In a recent judgment delivered on 12 February 2026 in C-471/24 J.J. v PKO BP S.A., the CJEU delivered further important interpretation on matters affecting loan contracts in variable rates.
In this Polish case the consumer concluded a mortgage loan contract with variable rate of interest, which was calculated on the basis, first, of the WIBOR 6M benchmark, an interest rate benchmark, within the meaning of Article 3(1)(22) of Regulation 2016/1011, the value of which was set at 1.79% on the date of conclusion of that agreement, and, secondly, of a fixed margin of 1.85%, the applicable rate being adjusted to reflect changes in that index on a six-monthly basis.
As the consumer alleged the unfairness of the term, this gave new opportunities to the CJEU to interpret Directive 1993/13/EC on Unfair Contract Terms.
With the first question, the CJEU was asked whether the term setting out the variable rate of interest can be assessed for its fairness under Article 1(2), given the influence of Regulation 2016/1011, which would qualify a term as one that reflects ‘mandatory statutory or regulatory provisions’. First, the CJEU importantly noted that although Article 1(2) relates to statutory or regulatory provisions of Member States and not EU law, as stated Recital 13 of the Directive the 'the provisions contained in acts adopted by the EU legislature in the form of regulations must be treated, in that regard, in the same way as the statutory and regulatory provisions of the Member States, in view of the effects of those regulations as laid down in the second paragraph of Article 288 TFEU, where such provisions of EU law seek, in the same way, to determine in a mandatory or supplementary manner the rights and obligations of the parties to certain contracts. The rationale for the exclusion established in Article 1(2) of Directive 93/13, …is, in principle, legitimate to presume that the national legislature struck a balance between all those rights and obligations, a balance which the EU legislature intended to preserve ... also applies where those rights and obligations are determined directly by the EU legislature itself.' (paras 73 and 74).
In answering the first question, the CJEU confirmed its earlier ruling in C-176/23 (see our report here), that '[a]rticle 1(2) must be interpreted as meaning that the exception provided for therein does not cover a term in a mortgage loan agreement stipulating a variable interest rate based on a benchmark, within the meaning of Regulation 2016/1011, and a fixed margin, where the statutory or regulatory provisions applicable to such a term merely establish a general framework for the setting of the interest rate for such contracts, while leaving it open to the seller or supplier to determine the contractual benchmark or the fixed margin which may be added to the value of that index'.
The second question related to whether a term in a mortgage loan agreement with a variable rate of interest based on a benchmark could be the main subject matter and, as such, exempted from the scrutiny of fairness based on Article 4(2). According to Article 4(2) the assessment of the unfair nature of the terms may 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 supplied in exchange, on the other hand, in so far as those terms are in plain, intelligible language. The question, therefore, here was the interpretation of the meaning of plain and intelligible in this context; whether where a mortgage loan agreement contains a term stipulating a variable interest rate based on a benchmark, within the meaning of Regulation 2016/1011, the transparency requirement arising from that provision imposes on the creditor certain specific obligations to provide information as regards the methodology of that index. The claimant alleged that the bank did not provide reliable, intelligible and complete information concerning the risk associated with the application of a variable interest rate and the mechanism for determining the WIBOR 6M benchmark, in particular as regards the influence that the banks providing the input data which was used to set that benchmark; the banks participating in setting the benchmark, including PKO, could exert influence on the benchmark; the input data did not come from transactions actually carried out on the Polish interbank market, but of price offers made on that market, which conferred discretion on the contributors to the benchmark.
The CJEU reiterated its previous position that in this context the transparency requirement must be understood as requiring an average consumer, who is reasonably well-informed and reasonably observant and circumspect, is in a position to understand the specific functioning of the method used for calculating that rate and thus evaluate, on the basis of clear, intelligible criteria, the potentially significant economic consequences of such a term on his or her financial obligations (para 86). Moreover, compliance with the requirement of transparency must be assessed in light of all relevant facts, including not only the terms contained in the agreement concerned but also the promotional material and information provided by the lender during the negotiation (para 87). Therefore, ‘[a]ccount should also be taken of the fact that the main elements relating to the calculation of a contractual reference index are easily accessible, on account of their publication, on condition that, in the light of the publicly available and accessible information and the information provided, as the case may be, by the lender, an average consumer, who is reasonably well informed and reasonably observant and circumspect, was in a position to understand the specific functioning of the method used for calculating the variable interest rate, in particular in so far as it involves a reference index, and thus to assess, on the basis of clear, intelligible criteria, the potentially significant economic consequences of such a term on his or her financial obligations (para. 88).
Moreover,
in order to assess whether a term in a loan agreement which falls within the
scope of Article 4(2) satisfies the requirement of transparency imposed by
that provision, it is appropriate to take into consideration all the provisions
of EU law laying down obligations relating to information for consumers which
may be applicable to the agreement concerned. The CJEU then examined
information duties in Directive 2014/17/EC and Regulation 2016/1011, and
concluded that these read together, lay down precise obligations to
provide information to consumers as regards, first the terms of mortgage loan
agreements setting a variable interest rate referring to a benchmark covered by
that regulation and, second, the benchmarks, and that those obligations are
divided between the creditors and the administrators of those benchmarks (para
101). The CJEU concluded that ‘the transparency requirement arising from
Article 4(2) does not impose on the creditor certain specific obligations to
provide information as regards the methodology of that benchmark. The fact that
the creditor has complied with all the obligations to provide information
imposed on it by Directive 2014/17 in respect of such a term and, if it has
provided additional information, has not provided any information giving a
distorted picture of that benchmark is such as to establish that that creditor
has satisfied that requirement of transparency as regards that term.’
The third question called for interpretation of Article 3(1) in this context, according to which a contractual term which has not been individually negotiated is to be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties’ rights and obligations arising under the contract, to the detriment of the consumer. The question here was whether the very way the benchmark is determined renders the term substantively unfair. The claimant argued that the way the benchmark is determined allows PKO to influence the benchmark and, in turn, the borrower's interest payable. The banks thus afford themselves a ‘hidden margin’ (para 107).
The CJEU noted that Regulation 2016/1011 contains a set of detailed provisions on benchmarks, including the provision of input data, in particular as regards the nature of those data and their reliability, and the use of those benchmarks. Consequently, ‘the use, in a mortgage loan agreement, of a benchmark which, at the time that agreement is concluded, may be regarded as complying with the requirements of the framework established by Regulation 2016/1011, in particular as regards its methodology, in the light of the control provided for by that regulation, cannot, in principle, be, in itself, such as to create, to the detriment of the consumer, a significant imbalance in the parties’ rights and obligations, notwithstanding the fact that the creditor is one of the banks which provide the input data used by the administrator of that index to determine its successive values’ (para. 129).
The answer to the third question is that Article 3(1) must be interpreted as meaning that, 'the lack of information on the part of the consumer concerning certain specific features of the contractual benchmark, in particular the fact that its methodology provides for the use of input data which does not necessarily correspond to actual transactions and the fact that the creditor is one of the banks contributing to the determination of that index' - those specific features themselves are not such as to render that term unfair, provided that that index could be regarded as consistent with that regulation at the time of the conclusion of that contract.
