Opinion of the Advocate General — ECLI:EU:C:2026:420
Date: 2026-05-21
Language of the case: Latvian

Summary C-242/25 – 1 
Case C-242/25 
Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court of Justice 
Date lodged:  
31 March 2025 
Referring court:  
Satversmes tiesa (Latvia) 
Date of the decision to refer: 
31 March 2025 
Applicants: 
S 
T 
AS SEB banka 
Institution responsible for the measure the constitutionality of which is called 
into question: 
Latvijas Republikas Saeima (Parliament of the Republic of Latvia) 
      
Subject matter of the main proceedings 
Assessment of the conformity of the support mechanism available to mortgage 
borrowers under Article 8.4 of the Patērētāju tiesību aizsardzības likums (Latvian 
Law on Consumer Rights Protection) with Article 1 of the Satversme (Latvian 
Constitution), with the principle of equality before the law enshrined in the first 
sentence of Article 91 thereof and with the right to property guaranteed by the first 
to third sentences of Article 105 thereof. 
Subject matter and legal basis of the request 
The referring court asks, on the basis of Article 267 TFEU, how Article 127(4) 
TFEU and Article 4 of Council Decision 98/415/EC (‘the Council Decision’) are 
to be interpreted from the point of view of the obligation to consult the ECB at an 
EN 
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appropriate stage, the principle of the primacy of EU law and the principle of legal 
certainty as to the consequences of a failure to fulfil that obligation. 
Questions referred for a preliminary ruling 
(1) Must Article 127(4) of the Treaty on the Functioning of the European Union 
and Article 4 of Council Decision [98/415/EC] be interpreted as meaning that the 
obligation which that provision imposes on the authority of a Member State to 
consult the European Central Bank at an appropriate stage is fulfilled in the case 
where the parliament of a Member State adopts a law before receiving the opinion 
of the European Central Bank but there is a procedure whereby that law may be 
the subject of a second examination in parliament before it is enacted and enters 
into force? 
(2) If the first question is answered in the negative, is an infringement of 
Article 127(4) of the Treaty on the Functioning of the European Union and 
Article 4 of Council Decision [98/415/EC] to be regarded as constituting a 
substantial procedural defect rendering the provisions of national law adopted in 
breach of EU law inapplicable? 
(3) If the second question is answered in the affirmative, are the principles of 
the primacy of EU law and legal certainty to be interpreted as meaning that the 
Satversmes tiesa (Constitutional Court, Latvia) may decide in the judgment it 
gives that the legal effects of the contested provisions must be maintained during 
period for which they were in force? 
Provisions of European Union law relied on 
Treaty on the European Union: first and third subparagraphs of Article 4(3) 
Treaty on the Functioning of the European Union: Article 127(4) and the fifth 
paragraph of Article 288 
Protocol (No 4) on the Statute of the European System of Central Banks and of 
the European Central Bank: Article 4 
Council Decision 98/415/EC of 29 June 1998 on the consultation of the European 
Central Bank by national authorities regarding draft legislative provisions: 
recitals 3 and 6 and Articles 3(1), (2) and (4) and 4 
Case-law of the Court of Justice and the General Court 
Judgment in Case C-11/00, Commission v ECB, of 10 July 2003, EU:C:2003:395, 
paragraph 110 
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Judgment in Case C-159/00, Sapod Audic, of 6 June 2002, EU:C:2002:343, 
paragraph 49 
Judgment in Case C-158/06, ROM-projecten, of 21 June 2007, EU:C:2007:370, 
paragraph 24 
Judgment in Case C-316/19, Commission v Slovenia (ECB archives), of 
17 December 2020, EU:C:2020:1030, paragraph 80 
Judgment in Case C-275/00, First and Fanex, EU:C:2002:711, of 26 November 
2002, paragraph 49 
Judgment in Case T-107/17, Steinhoff and Others v ECB, of 23 May 2019, 
EU:T:2019:353, paragraph 71 
Provisions of national law relied on 
Latvijas Republikas Satversme (Constitution of the Republic of Latvia, ‘the 
Constitution’): Article 64, which provides that the right to legislate lies with the 
Latvian Parliament and people in accordance with the procedures and to the extent 
laid down in the Constitution; Article 70, under which the State President is to 
enact laws by means of the following formula: ‘Parliament (acting in 
representation of the people) has enacted the following Law: (text of the law)’ and 
Article 71, which provides for the right of the State President to request a second 
examination of a law. 
