Caixabank and Others (Controle de transparence dans l'action collective) (Unfair terms in consumer contracts - Mortgage loan agreements - Concept of the 'average consumer who is reasonably well informed and reasonably observant and circumspect' - Judgment) [2024] EUECJ C-450/22 (04 July 2024)

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	Court of Justice of the European Communities (including Court of First Instance Decisions)
You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Caixabank and Others (Controle de transparence dans l'action collective) (Unfair terms in consumer contracts - Mortgage loan agreements - Concept of the 'average consumer who is reasonably well informed and reasonably observant and circumspect' - Judgment) [2024] EUECJ C-450/22 (04 July 2024) URL: http://www.bailii.org/eu/cases/EUECJ/2024/C45022.html Cite as: [2024] EUECJ C-450/22

(Reference for a preliminary ruling – Unfair terms in consumer contracts – Directive 93/13/EEC – Mortgage loan agreements – Clauses limiting the variation of the interest rates – ‘Floor’ clauses – Collective action seeking an order to cease and desist from using those clauses and reimbursement of the payments made in that respect, involving a significant number of sellers or suppliers and consumers – Plain and intelligible nature of those clauses – Concept of the ‘average consumer who is reasonably well informed and reasonably observant and circumspect’)

REQUEST for a preliminary ruling under Article 267 TFEU from the Tribunal Supremo (Supreme Court, Spain), made by decision of 29 June 2022, received at the Court on 6 July 2022, in the proceedings

Banco Santander SA, successor in law to Banco Popular Español SA and Banco Pastor SA,

Unicaja Banco SA, successor in law to Liberbank SA and Banco Castilla-La Mancha SA,

Asociación de Usuarios de Bancos, Cajas de Ahorros y Seguros de España (Adicae),

composed of C. Lycourgos, President of the Chamber, O. Spineanu-Matei (Rapporteur), J.‑C. Bonichot, S. Rodin and L.S. Rossi, Judges,

having regard to the written procedure and further to the hearing on 28 September 2023,

– Caixabank SA, successor in law to Bankia SA and Banco Mare Nostrum SA, by J. Gutiérrez de Cabiedes Hidalgo de Caviedes and E. Valencia Ortega, abogados,

– Banco Santander SA, successor in law to Banco Popular Español SA and Banco Pastor SA, by J.M. Rodríguez Cárcamo, and A.M. Rodríguez Conde, abogados,

– Targobank SA, by D. Machado Rubiño and J. Pérez de la Cruz Oña, abogados,

– Caja Rural de Navarra SCC, by J. Izquierdo Jiménez and M. Robles Cháfer, abogados, and by M. Sánchez-Puelles González-Carvajal, procurador,

– Caja Rural de Jaén, Barcelona y Madrid SCC, by R. Monsalve del Castillo, I. Moreno-Tapia Rivas and E. Portillo Cabrera, abogados, and by M. Moreno de Barreda Rovira, procuradora,

– Caja Rural de Asturias S.C.C., by R. Monsalve del Castillo, I. Moreno-Tapia Rivas and E. Portillo Cabrera, abogados, and by M. Moreno de Barreda Rovira, procuradora,

– Arquia Bank SA, by R. Monsalve del Castillo, I. Moreno-Tapia Rivas and E. Portillo Cabrera, abogados, and by M. Moreno de Barreda Rovira, procuradora,

– Nueva Caja Rural de Aragón SCC, by R. Monsalve del Castillo, I. Moreno-Tapia Rivas and E. Portillo Cabrera, abogados, and by M. Moreno de Barreda Rovira, procuradora,

– Caja Rural de Granada SCC, by R. Monsalve del Castillo, I. Moreno-Tapia Rivas and E. Portillo Cabrera, abogados, and by M. Moreno de Barreda Rovira, procuradora,

– Caja Rural del Sur SCC, by R. Monsalve del Castillo, I. Moreno-Tapia Rivas and E. Portillo Cabrera, abogados, and by M. Moreno de Barreda Rovira, procuradora,

– Caja Rural de Albacete, Ciudad Real y Cuenca SCC (Globalcaja), by R. Monsalve del Castillo, I. Moreno-Tapia Rivas and E. Portillo Cabrera, abogados, and by M. Moreno de Barreda Rovira, procuradora,

– Caja Rural Central SCC, Caja Rural de Extremadura SCC and Caja Rural de Zamora SCC, by J. López Torres, abogado,

– Unicaja Banco SA, successor in law to Liberbank SA and Banco Castilla-La Mancha SA, by M.Á. Cepero Aránguez and C. Vendrell Cervantes, abogados,

