Are there any measures specifically targeted for the contracts in the culture and arts sector?

Decree-Law no. 10-I/2020, of 26 March, amended successively and currently according to the amendments introduced by Decree-Law no. 78-A/2020, of 29 September,, seeks to establish the contractual effects of setting new dates and cancelling shows, which could not take place on the booked venue, date and hour, between 28 February 2020 and30 September 2020, including:

  • Imposing, when possible, the rescheduling of the shows until 30 September, 2020, otherwise the rescheduling shall be deemed as a cancellation. The new date for the realization of the shows shall not be set to no longer than one year after the initial date (or, in regard to free entrance shows, allowing it to be rescheduled to a date up to a maximum of 18 months after the emergency measures are revoked);
  • Clarifying that setting a new date shall not have any effect on the validity of the previously sold tickets;
  • Setting another date shall not lead to the reimbursement of the ticket price, nor to the payment of any extra charges by the owners or exploiting entities of the venue of the show;
  • The show must be cancelled in case rescheduling is objectively impossible and such impossibility cannot be attributed to the promotor. For such purpose, the rescheduling of shows is considered “objectively impossible” when it concerns local or regional festivities or specific festive days which are unrepeatable within one year counted from the originally scheduled date. The impossibility of rescheduling is not attributable to the promotor in case, within a maximum term of 1 year counted from the originally scheduled date of the show, the promotor is not able to find a venue with the capacity of the venue initially hired, in the city, metropolitan area or within a range of 50 km from the area where the show was supposed to take place;
  • In case of cancelation of the show, reimbursement of the ticket price and restitution of the amounts paid in advance to the owners or exploiting entities of the venue of the show shall take place (the customer is, however, entitled to ask for the substitution of the ticket for a ticket for a different show).
  • In regard to shows promoted by public entities or by “public-law bodies”, or shows that are mainly funded by public funds, promotor shall ensure, in case of cancelation or rescheduling of the show, that the payments are made within the contractual deadlines and that, at least, in the date in which the show was initially supposed to take place, minimum amount of 50% of the total contractual price has already been paid (nevertheless, a new date can be settled for the show and further payments can be made accordingly with the new deadline)
  • In case the works already performed or the services or goods already provided exceed the contractual price, the promotor shall pay the amount outstanding; in case of rescheduling, additional works, goods or services may be purchased, and prices may be revised whenever applicable.
  • Free entrance Shows may be rescheduled up to 18 months after the legal prohibition or limitation of shows have expired.
  • Such obligations also apply to contracts that had not been executed when Decree-Law no. 10-I/2020 entered in force, provided that: (i) the pre-contractual procedure had already been initiated, or (ii) the programming had already been announced, or (iii) the promotor had confirmed the cultural agent, in writing, that the show would be carried out, having agreed with the price and date proposed. Government shall ensure, with a frequency not exceeding 30 days, the announcement of the timetable for lifting of the restrictions or the maintenance of said limits to the performance of live shows. This should be adapted to the changing condition related to the fight against the pandemic.
  • Cancellation of shows arising from prohibitions and restrictions imposed to the operation of show activities or venues is considered as a result of force majeure, for legal and contractual purposes, as well as for obligations and commitments undertaken as a result of performance of a show that was canceled.
  • Whenever possible, the parties must maintain their contracts, ensuring their scope and objectives, and fulfilling their obligations in relation to the date to be chosen for rescheduling and, in any case, seek to achieve an equitable distribution of contractual costs and risks, avoiding unjustified losses or benefits.
  • Live shows occurring in indoor venues or outdoor festivals and shows of similar nature declared as such are prohibited until 30 September 2020. Such events may, however, exceptionally, take place in indoor venues or outdoor, in case of reserved seats, after communication and compliance with the legal capacity specifically defined by the Directorate General of Health (Direção-Geral da Saúde) according to the rules of physical distancing considered to be appropriated for the evolution of the pandemic.
  • The holders of the tickets for festivals and shows of a similar nature are entitled to obtain – without any additional cost or commission – a voucher with an equivalent amount to the price of the tickets purchased, which is transferable to third parties by mere tradition, and remains valid until 31 December 2021 (in case it is not used until then, the holder of the ticket may request the reimbursement). The voucher shall also mention the possibility of being used in the acquisition of tickets for the same show to be held on a new date or for other events held by the same promoter; the insurance contracted at the time of acquisition of the ticket is kept in force.
  • Cultural agents should provide information such as, namely, (i) the cancellation of the show or new date for its performance, (ii) the venue, physical or electronic, the procedure and deadline for the issuance of vouchers, (iii) all shows to be performed by said promoter until 31 December 2021, for which the vouchers issued may be used, as well as the (physical and electronic) place, procedure and deadline for their use, (iv) the list of agencies, sales outlets and electronic ticketing platforms allowing the use of the voucher, and (v) the physical or electronic place, procedure and deadline for reimbursement of the unused voucher.
  • When the amount of the ticket for another event held by the same promoter is higher than the amount of the voucher, this may serve as an initial payment of tickets of a higher amount for other events held by the same promoter; on the other hand, if the amount of the ticket for another event held by the same promoter is lower than the amount of the voucher, the remaining amount may be used for the purchase of tickets for other events held by the same promoter.

 

Who shall be covered by these measures?

These measures shall apply, regardless of the public or private nature to all:

a) Cultural agents, namely, artists, interpreters and performers, authors, producers, promotors, agents;
b) Owners or exploiting entities of the venues and entertainment facilities;
c) Agencies, ticket offices and online ticket sale platforms.

 

Are there any penalties for the non-compliance with these measures?

The compliance with the measures shall be supervised by Inspeção-Geral das Atividades Culturais and the non-compliance with the same shall be sanctioned under administrative offense (misdemeanor). 

 

Has any specific public procurement regime been approved for this purpose?

Yes. Decree-Law no. 10-I/2020, as amended by Law no. 7/2020, provided that public entities and “public law bodies” that promote shows could perform contracts (with no price limit) by means of a direct award based on the grounds of “extreme urgency”, and they could also perform contracts up to € 20.000 by means of a simplified direct award procedure. Nevertheless, said legal provision was revoked by Law no. 19/2020, which is effective as from 30 May.

 

As any derogatory support measure been approved within this context?

Yes. Ordinance no. 180/2020, of 3 August, enacted the Regulation on the Support Facilities for the Culture Sector as part of the Economic and Social Stabilization Program.

Such Regulation establishes the rules applicable to (i) the support facilities for the adaptation of the venues to comply with the COVID-19 safety measures (with a grant of €750,000), (ii) the support facilities to professional arts institutions (with a grant of €3.000.000) and (iii) an additional support facilities to artists, authors, technicians and other cultural sector professionals.

The support facilities in question are assigned as a non-refundable grant, being paid by bank transfer, in one single instalment (in the case of the support facilities for the adaptation of the venues to comply with the COVID-19 safety measures and for the professional arts institutions) or in two instalments (in the case of the additional support facilities to artists, authors, technicians and other cultural sector professionals), being directly reported to the Tax Authorities by GEPAC and DGARTES.

 

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This information is being updated on a regular basis.

All information contained herein and all opinions expressed are of a general nature and are not intended to substitute recourse to expert legal advice for the resolution of real cases.