Saeimas kārtības rullis (Rules of Parliamentary Procedure): Article 114, which 
provides in particular that a draft law is to become law once it has undergone three 
readings. 
Patērētāju tiesību aizsardzības likums (Law on Consumer Rights Protection): 
Article 8.4 
Succinct presentation of the facts and procedure in the main proceedings 
1 In the light of the considerable burden borne by households resulting from the 
increase in loan repayments and consumer prices driven by the rise in the 
EURIBOR rate and inflation, a draft law entitled ‘Grozījumi Patērētāju tiesību 
aizsardzības likumā’ (Amendment to the Law on Consumer Rights Protection; 
‘the draft Law’) was presented to the Latvian Parliament on 6 October 2023. That 
draft Law was intended to supplement Article 8.4 of the aforementioned Law by 
including in it a mechanism to support mortgage borrowers. The Latvian 
Parliament appointed the Budžeta un finanšu (nodokļu) komisija (Budget and 
Finance (Taxation) Committee; ‘the Budget Committee’) as the responsible 
committee. 
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2 The draft Law was examined in three parliamentary readings and debated in 13 
Budget Committee meetings attended by representatives of the public 
administrations and institutions representing the sector concerned. The versions of 
the draft Law adopted at the various meetings were different from each other. 
3 On 30 November 2023, the Budget Committee examined the draft Law ahead of 
its final (third) reading and approached the European Central Bank (ECB) with the 
version of the draft Law proposed prior to the third reading and a request for it to 
deliver an opinion on that version. 
4 On 6 December 2023, without waiting for the ECB’s opinion, the Latvian 
Parliament approved the likums “Grozījumi Patērētāju tiesību aizsardzības 
likumā” (Law amending the Law on Consumer Rights Protection; ‘the Law’) on 
its third reading and sent it to the State President for enactment. Under Article 71 
of the Constitution, the State President may, within a period of 10 days from the 
adoption of a law by parliament, request by reasoned letter addressed to the 
speaker of parliament that the law in question undergo a second examination. If, 
however, parliament does not amend the law in question, the State President may 
not raise objections a second time. 
5 On 11 December 2023, the ECB adopted and published an opinion on the 
temporary mortgage borrower protection fee payable by credit institutions 
(CON/2023/42). 
6 On 20 December 2023, the ECB’s opinion was discussed at a meeting of the 
parliamentary Budget Committee, which was also attended by representatives of 
the public administrations and institutions representing the sector concerned. On 
20 December 2023, the State President enacted the Law, which entered into force 
on 1 January 2024. In this way, Article 8.4 was added to the Law on Consumer 
Rights Protection. 
7 Under that article, credit institutions and some other institutions active in 
consumer credit (‘the fee payers’) were obliged to pay a tax known as the 
mortgage borrower protection fee (‘the fee’). At the same time, that article 
provided for interest rate compensation, payable to mortgage borrowers meeting 
the requirements which it laid down and covering part of the interest rate paid by 
them. The fee payers were obliged to calculate the compensation due to each 
eligible mortgage borrower and to forward that information to the Valsts 
ieņēmumu dienests (State Revenue Service; ‘the VID’). The VID paid the 
compensation into the accounts of the borrowers concerned once a quarter from 
the revenue derived from the fee. 
8 The scheme provided for in the Law was applied until 31 December 2024. 
9 A bank and two natural persons brought before the Satversmes tiesa actions in 
which they claimed that that scheme was unconstitutional. 
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The essential arguments of the parties in the main proceedings 
10 The applicant, AS SEB banka, claims that Article 8.4(2), (3), (4), (5), (6), (10), 
(11), (12), (13) and (15) of the Law on Consumer Rights Protection and point 43 
of its transitional provisions (‘the contested provisions’) are not in conformity 
with Article 1 of the Constitution or with the first three sentences of Article 105 
thereof. It submits that the contested provisions limit the right to property which it 
is guaranteed under the first three sentences of Article 105 of the Constitution, 
since they impose on it an obligation to pay a certain amount to the State budget, 
and also restrict its right to obtain performance of the contract as stipulated. It 
goes on to say that the act of subjecting it to the obligation to calculate and 
manage the payment of fees and compensation constitutes a restriction of its 
business activity, which is also considered to be the subject the right to property 
within the meaning of Article 105 of the Constitution. In the opinion of SEB 
banka, a limitation of the right to property is not provided for by law, since the 
legislature infringed the principle of the proper enactment of legislation. In 
particular, it considers that the Latvian Parliament failed to fulfil its obligation to 
consult the ECB about the scheme contained in the Law at an appropriate stage 
before adopting the Law, as required by Article 127(4) TFEU, the fifth paragraph 
of Article 288 TFEU, Article 4 of Protocol No 4 to the TFEU and Articles 2(1) 
and (4) of the Council Decision. SEB banka considers the scheme contained in the 
Law to be one of a kind throughout the European Union and that, consequently, 
adopting the Law before seeking the opinion of the ECB constitutes a serious 
infringement amounting to a breach of procedure. 
