Brussels, 10/01/2008 (Agence Europe) - With a few days to go from the second reading vote on a crucial text for the creation of a genuine internal market for consumer credit, as a guarantee for a high level of consumer protection, discussions are intensifying between the Parliament, Council and Commission, in the hope of reaching a compromise.
On the table since 2002 and after having experienced many changes, the draft directive on consumer credit, which aims to harmonise EU rules on the issue, with the exception of mortgage loans, will be debated on 15 January by the European Parliament in Strasbourg (rapporteur: Kurt Lechner, German Christian Democrat) and voted on 16 January.
Many points of agreement already exist on pre-contractual and contractual information for consumer, period for withdrawing and the harmonised method for calculating annual credit rates so consumers can make informed choices about offers in different member states. The question of the amount of compensation paid by consumers to lending body in event of early repayment, which had already given the Council something to discuss, before the adoption of a common position (EUROPE 9428), will undoubtedly be one of the most contentious points.
As part of the ongoing negotiations, BEUC, the European Consumers Organisation, is afraid that, there will be something of an anti-climax. It is also calling on decision makers and MEPs to, “not water down any further the protection and positive points seen in the Council's Common Position”. Concerns include: the scope of the directive being considered too restricted as overdrafts and “equity releases” (loans guaranteed on the value of the borrower's property) are not included; - the responsibility of loan providers that is not as broad as it should be to truly protect consumers against over-indebtedness; - and provisions of “far too vague” a kind on compensation for credit providers should loans be reimbursed early, which could in practice deprive the consumer of all possibility of early reimbursement and financial mobility. BEUC fears that the decisions taken on this may influence future debate on mortgage credit for which it has already awaited binding legislation for far too long. (A.N.)