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“Swiss Francs Act” – next generation

On August 2nd 2016, Chancellery of the President presented a new bill called "Franc Act”. It applies to credit agreements indexed and denominated and fixed-indexed denominated loans for which the a security interest have been established in the form of a mortgage on the property. The scope of the regulation includes credit agreements concluded from 1st of  July 2000 to 26th of August 2011. The regulation is aimed at consumers within the meaning of the Civil Code, as well as natural persons conducting economic activities individually (however with some reservations).

The Act provides for the obligation to return the benefits collected at startup and repayment of the credit due to the spread of higher than acceptable, with interest amounting to half of the statutory interest. Reimbursement may take the form of reduction of capital due to repayment (active credits) or payment (expired credits). The Act contains a quota limit of 350 000 PLN, which constitutes the amount of the credit principal in relation to which the consumer is entitled to demand a reduction of capital or repayment of the overpayment.

According to the draft, the regulation will enter into force after 30 days from the date of publication. Maintenance costs will depend on the scale of rights exercising by the borrowers and are expected to reach between 3.6 and 4 billion PLN.

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