Judges L Bay Larsen, N Jääskinen (Rapporteur)
Advocate General M Campos Sánchez-Bordona
In Slovakia, the borrower and lender concluded a consumer credit agreement by telephone which stipulated, inter alia, that the annual percentage rate of charge (“APRC”) would be between 21·5% and 22·4%. The contract also specified that the APRC would be communicated after the date on which loan was granted. The borrower paid off the loan early and brought a claim against the lender arguing that the credit should have been considered to be free of interest and charges, since the APRC in the contract was set out as a range referring to a minimum and a maximum rate, rather than as a single rate. The claim was dismissed by the court of first instance. On appeal by the borrower, the referring Slovakian court was unsure whether fixing the APRC by means of a range was contrary to article 10(2)(g) of Parliament and Council Directive 2008/48/EC which provided that a credit agreement should specify in a clear and concise manner the APRC and the total amount payable by the consumer, calculated at the time the credit agreement was concluded and that all the assumptions used in order to calculate that rate should be mentioned. The court, accordingly, stayed the proceedings and referred to the Court of Justice of the European Union for a preliminary ruling, a question concerning the interpretation of article 10(2)(g) of Directive 2008/48.
On the reference—
Held, the total cost of credit, presented in the form of an APRC calculated according to a single mathematical formula, was of critical importance for a consumer since it enabled him to assess, from a financial point of view, the extent of the commitment associated with the conclusion of the credit agreement. Considered from that perspective, the obligation to provide information set out in article 10(2) of Parliament and Council Directive 2008/48/EC contributed to the attainment of the objective pursued by the Directive, in particular, the objective of a high level of protection of consumers’ interests. Where the date of conclusion of the credit agreement was not known, Part II(f)(ii) of Annex I to the Directive provided that the date of the initial drawdown was assumed to be the date which resulted in the shortest interval between that date and the date of the first payment to be made by the consumer. Consequently, in particular because of those assumptions aimed at facilitating the calculation of the APRC in a uniform manner, it could not be claimed that fixing the APRC as a single rate would not be possible or would be excessively difficult when such information was not known. Accordingly, article 10(2)(g) of Directive 2008/48 precluded, in a consumer credit agreement, the APRC from being expressed as a range referring to a minimum and a maximum rate, rather than a single rate (judgment, paras 29–30, 34–36, operative part, para 1).
B Ricziová, agent, for the Slovakian Government.
G Goddin and A Tokár, agents, for the European Commission.