Can consumer legislation apply to a loan to set up a business?

The TS that the tuition legislation of consumer legislation can not be applied regarding the transparency and abusive controls in the cases in which the borrower is not. This happens, among other cases, when the loan is not requested to satisfy their personal needs, but for the exercise of a professional activity.

A person professionally dedicated to translation subscribes a mortgage loan on his house and a place of his property to finance the start-up of a hotel business.

The loan is unpaid so the bank executes the mortgage, but the person requests the nullity of the loan based on the abuse of certain clauses.

The JPI dismisses the claim by considering that the person was an entrepreneur and that therefore the regulation on consumers was not applicable. The PA, however, declares the nullity of certain clauses of the loan relating to the interest rate, the early maturity and the payment of expenses. The PA considers the person as a consumer because the purpose of the loan was different from that of his professional practice.

The bank resorts to cassation before the TS, considering that if the purpose of the loan was to set up a business, it can not be considered a consumer operation.

To define the consumer concept, the following guidelines must be followed (CJEU 25-1-18, case C-498/16):

It must be interpreted in relation to the position of the person in the contract and with the purpose and nature of the contract and not with the subjective situation of the person: a person can be a consumer in one contract and a professional in another.
Only the contracts concluded outside any activity or professional purpose to satisfy private consumption needs are applicable to consumer regulation.
The concept of consumer is independent of the knowledge and information that the person has.
If the contract is partially related to the professional activity only the consumption regulation is applied if the link with the professional activity is marginal.

It is clear that the purpose of the loan requested by the person was not to satisfy their personal needs, but to set up a business, so that the operation was not covered by consumer legislation. The exclusion of consumer quality makes it inappropriate to carry out transparency and abuse controls.

STS Room 1st of April 11, 2019. EDJ 2019/555298