Janice Roepnarain Since the beginning of 2012 there have been several court cases involving the Authority for the Financial Markets (AFM), one of the Dutch financial markets supervisors, and offerors of so-called flash loans. These are short-term loans to consumers for small amounts of money, whereby the money is transferred to the consumers on the same day that the request for the loan is made, or within just a few days. The reason behind the greater focus of the AFM on offerors of flash loans is that the Act on Financial Supervision (AFS) was amended due to the implementation of the Consumer Credit Directive (2008/48/EC) in May 2011. The most important amendment is that before the implementation of the Consumer Credit Directive, all credit which was repayable within three months fell outside the scope of the AFS. After the implementation of the Directive, only credit which has to be repaid by a consumer within three months and whereby the costs payable by the consumer are insignificant fall outside the scope of the AFS. Due to this amendment, many offerors of credit to consumers who previously were not regulated are now obliged to obtain a licence from the AFM. Recent case law shows that offerors of flash loans and the AFM often disagree on whether the activities concerned qualify as the offering of credit, or which costs should be considered to be part of the costs of the credit. In the Consumer Credit Directive 'total cost of the credit to the consumer' means, in short, all costs and fees which the consumer is required to pay in connection with the credit agreement, except for notarial costs. Furthermore, costs in respect of ancillary services relating to the credit agreement are also included if, in addition, the conclusion of a service contract is compulsory in order to obtain the credit or to obtain it on the terms and conditions marketed.
