Brussels, 12/09/2014 (Agence Europe) - In his opinion delivered at the Court of Justice of the EU on Thursday 11 September, Advocate General Nils Wahl provided an interpretation of the obligations for lenders and borrowers in a credit contract, relating principally to pre-contractual information and to checking the consumer's credit rating.
The directive on credit agreements for consumers (2008/48) makes provision for a number of obligations on the lender, in particular: to provide information and explanation so that the consumer may make an informed choice when subscribing to a credit agreement; to provide the consumer with a standard European information sheet; and to check the consumer's credit worthiness.
In France, a lender, who demanded clients immediately reimburse the sums lent with interest because they had failed to keep up the monthly repayments, was not able to show the French courts the European sheet or to provide any document attesting that the obligation of explanation had been fulfilled, apart from a standard clause in the credit agreement where the borrower stated that he/she was aware of the sheet in question. Furthermore, the lender used only the borrowers' declarations to determine their credit worthiness.
The Advocate General sees here (case C-449/131) several breaches of the directive. He says that it is for the lender to provide proof that the pre-contractual information obligations have been correctly carried out by, for example, retaining appropriate documents. However, the lender cannot be required to draft a specific document attesting that explanation has been provided - entries in the draft agreement being sufficient to ensure that these pre-contractual information obligations have been met - until such time as the consumer has seen the draft agreement prior to signature. Then, a standard clause in the agreement does not necessarily prove that the European information sheet has, in fact, been given to the consumer. As for the issue of credit rating, it is once again for the lender to make the necessary checks and the lender must not solely use consumers' unsubstantiated claims. (JK)