Order;Information — ECLI:EU:C:2023:1008
Date: 2023-12-18
Language of the case: Bulgarian
Court formation: Ninth Chamber
Subject matter: Consumer protection;Approximation of laws
Procedure: Reference for a preliminary ruling
Origin: Bulgaria

Summary C-231/23 – 1 
Case C-231/23 
Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court 
Date lodged: 
12 April 2023 
Referring court: 
Sofiyski rayonen sad (Bulgaria) 
Date of the decision to refer: 
12 April 2023 
Applicant: 
‘Eurobank Bulgaria’ AD 
Debtors: 
  
Subject matter of the case in the main proceedings 
The main proceedings were initiated by means of an application to the referring 
court from a bank (‘the applicant’) requesting the issue of an immediately 
enforceable order for payment on the basis of which it can directly collect the 
amounts that it is seeking to recover from two of its debtors. The application is 
based on an extract provided by the applicant from its accounting ledgers. In 
support of its application, it invokes the force of res judicata of a judgment by 
which a court partially upheld its action against the same debtors in respect of a 
loan agreement. 
Subject matter and legal basis of the request 
This request for a preliminary ruling is based on the first paragraph of Article 267 
TFEU and concerns the interpretation of Article 6(1) and Article 7(1) of Directive 
93/13/EEC of 5 April 1993 on unfair terms in consumer contracts. The question is 
whether a judgment by which a court has partially upheld an action arising from a 
loan agreement which may contain unfair terms has the force of res judicata not 
only as regards the part of the claim on which the court has ruled, but also as 
regards the part which has not yet been asserted in proceedings and in respect of 
EN 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-231/23 
 
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which the applicant has applied to the referring court for permission to proceed 
with immediate enforcement before the debtors can lodge an objection. 
Questions referred for a preliminary ruling 
1. Under Article 6(1) and Article 7(1) of Directive 93/13/EEC of 5 April 1993 on 
unfair terms in consumer contracts, 
is national case-law permissible under which, where only part of a claim arising 
from a consumer contract which may contain unfair terms has been the subject 
matter of a judgment which has become final and acquired the force of res 
judicata, the conclusion of the court which delivered it, according to which the 
contractual terms are binding on the consumer and not unfair, is to bind the courts 
hearing subsequent applications for orders requiring the consumer to pay the 
balance of his or her debt with regard to whether that balance is due? 
2. If the answer to the first question is in the affirmative (that is, if that national 
case-law is permissible under EU law), is it compatible with Article 6(1) and 
Article 7(1) of Directive 93/13/EEC 
if, although the judgment finding that there are no unfair terms does contain a 
statement of reasons on that point, that statement of reasons is nevertheless [not] 
sufficiently clear or related to the specific contractual terms? On the basis of what 
criterion should the national court assess the completeness of the statement of 
reasons in the second set of proceedings? 
