On July 2, 2019, the Supreme Court delivered a landmark judgment dealing with the requirements to be met to secure the discharge of debts through the so-called ‘fresh start’ mechanism. Under Spanish law, ‘fresh start’ refers to the situation where a debtor is relieved of paying outstanding debt. It is a tool that may be used by individuals (traders, freelancers and heavily indebted consumers) to shed their debts, which will be released, enabling them to undertake new ventures.
On September 10, the Advocate General (AG) issued his opinion on a preliminary ruling to be rendered by the Court of Justice of the European Union (CJEU) regarding a lawsuit in Spain over the validity, under the European directive on unfair terms in consumer contracts (Directive 93/13), of a contractual clause referencing a local interest rate benchmark in floating rate residential mortgage loans. The press has regarded the opinion as unfavorable to the banks. If upheld by the CJEU, it could mark a turning point in the underlying lawsuits. A final negative outcome could provoke massive losses for a number of Spanish banks with the possibility to accelerate a wave of domestic and European bank mergers.
On Thursday, June 6, 2019, the European Commission decided to refer Spain to the Court of Justice of the European Union for “imposing disproportionate penalties on Spanish taxpayers for the failure to report assets held in other EU and EEA States (Modelo 720)”, according to a press release just published.