Between the years of 2007 and 2014, a phase of economic crisis spread a little throughout Europe. Portugal was no exception. In fact, Portugal, along with Italy, Greece and Ireland, was one of the countries that suffered most from the crisis. Until this period, the Portuguese legislation concerning insolvency proceedings was only aimed at satisfying the claims of the companies’ creditors. However, in order to combat the scourge of bankrupting companies, Portugal has amended its legislation in this area, adapting it to the economic and financial reality that was lived. In Portugal, football clubs - also experiencing complicated financial moments - took advantage of the emergence of the Special Revitalization Processes (PER) and made use of it. However, at the football level, the application of PERs has proven to be highly detrimental to club creditors (in particular, players and coaches who survive on the club’s income).
The Portuguese football reality in PER’s
As far as football is concern, the purpose of PER is to enable a club with economic difficulties, but that is still viable, to negotiate directly with his creditors in order to reach an agreement that will enable its revitalization, before being declared legally insolvent, allowing it to continue competing.
In Portugal, historical clubs like Boavista Futebol Clube, Vitória Futebol Clube, Clube de Futebol "Os Belenenses", União Desportiva de Leiria, Sport Clube Beira-Mar and Naval 1º de Maio are examples of clubs that had to resort to PERs.
However, what seems a painful reality for clubs, is even more so for their creditors, particularly those that...
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