Individual Protection Goals in EU Banking Regulation – A Process Towards Private Law Enforcement

Abstract

Private law remedies are an increasingly important tool in EU law to enforce its regulatory goals, which is particularly evident in the areas of competition law and capital markets law. In contrast, private enforcement of banking regulation only plays a limited role so far. This is astonishing given that the protection of individual bank customers appears to be a fil conducteur in EU banking regulation. The Capital Requirements Directive and Capital Requirements Regulation as the main legislative acts of banking regulation strongly promote the goals of depositor and investor protection. More explicitly, the Consumer Credit Directive and the Consumer Mortgage Credit Directive introduced the duty of responsible lending towards consumers. Both the individual protection goals and the duty of responsible lending mirror the importance of private enforcement in other regulatory areas of EU law for banking regulation. In the absence of clear ECJ guidance, this contribution argues that the current EU banking regulation is open for and even requires private law remedies to enforce individual protection goals. Suitable instruments include contract interpretation, contract nullity and damages.

Keywords: EU banking regulation; private law; damages; private enforcement; contract nullity; contract interpretation; EU competition law; EU capital markets law

JEL Classification: K12, K13, K21, K22, K23, K42