|Beatriz Causapé||Laura Torrecilla|
In a context where Spanish banks continue to sell their non-performing loans (NPLs) to reduce the level of their provisions and improve their solvency ratios, several national and regional rules have been approved, and resolutions passed recently in an attempt to protect debtors, who are often in precarious situations.
Royal Decree Law 1/2015: gives the Catalan government a pre-emptive right over empty homes resulting from mortgage foreclosures, so they can use these homes as social housing.
Catalan Act 24/2015: establishes the possibility of consumers being released from their payment obligations by paying the assignee the relevant purchase price it paid for the assigned debt to the original lender. This law has been partially suspended and is pending the final ruling of the Constitutional Court (Tribunal Constitucional).
Act 14/2015: establishes a tax on empty homes owned by financing entities.
Royal Decree 6/2012 of Andalusia: allows debtors at risk of social exclusion to either restructure the debt or enter into debt-for-asset swap agreements for the full amount of the debt.
Another issue that has drawn the attention of foreign investors is the famous ruling from the European court of justice (ECJ) of December 21 2016, on restitution of amounts the banks received from unfair floor clauses (cláusulas suelo).
In this decision, the ECJ clarified that the economic effects of the Spanish supreme court ruling of May 9 2013, on the same issue, were not limited to that date onwards, but applied to the full term of the mortgage. Investors are now carrying out careful analysis when negotiating the allocation of liabilities in the relevant NPL sale and purchase agreements.
Consequently, the council of ministers approved royal decree law 1/2017, of January 20 2017 on urgent measures for consumer protection regarding refunds for unfair floor clauses. It establishes a quick and simple extra-judicial procedure for resolving consumers' claims under these judicial rulings. Clients can use this procedure to address credit entities (entidades de crédito), which must reach an agreement and resolve any claims within three months. Although the judicial process is always open, it is a question of preventing the courts from collapsing and allowing the process to be carried out with guarantees for the consumer.
Beatriz Causapé and Laura Torrecilla
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