11 The applicants, natural persons S and T, consider that Article 8.4(10), point 2, 
of the Law on the Consumer Rights Protection (also ‘the contested provision’) is 
not in conformity with the first sentence of Article 91 of the Constitution. 
12 S and T are spouses and consumers who, in the period up to 31 October 2023, 
concluded a variable-rate mortgage loan agreement with a credit institution. In 
2024, the balance outstanding on their loan was in excess of EUR 250 000 and, 
consequently, the contested provision prevented them from receiving 
compensation. 
13 According to S and T, all consumers with a current variable-rate mortgage loan 
concluded with a fee payer prior to 31 October 2023 are in an identical and 
comparable situation according to certain criteria. In their view, the contested 
provision establishes a difference in the treatment of borrowers of mortgage loans 
the balance outstanding on which is in excess of EUR 250 000. 
14 S and T submit that that difference in treatment is not imposed by a legislative 
provision adopted in accordance with the legally prescribed procedure, since the 
principle of the proper enactment of legislation has been infringed. In their 
contention, the Latvian Parliament failed to fulfil its obligation to consult the ECB 
about the scheme provided for before it adopted the contested provisions. 
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15 The institution responsible for the measure the constitutionality of which is 
called into question, that is to say the Latvian Parliament, considers that the 
contested provisions are compatible with Article 1 and the first three sentences of 
Article 105 of the Constitution and that the contested provision is compatible with 
the first sentence of Article 91 thereof. It takes the view that the principle of the 
proper enactment of legislation was not infringed during the first stage of 
examining the draft Law and that the Law was adopted in accordance with the 
legally prescribed procedure. 
16 According to the Latvian Parliament, the process for adopting the contested 
provisions does not exhibit any infringement of EU law. In its view, the Latvian 
Parliament fulfilled the obligation imposed on Member States to consult the ECB 
at the time of adopting the draft Law, since it approached the ECB when the draft 
Law was endorsed by the Budget Committee prior to its third reading. Although 
the ECB’s opinion was received after the Law had been adopted, the content of 
that opinion was examined at a Budget Committee meeting and the legislature had 
the opportunity to take that opinion into account and, if necessary, to propose 
amendments to the Law. However, the legislature did not consider it expedient or 
essential to recognise the recommendations expressed in the opinion as being 
relevant and valid vis-à-vis Latvia’s situation or to incorporate them into the 
scheme provided for in that Law. Furthermore, after being informed of the content 
of the opinion, the State President did not exercise his right under the Constitution 
not to enact the Law and to refer it back to parliament for a second examination. 
The Latvian Parliament also notes that a comparison of that opinion with other 
ECB opinions on measures to protect mortgage borrowers in EU Member States 
reveals a high degree of similarity in the content of the observations contained in 
them. In the view of the Latvian Parliament, the obligation to consult the ECB is 
of crucial importance in cases involving the introduction of a scheme on which the 
ECB has not previously commented. The Latvian Parliament points to the fact 
that, since the ECB’s opinion is advisory in nature, the application of the 
recommendations it contains is not legally binding on the Member States. 
Succinct presentation of the reasoning in the request for a preliminary ruling 
17 The Latvian Parliament recognised during the examination of the draft Law, and 
the ECB stated in its opinion, that the contested provisions fell within the 
competence of the ECB within the meaning of Article 2(1) of the Council 
Decision, with the result that, when adopting the contested provisions, the Latvian 
Parliament should have fulfilled the obligation to consult the ECB laid down in 
Article 127(4) TFEU. Furthermore, in accordance with Article 4 of the Council 
Decision, that obligation was to be fulfilled at an appropriate stage, that is to say 
one enabling the ECB’s opinion on the draft legislative provision to be taken into 
consideration before a decision was taken on the substance of that draft. The 
applicants consider that the Latvian Parliament failed to fulfil that obligation and 
that, consequently, the contested provisions were not adopted in accordance with 
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the legally prescribed procedure and the principle of the proper enactment of 
legislation was infringed. 
