Decree-Law No. 139-B/2025, published in the Official Gazette on 30 December 2025, formally abolished the Competitive Balance Mechanism — commonly referred to as the Clawback Mechanism — along with its entire regulatory framework.

The Clawback Mechanism, introduced by Decree-Law No. 74/2013 of 4 June 2013, was designed as a regulatory tool to correct potential distortions in the wholesale electricity market in the Iberian Electricity Market (MIBEL). These distortions could arise from extraordinary measures or events outside the market that affected price formation.

Under the new Decree-Law, the mechanism is permanently discontinued as of the 2025 fiscal year. No further assessments, studies or compensations will be carried out for 2025 or subsequent years. However, obligations related to prior fiscal years remain in force, including the assessment and settlement for the 2024 fiscal year.

The Decree-Law entered into force on 31 December 2025, the day following its publication.

Implications

The Decree-Law abolishes the Clawback Mechanism from the Portuguese regulatory framework as of the 2025 fiscal year. Although this reduces future regulatory and financial uncertainty for market participants, it does not affect obligations arising from prior periods. Entities must therefore continue to ensure compliance, settlement and the management of any ongoing or potential disputes relating to the 2024 fiscal year and earlier years.