The purpose of the draft bill is to create the Independent Administrative Authority for the Defense of Financial Customers, to establish a system for the out-of-court resolution of disputes arising between financial institutions and financial customers and to promote financial education.
In order to increase the protection of the clients of financial entities, to increase legal certainty in the area of the rules of conduct that financial entities must observe, and to contribute to the extension of common practices in the relations of financial entities with their clients, with adequate and common standards of protection, in which transparency, the financial inclusion of vulnerable groups and competition in terms of quality of service are strengthened, for the benefit of society as a whole.
This modification is due to the need to introduce, within the framework of the reconfiguration of Spanish financial institutions, a general principle to guarantee the personalized provision of financial services, understood as that which takes into consideration the age of the person to whom it is providing or will provide services, the characteristics of the geographical area in which the person resides in terms of population and the level of digital skills of that person, among other characteristics.
Lack of access to financial services is a complex phenomenon in which factors such as the distribution of the population in the territory, its age structure, its socioeconomic characteristics and the distribution channels of available financial services are interrelated.
First, a substantial number of Spanish municipalities lack a bank branch. This fact makes access to financial services difficult, although it does not necessarily imply that the residents of these localities do not have access to them.
- On the one hand, in some cases the credit institutions themselves offer face-to-face service alternatives through collaborating agents, mobile employees or mobile offices. In addition, various organizations and public administrations are carrying out different initiatives to improve access to face-to-face financial services.
- On the other hand, residents of these municipalities can access financial services through digital and telematic channels.
However, in some populations, face-to-face service alternatives are not available and, in other cases, digital and telematic channels are not adapted to the level of familiarity of some segments of the population with these technologies, preventing their use in practice.
Secondly, difficulties in accessing financial services may also arise in municipalities that do have a bank branch in their municipal district. In these cases, the apparent offer of face-to-face service may not be effective for different reasons, such as referral to automatic teller machines or telematic channels for queries and procedures, limited opening hours for certain procedures or the lack of service adapted to the needs of some segments of the clientele. It is therefore necessary to guarantee the personalized provision of financial services.
The service will be free of charge for financial clients, who will be able to file claims without the need for a lawyer or solicitor. In order to ensure adequate and inclusive access to this alternative dispute resolution system, the principle of personalized attention is established. To this end, the age, the characteristics of the geographical area and the level of skills of citizens will be taken into account, and face-to-face, telephone and telematic channels, adapted and accessible to vulnerable groups, will be guaranteed for filing claims.
The law consists of a preliminary title and five other titles, with a total of 61 articles, as well as six additional provisions, four transitory provisions, one derogatory provision and twelve final provisions.
Preliminary Title. General Provisions (Articles 1 to 4)
The preliminary title contains the general principles applicable to the institutional system created for the out-of-court resolution of conflicts between financial institutions and their customers, establishing its purpose and scope of application, the definitions of the concepts used throughout the text, and the legal regime applicable to it.
Complaints may be filed with the Authority by individuals or legal entities that are customers of financial services for possible breaches of rules of conduct, good financial practices and usages, as well as for abuse of clauses declared as such by the corresponding courts in relation to financial contracts.
The draft bill affects all financial institutions: credit institutions, investment services companies, insurance companies, financial credit institutions, participatory financing platforms, lenders and credit intermediaries, payment and electronic money institutions or issuers and service providers of the so-called fintech sector and crypto-asset services.
Title I. Out-of-Court Dispute Resolution System ( Articles 5 to 7)
Title I establishes the institutional system for the out-of-court resolution of conflicts between financial entities and their clients and its legal regime.
Title II. Independent Administrative Authority for the Defense of the Financial Customer ( Articles 8 to 47)
Title II creates the Independent Administrative Authority for the Defense of the Financial Customer (Chapter 1ª), establishing its organization (Chapter 2ª), legal and personnel regime (Chapter 3ª), its operating principles (Chapter 4ª), the procedure to be followed in the resolution of the conflict between the financial entity and its customer, in which a novelty compared to the previous regime is the binding nature of the resolutions for the financial entities (Chapter 5ª); and the information to be provided, including the parliamentary control of its operation (Chapter 6ª). This Authority is destined to be the mechanism through which an adequate solution can be found to the claims of financial customers against financial institutions that may arise in the future in this area.
Title III. Cooperation with other bodies (Articles 48 to 50)
Title III, contains the cooperation of the Independent Administrative Authority for the Defense of Financial Customers with the Ministry of Economic Affairs and Digital Transformation, the Ministry of Consumer Affairs and the supervisory authorities for conduct in the financial sector.