– Banco Sabadell SA, by G. Serrano Fenollosa, R. Vallina Hoset and M. Varela Suárez, abogados,

– Ibercaja Banco S.A., by S. Centeno Huerta and C. González Silvestre, abogadas,

– the Asociación de Usuarios de Bancos, Cajas de Ahorros y Seguros de España (Adicae), by V. Cremades Erades, K. Fábregas Márquez and J.F. Llanos Acuña, abogados, and by M. del M. Villa Molina, procuradora,

– the Spanish Government, by L. Aguilera Ruiz and A. Pérez-Zurita Gutiérrez, acting as Agents,

– the Portuguese Government, by P. Barros da Costa, A. Cunha and L. Medeiros, acting as Agents,

– the European Commission, by J. Baquero Cruz, N. Ruiz García and I. Galindo Martín, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 18 January 2024,

1 This request for a preliminary ruling concerns the interpretation of Article 4(1) and (2) and Article 7(3) of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts (OJ 1993 L 95, p. 29).

2 The request has been made in proceedings between, of the one part, Caixabank SA, successor in law to Bankia SA and Banco Mare Nostrum SA, Caixa Ontinyent SA, Banco Santander SA, successor in law to Banco Popular Español SA and Banco Pastor SA, Targobank SA, Credifimo SAU, Caja Rural de Teruel SCC, Caja Rural de Navarra SCC, Cajasiete Caja Rural SCC, Caja Rural de Jaén, Barcelona y Madrid SCC, Caja Laboral Popular SCC (Kutxa), Caja Rural de Asturias SCC, Arquia Bank SA, formerly Caja de Arquitectos SCC, Nueva Caja Rural de Aragón SCC, Caja Rural de Granada SCC, Caja Rural del Sur SCC, Caja Rural de Albacete, Ciudad Real y Cuenca SCC (Globalcaja), Caja Rural Central SCC, Caja Rural de Extremadura SCC, Caja Rural de Zamora SCC, Unicaja Banco SA, successor in law to Liberbank SA and Banco Castilla-La Mancha SA, Banco Sabadell SA, Banca March SA, Ibercaja Banco SA and Banca Pueyo SA and, of the other part, the Asociación de Usuarios de Bancos, Cajas de Ahorros y Seguros de España (Adicae), a Spanish association of users of banks, savings banks and insurance, M.A.G.G., M.R.E.M., A.B.C., Óptica Claravisión SL, A.T.M., F.A.C., A.P.O., P.S.C. and J.V.M.B., as successor in law to C.M.R., concerning applications to cease and desist from using a clause in the general conditions of mortgage loan agreements concluded by the aforementioned credit institutions and the repayment of the sums paid in that regard by the aforementioned users.

‘Whereas persons or organisations, if regarded under the law of a Member State as having a legitimate interest in the matter, must have facilities for initiating proceedings concerning terms of contract drawn up for general use in contracts concluded with consumers, and in particular unfair terms, either before a court or before an administrative authority competent to decide upon complaints or to initiate appropriate legal proceedings; whereas this possibility does not, however, entail prior verification of the general conditions obtaining in individual economic sectors’.

(b) “consumer” means any natural person who, in contracts covered by this Directive, is acting for purposes which are outside his trade, business or profession’.

‘1. Without prejudice to Article 7, the unfairness of a contractual term shall be assessed, taking into account the nature of the goods or services for which the contract was concluded and by referring, at the time of conclusion of the contract, to all the circumstances attending the conclusion of the contract and to all the other terms of the contract or of another contract on which it is dependent.

2. Assessment of the unfair nature of the terms shall relate neither to the definition of the main subject matter of the contract nor to the adequacy of the price and remuneration, on the one hand, as against the services or goods supplies in exchange, on the other, in so far as these terms are in plain intelligible language.’

‘In the case of contracts where all or certain terms offered to the consumer are in writing, these terms must always be drafted in plain, intelligible language. Where there is doubt about the meaning of a term, the interpretation most favourable to the consumer shall prevail. This rule on interpretation shall not apply in the context of the procedures laid down in Article 7 (2).’

‘1. Member States shall ensure that, in the interests of consumers and of competitors, adequate and effective means exist to prevent the continued use of unfair terms in contracts concluded with consumers by sellers or suppliers.

2. The means referred to in paragraph 1 shall include provisions whereby persons or organisations, having a legitimate interest under national law in protecting consumers, may take action according to the national law concerned before the courts or before competent administrative bodies for a decision as to whether contractual terms drawn up for general use are unfair, so that they can apply appropriate and effective means to prevent the continued use of such terms.

