• 3^rd October, one year passed since the Court of Justice of the EU issued its judgement in Case C-260/18 (Dziubak).
• The President of the Office of Competition and Consumer Protection (UOKiK) supports borrowers by initiating administrative proceedings, issuing decisions and relevant opinions.
• “Decisions issued by us in cases of mortgage loans have an impact on the situation of hundreds of thousands of borrowers,” says Tomasz Chróstny, President of UOKiK.

One year ago - on 3^rd October 2019 - the Court of Justice of the EU commented on the consequences of the application of prohibited clauses (C-260/18, Dziubak). This is the result of a preliminary ruling submitted by the District Court in Warsaw, which decided the case involving consumers and Raiffeissen Bank. The dispute pertained to the consequences of applying prohibited contractual provisions in a mortgage loan agreement indexed to the Swiss franc - it concerned the method of converting the loan balance from Polish zloty to Swiss franc. We informed about the details of this judgement in the communication. According to data from the Stop Banking Lawlessness Association, following the Dziubak judgment, 88% of cases in courts of first instance ended up in favour of consumers. 

“I am glad that in most cases courts adjudicate in favour of consumers on foreign currency loans. After a year of the CJEU ruling and years of UOKiK presenting the same stance as the one presented by the Court, there are still many issues to be resolved on the part of the banks, e.g. the one concerning their claims for remuneration for the use of principal and interest when the court annuls a mortgage loan agreement expressed in a foreign currency. I would like to remind that both in Polish and European legal regulations there are no grounds for making such claims,” says Tomasz Chróstny, President of UOKiK.

The President of UOKiK has been consistently supporting borrowers who pursue their claims in common courts. Each year, he issues several hundred reasoned opinions in a case. Only from 3^rd October 2019, i.e. since the CJEU judgment in Dziubak case, there were over 500 of them - they have already included the CJEU ruling and the position of the President of UOKiK in this case. They constitute tangible help for consumers in pursuing their claims against banks. They are also important information for courts.

“The Office of Competition and Consumer Protection supports holders of mortgage loans in various ways. We initiate administrative proceedings and issue decisions, we present our position in court disputes between consumers and banks, issuing reasoned opinions. We participate in drawing up positions presented by the Government of the Republic of Poland in consumer matters before the CJEU, such as recently in the position on C-19/20 (Bank BPH), positive for the so-called franc debtors. The decisions issued by us influence dozens, and sometimes even hundreds of thousands of borrowers. The Office is an institution whose final decisions constitute prejudication for common courts in individual cases. This means that our decisions have a real impact on the litigation situation of consumers, and the courts must not disregard UOKiK's findings. In many cases, we see that banks, as a stronger party, impose unfavourable conditions on consumers. In such cases, I do not hesitate to impose harsh yet fair financial sanctions,” adds Tomasz Chróstny, President of UOKiK.

Below we present the most important actions of the President of UOKiK:

1. CJEU and UOKiK

In total, the President of UOKiK has issued 10 positions on new franc cases before the CJEU, including 3 on Polish cases, which are taken into account when drawing up Polish positions in the proceedings (C-19/20 Bank BPH, C-198/20 X Bank, C-212/20 A.S.A.). The most recent position concerns the case No.C-19/20. UOKiK participated in drawing up a position favourable to borrowers. At the end of 2019, the Regional Court in Gdańsk asked the CJEU for a preliminary ruling concerning, inter alia, whether the court may determine the unfair nature of a term of a contract resulting in the cancellation of this contract, even if it was subsequently amended, the admissibility of determining the unfair nature of only some elements of the term of a contract, as well as whether the court should inform the consumer that in the case of invalidity of the contract, the bank may make claims against them, even if the legitimacy of these claims is not prejudged.

In the same period, 6 CJEU judgments were passed in franc cases, on which the President of OCCP has drawn up a position.

2. High fees

The President of the Office has intervened on the methods of calculating fees for mortgage loan repayment record certificates collected by the banks, which amounted even to 2 thousand zlotys, as well as the time limits for their issuance. Following the UOKiK's intervention, the banks revised the method of setting fees for issuing certificates and shortened the time limit for issuing them. In this case, the President of UOKiK issued the first decision against Deutsche Bank Polska and imposed a fine of nearly PLN 5 million on this bank for using prohibited clauses. Four more exploratory investigations are still pending.

3. Important positions of UOKiK

The President of UOKiK has issued 5 general positions on loans indexed or denominated in foreign currencies. They pertain to:

• clauses applied by entrepreneurs relating to the premises for changes in interest rates in mortgage and consumer loan agreements
• indexation clauses included in bank agreements
• clauses relating to low own contribution insurance (UNWW), included in loan agreements
• judgement in Case C-260/18 (Dziubak)
• position of the President of UOKiK on the annexes concerning repayment holidays offered in connection with the COVID-19 epidemic.