18 In order to determine whether limiting the right to property may be regarded as 
justified, the Satversmes tiesa must examine whether that limitation was 
prescribed by a legislative provision adopted in accordance with the correct 
procedure, and with due regard for the principle of the proper enactment of 
legislation. Similarly, in assessing whether the legislation with which the dispute 
is concerned complies with the principle of equality before the law, the 
Satversmes tiesa examines whether the equality or inequality of treatment was 
established by a law adopted in accordance with the appropriate procedure, and 
with due regard for the principle of the proper enactment of legislation. In 
accordance with the principle of the proper enactment of legislation, the 
legislature must assess whether the provisions laid down in a draft law are in 
conformity with higher-ranking provisions, including the Constitution, 
international law and EU law. 
19 Consequently, in order to assess the compatibility of the contested provisions with 
the Constitution, it is necessary to interpret the obligation imposed on the national 
authority to consult the ECB at an appropriate stage, laid down in Article 127(4) 
TFEU and Article 4 of the Council Decision. Of particular relevance is how to 
interpret the obligation to consult the ECB at an appropriate stage within the 
meaning of EU law and, in the event that that obligation has not been fulfilled, 
how the failure to fulfil it affects the validity of the contested provisions. 
20 The Satversmes tiesa has doubts as to whether the provisions of Article 127(4) 
TFEU and Article 4 of the Council Decision were complied with in the process of 
adopting the Law. In particular, it is uncertain whether the obligation to consult 
the ECB at an appropriate stage must be regarded as having been fulfilled in the 
process of adopting the Law. 
21 The objective of the European System of Central Banks (ESCB) is to maintain 
price stability in the European Union and support the general economic policies 
there with a view to contributing to the achievement of the objectives of the Union 
(see Article 2 of Protocol No 4 to the Treaty on the European Union ‘on the 
statute of the European System of Central Banks and of the European Central 
Bank’). Article 127(2) TFEU provides that the basic tasks to be carried out 
through the ESCB include, inter alia, that of defining and implementing the 
monetary policy of the Union. Through the ESCB, such tasks are thus the 
responsibility not only of the ECB but also of the national central banks. Close 
cooperation between the ECB and the latter is therefore required (see the 
judgment of the Court of Justice of 17 December 2020 in Case C-316/19, 
Commission v Slovenia, paragraph 80). 
22 The first subparagraph of Article 4(3) TFEU provides that, pursuant to the 
principle of sincere cooperation, the Union and the Member States must, in full 
mutual respect, assist each other in carrying out tasks which flow from the 
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Treaties. For its part, the third subparagraph of paragraph 3 of that article provides 
that the Member States are to facilitate the achievement of the Union’s tasks and 
refrain from any measure which could jeopardise the attainment of the Union’s 
objectives. The Satversmes tiesa has stated that the principle of since cooperation 
on the part of the Member States, enshrined in that article, imposes on the 
Member States a negative obligation to refrain from carrying out any action 
capable of adversely affecting the interests of the European Union. The principle 
of since cooperation not only requires the Member States to take all the measures 
necessary to guarantee the application and effet utile of EU law, but also imposes 
mutual duties of sincere cooperation on the Member States (see the judgment of 
the Court of Justice of 26 November 2002 in Case C-275/00, First and Franex, 
paragraph 49). 
23 Thus, the obligation on Member States, pursuant to the principle of sincere 
cooperation, to facilitate the achievement of the Union’s tasks and refrain from 
any measure which could jeopardise the attainment of the Union’s objectives also 
entails an obligation on the part of the Member States to cooperate with the ECB 
by consulting it on any legislative provision of the Member State that falls within 
the competence of the ECB. 