3. With due regard for national laws, the legal remedies referred to in paragraph 2 may be directed separately or jointly against a number of sellers or suppliers from the same economic sector or their associations which use or recommend the use of the same general contractual terms or similar terms.’

8 Ley 7/1998 sobre condiciones generales de la contratación (Law 7/1998 on General Contractual Conditions) of 13 April 1998 (BOE No 89 of 14 April 1998, p. 12304) provides, in Article 12:

‘1. It shall be possible to bring actions for an injunction and for recovery against the use of, or the recommendation to use, general conditions which are contrary to the provisions of the present legislation or to other mandatory or prohibitive legislation.

2. The action for an injunction is aimed at obtaining judgment ordering the defendant to delete from its general conditions any conditions which are held to be null and void and to refrain from using such conditions in future, determining and specifying, depending on the circumstances, the content of the contract which is to be considered valid and binding.

A related action for the recovery of any payments made under such general conditions may be joined, as an ancillary matter, to an action for an injunction, as well as an action for damages caused by the application of such conditions.’

‘1. An action for an injunction is possible against any seller or supplier who uses general conditions which are held to be null and void.

4. The actions provided for in the previous paragraphs may be brought jointly against a number of sellers or suppliers operating in the same economic sector or against their associations which use or recommend the use of identical general conditions which are held to be null and void.’

10 The Real Decreto Legislativo 1/2007 por el que se aprueba el texto refundido de la Ley General para la Defensa de los Consumidores y Usuarios y otras leyes complementarias (Royal Legislative Decree 1/2007 approving the consolidated text of the General Law for the protection of consumers and users and other supplementary laws) of 16 November 2007 (BOE No 287 of 30 November 2007, p. 49181), as amended, provides, in Article 53:

‘Actions for an injunction are aimed at obtaining a judgment that orders the defendant to cease certain conduct and prohibit its future occurrence. An action may also be brought to prohibit conduct that has ended at the time the action is brought, if there is sufficient evidence pointing towards the immediate recurrence of that conduct.

For the purposes of the provisions of this chapter, recommending the use of unfair terms is also considered conduct contrary to this law in respect of unfair terms.

Provided that an application for a declaration of nullity and for annulment is made, there may be joined to any action for an injunction an action for failure to comply with obligations, an action for termination or rescission of the contract, or an action for recovery of payments made as a result of the conduct, terms or general conditions held to be unfair or non-transparent, as well as an action for compensation for damage caused by the application of such terms or practices. The court hearing the main action, namely the action for an injunction provided for by the procedural rules, shall also hear that ancillary action.’

The dispute in the main proceedings and the questions referred for a preliminary ruling

11 On 15 November 2010, Adicae brought, before the Juzgado de lo Mercantil No 11 de Madrid (Commercial Court No 11, Madrid, Spain) a collective action seeking, first, an injunction against 44 credit institutions, directed at a so-called ‘floor’ clause in the general conditions of mortgage loan agreements used by those credit institutions, which provided for a minimum rate below which the variable interest rate could not fall (‘the floor clause’) and, second, reimbursement of the sums paid on the basis of that clause by the consumers concerned. That action was subsequently extended on two occasions, with the result that proceedings were ultimately brought against 101 credit institutions. Following three calls in the Spanish media, 820 consumers entered an individual appearance in the main proceedings, in support of the forms of order sought by Adicae.

12 The Juzgado de lo Mercantil No 11 de Madrid (Commercial Court No 11, Madrid) upheld the action in respect of 98 of the 101 credit institutions sued before it. With regard to those institutions, that court found that the floor clause was null and void, ordered that that clause cease to be used and declared that the mortgage loan agreements concerned would remain in existence. It also required those institutions to reimburse the sums unduly received pursuant to that clause, with effect from 9 May 2013, the date of publication of judgment No 241/2013 of the Tribunal Supremo (Supreme Court, Spain), by which that court decided that the declaration that a floor clause was null and void produced effects ex nunc.

13 The Audiencia Provincial de Madrid (Provincial Court, Madrid, Spain) dismissed almost all the appeals brought by the institutions against which judgment had been given at first instance.

14 That court specified the criteria according to which the review of the transparency of a floor clause had to be carried out in the context of a collective action and thus held that, when examining the standard-form mortgage loan agreements used by credit institutions, it was important to ascertain whether those institutions had engaged in conduct such as to conceal or disguise the ‘effect on finances and assets’ of such a floor clause. Such concealment or disguising occurs, according to that court, where those institutions do not present and place the floor clause on an equivalent footing to the other clauses to which the average consumer generally pays attention, with that consumer considering that those other clauses, relating to the reference index, the differential to be added to that index or the repayment term concerned, determine the costs of the contract concluded.

