EU asks Romania for details on consumer lending contracts ordinance while customers prepare to sue banks

The European Commission has sent Romanian authorities a letter asking for further details on how a European directive was transposed into local legislation through Government Emergency Ordinance 50/2010 on consumer lending contracts. The document was sent to the local Department for European Affairs, and, according to government sources, it is the first step in a potential infringement procedure. Romanian Central Bank (BNR) first deputy governor Florin Georgescu confirmed that the European Commission approached local authorities regarding the provisions of Ordinance 50. According to Mediafax newswire, local lenders could request infringement procedures against Romania should Ordinance 50 apply to loans already unfolding, or if it does not stick to implementing the European Directive alone. Government Emergency Ordinance 50/2010, on consumer lending contracts, transposes EU Directive 48/CE/2008 into local legislation. Provisions include the removal of the early repayment fee on loans with variable interest, and the calculation of interest using a transparent reference index, added with a fixed margin, which is established in the initial contract. Groups of Romanians with loans contracts signed with various banks active in Romania have already started lawsuits against their banks, complaining about the enforcement of the new Government Emergency Ordinance and asking for lower interest rates on their ongoing loan contracts. More about the emergency ordinance and its effects here. Mediafax, Romania-insider.com