account the moment of
the conclusion of the contract.
2. If the parties have established only the maximum and minimum limits for
the entire supply or for each individual delivery, the quantity due shall be
established, within those limits, by the client.
3. If the quantity of the supply is to be determined in accordance with needs
and if a minimum quantity was stipulated, the client is bound for the quantity
corresponding to his needs that exceeds the said minimum limit.
(Determination of price)
In a periodic supply, if the price is to be determined according to the
provisions of article 873 of the Civil Code, the date on which each periodic
performance occurs shall be taken into account.
(Payment of price)
In periodic supply contracts, the price is paid at the moment of, and in
proportion to, each periodic performance; in continuous supply contracts, the
price is paid at the stipulated frequency or, in the absence of stipulation, in
accordance with usage.
(Maturity of each performance)
1. The time limit established for each performance is presumed to have been
agreed in the interests of both parties.
2. If the client has the power to set the date of maturity of each individual
performance, he shall communicate to the counterpart the date for the supply
with adequate advance notice.
(Rescission of contract)
In case of non-performance by one of the parties in relation to individual
performances, the other party can rescind the contract, if the non-performance,
given its seriousness, is such as to cast doubt upon the proper fulfillment of
the remaining performances.
(Suspension of the supply)
1. The suspension of the supply cannot be effected without a reasonable advance notice,
except in the case of fortuitous events or force majeure.
2. If a client is in a situation of non-performance, of minor importance, a
supplier cannot suspend the execution of the contract without adequate advance
1. An agreement by which a client binds himself to give a pre-emption right
to a supplier in the conclusion of a new contract, for the same purpose, cannot
be extended for more than five years; if a longer period is stipulated, it is
deemed to be reduced to such limit.
2. The client has an obligation to notify the supplier of the conditions
proposed to him by third parties, and the supplier, under penalty of lapse
of his right, shall declare within the established time limit or, in its
absence, within a period required by circumstances or by usage, whether he
intends to exercise his pre-emption right.
(Exclusive dealing in favor of supplier)
If exclusive dealing in favor of a supplier has been agreed, the counterpart
cannot receive performances of the same nature from third parties nor, unless
otherwise agreed, can he promote with his own means the production of the goods
which form the object of the contract.
(Exclusive dealing in favor of client)
1. If an exclusive dealing clause has been agreed in favor of a client, the
supplier cannot directly or indirectly perform any supplies of the same nature
within the zone for which the exclusive right was granted and for the duration
of the contract.
2. A client who assumes an obligation to promote the sale of goods for which
he has exclusive rights within the zone assigned to him is liable for any damage
in case of non-performance of such obligation, even if he has performed to the
minimum limit set in the contract.
Denunciation is allowed only in supply contracts agreed for an undetermined
period of time, and must be made with the advance notice stipulated, or arising
from usage; in the absence of stipulation or usage, with adequate advance notice
having regard to the nature of the supply contract.
The provisions governing the type of contract to which the individual
performances of supply correspond shall apply to a supply contract, to the
extent that they are compatible with the preceding articles.
A commission contract is a mandate by which a commercial entrepreneur
undertakes to buy or sell goods in his own name, but for the account of another
person, against payment.
(Revocation of commission)
Before a contract is concluded, the principal can at any time revoke the
order for its conclusion; in such case the commission agent shall be entitled to
reimbursement of expenses incurred and to a remuneration proportional to the
RIGHTS AND OBLIGATIONS OF PARTIES
(Obligations of commission agent)
A commission agent is obliged:
a) to take adequate measures to protect the interests of the principal, and
to follow his instructions;
b) to provide relevant information to the principal, and in particular to
promptly communicate the execution of the commission;
c) to render accounts to the principal on transactions effected, and to
deliver to him the results of the operation.
(Non-performance of commission or disrespect of instructions)
1. A commission agent can cease to execute a commission or deviate from
instructions received in the presence of circumstances which, being unknown to
the principal and which it is not possible to timely communicate to him, make it
reasonable to suppose that, if the principal had known them, he would have given
2. Besides the cases mentioned in the previous paragraph, a commission agent
who does not fulfill a commission in conformity with instructions received or,
in their absence or insufficiency, with commercial usage, shall be responsible
for the act if the principal does not ratify it, unless the counterpart knew or
had an obligation to know of the abuse.
(Safekeeping of merchandise and protection of rights of principal)
1. A commission agent is obliged to provide for the safekeeping and
conservation of merchandise that he receives for the account of a principal, and
to take measures necessary to safeguard his rights regarding the carrier, should
the merchandise show visible sign of having suffered damage during
transportation or arrive with delay.
2. If deterioration is such as to require urgent measures, the commission
agent can have the merchandise judicially sold.
3. The commission agent should give immediate notice to the principal if any
of the situations mentioned in the previous paragraphs occurs, or if the
merchandise does not arrive.
4. The commission agent is obliged to observe the provisions of the previous
paragraphs, even if he has refused a commission proposed by the principal.
(Liability of commission agent regarding safekeeping of merchandise)
1. While performing safekeeping and conservation of a principal's
merchandise, a commission agent is responsible for its loss or deterioration,
except if this is the result of a cause not imputable to him.
2. The commission agent is not obliged to insure the principal's merchandise,
except if otherwise agreed or arising from usage.
(Verification of damage occurring to merchandise)
Irrespective of its cause, a commission agent is obliged to have any damage
occurring to merchandise that he detains for the account of a principal verified
in accordance with the law, and to give notice to him immediately, under penalty
of liability for damage caused.
(Liability of commission agent for defective performance)
1. A commission agent who sells for a price lower than that indicated to him
by a principal or, in the absence of an indicated price, for less than the going
price, is responsible towards the principal for the price difference, except if
he proves that the sale prevented greater damage to the principal, and that
circumstances did not allow him to fulfill his instructions.
2. If the commission agent buys for a price higher than that indicated to him
or, in the absence of indication, for more than the going price, the principal
is not obliged to accept the transaction, except if the commission agent agrees
to receive only the price that was indicated to him by the principal or, in the
absence of indication, the going price.
3. If the commission agent's excess consists in the fact that the goods
bought are not of the recommended quality, the principal can refuse the
4. The provisions of the previous paragraphs do not affect the right of the
principal to demand compensation for damage resulting from non-performance of
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