15 The Audiencia Provincial de Madrid (Provincial Court, Madrid) also identified certain forms of conduct of the credit institutions concerned which demonstrate such an intention to conceal or disguise. According to that court, such forms of conduct include the following: the presentation by those institutions of the floor clause in relation to concepts unconnected with the price of the mortgage loan agreement concerned or to factors with the potential to lower that price, thereby creating the impression that the ‘floor effect’ of the fluctuation in the reference interest rate is subject to certain conditions or requirements which will make it difficult to implement such a clause; the placing of the floor clause in the middle or at the end of long paragraphs which begin by dealing with other matters and in which such a clause is mentioned only briefly, without being highlighted, so that the average consumer’s attention is diverted from it; or the presentation of the ‘floor clause’ together with the terms limiting the upward adjustment of the variable interest rate (‘ceiling clauses’), so that the consumer’s attention is focused on the apparent security of having a cap on the hypothetical increase of the reference index, thereby diverting his or her attention from the importance of the minimum floor stipulated.

16 The credit institutions, which were unsuccessful on appeal, then brought exceptional appeals for breach of procedure and appeals on a point of law against the judgment delivered on appeal, before the Tribunal Supremo (Supreme Court), which is the referring court.

17 That court states that the case in the main proceedings raises two legal issues of equal importance. The first concerns the question whether a collective action is an appropriate procedural mechanism for examining the transparency of floor clauses, an examination which, according to the case-law of the Court, would require a concrete assessment of all the circumstances attending the conclusion of a contract and of the pre-contractual information provided to the consumer concerned. Such a question would be all the more relevant where, like the situation at issue in the main proceedings, the collective action brought does not concern a single credit institution alone, but all credit institutions in the banking system of a country whose only common denominator consists in the use, in their variable-rate mortgage loan agreements, of floor clauses whose content varies to a greater or lesser extent.

18 The referring court makes reference to its case-law on the subject and states, inter alia, that it has carried out a review of the transparency of floor clauses in the context of a collective action, in particular in the case giving rise to judgment 241/2013 of 9 May 2013, by taking as a reference criterion the perception of the average consumer and taking into account the characteristics of the standardised models of ‘mass contracts’ concerned. However, that court states that, in those cases, the collective action brought was directed against a single credit institution or against a very limited number of credit institutions, with the result that it was easier to standardise the practices and clauses concerned.

19 By contrast, the referring court states that, in the present case, according to the statistics of the Banco de España (Bank of Spain), millions of mortgage loan agreements are concerned, giving rise to multiple different wordings and formulations of floor clauses. In addition, that court states that those clauses were lawfully used during a period ranging from December 1989 to June 2019, with the result that they were subject to successive regulations, whereas the assessment of the unfairness of a contractual term must refer to the time of conclusion of the contract.

20 Consequently, the referring court considers that where a collective action is brought against a considerable number of credit institutions, concerns the use of floor clauses over a very long period, in accordance with successive regulations, and does not make it possible to verify the pre-contractual information provided in each case to the consumers concerned, it is extremely difficult to carry out a review of the transparency of those clauses, pursuant to Article 7(3) of Directive 93/13.

21 The second issue raised by the referring court concerns the difficulty of characterising the average consumer in a case such as that in the main proceedings. In that regard, the referring court states that although in its case-law the Court of Justice refers to the average consumer, who is reasonably well-informed and reasonably observant and circumspect (judgment of 3 March 2020, Gómez del Moral Guasch, C‑125/18, EU:C:2020:138, paragraph 51), the level of attention of a consumer may vary depending on several factors, in particular national or sectoral advertising requirements or even elements of the language used in the commercial information supplied.

22 In the case in the main proceedings, floor clauses were aimed at various specific categories of consumers, namely, in particular, consumers who had taken over mortgage loans concluded by real estate developers, consumers coming under social housing finance programmes or public housing access programmes according to certain age brackets, or consumers who had obtained loans under a special scheme on account of their profession, with the result that it would be difficult to apply the concept of ‘average consumer’ in order to examine the transparency of those clauses.

23 In those circumstances the Tribunal Supremo (Supreme Court) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1) For the purposes of a review of transparency in the context of a collective action, is an abstract assessment of terms used by more than one hundred financial institutions in millions of banking contracts, without taking into account the level of pre-contractual information offered on the legal and financial burden of the term or the other circumstances occurring in each case at the time when the contract was concluded, covered by Article 4(1) of Directive 93/13/EEC, where it refers to the circumstances attending the conclusion of the contract, and by Article 7(3) of that directive, where it refers to similar terms?