Provisions of EU legislation and case-law cited 
Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts, 
Article 6(1) and Article 7(1) 
Judgments of 1 October 2015, ERSTE Bank Hungary, C-32/14, EU:C:2015:637; 
of 20 September 2017, Andriciuc, C-186/16, EU:C:2017:703; of 4 June 2009, 
Pannon GSM, C-243/08, EU:C:2009:350; of 17 May 2022, SPV Project 1503 and 
Others, C-693/19 and C-831/19, EU:C:2022:395; and of 17 May 2022, Ibercaja 
Banco, C-600/19, EU:C:2022:394 
Provisions of national legislation and case-law cited  
Zakon za zadalzheniata i dogovorite (Law on obligations and contracts), 
Articles 26, 34 and 55 
Grazhdanski protsesualen kodeks (Code of civil procedure), Articles 6, 7, 232, 
296 to 299, 246, 410, 411, 413 to 416, 419, 420 and 423 
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Zakon za zashtita na potrebitelite (Law on consumer protection), Articles 143, 
144, 146 and 147 
Interpretative Ruling No 4/2013 of 18 June 2014 of the Obshto sabranie na 
grazhdanskata i targovskata kolegii na Varhoven kasatsionen sad (Joint Assembly 
of the Civil and Commercial Chambers of the Supreme Court of Cassation; ‘the 
JACCC of the VKS’) in Interpretative Case No 4/2013, paragraph 2b; 
Interpretative Ruling No 3/2016 of 22 April 2019 of the JACCC of the VKS in 
Interpretative Case No 3/2016, paragraph 2; Judgment No 236/20.12.2016 of the 
Varhoven kasatsionen sad (Supreme Court of Cassation, Bulgaria; ‘the VKS’) in 
Commercial Case No 3082/2015; Judgment No 165/02.12.2016 of the VKS in 
Commercial Case No 1777/2015 
Succinct presentation of the facts and procedure  
1 By a loan agreement concluded on 7 June 2012 for the refinancing of an earlier 
loan liability by the applicant, the two debtors accepted payment of a sum of 
EUR 53 642 from the applicant, which they received, however, in Swiss francs 
(CHF), specifically CHF 64 423.48, and undertook to repay that sum in 
264 monthly instalments. The liability is based on a previous loan in Swiss francs 
on which amounts are still outstanding. The loan of 7 June 2012 is secured by a 
second mortgage on immovable property already mortgaged in favour of the 
applicant. 
2 The loan agreement provides that the amount received must be repaid by the 
debtors at variable rates of interest. For the first year, the interest rate is 6.5% per 
annum, and for the period after the first year, the interest rate is determined by a 
reduction of 1.45 percentage points on the applicant’s base interest rate (‘the 
BIR’) each year. Under that agreement, the BIR is reviewed on a monthly basis 
and determined by an organ of the bank which, although the manner has not been 
specified in any way, ‘reflects’ various indicators including ‘the market interest 
rates (reference rates) (Sofibor, Juribor, Libor), the risk premium applicable to 
Bulgaria when obtaining finances, […] the assessment of the risk for the most 
creditworthy clients in the form of an interest rate premium’. The case file 
contains no indication as to what the reference rate is and how the risk premium is 
determined, how the assessment is carried out and how the indicators are actually 
weighted. 
3 Under the loan agreement, the debtors are additionally liable for a monthly special 
fee if payments are late, which essentially constitutes a contractual penalty. If the 
debtors repay the loan early with their own funds, they are not liable for any fees. 
If, however, they decide to repay it with funds from another financial institution, 
they are required to pay the applicant 4% of the capital amount repaid early. 
4 Under an addendum which the debtors concluded with the applicant on 28 March 
2013, their liabilities are no longer determined in Swiss francs but in euros. It was 
agreed that the interest on the loan would be reduced by 4.06 percentage points for 
SUMMARY OF THE REQUEST FOR A PRELIMINARY RULING – CASE C-231/23 
 
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four months, but that the debtors would thereafter pay an increased interest rate, 
so that the annual effective interest rate would correspond to the BIR less 1.36 
percentage points and not, as in 2012, to the BIR less 1.45 percentage points. 
5 On 30 August 2013, a new addendum was concluded according to which the 
capital amount owed, including arrears, amounted to EUR 54 557.25 on that date, 
which was higher than the original amount of EUR 53 642. The level of the 
effective interest rate was determined according to a new formula with the 
introduction of the applicant’s prime reference rate, calculated following a method 
which is explained in more detail, using a mathematical formula in which each 
element has a given weight. 
6 In March 2018, the applicant established that there was serious defaulting on the 
liabilities arising from the loan on the part of the debtors and called in the entire 
loan early. The demand for payment was served on the debtors on 12 April 2018, 
and the entire claim became due on that date. Following the early calling-in of the 
loan, the applicant initiated legal proceedings to recover the debt. An immediately 
enforceable order for payment for part of the claim was issued, which the debtors 
contested. 
