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Report of the General Advocate of the European Court of Justice (ECJ) on a Mortgage Loan Reference Index (IRPH) litigation

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12 September 2019

In the context of a claim of a consumer against a Spanish bank regarding the potential unfair nature of a IRPH indexed floating interest rate clause, the First Instance Court number 38 of Barcelona filed a preliminary ruling request before the ECJ. In the case being decided, a mortgage loan agreement to acquire a dwelling was entered into in 2001.

Thereafter the consumer sued the bank and requested that the IRPH clause was declared unfair.

The consumer alleged that most mortgage loans in Spain were indexed to Euribor, which it is more beneficial for the consumer. The First Instance Court asserted that around 10% of these contracts were indexed to IRPH that was indeed less beneficial for the consumers since it implies a higher cost for them. The First Instance Court also showed its concerns in connection with the information provided to the customer when subscribing the contract.