“As preserving credit discipline and avoiding moral hazard among debtors contributes significantly towards enhancing financial stability, we will refrain from adopting legislative initiatives (for instance, proposals for the personal insolvency law and for the debt collecting law) or amending Ordinance 50/2010, which would undermine credit discipline,” the document obtained by Mediafax noted.
Romania is one of the few countries in Europe that doesn’t have a personal bankruptcy legislation, leaving over-indebted consumers unprotected against creditors, a report commissioned by the European Commission showed in April.
In January, the government deferred to the second half of the year the introduction of a new stipulation to the Code of Civil Procedure that would allow consumers and the consumer protection authority to file class actions against commercial banks over abusive clauses.
The delay was requested by the IMF, which cited the absence of an impact study regarding the new measure. The central bank also criticized the new stipulation, arguing that the norm would cause losses in the local banking system and would endanger financial stability.
According to a survey from the central bank, Romanian lenders are likely to incur aggregate losses of some 5 billion lei (over EUR1.1 billion) following the potential implementation of the regulation allowing collective lawsuits against banks over abusive loan contract clauses.
Should the new stipulation be added to the Civil Procedure, Romanian banks would be forced to modify all contract clauses that might be considered abusive.
Additionally, the new measure might extend to various types of litigations between consumers and service providers, opening the way to possibly thousands of lawsuits by disgruntled consumers.