• The CJEU has ruled on consumers with loans indexed or denominated to the Swiss franc.
• If a loan agreement is invalidated due to its abusive clauses, a bank cannot demand remuneration from consumers for using capital.
• At the same time, in such a situation, there is no obstacle for the consumer to demand additional benefits from the bank, if national regulations allow it.

On the list of cases of the Court of Justice of the European Union, the issue of the interpretation of national legislation in connection with the preliminary question in Case C-520/21 posed in August 2021 by the District Court for Warsaw - Śródmieście has been heard today. It is about important issues concerning mortgage loans relating to the Swiss franc. If a loan agreement is declared invalid due to the presence of abusive clauses in it, can the parties, in addition to the return of the money paid in the performance of this agreement (the bank - the capital of the loan, the consumer - the installments, fees, commissions and insurance premiums) and statutory interest for delay from the time of the call for payment, also claim other receivables? So, in addition to the return of the capital, can the bank also demand remuneration, compensation, reimbursement of expenses or valorization of the benefit, for example, due to the fact that it was temporarily deprived of the use of its money or that it incurred the costs of servicing the loan agreement? May the same benefit, in addition to the repayment of loan installments, fees, commissions and insurance premiums, be demanded from the bank by the consumer?

Bank claims without legal basis

The CJEU has ruled that if a loan agreement between a bank and a borrower is invalid from the start because it contains unfair contractual terms, Directive 93/13 precludes the bank from being entitled to demand compensation from the consumer beyond the return of the capital disbursed and beyond the payment of statutory default interest. The ruling is identical to the standpoint expressed by President of UOKIK and the opinion issued in February by the Advocate General of the CJEU. The Court has further argued that granting such a right would contribute to eliminating the deterrent effect on businesses

- Another ruling would contradict the entirety of the CJEU's case law to date and the assumptions of Directive 93/13 which aims to ensure a high level of consumer protection. We have argued for long time that banks do not have the right to demand remuneration for the use of the capital when a contract is cancelled due to their fault, i.e. due to the use of abusive clauses. It is good that this issue has finally been resolved, the CJEU ruling reflects our standpoint on these matters - says Tomasz Chróstny, President of the Office of Competition and Consumer Protection.

Consumer claims unhindered

According to the CJEU's ruling, Directive 93/13 does not oppose national laws as well as the adjudication of additional benefits, by national courts, in favor of the consumer - in addition to the return of money paid under the agreement by the consumer - such as the bank's use of amounts paid in loan installments.

As indicated in the ruling, Directive 93/13 does not directly regulate the consequences of the invalidity of a contract concluded between an entrepreneur and a consumer as unfair terms have been eliminated. It is up to member states to determine the implications of such a statement. At the same time, the rules they establish in this regard should comply with EU law and, in particular, with the objectives of this directive. In the Court's view, it does not appear that the consumer's ability to assert claims against the bank beyond the return of monthly installments undermines the stated objectives of the directive.

Situation of banks

In ruling, the CJEU has pointed out that granting banks the right to pursue other claims besides the return of the capital amount would help eliminate the deterrent effect on entrepreneurs. At the same time, it would reduce the effectiveness of the protection granted to consumers by the directive if they were exposed at the risk of paying such compensation. Such an interpretation would pose a risk of creating a situation in which it would be more beneficial for consumers to continue to perform a contract containing an unfair term rather than to exercise the rights they derive from the said directive.

At the same time, the CJEU has stressed that the argument raised about the threat to the stability of the financial markets is irrelevant under the interpretation of the directive which aims to protect consumers.

Moreover, as the CJEU has pointed out, neither the entrepreneur can be allowed to benefit economically from his unlawful behavior, nor can they be compensated for the inconvenience caused by it. The Court has further pointed out that entrepreneurs cannot circumvent the objectives pursued by the directive for the sake of preserving the stability of the financial markets. Indeed, it is up to banking institutions to organize their activities in a manner consistent with this directive.

Judgment on suspension of repayments

The CJEU has also issued a ruling on the suspension of loan installment payments. According to the CJEU, the court may order an interim measure to suspend loan installments while the case is pending to establish the unfairness of the contract terms. In the Court's view, a refusal to suspend loan installments as an interim measure may render, at least in part, a final judgment on the agreement invalidity ineffective.

This is because the ruling would not lead to the restoration of the legal and factual standing in which the consumer would have been in the absence of the unfair clause since they would then have to file another lawsuit for payment of the amounts paid in the course of the first trial on the basis of the invalidated agreement. In other words, the restitution effect of the ruling declaring the agreement invalid would not be fully achieved.

Consumer Support:

Phone: 801 440 220 or 222 66 76 76 – consumer helpline
E-mail: [SCODE]cG9yYWR5QGRsYWtvbnN1bWVudG93LnBs[ECODE]
Consumer Ombudsmen – in your town or district
Financial Ombudsman – when a complaint has been rejected by a financial institution

Additional information for the media:

UOKiK Press Office
pl. Powstańców Warszawy 1, 00-950 Warszawa, Poland
Phone: 22 55 60 246
Email: [SCODE]Yml1cm9wcmFzb3dlQHVva2lrLmdvdi5wbA==[ECODE]
Twitter: @UOKiKgovPL
You can also follow us on Instagram: @uokikgovpl