24 Article 127(4) imposes on the authorities of the Member States an obligation to 
consult the ECB. Furthermore, Article 4 of the Council Decision provides that the 
national authorities have an obligation to consult the ECB at an appropriate stage 
enabling the authority initiating the draft legislative provision to take into 
consideration the ECB’s opinion before taking its decision on the substance of that 
draft. Recital 6 of the Council Decision, which clarifies the provisions of that 
decision, provides that consultation of the ECB must not unduly lengthen 
procedures for adopting legislative provisions in the Member States, but the time 
limits within which the ECB must deliver its opinion must enable it to examine 
the texts referred to it with the required care. In accordance with Article 3(1) of 
the Council Decision, the time limit for issuing a general opinion is one month, 
whereas paragraph 2 of that article provides that, in case of extreme urgency, the 
time limit may be reduced and, in that event, the consulting authority must state 
the reasons for the urgency. 
25 The ECB has drafted a Guide to consultation of the European Central Bank by 
national authorities regarding draft legislative provisions (available at: 
ecb.europa.eu; ‘the ECB Guide’) Section 4.1 of the ECB Guide clarifies the 
obligation to consult at an appropriate stage and states ‘the ECB must be 
consulted “at an appropriate stage” in the legislative process’. That section further 
states that consultation of the ECB during the legislative process must take place 
at a point which affords the ECB sufficient time to examine the draft legislative 
provisions, including the time necessary to translate them, and to adopt its opinion 
in the language required. Section 4.1 of the ECB Guide also makes it clear that 
Article 3(4) of the Council Decision, which provides for the consequences in the 
event that a national authority has not received the ECB’s opinion at an 
appropriate stage, must be understood as meaning that the national authority must 
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suspend the adoption of the draft law until it has received the ECB’s opinion. 
Section 3.1.2 of the ECB Guide also contains a segment on the participation of 
national parliaments. This states that it is for the national parliaments to decide on 
the basis of their rules of procedure how to comply with the obligation to submit a 
draft law for the ECB’s opinion. 
26 Thus, on the one hand, the obligation to consult the ECB at an appropriate stage 
within the meaning of Article 127(4) TFEU and Article 4 of the Council Decision 
could be interpreted as meaning that the competent authority of a Member States 
must approach the ECB at the earliest possible stage in the legislative process in 
accordance with the national legislation on legislative procedure. This is intended 
to ensure that the competent authority is aware of the ECB’s opinion prior to the 
adoption of the legislation in question and that the ECB’s observations can be 
examined at the time when the legislation is adopted. 
27 Article 64 of the Constitution provides that, under the Latvian constitutional 
system, parliament has legislative power and adopts laws. Consequently, the 
Latvian Parliament has to be regarded as a national authority within the meaning 
of Article 127(4) for the purposes of the adoption of laws. It follows from the facts 
of the present case that the Budget Committee contacted the ECB before the 
contested provisions were adopted, but that the ECB’s opinion was received five 
days after those provisions were adopted. It might therefore be concluded that the 
obligation to consult the ECB at an appropriate stage within the meaning of 
Article 127(4) TFEU and Article 4 of the Council Decision was not fulfilled in the 
process of adopting the contested provisions. 
28 However, it is important to bear in mind in the present case that, although the 
ECB’s opinion was received after the contested provisions had been adopted, that 
opinion was examined at a meeting of the Budget Committee on 20 December 
2023. Furthermore, the contested provisions had not yet been enacted or entered 
into force at the time when the ECB’s opinion was received. For his part, the State 
President has the right under Article 71 of the Constitution to request a second 
examination of a law within a period of ten days from the adoption of that law by 
parliament by sending a reason letter to the speaker of parliament. If the State 
President exercises his right to request a second examination of a law, that law is 
sent back to parliament for re-examination and enactment of that law is deferred 
until parliament has given a second opinion on its adoption. The State President 
may justify the need for a second examination on both legal grounds and grounds 
of expediency. 
29 On the other hand, Article 127(4) TFEU and Article 4 of the Council Decision 
could therefore be interpreted as meaning that the obligation on the national 
authorities to consult the ECB at an appropriate stage is fulfilled if the parliament 
of a Member State adopts a law before obtaining the ECB’s opinion but the 
national legislation allows that law to undergo a second examination in parliament 
before being enacted and entering into force. In the light of the foregoing, the 
Satversmes tiesa concludes that how Article 127(4) TFEU and Article 4 of the 
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Council Decision are to be interpreted and correctly applied in the present factual 
and legal circumstances is not so obvious as to leave no room for reasonable 
doubt. Furthermore, to date, the Court of Justice has not interpreted those 
provisions. 
