Activities of Alessandra BASSO related to 2021/0171(COD)
Shadow reports (1)
REPORT on the proposal for a directive of the European Parliament and of the Council on consumer credits
Amendments (32)
Amendment 115 #
Proposal for a directive
Recital 7
Recital 7
(7) In recent years, credit offered to consumers has evolved and diversified considerably. New credit products have appeared, in particular in the online environment, and their use continues to develop. This has raised legal uncertainty with regard to the application of the Directive 2008/48/EC to such new products. Practices such as the use of minicredits and long-term leases have experienced unprecedented growth in recent years, often leading to abuses and unfair commercial practices where consumers have been left in a precarious financial situation, or even heavily in debt, which they could have avoided if such practices were properly regulated and if contractual information were provided in a transparent, comprehensive and timely manner.
Amendment 137 #
Proposal for a directive
Recital 28
Recital 28
(28) Advertising tends to focus on one or several products in particular, while consumers should be able to make their decisions in full knowledge of the range of credit products on offer. In that respect, general information plays an important role in educating the consumer in relation to the broad range of products and services available and the key features thereof, such as the total cost of the credit and the total amount payable by the consumer. Consumers should therefore be able at all times to access general information on credit products available. This should be without prejudice to the obligation to provide consumers with personalised pre- contractual information.
Amendment 193 #
Proposal for a directive
Recital 49 a (new)
Recital 49 a (new)
(49 a) Creditors, providers of crowdfunding credit services and insurers should not take into account the medical history of people who have been affected by cancer. Currently, five Member States have national provisions to help specific groups of people affected by cancer, under certain circumstances, to access financial services, including insurance, without reference to the risk associated with cancer. Such provisions should be implemented in all Member States. To this end, Member States should define, with the support of medical, scientific and statistical experts, the conditions determining the right to access financial services, including insurance, without reference to the risk associated with cancer. Member States should also undertake to adopt measures to inform consumers of the existence of this right. The imposition of restrictive conditions in policies, which are not based on medical, scientific and statistical data, should be avoided whenever pre-existing conditions are disclosed.
Amendment 204 #
Proposal for a directive
Recital 62
Recital 62
(62) The consumer should have the right to discharge his or her obligations before the date agreed in the credit agreement. As provided by the Court of JusticeThe consumer should have the right to a reduction in the total cost of the credit in the event of early repayment of the credit, which includes all the costs imposed by the creditor ofn the EU Lexitor ruling,34 the right of the consumer to a reduction in the total cost of the credit in the event of early repayment of the credit includes all the costs imposconsumer with the exclusion of up-front costs - in so far as they are preliminary and preparatory activities for the granting of the loan, and are fully exhausted at the time of granting the loan - that have been adequately identified and declared and the cost of third parties (e.g fee of credit intermediaries, insurance charges and taxes). As regards the method of reimbursement, the amortised cost criterion (interest curve) for the calculation of the proportional reduction of costs should apply unless it is otherwise regulated oin the consumertract taken in account. In the case of early repayment the creditor should be entitled to a fair and objectively justified compensation for the costs directly linked to the early repayment, taking into account also any savings thereby made by the creditor. However, in order to determine the method of calculating the compensation, it is important to respect several principles. The calculation of the compensation due to the creditor should be transparent and comprehensible to consumers already at the pre-contractual stage and in any case during the performance of the credit agreement. In addition, the calculation method should be easy for creditors to apply, and supervisory control of the compensation by the competent authorities should be facilitated. Therefore, and due to the fact that consumer credit is, given its duration and volume, not financed by long- term funding mechanisms, the ceiling for the compensation should be fixed in terms of a flat-rate amount. This approach reflects the specific nature of consumer credits and should not prejudice the approach in respect of other products which are financed by long-term funding mechanisms, such as fixed-rate mortgage loans. _________________ 34 Judgment of the Court of Justice of 11 September 2019, Lexitor, C-383/18, ECLI:EU:C:2019:702.
Amendment 211 #
Proposal for a directive
Recital 65
Recital 65
(65) The fixing of caps on interest rates, on annual percentage rates of charge and or the total cost of the credit to the consumer is a common practice in a number of Member States. Such capping has proved beneficial for consumers. In that context, Member States should be able to maintain their current legal regime. However, in an effort to increase consumer protection without imposing unnecessary limits on Member States, caps on interest rates, on annual percentage rates of charge and or on the total cost of the credit to the consumer should be introduced throughout the Union.
Amendment 245 #
Proposal for a directive
Article 2 – paragraph 2 – point g a (new)
Article 2 – paragraph 2 – point g a (new)
(g a) credit agreements where the credit is granted free of interest and without any other charges;
Amendment 286 #
Proposal for a directive
Article 3 – paragraph 1 – point 5 a (new)
Article 3 – paragraph 1 – point 5 a (new)
(5 a) Short-term, interest-free (“STIF”) credit agreement means “a fixed-sum credit agreement between a consumer (borrower) and a creditor (lender) entered into in connection with the purchase of goods or services, where the credit is granted free of interest and without any other charges and credit agreements under the terms of which the credit has to be repaid within three months and only insignificant charges are payable”.