7 Substantive proceedings were brought before the Sofiyski gradski sad (Sofia City 
Court) to clarify whether the claimed part of the loan was due. In the course of 
those proceedings, the debtors declared that they had repaid the loan and that, due 
to the immediate enforceability, the mortgaged property had been sold, with the 
result that the debt had been settled. By judgment of 30 December 2021, the Sofia 
City Court held that, at the time when the immediately enforceable order for 
payment was issued, the debtors had been liable for the claimed part of the loan 
liabilities. 
8 An appeal was brought against the judgment of the Sofia City Court before the 
Apelativen sad Sofia (Court of Appeal, Sofia). By their appeal, the debtors 
claimed that the court of first instance ought to have examined whether the loan 
granted on 7 June 2012 constituted repayment of a liability arising from an earlier 
loan agreement containing unfair terms. Their argument concerning the unfairness 
of the terms referred only to the loan agreement of 7 June 2012 and not to the 
earlier agreement. By judgment of 16 November 2022, the Court of Appeal 
upheld the judgment at first instance in its entirety, finding that there were no 
unfair terms and that the claim was justified in its entirety. 
9 The debtors did not appeal against the judgment to the VKS, though this would 
have been possible. 
The essential arguments of the parties in the main proceedings 
10 The applicant has applied to the referring court to issue an immediately 
enforceable order for payment against the two debtors on the basis that the 
judgment of the Sofia Court of Appeal of 16 November 2022, which has become 
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final, is res judicata. It submits that this appeal judgment established that the 
terms of the loan agreement in their entirety were not unfair, although only a part 
of its claims has been satisfied. It refers to the case-law of the VKS, according to 
which, it submits, the courts in order-for-payment proceedings initiated by the 
application for an immediately enforceable order for payment on the basis of a 
document – in the present case, the extract from the applicant’s accounting 
ledgers – must assess solely on the basis of the submitted document whether to 
permit enforcement. The referring court, it submits, should therefore not examine 
further whether the terms of the agreement are binding on the debtors/consumers. 
11 The debtors are not yet a party to the order-for-payment proceedings pending 
before the referring court, as this becomes the case only after the order for 
payment applied for has been issued. 
Succinct presentation of the reasoning in the request for a preliminary ruling 
12 The referring court bases its request on judgments in which the Court of Justice 
examined the relationship between, on the one hand, the protection of consumers 
against the effects of unfair terms and, on the other, the limits imposed by national 
procedural law on account of the force of res judicata of national judgments. To 
rule on the dispute in the main proceedings, it considers it necessary to interpret 
Article 6(1) and Article 7(1) of Directive 93/13. 
13 In that regard, the referring court recalls that, according to the judgment of the 
Court of Justice of 17 May 2022 in SPV Project 1503 and Others (C-693/19 and 
C-831/19, EU:C:2022:395), the national court’s obligation to examine of its own 
motion whether terms in a consumer contract are unfair remains in place even 
where national procedural law, in certain cases, prohibits a subsequent review of 
the validity of a contract by reason of the force of res judicata of a national 
judgment. The Court’s judgment was delivered in the context of an order for 
payment which was issued and not contested, whereas, in the present case, which 
is the subject matter of the proceedings before the referring court, a partial action 
had already been brought. The question arises as to whether the interpretation 
made by the Court of Justice in that judgment can be applied to the main 
proceedings here. 
14 The referring court is unclear in particular as to whether the loan agreement of 
7 June 2012 does not contain unfair terms in relation to the manner of setting the 
interest rate and the amount to be repaid, which was initially determined in Swiss 
francs and later converted into euros. 
15 According to national case-law, the validity of a term allowing a bank to alter 
unilaterally the price of a contract in view of changes in the interest rate is 
conditional on the term being clear, containing a methodology for alterations in 
connection with changes in the interest rate, and satisfying the requirement of 
good faith. 
