Foreign currency loans – Banking Association sent its opinion to the Constitutional Court


The Hunger Banking Association sent its opinion to the Constitutional Court on the first law on foreign currency loans, reiterating that the law is unconstitutional, as many of its provisions are retroactive and violate the principle of legal certainty.

The Constitutional Court will begin hearing court petitions on foreign currency lending law.

The legal working group of the Hunger Banking Association has stated its position for Ab in a summary of more than forty pages. The essence of this is that certain provisions of the law violate the rule of law, freedom of contract, the fundamental right of access to justice and fair trial, and the principle of separation of powers, and the adoption of the law is also unconstitutional.
According to the Banking Association’s opinion on Ab’s website, clauses that were not manifestly unfair under applicable law, the case law of the Court, and EU law as the yardstick of interpretation were considered unfair by law.
The opinion of the association states that, according to the Constitutional Court following an earlier legislative act, “the law may not impose an obligation or declare any conduct unlawful before its promulgation.”
The wording of this requirement, which has the same content but is more precise, is contained in a section of the Legislative Act 2010: “the law shall not impose an obligation prior to its entry into force,” shall not render the obligation more burdensome, and shall not behavior is illegal – they wrote.

If a law does not meet this requirement, it automatically and without further consideration violates the rule of law – argues the banking association.

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In the summary sent to MTI about the position of the Association, the Hunger Banking Association as a legal entity is not involved in the Foreign Currency Lending Act, but it can present its professionally substantiated opinion to the Constitutional Court as an interest representation body.
In order to overturn the presumption of unfairness found in each of the Bank’s General Terms and Conditions (HFSA), banks would be required by law to comply with new test criteria which, however, were not known when the HFSA approved the wording.
The law obliges the courts to make their decision not on the basis of the content of the legislation in force at the time the contract terms are drawn up but solely on the basis of these new criteria, which results in a serious violation of the rule of law.

They also believe that equality before the courts is violated by the fact that the law does not allow the court to seek expert assistance in clarifying the facts.

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The Banking Federation’s petition points out that the personal and temporal scope of the Act could not be decided on the basis of its wording. This is evidenced by the fact that the Settlement Act, adopted in September, was forced to amend the legislation adopted two months earlier in 25 jurisdictions, while banks were required to prepare their accounts with the National Bank of Hungary under the old, inaccurate Act, and lawsuits to overturn the presumption of unfairness – read the summary.
Based on a lawsuit decided by the Mansion in June, the FBC Act, adopted a few weeks later, states that unilateral changes to FBCs, such as increases in interest rates, costs or fees, must be refunded, resulting in overpayments to customers. This presumption may be sought by financial institutions in civil lawsuits against the state.

The judges complained, inter alia, that the FX law violates the principle of non-retroactivity, the requirement of legal certainty and the rule of law, and unnecessarily restricts procedural rights. Some have argued that it is against the parties’ self-determination that the law modifies foreign currency-denominated contracts, including those that have already been executed, which it could do for the future. (MTI)