Order of the Court (Seventh Chamber) of 18 October 2023 (request for a preliminary ruling from the Apelativen sad – Sofia – Bulgaria) – VU, IT v EUROBANK BULGARIA
(Case C-117/23, 1 Eurobank Bulgaria)
(Reference for a preliminary ruling – Article 99 of the Rules of Procedure of the Court of Justice – Directive 93/13/EEC – Unfair terms in consumer contracts – Article 3(1) and Article 4 – Assessment of the unfairness of contractual terms – Contractual term that is in plain, intelligible language – Bank loan agreement denominated in a foreign currency – Term that places the exchange risk entirely on the consumer – Advantage not specifically agreed upon for the benefit of the credit institution resulting from the conversion, into the settlement currency, of the amount of the loan expressed in the currency of the account – Article 6 – Consequences of a finding that a contractual term is unfair)
Language of the case: Bulgarian
Referring court
Apelativen sad – Sofia
Parties to the main proceedings
Defendant and appellant: VU, IT
Applicant and respondent: EUROBANK BULGARIA
Operative part of the order
Article 3(1) of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts
must be interpreted as meaning that terms in a loan agreement under which the amount borrowed is denominated in a foreign currency and is, in the first place, paid out by the bank, in that currency, into a blocked account before, in the second place, being converted by that bank into the national currency or into the reserve currency and credited to the borrower’s current account are likely to constitute unfair terms within the meaning of that provision where those terms are intended, first, to transfer the exchange risk entirely to the consumer in the event that the value of the foreign currency increases significantly and, secondly, to grant the credit institution, to the detriment of the consumer, an advantage relating to the conversion rules for the loan that were not specifically agreed upon between the parties at the time of conclusion of the agreement.
Article 6(1) of Directive 93/13
must be interpreted as meaning that a national court, when it has found terms in a loan agreement denominated in a foreign currency to be unfair, may consider that that loan was in fact denominated in the national currency or in the reserve currency of the Member State concerned only where the annulment of the loan agreement in its entirety that the deletion of those terms would entail exposes the consumer to particularly unfavourable consequences and where such revision of that agreement is possible under a supplementary provision of national law or a relevant legislative provision in the event of an agreement between the parties to that loan agreement.
In the absence of such provisions of national law, the high level of consumer protection prescribed by Directive 93/13 requires the national court, when taking into account all of its national law, to take all the measures necessary to protect the consumer from such consequences, in such a way that guarantees that the consumer is ultimately in the position he or she would have been in if the terms held to be unfair had never existed.
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1 Date lodged: 28.2.2023.