(2) Is the possibility of conducting an abstract review of transparency from the perspective of the average consumer, where a number of the contracts offered are aimed at different specific groups of consumers or where numerous financial institutions having, economically and geographically, very different business areas were using standard terms and conditions over a very long period of time during which public awareness of such terms was developing, compatible with Articles 4(2) and 7(3) of Directive 93/13/EEC?’

24 By its first question, the referring court asks, in essence, whether Article 4(1) and Article 7(3) of Directive 93/13 must be interpreted as allowing a national court to review the transparency of a contractual term in the context of a collective action brought against a large number of sellers or suppliers operating in the same economic sector, and concerning a very large number of contracts.

25 In that regard, it must be observed at the outset that, in the system of protection implemented by Directive 93/13, consumers may assert their rights recognised by that directive both by means of an individual action and a collective action.

26 In parallel to the individual right of a consumer to bring an action before a court for examination as to whether a term of a contract to which he or she is a party is unfair, the mechanism provided for in Article 7(2) of Directive 93/13 allows Member States to introduce a check on unfair terms contained in standard contracts by means of actions for an injunction brought in the public interest by consumer-protection associations (see, to that effect, judgment of 14 April 2016, Sales Sinués and Drame Ba, C‑381/14 and C‑385/14, EU:C:2016:252, paragraph 21).

27 Article 7(3) of Directive 93/13 provides that such collective actions may, with due regard for national laws, be directed separately or jointly against a number of sellers or suppliers from the same economic sector or their associations which use or recommend the use of the same general contractual terms or similar terms.

28 Although the rights recognised by Directive 93/13 may thus be exercised by means of an individual action or a collective action, those actions have, in the context of that directive, different purposes and legal effects (see, to that effect, judgment of 14 April 2016, Sales Sinués and Drame Ba, C‑381/14 and C‑385/14, EU:C:2016:252, paragraph 30).

29 Thus, as regards individual actions, the imbalance which exists between a consumer and the seller or supplier concerned, on which the system of protection established by Directive 93/13 is based, requires positive action by the national court which is required to assess of its own motion the unfairness of a contractual term by taking account, as required by Article 4(1) of Directive 93/13, of the nature of the goods or services that form the subject matter of the contract concerned and by reference, on the date on which the contract was concluded, to all the circumstances attending its conclusion, as well as all the other clauses of that contract or of a contract on which it is dependent (see, to that effect, judgment of 14 April 2016, Sales Sinués and Drame Ba, C‑381/14 and C‑385/14, EU:C:2016:252, paragraphs 21 to 24 and the case-law cited).

30 On the other hand, as is clear from the very wording of Article 4(1) of Directive 93/13, the taking into account of all the circumstances attending the conclusion of a contract, which characterises individual actions, is without prejudice to the application of Article 7 of that directive and must not, therefore, preclude the bringing of a collective action.

31 In that regard, the Court has held that the deterrent nature and dissuasive purpose of actions for an injunction brought by persons or organisations having a legitimate interest in protecting consumers referred to in Article 7(2) of Directive 93/13, together with the independence of those actions of any particular dispute, mean that such actions may be brought even though the terms which it is sought to have prohibited have not been used in specific contracts (see, to that effect, judgment of 14 April 2016, Sales Sinués and Drame Ba, C‑381/14 and C‑385/14, EU:C:2016:252, paragraph 29 and the case-law cited).

32 As regards, in particular, the relationship between individual actions and collective actions, it should be borne in mind that, in the absence of harmonisation in Directive 93/13 of the procedural means governing that relationship, it is for each internal legal order, under the principle of the procedural autonomy of the Member States, to establish such rules, on condition, however, that they are not less favourable than those governing similar situations subject to domestic law (principle of equivalence) and that they do not make it impossible in practice or excessively difficult to exercise the rights conferred by EU law on consumers (principle of effectiveness) (see, to that effect, judgment of 14 April 2016, Sales Sinués and Drame Ba, C‑381/14 and C‑385/14, EU:C:2016:252, paragraph 32 and the case-law cited). Those rules cannot, therefore, undermine the effective exercise of the freedom of choice, afforded to consumers under Directive 93/13, to assert their rights either by means of an individual action or by means of a collective action by being represented by an organisation having a legitimate interest in protecting them.