Amendment 377 #
Proposal for a directive
Article 10 – paragraph 3 – point a
Article 10 – paragraph 3 – point a
(a) the total amount of credit; (b) the duration of the credit agreement or of the agreement for the provision of crowdfunding credit services; (c) the borrowing rate, or all borrowing rates if different borrowing rates apply in different circumstances; (d) the annual percentage rate of charge and the total amount payable by the consumer; (e) in the case of a credit in the form of deferred payment for specific goods or services and in the case of linked credit agreements, the specific goods or services and their cash price; (f) costs in the case of late payments; (g) the type of credit;
Amendment 381 #
Proposal for a directive
Article 10 – paragraph 3 – point c
Article 10 – paragraph 3 – point c
Amendment 384 #
Proposal for a directive
Article 10 – paragraph 3 – point d
Article 10 – paragraph 3 – point d
Amendment 385 #
Proposal for a directive
Article 10 – paragraph 3 – point e
Article 10 – paragraph 3 – point e
Amendment 386 #
Proposal for a directive
Article 10 – paragraph 3 – point f
Article 10 – paragraph 3 – point f
Amendment 389 #
Proposal for a directive
Article 10 – paragraph 3 – point g
Article 10 – paragraph 3 – point g
Amendment 416 #
Proposal for a directive
Article 10 – paragraph 4
Article 10 – paragraph 4
Amendment 438 #
Proposal for a directive
Article 10 – paragraph 5
Article 10 – paragraph 5
Amendment 445 #
Proposal for a directive
Article 10 – paragraph 5 – subparagraph 1
Article 10 – paragraph 5 – subparagraph 1
Any additional information which the creditor may provide to the consumer shall be given in a separate document which may be annexed to the Standard European Consumer Credit Information form or the Standard European Consumer Credit Overview form.
Amendment 460 #
Proposal for a directive
Article 10 – paragraph 7
Article 10 – paragraph 7
7. If the agreement has been concluded at the consumer's request using a means of distance communication which does not enable the information to be provided in accordance with this article, the creditor and, where applicable, the credit intermediary or the provider of crowdfunding credit services shall provide the consumer with the Standard European Consumer Credit Information form and the Standard European Consumer Credit Overview form immediately after the conclusion of the credit agreement or of the agreement for the provision of crowdfunding credit services.
Amendment 464 #
Proposal for a directive
Article 10 – paragraph 8
Article 10 – paragraph 8
8. Upon request from the consumer, the creditor and, where applicable, the credit intermediary or the provider of crowdfunding credit services shall, in addition to the Standard European Consumer Credit Information form and the Standard European Consumer Credit Overview form, provide the consumer free of charge with a copy of the draft credit agreement, or of the draft agreement for the provision of crowdfunding credit services, provided that the creditor at the time of the request is willing to proceed to the conclusion of the credit agreement or of the agreement for the provision of crowdfunding credit services with the consumer.
Amendment 517 #
Proposal for a directive
Article 14 – paragraph 4
Article 14 – paragraph 4
4. Member States may allow creditors or providers of crowdfunding credit services to require the consumer to hold a relevant insurance policy related to the credit agreement or crowdfunding credit services, taking into account proportionality considerations. In such cases, Member States shall ensure that the creditor or the provider of crowdfunding credit services is required to accept the insurance policy from a supplier different to his or her preferred supplier where such insurance policy has a level of guarantee equivalent to the one the creditor or the provider of crowdfunding credit services has proposed, without modifying the condition of the credit offering to the consumer. Under those circumstances, the insurance policy shall avoid imposing restrictive conditions, whenever specific requirements related to pre-existing medical conditions are fulfilled (such as the “right to be forgotten” criteria for cancer survivors). Member States shall guarantee that people cured of specific pathologies have equal access to insurance policies. For this purpose, Member States should define, with the support of medical, scientific and statistical experts, the conditions that determine the right to access financial services, including insurance, without reference to cancer, committing themselves to review these conditions periodically. Member States should also take measures to inform consumers of the existence of this right.
Amendment 541 #
Proposal for a directive
Article 17 – paragraph 1
Article 17 – paragraph 1
Member States shall prohibit any sale of credit to consumers, without their prior request and explicit agreement. This provision shall not apply to credit agreements concluded at point of sale to finance the purchase of a good or a service
Amendment 552 #
Proposal for a directive
Article 18 – paragraph 1
Article 18 – paragraph 1
1. Member States shall require that, before concluding a credit agreement, or an agreement for the provision of crowdfunding credit services, the creditor or, where applicable, the provider of crowdfunding credit services makes a thorough assessment of the consumer’s creditworthiness. That assessment shall be done in the interest of the consumer, taking into account the nature and the risks of the credit, to prevent irresponsible lending practices and over-indebtedness, and shall take appropriate account of factors relevant to verifying the prospect of the consumer to meet his or her obligations under the credit agreement or the agreement for the provision of crowdfunding credit services. The obligation to assess the creditworthiness is considered fulfilled if the creditor has met the requirements provided by Directive 2013/36/EU, Regulation n. 575/2013 EU and EBA Guidelines ABE/GL/2020/06.
