Banking: “Handling charges” may be illegal also in Latvia.

The German Supreme Court has ruled that the banks have no right to demand handling charges for preparing a contract with a consumer. The Court was of the opinion that its judgement is in line with the EU law, which is the basis also for Latvian consumer protection legislation.

The wording of the Latvian legislation favours consumers even more than in Germany. Therefore, it seems very likely that a Latvian court could also support the reasoning of the German Court reaching the same conclusion. With the profound argumentation as to why handling charges are illegal, the German Court also provides valuable guidelines to the banks to be able to receive similar payments from the consumers in the future.

For more information in Latvian, please see our INSIDER.

by Vairis Dmitrijevs, Head of M&A, Latvia

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