A regulated bond, not an ICO.
A token that pays its holders from rent is a security under EU law. So we use the route regulators already accept: a single-building company issuing bonds through a licensed crowdfunding platform, with the bond register kept on a blockchain.
Status of this analysis
This structure comes from our own legal research (version 3.1, 14 October 2026). Portuguese counsel has not yet given a written opinion. Items they must confirm are listed at the bottom of this page.
How each regime treats a token that pays from rent.
| Regime | Treatment |
|---|---|
| EU MiCA | Excluded: MiCA does not cover financial instruments (Art. 2(4)). A "MiCA white paper" is the wrong document. |
| EU MiFID II / Prospectus Regulation | A transferable security. A public offer needs a prospectus unless exempt, and selling to retail through an intermediary needs a licence. |
| United States | An investment contract under the Howey test. US persons are excluded. |
| United Kingdom | A specified investment under FCA financial-promotion rules. UK persons are excluded. |
We will not sell a separate "utility" or "governance" token. It would either be a security or a MiCA crypto-asset needing its own white paper, and it would add cost for no capital benefit.
Why one company per building, through crowdfunding.
EU crowdfunding (ECSP) fits a single building
The EU crowdfunding regulation lets a special-purpose company sit between project owner and investors only for one illiquid or indivisible asset. ESMA's own example of such an asset is a residential building. One building per company fits exactly; a company holding several buildings would not.
Limit: €5M per project owner per 12 months. Source: ESMA ECSPR Q&A 1.3, 1.5.
Bonds keep holders as secured creditors
Holders lend to a single-asset company, secured by a mortgage, rather than owning shares in a pool. That keeps the investment-fund question at its lowest. It also matches the regulator-accepted precedent: Reental's tokenised debt per property in Spain, formalised with the CNMV in December 2025 at €100 per token.
| Mechanism we compared | Holder yield | Verdict |
|---|---|---|
| Fractional ownership (tokenised shares of one pooled company) | ~3.7% | Best economics, but likely an investment fund needing a licensed manager. Phase 2. |
| DAO or community land trust | 0–1.5% | A DAO cannot hold Portuguese property. Permanent affordability comes through the CIA contract instead (up to 25 years). Not used. |
| Tokenised participating bonds, one company per building | ~3% target | Regulator-accepted, fits EU crowdfunding. Launch. |
Indicative bond terms.
| Name / ticker | Lar Commons / LAR, one series per building (e.g. LAR-COI-01) |
| Legal nature | Participating bond of a Portuguese building company, registered on DLT (DL 171/2026) |
| Nominal | €100 |
| Coupon | 1.25% fixed plus a share of remaining distributable rent cash; target total ~3%, not guaranteed |
| Security | Mortgage over the building, held by the bondholders' representative (representante comum) |
| Capital stack | 75% senior community bonds, 25% subordinated 0% impact bond taking first loss |
| Term | 10 years (indicative) |
| Standard / network | ERC-3643 permissioned token; Base preferred because EURC is native there; final chain set by the platform |
| Supply | Fixed per building raise. No pre-mine, no free team tokens |
| Payments | Quarterly, in EURC or by SEPA, after withholding tax |
| Transfers | Only between verified wallets; US and UK persons excluded |
| Lost keys | Recoverable after identity re-verification |
| Liquidity | Resale on the platform's bulletin board. No redemption promise at launch |
The path to a pooled fund, opt-in only.
Once 3 to 5 buildings are running, the plan is to pool them into one larger vehicle (a Portuguese REIT, called a SIGI, or a licensed fund), worth about +0.45pp and with better liquidity. Without a clause now, every holder would have to agree individually later. So the bond terms include it from day one:
- Offer. The issuer may offer every holder of a series an exchange into units of the pooled vehicle. The exchange is itself a new securities offer, subject to its own offer documentation.
- Price. Set by independent valuations of the building and of the pooled vehicle, both published before holders decide.
- Opt-in. Nobody is converted without consent.
- Decliners. If an exchange offer is made, you keep your bond to maturity or are repaid early at €100 face value, your choice. This applies only when an exchange is offered; it is not a standing right to demand repayment.
- Impact bond. Converts into a junior unit class, so it stays first-loss.
- Process. A bondholders' meeting convened by the representative, with at least 30 days to decide after both valuations are published (pending lawyer confirmation).
The two regimes the model relies on.
Both were created by Decreto-Lei n.º 97/2026 and apply from 1 September 2026.
RSAA: affordable-rent regime (Anexo III)
- Rent cap set per municipality and typology, based on 80% of the INE median rent.
- Qualifying rental income is exempt from IRS and IRC.
- Minimum 3-year lease for permanent residence.
- Pending: the implementing order with the actual caps, and the live IHRU registration platform.
CIA: rental investment contract with IHRU (Anexo I)
- No IMT or stamp duty on purchase; no IMI for up to 8 years, then −50%; no AIMI for the whole term; 6% VAT on works.
- The purchase-tax and IMI benefits need a vote of the municipal assembly.
- Homes let within one year, each at least 8 months a year; term up to 25 years.
- Breach claws back 100% of benefits in years 1–10. Our bond terms aim to make a clawback a sponsor-default event, not a holder loss, where the law allows.
Who will do what.
| Role | What it does | Status |
|---|---|---|
| ECSP crowdfunding platform | Runs KYC, the appropriateness test and the offer; publishes the KIIS; bulletin-board resales | Shortlisting |
| Tokenization provider | ERC-3643 bond token, identity registry, EURC and SEPA payouts | Shortlisting |
| Portuguese counsel | Securities, tax and real-estate opinion; bond terms; KIIS | To appoint |
| Bondholders' representative | Holds the mortgage for holders; acts on default; runs any exchange offer | To appoint |
| Statutory auditor | Annual accounts; occupancy and CIA / RSAA compliance | To appoint |
| Independent valuer | Valuation before purchase and every year | To appoint |
| Impact anchor | €1M subordinated 0% bond | To approach |
What counsel must confirm before any offer.
- Can the RSAA income-tax exemption and the CIA property-tax relief apply to the same building? This decides whether the target is about 3% or 2.4–2.9%.
- Is a building company issuing participating bonds, with a profit share and a sponsor share above 3%, outside the EU definition of an investment fund?
- Does the CIA purchase-price cap apply to these acquisitions, and can a new company meet CIA's management-capacity test through the sponsor's operating company?
- Who withholds tax on coupons paid to blockchain wallets, and how is each holder's residence evidenced?
- Can the mortgage be held by the bondholders' representative?
- What may this website say before and during the offer?