Brussels, 29/12/2000 (Agence Europe) - The Banking Federation of the European Union (which represents the banking associations of EU Member States, Switzerland, Norway and Iceland) lodged on 26 December with the European Commission a complaint against interpretation of the Italian usury law -in force since 1997-, saying it agrees in full with the arguments set out by the associations of Italian banks and foreign banks in Italy, the ABI and AIBE.
In a press release, the FBE states that the recent ruling by the Italian Court of Appeals stating that Law 108 of 7 March 1996 concerning usury can also be applied to loan contracts signed before the law went into force, violates a number of the Union's directives and principles and retroactively alters interest rates that had been freely agreed, which "conflicts with the principle of continuity of contracts set forth in the regulations governing the changeover to the euro". Italy's highest court had considered as "measures concerning usury", and hence unlawful, the rates of interest that exceed the ceiling fixed by the law of 1996, which came into force in 1997. According to FBE, this decision effectively "outlaws" fixed -rate loans for Italian borrowers, isolating them from the European and world markets and creating "clear competitive discrimination" against EU banks which "can no longer market in Italy, or to Italian customers, a product that is standard throughout the European Union and worldwide".
On Thursday, the Italian government approved a decree of law taking into account the protests made by the banks but causing consumers to protest.