33 In the present case, it must be observed that the referring court is uncertain as to the extent to which a collective action constitutes an appropriate judicial mechanism for reviewing the transparency of a floor clause in mortgage loan agreements, where that action is brought against a large number of sellers or suppliers who have concluded numerous contracts of that kind over a long period.

34 As regards, in the first place, the concept of ‘transparency’ in the context of Directive 93/13, it should be borne in mind that the requirement of transparency of contract terms constitutes a general rule applicable to the drafting of terms used in consumer contracts. In that regard, Article 5 of that directive provides that, in the case of contracts where all or certain terms offered to the consumer are in writing, those terms ‘must always be drafted in plain, intelligible language’.

35 The scope of that obligation to draft in plain, intelligible language, which reflects the requirement of transparency incumbent on sellers or suppliers, does not depend on the type of action, whether individual or collective, by which a consumer or an organisation having a legitimate interest in protecting him or her seeks to assert the rights recognised by Directive 93/13.

36 Consequently, the case-law arising from individual actions and relating to the requirement of transparency is transposable to collective actions. In that regard, it must be borne in mind that, according to that case-law, that requirement cannot be reduced merely to a term being formally and grammatically intelligible, but must, to the contrary, be understood in a broad sense, since the system of protection introduced by Directive 93/13 is based on the idea that consumers are in a position of weakness vis-à-vis sellers or suppliers, in particular as regards their level of knowledge (see, to that effect, judgment of 16 March 2023, Caixabank (Loan arrangement fees), C‑565/21, EU:C:2023:212, paragraph 30, and the case-law cited).

37 Consequently, that requirement of transparency requires not only that a term must be formally and grammatically intelligible to the consumer concerned, but also that an average consumer, who is reasonably well informed and reasonably observant and circumspect, is in a position to understand the specific functioning of that term and thus evaluate, on the basis of clear, intelligible criteria, the potentially significant economic consequences of such a term for his or her financial obligations (see, to that effect, judgment of 10 June 2021, BNP Paribas Personal Finance, C‑776/19 to C‑782/19, EU:C:2021:470, paragraph 64 and the case-law cited).

38 It follows from the foregoing that, in the system of protection established by Directive 93/13, judicial review of the transparency of contractual terms cannot be limited solely to terms which form the subject matter of individual actions. No provision of that directive indeed permits the inference that that review is excluded as regards terms that form the subject matter of collective actions, subject, however, to compliance with the conditions laid down in Article 7(3) of that directive, namely that where a collective action is brought against a number of sellers or suppliers, it be directed against sellers or suppliers from the same economic sector, on the one hand, which use or recommend the use of the same general contractual terms or similar terms, on the other hand.

39 As regards, in the second place, the examination of the transparency of a contractual term which it is for the national court to carry out in the context of a collective action, it must be observed that, by its very nature, that examination cannot concern circumstances specific to individual situations, but relates to standardised practices of sellers or suppliers.

40 Consequently, the obligation of the national court to verify, in the context of an individual action, whether all the information likely to have a bearing on the commitment of the consumer concerned has been communicated to him or her, considering the circumstances attending the conclusion of the contract concerned and taking into consideration the provision, before that contract was concluded, of information on the terms of the contract and the consequences of concluding it (see, to that effect, judgment of 12 January 2023, D.V. (Lawyers’ fees – Principle of an hourly rate), C‑395/21, EU:C:2023:14, paragraphs 38 and 39 and the case-law cited), must be adapted to the specific features of collective actions, in particular having regard to their preventive nature and their independence of any particular dispute, recalled in paragraph 31 above.

41 Thus, in the context of a collective action, it is for the national court, when assessing the transparency of a contractual term, such as a floor clause, to examine, in the light of the nature of the goods or services which are the subject matter of the contracts concerned, whether the average consumer, who is reasonably well informed and reasonably observant and circumspect, is in a position, at the time the contact is concluded, to understand the functioning of that term and to evaluate its potentially significant economic consequences. To that end, that court must take into account all the standard contractual and pre-contractual practices followed by each seller or supplier concerned, including, in particular, the drafting of the term in question and its position in the standard-form contracts used by each seller or supplier, the advertising employed for the types of contract concerned by the collective action, the dissemination of generalised pre-contractual offers aimed at consumers and any other circumstances which the court might consider relevant in order to exercise its power of review with regard to each of the defendants.

