Hungary’s supreme court to assess CJEU ruling on forex borrowers

Hungary’s Kúria (supreme court) is assessing Thursday’s ruling of the European Union’s Court of Justice (CJEU) affecting forex borrowers, the Kúria said in a statement.

The ruling stated that “the unfairness of an unclear contractual term which places the exchange rate risk on the borrower and does not reflect statutory provisions may be subject to judicial review.”

The CJEU, in a preliminary ruling requested by Hungary’s Budapest Regional Court of Appeal, said that financial institutions are required to provide borrowers with adequate information to enable them to take well-informed and prudent decisions.

Two Hungarian borrowers brought legal proceedings before the Hungarian courts against OTP Bank and OTP Faktoring concerning a credit contract for the provision of a loan denominated in Swiss francs. The Hungarian courts referred the case to the CJEU to determine if elements of the contract were unfair.