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16 Under Article 143(1) of the Law on consumer protection, a term which creates a 
significant imbalance between the rights and obligations of the seller or supplier 
and those of the consumer does not satisfy the requirement of good faith. For 
example, a term providing only for the possibility of increasing the price of a 
financial service if the interest rate increases without taking into account the 
possibility of reducing it according to the same methodology in the event of a fall 
in the interest rate could lead to unjust enrichment of the seller or supplier at the 
expense of the consumer. 
17 However, if the interpretation advocated by the applicant were accepted, the 
referring court would not be in a position to review the loan agreement of 7 June 
2012 for unfair terms. The referring court asks whether such an interpretation of 
national procedural law is not contrary to EU law and whether it is compatible 
with the obligation imposed on national courts by EU law to set aside unfair terms 
in consumer contracts of their own motion (see judgment of 4 June 2009, Pannon 
GSM, C-243/08, EU:C:2009:350). 
18 According to the settled case-law of the Court of Justice, national rules on res 
judicata cannot be applied if they render ineffective Article 6(1) of Directive 
93/13, which provides that consumers must not be bound by unfair terms in 
contracts concluded with them (see judgments of 17 May 2022, SPV Project 1503 
and Others, C-693/19 and C-831/19, EU:C:2022:395, paragraphs 60 to 63, and 
Ibercaja Banco, C-600/19, EU:C:2022:394, paragraphs 44 to 47). 
19 At the same time, application of the principle of effective protection for the 
consumer’s rights must not preclude preservation of the force of res judicata, 
meaning that it must not be stretched so far as to make up fully for total inertia on 
the part of the consumer concerned (see judgment of 1 October 2015, ERSTE 
Bank Hungary, C-32/14, EU:C:2015:637, paragraph 62). In this respect, the 
examination of the unfairness of terms in consumer contracts is in principle 
binding on the courts if it has been carried out in proceedings which produce the 
force of res judicata and if the assessment of unfairness is accompanied by 
reasons which have been brought to the attention of the consumer (see judgment 
of 17 May 2022, SPV Project 1503 and Others, C-693/19 and C-831/19, 
EU:C:2022:395, paragraphs 65 and 66). 
20 The referring court is uncertain whether that principle can be applied to national 
case-law under which the force of res judicata attaching to a judgment granting 
part of a sum of money extends to the remainder of the unpaid sum claimed from 
the consumer in subsequent legal proceedings. 
21 In its view, the unfairness of a term relating to a cumulative liability, the amount 
of which is not fully determined, but can be determined only via the medium of 
other liabilities, such as interest liabilities, does not concern the basis of the claim 
for interest as such, but only the question of the amount of interest accrued and, 
therefore, of the amount of interest to be paid. Therefore, if such an assessment is 
made, this should not stand in the way of a reassessment of unfairness. 
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22 Furthermore, in the context of the judgment of the Court of Justice of 17 May 
2022 in SPV Project 1503 and Others (C-693/19 and C-831/19, EU:C:2022:395), 
the question arises as to the clarity of the binding statement of reasons given by 
the court which delivered the final judgment against the consumer. It follows from 
the case-law that the force of res judicata cannot be acquired in the absence of 
such a statement of reasons or ‘at least summary’ considerations (see judgment of 
17 May 2022, Ibercaja Banco, C-600/19, EU:C:2022:394, paragraph 51). 
23 The referring court has doubts as to the existence of such a summary statement of 
reasons in the judgment of the Sofia Court of Appeal, given that that court did not 
address either the issue of the currency of the loan granted or the debtor’s request 
for examination of the unfairness of the terms of the earlier loan agreement which 
the later agreement was intended to refinance. It is not clear what criteria should 
be applied in order to determine whether the statement of reasons relating to the 
unfairness of certain terms is of a ‘summary’ nature and whether each potentially 
unfair term must be the subject of a separate statement of reasons or whether it is 
sufficient merely to examine them together.