42 As regards, in the third place, the question whether the complexity of a case, as a result of the very large number of defendants, contracts concluded over a long period and the multiple different wording of the terms concerned, may preclude the transparency of those terms from being reviewed, it must be observed at the outset that, as has been pointed out in paragraph 38 above, Article 7(3) of Directive 93/13 makes a collective action against a number of sellers or suppliers subject to two conditions, namely that such an action must be brought against sellers or suppliers in the same economic sector, on the one hand, and that the latter must use or recommend the use of the same general contractual terms or similar terms, on the other hand.

43 As regards the first of those conditions, it is not disputed in the present case that the defendants in the main proceedings belong to the same economic sector, namely that of credit institutions. The fact that the action brought in the main proceedings is directed against a considerable number of credit institutions is not a relevant criterion for assessing the national court’s obligation to examine the transparency of similar contractual terms, within the meaning of Article 7(3) of Directive 93/13, since, as is apparent from that provision, a collective action may be directed separately or jointly against a number of sellers or suppliers from the same sector. Indeed, the complexity of a case cannot undermine the effectiveness of the individual rights conferred by Directive 93/13 on consumers which cannot be called into question by the organisational challenges raised by a case.

44 As regards the second of the aforementioned conditions, it must be held that it is for the national court to determine, in compliance with its national law, whether there is a sufficient degree of similarity between the contractual terms concerned by a collective action to enable that action to be brought. In that regard, it is apparent from the very wording of Article 7(3) of Directive 93/13 that it is not necessary for those terms to be identical. Furthermore, such similarity cannot be excluded merely because the contracts in which they appear were concluded at different times or under different rules, as otherwise Article 7(2) and (3) of Directive 93/13 would be rendered largely meaningless and the effectiveness of that provision would thereby be undermined.

45 In the present case, subject to the checks which it will be for the referring court to carry out, it appears that the floor clauses used in the mortgage loan agreements concerned include, in essence, the indication of a minimum rate below which the variable interest rate may not fall, their operating mechanism being, in principle, always the same. Consequently, those clauses appear to be capable of being classified as ‘similar’ within the meaning of Article 7(3) of Directive 93/13.

46 In the light of all the foregoing, the answer to the first question is that Article 4(1) and Article 7(3) of Directive 93/13 must be interpreted as allowing a national court to review the transparency of a contractual term in the context of a collective action brought against a large number of sellers or suppliers operating in the same economic sector and concerning a very large number of contracts, provided that those contracts contain the same term or similar terms.

47 By its second question, the referring court asks, in essence, whether Article 4(2) and Article 7(3) of Directive 93/13 allow a national court, hearing a collective action brought against a large number of sellers or suppliers operating in the same economic sector and concerning a very large number of contracts, to review the transparency of a contractual term on the basis of the perception of the average consumer who is reasonably well informed and reasonably observant and circumspect, where those contracts are aimed at specific categories of consumers and that term has been used for a very long period of time during which the degree of awareness of that term was developing.

48 In that regard, it should be noted that, as is apparent from settled case-law and as has been recalled in paragraph 37 above, the transparency of a contractual term and the extent to which that term makes it possible to understand its functioning and evaluate its potentially significant economic consequences are to be examined taking into consideration the perception of the average consumer, defined as being reasonably well informed and reasonably observant and circumspect (see, to that effect, judgment of 20 September 2017, Andriciuc and Others, C‑186/16, EU:C:2017:703, paragraph 51, and of 20 April 2023, Ocidental – Companhia Portuguesa de Seguros de Vida, C‑263/22, EU:C:2023:311, paragraph 26 and the case-law cited).

49 In a similar way to the generic concept of ‘consumer’, within the meaning of Article 2(b) of Directive 93/13, which is objective in nature and is distinct from the knowledge and concrete information that the person concerned actually has (see, to that effect, judgment of 21 March 2019, Pouvin and Dijoux, C‑590/17, EU:C:2019:232, paragraph 24 and the case-law cited), the use of an abstract reference criterion for reviewing the transparency of a contractual term makes it possible to avoid making that review dependent on the combination of a complex set of subjective factors which it is difficult, if not impossible, to establish.

50 As the Advocate General observed, in essence, in point 83 of her Opinion, since, in the context of an individual action, the specific knowledge that a consumer may be deemed to have is not capable of justifying a deviation from the level of knowledge of the average consumer, the individual characteristics of different categories of consumers cannot, a fortiori, be taken into consideration in the context of a collective action.

51 In the present case, the referring court notes that, as a result of the considerable number of sellers or suppliers who have concluded mortgage loan agreements, their geographical distribution throughout the national territory and the long period of use of floor clauses during which successive regulations have been introduced, the collective action in the main proceedings concerns specific categories of consumers which are difficult to group together, namely, in particular, consumers who had taken over mortgage loans concluded by real estate developers, consumers coming under social housing finance programmes or public housing access programmes according to certain age brackets, or consumers who had obtained loans under a special scheme on account of their profession.

