In April 2015, Spanish MEP Soledad Cabezón took the issue of mortgage legislation and risky financial instruments in the EU, and focusing on Spain in particular, to the European Parliament Petitions Committee. Since the protection of consumer rights is a fundamental operating principle of the European Union, the matter is obviously raising eyebrows. Both the European Court of Justice and the Supreme Court in Spain already ruled against abusive Spanish clauses and practices that resulted in forced evictions since consumers were not duly informed about the extent of the risks involved in their investments and banks did not perform suitability tests to determine whether the client possessed adequate knowledge.
The debate followed a roundtable discussion on the same topic involving Spanish experts and representatives of consumer organisations and financial services users, aimed at establishing a platform for dialogue that would provide an opportunity to analyse the current situation and find possible solutions that benefit consumers of banking products. The event counted with the participation of Manuel Pardos Vicente, President of ADICAE, one of BETTER FINANCE’s Spanish member organisations.
In July 2015, Cecilia Wikström, Chair of the Petitions Committee, raised the issue at the European Parliament Plenary session following a large number of petitions denouncing infringements of European legislation in the Spanish mortgage sector that left unprotected consumers facing considerable barriers to obtaining the accurate information essential for making decisions.
On the 2nd of October, Ms. Wikström, on behalf of the Petitions Committee, filed a motion for a resolution on the matter. Among others, the Petitions Committee called on the European Commission to monitor the implementation in all Member States of the Directive on mortgage legislation and draw up a comprehensive EU-wide blacklist of financial entities that regularly engage in bad banking practices. It also called upon the Spanish Government to make use of the tools at its disposal in order to find a comprehensive solution in order to drastically reduce the intolerable numbers of evictions.
The vote on the resolution in Plenary is now scheduled for Thursday, 8th of October.
More information on the evolution of this file is available on the European Parliament website.