Earlier this year in March, the CJEU delivered a judgment in C-50/22 Sogefinancement SAS that clarified the scope of Directive 2008/48/EC on consumer credits in regard to its rules on the right of withdrawal.
Article 14 of the Directive provides consumers with the standard European14 days right of withdrawal. However, in order to make the withdrawal right more effective, national rules may provide for a period of time within which the loan should not be issued to the consumer. Pursuant to Article 14 para 7 the Directive's rules on right of withdrawal shall be without prejudice to any such national rules.
In the present case, Sogefinancement concluded a consumer credit contract with the defendants. When a dispute arose in regard to the performance of the contract, the ruling national court raised on its own motion the fact that the loan was issued to the customer in breach of the Consumer Code - the funds had been given to the consumer before the 7 days national mandatory waiting period. The finance company appealed against this decision arguing that the matter of nullity should have not been raised by the court outside the national 5 year limitation period and that in fact that any action to nullify the contract should have been initiated by the parties and not the court.
The CJEU reasoned that 'by
allowing the Member States the option of adopting or maintaining provisions
establishing a period of time during which the performance of the contract may
not begin, the use of the words ‘without prejudice’ in Article 14(7) of Directive
2008/48 means that the full and imperative harmonisation effected by that
directive as regards the consumer's right of withdrawal does not cover the
arrangements for the start of performance of a credit agreement and, in
particular, for making funds available to the borrower' (para 29)
It follows that, where 'Member States lay down, in exercise of the option conferred on them by Article 14(7) of Directive 2008/48, provisions laying down a period during which the performance of the credit agreement may not begin, the national procedural rules governing the raising by a court of its own motion of, and the penalty that it imposes for, a breach by the lender of such provisions fall within the retained competence of the Member States, without being regulated by that directive or falling within the scope of that directive' (para 32).
