ZAGREB, 7 Sept, 2021 - The Franak association on Tuesday called on its members to send emails to members of parliament ahead of a parliamentary vote on President Zoran Milanović's candidate for Supreme Court president, Radovan Dobronić, expressing support for his election.

Franak brings together former holders of loans pegged to the Swiss franc whose loans were converted to euro-denominated loans.

On 4 July 2013, the Zagreb Commercial Court delivered a ruling in favour of the Consumer Protection Association which had sued eight banks with regard to the Swiss franc foreign currency clause and their unilateral decision to increase interest rates.

The judgement was handed down by Judge Dobronić, who said at the time that the banks had violated consumers' rights by failing to fully inform them about all the parameters necessary to decide on taking loans.

The ruling on the legal nullity of the currency clause in contracts on loans pegged to the Swiss franc was later upheld by the High Commercial Court.

Eight years ago, Judge Dobronić gave hope to all holders of CHF-indexed loans, the Franak association said today.

"We believe that we do not have to explain in great detail the reasons why we are confident that Judge Dobronić is the only candidate who can launch the necessary changes in the judiciary. We believe that by expressing our support for him we can send a message to members of parliament and let them know who is the citizens' choice," Franak said.

In a draft message of support for Judge Dobronić, which can be sent by citizens to members of the parliamentary Judiciary Committee, which is to interview candidates for Supreme Court president, and their party groups, Franak says: "By supporting Judge Dobronić for Supreme Court President you will restore citizens' hope and faith in judicial autonomy and a just Croatia."

The Judiciary Committee is to interview the candidates on 9 September.

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ZAGREB, June 5, 2020 - The Franak Association reported Croatia to the European Commission, for the breach of the treaty with the European Union, the association said on Friday, claiming that the Supreme Court's multiple arbitrary actions during the so-called model proceedings amounted to the breach.

Calling for the action to be taken against Croatia at the EU Court, the Association made accusations against the Supreme Court noting that there were no grounds for initiating the model proceedings and that a series of misinterpretations and wrong conclusions were presented during the proceedings about consumer protection on the basis of the EU legislature.

"The report contains a short presentation of the history of court rulings in the Swiss francs loan conversion case, and a description of the Swiss francs conversion into euros based on the amendments to the law on customer credit. On the basis of all those facts, an explanation was given for what the Supreme Court of the Republic of Croatia had done incorrectly in the model proceedings ruling which declared the conversion agreements valid," stated the head of the Franak Association's office, Sandra Ziga, at a news conference in Zagreb today.

ZAGREB, September 18, 2019 - Representatives of the Franak association, which brings together holders of loans originally indexed to the Swiss franc, said on Wednesday that the Supreme Court ruling of Tuesday constituted the final victory in their class action against eight banks and that by June 2023 more than 100,000 citizens were expected to sue banks over unfair terms regarding the currency clause in their loan contracts.

Explaining its ruling, the Supreme Court said on Tuesday that the eight sued banks had breached the collective interests and rights of holders of loans originally pegged to the Swiss franc.

The court reported that it had refused a motion by the banks for a review of the case in which the Croatian Consumer Protection Association sued eight domestic banks to protect their collective interests and rights.

"We have finally proved that we are right. We have won and now 125,000 people can sue banks, 30,000 have already done so, and I expect more than 100,000 lawsuits by June 2023," SNAGA party member of parliament and Franak association activist Goran Aleksić told a news conference outside the Supreme Court.

Aleksić is confident that anyone who opts to sue the banks will win, noting that the Supreme Court ruling was final and binding on all courts. "I maintain that everyone is certain to get their money back," he said.

He stressed that in the meantime the Supreme Court would have a few more things to do, primarily to decide whether loan contracts with a clause indexing loans to the Swiss franc were null and void.

Aleksić says that a ruling by the Court of the EU determined that if a currency clause was null and void, so was a contract in its entirety.

He expects that in the next few months the Supreme Court will determine that loan contracts indexing loans to the Swiss franc are null and void, in which case, he says, compensation will be 100% higher than if only interest and the currency are null and void.

He added that the Court of the EU had established beyond doubt that if contractual terms were found to be unfair and therefore null and void, restitution had to be complete.

According to information from the Finance Ministry in mid-2016, over 58,000 debtors had Swiss franc-pegged loans totalling an amount of 20.9 billion kuna. Ninety-four percent of the debtors accepted a conversion scheme and 85% of them converted their loans. The balance of CHF-denominated loans after the conversion in mid-2016 stood at 15.4 billion kuna.

More news about Swiss franc loans can be found in the Business section.

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