Amendment 558 #
Proposal for a directive
Article 18 – paragraph 2 – introductory part
Article 18 – paragraph 2 – introductory part
2. The assessment of creditworthiness shall be carried out on the basis of relevant and accurate information on the consumer’s income and expenses and other financial and economic circumstances which is necessary and proportionate such as evidence of income or other sources of repaymenwhich is necessary and proportionate to the nature and the risks of the credit, inform relation on financial assets and liabilities, or information on other financial commitmentsto nature, duration, complexity and size of the credit granted. The information shall be obtained from relevant internal or external sources, including the consumer and, where necessary, on the basis of a consultation of a database referred to in Article 19. In the case of STIF credit agreements, as referred to in Article [3 point 5a] of the current Directive , the creditors may base their creditworthiness assessment on other indicators or information as appropriate to the reduced risk levels associated with these products.
Amendment 564 #
Proposal for a directive
Article 18 – paragraph 2 – subparagraph 1
Article 18 – paragraph 2 – subparagraph 1
Amendment 570 #
Proposal for a directive
Article 18 – paragraph 2 – subparagraph 1 a (new)
Article 18 – paragraph 2 – subparagraph 1 a (new)
Given that STIF credit agreements (as defined in Article 3) are a relatively new and rapidly expanding market, Member States shall impose additional reporting requirements on STIF credit providers licensed in their territory including on usage levels, default rates and late fee revenues accrued. Where default rates and late fees are found to be excessively high, Member States shall take additional steps to ensure the full compliance of the STIF credit provider with the conduct rules set out in Article 38 and require remedial measures as appropriate.
Amendment 585 #
Proposal for a directive
Article 18 – paragraph 4 – introductory part
Article 18 – paragraph 4 – introductory part
4. Member States shall ensure that the creditor or the provider of crowdfunding credit services only makes the credit available to the consumer where the result of the creditworthiness assessment indicates that the obligations resulting from the credit agreement or the agreement for the provision of crowdfunding credit services are likely to be met in the manner required under that agreement. However, a positive creditworthiness assessment should not constitute an obligation for the creditor to provide credit.
Amendment 592 #
Proposal for a directive
Article 18 – paragraph 4 – subparagraph 1
Article 18 – paragraph 4 – subparagraph 1
Amendment 600 #
Proposal for a directive
Article 18 – paragraph 6
Article 18 – paragraph 6
Amendment 651 #
Proposal for a directive
Article 21 – paragraph 3 a (new)
Article 21 – paragraph 3 a (new)
3 a. Member States shall identify, among the elements listed in paragraph 1, those which, if absent or uncertain, shall lead to the nullity of the contract, those which can be replaced by law and those which extend the period for exercising the right of withdrawal defined by article 26.
Amendment 688 #
Proposal for a directive
Article 29 – paragraph 1
Article 29 – paragraph 1
1. Member States shall ensure that the consumer is at any time entitled to early repayment. In such cases, the consumer shall be entitled to a reduction in the total cost of the credit, consisting of the interest and the costs for the remaining duration of the contract. When calculating that reduction, all the costs imposed on the consumer by the creditor shall be taken into consideration, except for up-front costs, which are fully exhausted at the time of granting of the loan and corresponded to services effectively provided to the consumer or to costs effectively incurred by creditor as well as third party costs. The up-front costs should be adequately identified and declared in the credit contract. In any case, costs that remunerate credit intermediaries activities or costs that remunerate creditor’s services as well as taxes are excluded from the calculation of the reduction of the total cost of credit. As regards the method of reimbursement the amortised cost criterion (interest curve) for the calculation of the proportional reduction of costs should be used unless otherwise regulated in the contract.
Amendment 711 #
Proposal for a directive
Article 31 – paragraph 1 – introductory part
Article 31 – paragraph 1 – introductory part
1. 1. Member States shall introducemay set caps on one or more of the following:
Amendment 721 #
Proposal for a directive
Article 31 – paragraph 2
Article 31 – paragraph 2
2. Member States may introduce additional caps for revolving credit facilitiesThe provision of Paragraph 1 is considered fulfilled whereas there are national legislations already in force setting up caps on one of the options listed in letters a,b, c.
Amendment 796 #
Proposal for a directive
Article 46 – paragraph 2
Article 46 – paragraph 2
2. The Commission shall also monitor the effect of the existence of the regulatory choices referred to in Article 42 on the internal market and consumers. Given that STIF credit products (as defined in Article 3) are a relatively new and rapidly expanding market, it is appropriate that the Commission gives particular consideration in its review to the further development of this market and the evidence base regarding consumer harm, and to whether the treatment of such products under this Directive needs to be revised.