Title IV. Promotion of Financial Education (Articles 51 and 52)
Title IV regulates the promotion by the Bank of Spain, the National Securities Market Commission and the Directorate General of Insurance and Pension Funds, in coordination with the Independent Administrative Authority for Customer Protection, of financial education for customers, especially in the areas of savings, investment, loans and credit and debt management and insurance, promoting customer responsibility in the contracting of financial products.
Title V. Penalty Regime (Articles 53 to 61)
Title V establishes the sanctioning regime attributed to the Independent Administrative Authority for the Defense of the Financial Customer. Failure to comply with the Authority's binding resolutions, as well as certain other actions by financial institutions, may be subject to sanctions by the Authority. In addition, the Authority's protection system complements the conduct supervision of financial supervisors.
The resolutions will be issued in an expeditious manner, based on uniform criteria, within a period not exceeding 90 days, and will be binding on the financial institutions when the claims are for an amount of less than 20,000 euros.
Additional Provisions
The first five additional provisions regulate relevant issues to ensure that the implementation of the system is carried out in an agile, fluid manner, as an evolution from the current scheme. Thus, they deal with issues such as its financing, based fundamentally on a fee contributed by the financial sector itself, as provided for in the first additional provision. It is worth noting that the fee, in addition to contributing to the financing of the new Authority, will encourage institutions to resolve their customers' claims amicably, before they go to the Authority. The fee will be 250 euros per admitted claim and the Government may introduce modifications to the fee in the corresponding General State Budget Law.
The second additional provision, for its part, establishes the obligation for financial institutions to disseminate the system among their customers, a necessary premise for the generalization of its use. Finally, the third additional provision provides for the collaboration that, exceptionally and in the event of insufficient resources, public and private entities may provide to the Independent Administrative Authority for the Defense of Financial Customers; the fourth provision provides for the preparation of an impact report on the implementation of the institutional system for the out-of-court resolution of conflicts; and the fifth provision provides for legal advice. A sixth additional provision is also included, which regulates the obligations of the authority in the event of actions involving the execution of the Recovery, Transformation and Resilience Plan.
Transitional Provisions
The first transitory provision sets forth the rules for processing claims initiated before the entry into force of this law; the second deals with the possibility for customers who, at the entry into force of this law, were litigants in civil court proceedings on any matter whose resolution falls within the jurisdiction of the Independent Administrative Authority for the Defense of Financial Customers, to unilaterally withdraw from the legal proceedings before a judgment has been handed down, in order to submit the matter in question to the Independent Administrative Authority for the Defense of Financial Customers; the third one relating to the first term of office of the elected directors of the Governing Council of the Authority and their renewal by halves, and the fourth one conditions the effective start-up of the entity to the existence of a specific budget allocation in the corresponding General State Budget Law.
Repealing provision
The repeal, on the other hand, puts an end to the validity of article 30 of Law 44/2002, of November 22, article 31 of Law 2/2011, of March 4, on Sustainable Economy, as well as Order ECC/2502/2012, of November 16, which regulates the procedure for submitting complaints to the complaints services of the Bank of Spain, the National Securities Market Commission and the Directorate General of Insurance and Pension Funds, which until now established the legal regulation of the complaints system by the supervisors, implicitly maintaining the validity of the rest of the provisions that do not oppose the provisions of this law.
Final Provisions
The twelve final provisions introduce various legal amendments: of Law 8/1989, of April 13, 1989, on Public Fees and Prices, to include the new fee within the substantive regulation of public fees and prices; of Law 29/1998, of July 13, 1998, regulating the Contentious-Administrative Jurisdiction to attribute to the Contentious-Administrative Chamber of the National High Court the competence to hear in sole instance appeals against resolutions issued by the Authority; of Law 7/2017, of November 2, to appoint the Ministry of Economic Affairs and Digital Transformation as the accreditation authority in the financial sector; and of Law 3/2015, of March 30, regulating the exercise of senior positions in the General State Administration, to attribute the status of senior position to the persons holding the presidency and vice-presidency of the Authority;
The third, fourth, fifth and sixth provisions, which amend the main regulations governing the three financial sectors, as well as Royal Decree-Law 3/2020, of February 4, on urgent measures for the incorporation into Spanish law of various European Union directives in the areas of public procurement in certain sectors; private insurance; pension plans and funds; taxation and tax litigation, stand out among the others.Law 10/2014, of June 26, on the regulation, supervision and solvency of credit institutions, the revised text of the Securities Market Law, approved by Royal Legislative Decree 4/2015, of October 23 and Law 20/2015, of July 14, on the regulation, supervision and solvency of insurance and reinsurance companies.
Finally, in the tenth, eleventh and twelfth final provisions, the title of competence, the regulatory development and its entry into force are established.
The deadline for comments is May 12, 2022.
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