1.1.1. Is TPF commonly used in your Jurisdiction? If yes, since when (is it a new trend or a well-established practice)?
The Portuguese legal community is yet to become completely aware of the dimension, particularities and challenges arising from this financing model. Only few references can be found in relation to the Third-Party Funding phenomenon. The first reference came in a form of an intervention by Antonio Pinto Leite in an arbitration event held in 2013. However, the conclusions reached about this topic and the discussion that briefly followed did not resonate and received little attention from the legal community. In any event, this author wrote a scholarly article that was published by the Portuguese Bar Association Journal, and another practitioner dealt with the ethical implications of the Third-Party Funding towards the arbitrators in another Portuguese law journal.
Furthermore, there is not a single case decided by the courts where this issue has been touched upon and much less may one find even the slightest of references to it in any legal provision, including those applicable to the exercise of the legal profession.
In a nutshell, TPF is a financing mechanism which is “uncommon” in the Portuguese legal community.
However, if one includes “before-the-event” insurance policies in the definition of “Third-Party Financing”, the Portuguese market is well aware of this non-recourse financing of litigation expenses and legal fees.