30 The Satversmes tiesa has doubts as to whether, in the event of a failure to fulfil the 
obligation to consult the ECB at an appropriate stage within the meaning of 
Article 127(4) TFEU and Article 4 of the Council Decision, that failure is to be 
regarded as an infringement of EU law rendering the legislative provisions 
adopted by a Member State inapplicable. 
31 The Satversmes tiesa has repeatedly held in its case-law that not every 
infringement of parliamentary procedure is a sufficient ground for the act adopted 
to be regarded as lacking legal validity. In order for an act to be capable of being 
declared void for infringement of parliamentary procedure, there must be 
reasonable doubt as to whether parliament would have taken the same decision if 
the procedure had been followed. After all, a rule of law may be regarded as 
illegal only if there has been a substantial procedural defect. 
32 To date, the case-law of the Court of Justice has not clarified the consequences for 
the applicability of legislation enacted by a Member State that would be attendant 
upon a failure to fulfil the obligation to consult the ECB at an appropriate stage. 
However, the Court of Justice has analysed the obligation of EU institutions to 
consult the ECB and has held that the obligation to consult the ECB, provided that 
the proposal in question concerns the adoption of an act falling within the latter’s 
field of competence, is intended essentially to ensure that the author of the act in 
question does not adopt it without having heard the body which, by virtue of the 
specific functions that it exercises in the Community framework in the area 
concerned, in which it is regarded as having a high degree of expertise, is 
particularly well placed to play a useful role in the process of adopting the act in 
question (see the judgment of the Court of Justice in Case C-11/00 Commission v 
ECB, paragraph 110). 
33 In the view of the Satversmes tiesa, the lessons learned from the case-law of the 
Court of Justice concerning consultation between the EU institutions could also be 
applied to the obligation of the national authorities to consult the ECB and could 
thus support the conclusion that the process of consultation by the national 
authorities is intended to ensure the quality of the decisions adopted and the 
conformity of the national legislation with the monetary policy and financial 
stability objectives laid down by the European Union. What is more, the 
obligation to consult the ECB is not regarded exclusively as an obligation arising 
from Article 127(4) TFEU and Article 4 of the Council Decision. 
34 In a broader sense, it also forms part of the principle of sincere cooperation 
enshrined in the third paragraph of Article 4 TEU, since the Member States 
cooperate with the EU institutions and listen to their point of view, while the EU 
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institutions communicate to the Member States their observations on matters over 
which they have competence. 
35 Thus, on the one hand, it might be concluded that a failure to fulfil the obligation 
to consult the ECB at an appropriate stage, in particular in the case where the 
ECB’s opinion could have changed and influenced the national legislature’s 
decision, constitutes a substantial procedural defect. 
36 On the other hand, however, the assessment of the seriousness of the defect must 
take into account that, under the fifth paragraph of Article 288 TFEU, 
recommendations and opinions are not binding. Indeed, according to recitals 3 and 
4 of the Council Decision, national authorities are required only to take those 
opinions into account, without prejudice to their responsibility for the legislation 
in question. It follows that, in order to comply with the obligation to consult the 
ECB, the ECB must be able to make its views known to national authorities, even 
though those authorities are not legally obliged to share them (see the judgment of 
the General Court of 23 May 2019 in Case T-107/17, Steinhoff and Others v ECB, 
paragraph 71). Consequently, given that, in any event, the Member State is not 
bound by the considerations contained in the ECB’s opinion, it could be 
concluded that the fact of the opinion’s not having been requested at an 
appropriate stage does not constitute a substantial procedural defect. 
37 It is therefore doubtful whether, in the event that, in the present case, there has 
been a failure to fulfil the obligation to consult the ECB within the meaning of 
Article 127(4) TFEU and Article 4 of the Council Decision, that failure must be 
regarded as a substantial procedural defect such as to render the legislative 
provisions adopted by the Member State inapplicable because adopted in a 
procedure contrary to EU law. 
38 Consequently, the Satversmes tiesa considers that, in the present case, there are 
circumstances which justify the decision to seek a preliminary ruling from the 
Court of Justice. 
39 Article 32(1) of the Satversmes tiesas likums (Law on the Constitutional Court) 
provides that a judgment given by the Satversmes tiesa is to be final and 
enforceable upon delivery. Furthermore, pursuant to paragraph 3 of that article, a 
legislative provision which the Satversmes tiesa has declared to be inconsistent 
with a higher-ranking rule of law is to be treated as void as from the day of 
publication of the judgment of that court, unless the court decides otherwise. 
