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In its first case(1) based solely on the EU Consumer Credit Directive (2008/48/EC),(2) the European Court of Justice (ECJ) ended – at least on an EU level – a dispute concerning the scope of consumer rights to a reduction of costs in cases of an early repayment of credit. With respect to the second sentence of Article 16(1) of the EU Consumer Credit Directive (ie, "shall be entitled to a reduction in the total cost of the credit, such reduction consisting of the interest and the costs for the remaining duration of the contract"), the ECJ clarified that consumers are also entitled to a reduction of costs that do not depend on the duration of a credit agreement.
Irrespective of whether the ECJ's interpretation of the EU Consumer Credit Directive is correct, its decision puts Austrian courts in severe difficulty when applying domestic law implementing Article 16 of the directive.
In its decision, the ECJ examined the wording of Article 16 of the EU Consumer Credit Directive in various languages and concluded that it is impossible to determine the exact extent of the reduction in total costs, as different translations of the directive suggest different results. Based on a teleological interpretation of the provision, the ECJ focused on ensuring a high level of consumer protection and held that the effectiveness of the consumer right to a reduction in total costs would be impaired if it were to refer only to those costs which creditors identified as dependent on the duration of a contract. Following the opinion of Advocat General Hogan(3) and the referring court, the ECJ addressed the ability of banks to determine unilaterally the costs and fee structure of credit agreements. Placing costs which do not depend on contract duration outside the scope of Article 16 of the EU Consumer Credit Directive could entail higher one-off fees payable when concluding credit to reduce costs depending on the contract duration, thereby reducing the impact of an early repayment on collectable fees (including a profit margin) for such credit. Finally, the ECJ held that including costs, which are independent of contract duration, is unlikely to be disproportionally disadvantageous to creditors whose interests are protected by Article 16(2) and 16(4) of the EU Consumer Credit Directive.
When drafting the Austrian Consumer Credit Act (ACCA),(4) similar to the German legislature,(5) the Austrian legislature explicitly stipulated in Section 16(1) of the ACCA that in an early repayment scenario, "costs dependent on the duration of the credit agreement are reduced proportionately" with the interest payable.
The legislature's aim to exclude costs which are independent of contract duration is also confirmed by its explanatory remarks,(6) which state that the "purpose of this provision is to lay down a provision which is more precise than the corresponding provision in the Consumer Credit Directive (Article 16(1), second sentence)".(7) In short, even though the Austrian legislature obviously erred in the ambiguous wording of Article 16 of the EU Consumer Credit Directive, it is clear that the effects of the wording of Section 16(1) of the ACCA (ie, the exclusion of costs which are independent of contract duration from any reduction in case of an early repayment) are exactly what the Austrian legislature aimed to achieve.
Considering the obvious conflict with ECJ case law, the Austrian legislature's aim to implement fully the EU Consumer Credit Directive and the ACCA's intended (but directive breaching effects) consumers, legal advisers and the courts are now confronted with the delicate question of how consumer requests for repayment should be dealt with.
Pursuant to Austrian Supreme Court case law,(8) when interpreting the conformity of Austrian law with EU directives, the wording and meaning of national provisions must not be attributed divergent or opposite meanings, if such which cannot be achieved by the national rules of interpretation. Similarly, ECJ case law confirms that the principle that national law must be given a conforming interpretation cannot lead to a contra legem interpretation.(9)
Hence, unless a consumer is highly creative (and successful) in asserting that a one-off fee paid when taking out a loan qualifies as a cost dependent on the duration of the credit agreement (and as such is to be reduced in an early repayment scenario), applying Section 16 of the ACCA will trigger elaborate procedures through various court instances. As a result, the proverbial worm that the early bird hopes to catch will not be easy to obtain, unless the legislature amends Section 16 of the ACCA in accordance with the Lexitor decision – and against the interests of the Austrian and EU banking industry.
Endnotes
(1) ECJ, 11 September 2019, Lexitor (C-383/18), EU:C:2019:702.
(2) EU Consumer Credit Directive (2008/48/EC) of 23 April 2008 on credit agreements for consumers and repealing the EU Consumer Loans Directive (87/102/EEC).
(3) EU:C:2019:451, paragraph 54.
(4) Bundesgesetz über Verbraucherkreditverträge und andere Formen der Kreditierung zu Gunsten von Verbrauchern (Verbraucherkreditgesetz – VKrG), BGBl I 28/2010.
(6) RV 650 BlgNR XXIV GP, p 28, last paragraph.
(7) Mit diesen Anordnungen soll eine gegenüber der korrespondierenden Bestimmung in der Verbraucherkreditrichtlinie (Artikel 16 Abs. 1 zweiter Satz) exaktere (nämlich auch auf die bloße Teilrückzahlung Bezug nehmende) und gegenüber den vergleichbaren Gesetzesbestimmungen zur früheren Richtlinienumsetzung (§ 12a Abs. 1 KSchG, § 33 Abs. 8 BWG) verständlichere (weil den bankrechtsspezifischen Begriff „kontokorrentmäßige Abrechnung" vermeidende) Regelung getroffen werden.
(8) RS0114158 (including decisions rendered in 2018 and 2019). However, in its Decision 4 Ob 62/16w, the Supreme Court, contrary to prevalent case law, held that the concrete intentions to legislate must rank behind the general will to transpose a regulation.
(9) ECJ, 16 June 2005, Puppino (C-105/03), EU:C:2005:386, paragraph 47; ECJ, 23 April 2009, Angelidaki and Others (C-378/07 to C-380/07, paragraph 196 et seq; ECJ, 10 March 2011, Deutsche Lufthansa/Kumpan (C-109/09), EU:C:2011:129, paragraph 54 et seq.