4. Currency spreads

President of UOKiK Tomasz Chróstny has been consitently declaring illegal the clauses concerning the unclear rules of setting exchange rates in annexes, used for calculating installments of credits indexed to, inter alia, EUR and CHF. The President of UOKiK questioned such provisions in annexes applied by 9 banks. As a result, the borrowers were unable to verify how the banks fix the exchange rates and whether they charge them with excessive credit instalments. So far, the President of UOKiK imposed fines on 5 banks for such provisions - in the total amount of PLN 80 million – and forbade them to apply the disputed clauses. These are: BNP Paribas (PLN 26.6 million fine), Millennium (PLN 10.5 million), Santander Bank (PLN 23.6 million), Deutsche Bank Polska (nearly PLN 7 million) and Getin Noble Bank (nearly PLN 13.5 million). The Office has also been conducting proceedings against another 4 banks: Raiffeisen Bank International AG (previously: Raiffeisen Bank Polska), PKO BP, BPH, Pekao SA.

5. Unfair practices of law firms and insurance claim law firm

The judgement in Case C-260/18 (Dziubak) resulted not only in increased activity of consumers who were pursuing their claims in court, but also of law firms and other entities that wanted to represent borrowers in civil disputes. UOKiK pointed out that not all their actions may be beneficial to consumers. Therefore, the President of the Office has recently instigated explanatory proceedings in which he examines the practices of 15 law firms. The objections concern, inter alia, inability to estimate the remuneration of a law firm, or reserving all the benefits obtained for the consumer for the benefit of the law firm. Moreover, in early 2020 the President of UOKiK also issued four decisions concerning insurance claim law firms which, inter alia, dealt with the recovery of claims from banks on behalf of consumers. Two further proceedings are pending. The most frequently challenged practices also involve unclear rules for determining remuneration for representing customers.

6. Unilateral amendments in agreements

The President of UOKiK also makes sure that banks do not unilaterally amend major terms of mortgage loan agreements. Such amendments to fixed-term agreements under which consumers become indebted are only allowed upon voluntary agreement between the bank and the consumer. The same applies to the intention to replace a prohibited provision with another provision unilaterally determined by the bank. The borrower cannot be forced to make a choice - either they agree to arbitrarily introduced amendments, or the bank terminates the agreement, which involves the immediate repayment of the debt. President of UOKiK Tomasz Chróstny imposed a financial fine on Raiffeisen Bank International for a unilateral amendment in the methods of setting exchange rates that determine the amount of installments paid. Similar proceedings are also pending against Getin Noble Bank (unilateral change in the manner of determining currency exchange rates and credit collateral) and against Raiffeisen Bank Polska (unlawful change of account numbers after merger with BNP Paribas). The explanatory proceedings are also in progress - concerning the unilateral amendment by Deutsche Bank Polska of the provisions on the method of calculating fees for the issuance of certificates in the course of proceedings of the President of UOKiK to recognise them as abusive.

7. Repayment Holidays

The Office also took care of the consumers who wanted to benefit from the so-called repayment holidays i.e. deferral of repayment of credit installments. In early April, the President of UOKiK initiated proceedings concerning the actions of 26 banks. One of the challenged practices concerned mortgage loans, including loans repaid in a foreign currency. It concerned situations where banks used the provisions of the signed annexes to "repayment holidays" to obtain confirmation that the consumer had accepted a specific debt balance under the agreements. This violated common sense, as by doing so the banks enforced the declaration not related to the purpose of signing the annex, which is to postpone the repayment of the loan. This declaration might have been used by banks in the future to hinder consumers from pursuing their rights should they question the terms and conditions of foreign currency mortgage loan agreements. Following the intervention of the President of UOKiK, the banks abandoned applying this provision.

The COVID-19 pandemic put people who lost their jobs and are repaying loans in a very difficult situation. This is especially true for consumers repaying their mortgage loans, who may lose their apartment if they discontinue repayment. Therefore, the Office actively participated in developing regulations under the anti-crisis shield, which enabled individuals allowed people who found themselves in a difficult situation due to the coronavirus pandemic to take free repayment holidays. Thanks to UOKiK, they currently have the right to suspend the repayment of a loan for a period of up to 3 months, without charging any interest and other fees.

After the introduction of new regulations, the Office received information that banks used to hinder their customers from benefitting from this solution. In a number of instances, consumers only received an offer to take advantage of the bank's costly credit memorandum also when they would apply for statutory, free repayment holidays and met the statutory criteria for granting them. The President of UOKiK initiated explanatory proceedings to examine the practices of 26 banks in this case. Based on the information obtained, explanatory proceedings were initiated against one of the banks, and the Office urged three other banks to provide explanations and voluntarily revise their practices. 

Additional information for the media:

UOKiK Press Office
Pl. Powstańców Warszawy 1, 00-950 Warszawa, Poland
Phone +48 695 902 088, +48 22 55 60 246
E-mail: [SCODE]Yml1cm9wcmFzb3dlQHVva2lrLmdvdi5wbA==[ECODE]
Twitter: @UOKiKgovPL