40 The Satversmes tiesa also recognises in its case-law that, in a democratic State 
governed by the rule of law, there must be respect for the principle that a 
legislative provision which has not been adopted in accordance with the 
appropriate procedure is incapable of producing legal effects. However, in 
exceptional cases in which invalidating such a provision immediately would be 
more incompatible with the Constitution than maintaining it in force, it is also 
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possible to set a different point in time at which the provision in question will 
cease to be effective. 
41 In deciding the point at which a legislative provision will cease to be effective, the 
Satversmes tiesa must ensure to the extent possible that the situation that may 
arise from that point in time does not have a seriously adverse effect on the 
interests of individuals. In addition, the Satversmes tiesa must ensure that the 
retroactive effect of a judgment does not impinge substantially on the rights of 
other persons. Rather, the function of the Satversmes tiesa is to balance the 
divergent interests of the litigants to the extent that it is able to do so. 
42 Thus, when ruling on the point in time at which a legislative provision is to cease 
to be effective, the Satversmes tiesa will, on a case-by-case basis, balance the 
principle of legal certainty, on the one hand, against the fundamental rights of the 
individuals, on the other. 
43 In the light of the foregoing considerations, if, in the present case, the contested 
provisions had to be regarded as not having been adopted in accordance with the 
appropriate procedure because they infringed Article 127(4) TFEU and Article 4 
of the Council Decision, the Satversmes tiesa would have to rule on the date on 
which the contested provisions will cease to be effective. 
44 The case-law of the Court of Justice has not yet clarified the legal consequence 
deriving from a failure to fulfil the obligation to consult the ECB laid down in 
Article 127(4) TFEU and Article 4 of the Council Decision. Nonetheless, the 
Satversmes tiesa is familiar with the position which the Court of Justice has taken 
to the effect that Member States have an obligation not to apply a provision of 
domestic law adopted in breach of the obligation to notify the European 
Commission in the field of technical regulations, currently laid down in Directive 
(EU) 2015/1535 of the European Parliament and of the Council of 9 September 
2015 laying down a procedure for the provision of information in the field of 
technical regulations and of rules on Information Society services. In that context, 
the Court of Justice has stated that a failure to observe the obligation to notify laid 
down in the aforementioned directive constitutes a substantial procedural defect 
such as to render the technical regulations in question inapplicable and thus 
unenforceable against individuals (see the judgment of the Court of Justice of 
6 June 2002 in Case C-159/00, Sapod Audic, paragraph 49). It may therefore be 
concluded from the foregoing that, in such circumstances, the contested provisions 
are also inapplicable and incapable of producing legal effects, which limits the 
Satversmes tiesa when deciding on the point in time from which such provisions 
must be declared void. 
45 It may nonetheless be noted that the principle of legal certainty forms part of the 
legal order of the European Union (see, for example, the judgment of the Court of 
Justice of 21 June 2007 in Case C-158/06, ROM-projecten, paragraph 24). In the 
present case, it is important to bear in mind that the contested provisions were in 
force for a limited period of a year and are no longer applicable. If the Satversmes 
SEB BANKA 
 
13 
tiesa were to find that the contested provisions are to be regarded as having been 
void as from their adoption, SEB banka, as it was, other credit institutions and 
capital companies licensed to grant credit to consumers could seek to have the fee 
they have paid reimbursed from State funds. The total amount paid to the State 
budget in mortgage borrower protection fees by those liable for them is in excess 
of EUR 97 million. A ruling of that kind would have a considerable effect on the 
budgetary interests of the State, and would not provide legal certainty, clarity and 
peace of mind in the social field. Furthermore, the compensation provided for in 
the contested provisions was paid to high number of mortgage borrowers, which is 
to say that, in 2024, compensation calculations were carried out in respect of just 
over 90 000 mortgage loan agreements per quarter, on average. The total amount 
of compensation paid to mortgage borrowers in 2024 was just over EUR 78 
million. 
46 For the purposes of the judgment to be given in the present case, therefore, it falls 
to be determined whether, given that the contested provisions were not adopted in 
accordance with the appropriate procedure because they infringed Article 127(4) 
TFEU and Article 4 of the Council Decision, the principle of legal certainty and 
the principle of the primacy of EU law must be interpreted as meaning that the 
Satversmes tiesa may order in its judgment that the legal effects produced by the 
contested provisions while they were in force must be maintained.