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Credit consumer – breakthrough judgment TSUE. Note on RRSO

Kredyty konsumenckie - przełomowy wyrok TSUE. Uwaga na RRSO

Credit and cash loans are becoming and more often the subject of analysis and interpretations of Poland courts, especially in the context of consumer claims related to the so-called. sanction credit free. In 2025 year we can expect the first resolution of the TSUE on Poland credit and loans cash, where there is a waiting for a resolution of some prejudicial questions of Poland courts, a topic that is becoming more palpable for

justice. The subject is discussed by adv. Karolina Pilawska from Pilawska Zorski Advocates. July 2025 year may be the valid date for borrowers

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July 2025 year may be a valid date for borrowers

Poland borrowers on January 23 2025 year received a valid “gift” from their southern neighbors of Slovakia. In one of the cases referred to the Slovak district court, the TSUE has issued a verdict, which has huge implications not only for Slovakia, but and for all Europe, a particularly for the Polish credit market. This judgment constitutes a breakthrough step in the direction to protect consumers and could revolutionize the way, in how Poland courts adjudicate in cases on consumer credit and their compliance with EU regulations.

– the CJEU in the case of Sign C-677/23 resolved two key legal issues. The first concerned the objection of borrowers, who claimed that the loan agreement lacked a precise definition of its length, which really prevented they from fully evaluating the credit offer. The second, in my opinion the key issue, referred to the argument of not indicating in the agreement accurate assumptions used to calculate the actual annual interest rate (RRSO). In the lawsuit the borrowers requested that part of the conditions of the agreement be void, and also exempt from the obligation to pay interest and additional fees, restricting its obligation only to pay the self capital – explains adv. Carolina Pilawska of the law firm Pilawska Zorski Advocates.

This issue is especially important, because it affects millions of Poles,Who have entered credit agreements with banks and non-bank institutions. There are about 18 million of this type of contracts in the market, a judgment in the Slovak case with certainty will have widespread application also in Poland judicial processes on credit consumers.

Significance of Judgment TSUE

The TSUE Judgment of January 23 2025 year is a milestone, which sets new rules in the area of calculation of the actual annual interest rate (APR) and imposes on banks and financial institutions the obligation of complete transparency on this issue – advises . Carolina Pilawska.The TSUE has unambiguously indicated, that the assumptions used for calculation of the RRS must be explicitly defined in the credit agreement. This provision does not create doubt: banks and other financial institutions must clearly and precisely indicate in the agreement all parameters, which affect the calculation of ROC. Not enough, that the consumer can independently calculate these parameters, by analyzing the contract provisions, because, as shown in court cases, many contracts are written in unintelligible or too complicated.

 – This approach has huge implications for consumers, who are still led in mistake by inaccurate writings in credit agreements. In my practice I encounter with contracts, which either in the none of the issues of calculation of RRSO, or they do this in a superficial, not precise, which makes it difficult for the consumer to understand, how it is calculated the actual interest rate of credit. For the average borrower, who does not have legal or financial knowledge, this is a serious problem, which may lead to sign a contract on very unfavorable conditions – requests attention adv. Carolina Pilawska.

Why ROS is so important?

The annual interest rate (APR) is a key indicator, which reflects the total cost of a loan or loan, expressed as a percentage of the total loan amount per year. Thanks RRSO consumers can easily comparison of offers of different financial institutions and select that will be the most beneficial for them in costs. The APR includes not only interest, but also all other fees related to the loan, such as commissions, insurance or administrative fees.

Unfortunately, as practice shows, many credit agreements do not contain precise data, which would allow the consumer to verify, how the RSO was calculated. Additionally,in the event of erroneous calculation of RRSO, the consumer may be led in error of the total cost of the loan, which may lead to situation, in which the borrower is obligated to pay a higher amount than that results on the actual costs of the loan.

Protecting interests of consumers

The ruling of the TSUE has great implications for the Polish credit market, because it clearly defines the obligations of banks and financial institutions in the information about RRS – assess adv.CarolinaPilawska.Incases,whenthelenderdoesnotpresentcompleteandaccurateinformationaboutthebasisoftheRRSO calculation,theconsumermaydemandexemptionfromtheobligationtopayinterestandfees,limitingitsitsobligationtotheselfcapital.SuchjudgmentmayaffecthundredsofthousandsofcourtcasesinPoland,inwhichborrowersarefightingfortheirrights.

-Whatmore,thisjudgmentwillalsobean importanttoolinthehandsofPolandcourts,whichandmore oftenmustdecidecustomercreditcases.Judges, guidedbytheguidelinesof theTSUE,willbe abletobetterprotecttheinterestsofconsumersandpreventabusebyfinancialinstitutions-emphasizesKarolinaPilawska.

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