UNFAIR TERMS

An EU directive provides that consumers are not bound by unfair terms in a contract concluded with a seller or supplier. The Court has ruled on numerous cases in this field and has clarified the scope of that directive.

The Court first of all clarified that national courts are required to examine, of their own motion, whether a term contained in a contract may possibly be unfair. That rule, which also applies to insolvency proceedings, does not allow the court to revise the content of the term, but may lead it solely to set that term aside (judgments of 4 June 2009, PannonGSM, C-243/08; of 21 April 2016, RadlingerandRadlingerová, C-377/14; of 14 June 2012, BancoEspañoldeCrédito, C-618/10).

In addition, it is not possible to impose a temporal limitation on the effects of the invalidity of 'floor clauses' (clauses requiring the consumer to pay a minimum amount of interest) included in mortgage loan contracts concluded with consumers (judgment of 21 December 2016, Gutiérrez Naranjo, C-154/15, C-307/15 and C-308/15). Lastly, when a financial institution grants a loan denominated in a foreign currency, it must provide the borrower with sufficient information to enable the latter to take a prudent and well-informed decision (judgment of 20 September 2017, Andriciuc and Others, C-186/16).