This chapter analyzed how fundamental rights, along with the application of a ‘capability approach’ to consumer law, may affect financial consumer contracts, focusing in particular on credit agreements.
The current framework is characterized by opposing tendencies. On the one hand, liberal views led to measures aimed at improving market functioning through harmonization, and at protecting the consumer on the basis of the ‘autonomous, informed consumer concept’ of the 2008 directive on credit agreements. According to this view, the main role of consumer protection is to allow well-informed choices, especially when these have long-lasting effects, as in the area of consumer credit.
On the other hand, there is an emergence of new ‘social’ concepts like responsible lending, which introduce a novel perspective to consumer law. This tendency is accompanied and strengthened by a progressive influence of constitutional and fundamental rights in financial contracts. As shown, constitutional social principles have been invoked in favour of weak parties in some Member States, which can lead to fairer business practices in specific contractual relations.
Furthermore, as illustrated in the controversial Test-Achats case, the Charter of Fundamental Rights can have significant implications for the content of existing secondary law and may influence the meaning of general principles of EU law, such as equal treatment. This indicates an increasing importance of primary EU law for consumer law and could promote a more value-based approach, strengthening a broader consumer concept.
Finally, the last part illustrated the importance of complementary legal approaches to the 2008 directive, which enhance contractual capacity for consumers to participate equally in markets in a substantive way. This inclusive role can be reached through instruments such as corporate responsibility and social lending, as well as new norms in consumer bankruptcy. Interestingly, these innovations have a strong flavour of a capability approach, which was outlined in Chapter 4. In this ‘empowerment’ perspective, which is a typical trait of the capability approach, this chapter has discussed four important issues that may be promoted by fundamental rights, policy objectives, or secondary law: (1) financial literacy, obtained via information and education; (2) fundamental rights protecting weaker parties; (3) the principle of non-discrimination; and (4) financial inclusion, which ensures participation in society and in the market, and the prevention of over-indebtedness.
While the current legal framework (in particular, the 2008 directive on credit agreements) is fully mindful of the information principle, protection of weaker parties and financial inclusion are only partially addressed at present.