52 It must be observed that it is precisely the heterogeneity of the public concerned, as a result of which it is impossible to examine the individual perception of all the individuals making up that public, which makes it necessary to have recourse to the legal fiction of the average consumer, which entails understanding the latter as being a single abstract entity whose overall perception is relevant for the purposes of its examination.

53 Consequently, in its analysis of the transparency of floor clauses at the time the mortgage loan agreements concerned were concluded, it will be for the referring court to rely on the perception of the average consumer, who is reasonably well informed and reasonably observant and circumspect, irrespective of the differences which may exist between each individual consumer to whom the agreements in question are aimed, in particular as regards the degree of awareness of the floor clause, income level, age, or occupation. The fact that those agreements are aimed at specific categories of consumers is not such as to lead to a different conclusion. In order to examine the transparency of terms which are included in the general conditions of all those agreements and the functioning of which is, in essence, identical – consisting in limiting the reduction of the variable interest rate beyond a certain level – a national court cannot rely on the perception of a consumer who is less well informed than that average consumer, nor on that of a consumer who is better informed than the latter (see, to that effect, judgment of 21 September 2023, mBank (Polish register of unlawful terms), C‑139/22, EU:C:2023:692, paragraph 66).

54 However, it cannot be excluded a priori that, as a result of the occurrence of an objective event or a matter of common knowledge, such as an amendment to the applicable legislation or a development in case-law widely disseminated and discussed, the referring court considers that the average consumer’s overall perception of the floor clause was, during the reference period, altered and enabled the latter to become aware of the potentially significant economic consequences entailed by that clause.

55 In such a situation, Directive 93/13 does not preclude account being taken of changes during that period in the perception of the average consumer, with the level of information and attention of that consumer thus being able to depend on the time at which the mortgage loan agreements are concluded. However, the referring court must avail itself of that possibility on the basis of concrete and objective evidence establishing the existence of such a change, and that change cannot be inferred from the passage of time alone.

56 In the present case, as became apparent from the proceedings during the hearing before the Court, that objective event or matter of common knowledge could consist in the collapse in interest rates, characteristic of the 2000s, which led to the application of the floor clauses and therefore to consumers becoming aware of the economic effects of those clauses, or in the delivery of judgment No 241/2013 of the Tribunal Supremo (Supreme Court) of 9 May 2013, which found that those clauses were not transparent. It will be for the referring court to ascertain whether, for the purposes of reviewing the transparency of those clauses, that collapse in interest rates or the delivery of that judgment may have led to a change, over time, in the level of attention and information of the average consumer at the time a mortgage loan agreement was concluded.

57 In the light of all the foregoing, the answer to the second question is that Article 4(2) and Article 7(3) of Directive 93/13 must be interpreted as allowing a national court, hearing a collective action brought against a large number of sellers or suppliers operating in the same economic sector and concerning a very large number of contracts, to review the transparency of a contractual term on the basis of the perception of the average consumer, who is reasonably well informed and reasonably observant and circumspect, where those contracts are aimed at specific categories of consumers and that term has been used for a very long period of time. However, if, during that period, the average consumer’s overall perception of that term has changed as a result of the occurrence of an objective event or a matter of common knowledge, Directive 93/13 does not preclude the national court from carrying out that review by taking account of the change in that consumer’s perception, with the relevant perception being that existing at the time a mortgage loan agreement is concluded.

58 Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the referring court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

1. Article 4(1) and Article 7(3) of Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts

must be interpreted as allowing a national court to review the transparency of a contractual term in the context of a collective action brought against a large number of sellers or suppliers operating in the same economic sector and concerning a very large number of contracts, provided that those contracts contain the same term or similar terms.

must be interpreted as allowing a national court, hearing a collective action brought against a large number of sellers or suppliers operating in the same economic sector and concerning a very large number of contracts, to review the transparency of a contractual term on the basis of the perception of the average consumer, who is reasonably well informed and reasonably observant and circumspect, where those contracts are aimed at specific categories of consumers and that term has been used for a very long period of time. However, if, during that period, the average consumer’s overall perception of that term has changed as a result of the occurrence of an objective event or a matter of common knowledge, Directive 93/13 does not preclude the national court from carrying out that review by taking account of the change in that consumer’s perception, with the relevant perception being that existing at the time a mortgage loan agreement is concluded.

Court of Justice of the European Communities (including Court of First Instance Decisions)