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ELRA Report Green Paper on Retail Financial Services in the Single Market

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ELRA Report Green Paper on Retail Financial Services in the Single Market Powered By Docstoc
					           Green Paper on Retail Finance Services in the Single Market


        The Commission invited stakeholders to make comments on the contents of the
“Green Paper on Retail Finance Services in the single Market” and to answer the
questions contained therein.


        The Green Paper refers to the importance of retail finance services in the single
market and recognizes that retail finance services integration appears not to have yet
reached its potential. The Green Paper tries to strengthen the understanding of the
problems faced by consumer and industry in this field and to establish the possibility of
further initiatives in this area.


        Considering the concept of retail finance services in the Paper (current accounts,
payments, personal loans, mortgages, saving pensions, investments and insurance
products when provided to individual customers), the questions affects ELRA when it
can imply the constitution of mortgages in order to assure the credits to customers. As
far as European land registries are concerned, the question should be referred to the
European initiatives concerning the European mortgage market, particularly to the
current preparation of a White Paper about this particular issue (end of point 4.1 of the
document).


        ELRA should remember the position of the Association expressed as the result
of consultations of the Commission or by making comments on the conclusions of
Experts Groups.


        Therefore, the Association has introduced the significance of the “lex rei sitae”
principle in the field of real state rights and land registration. This significance is the
result of the special relationship between the immovable assets and the law of their




                  ELRA Aisbl Avenue Cortenbergh, 66 – 2ème étage - 1000 Bruxelles
situation and has been recognized by the internal and conventional law and the
jurisprudence of the European Court of Justice.


       That is why ELRA expressed the unsuitability of the adoption of a 26th regime
in relation to mortgage credit, considering more appropriate the possibility to harmonize
some aspects referring the European mortgage market, through the extension of the “lex
rei sitae” principle to the underlying contract or through the flexibilisation of the
principle of accessoriness.


       ELRA also recognized the importance of the transferability of the credits
without the necessity or extinguishing the existing mortgage and creating a new one, but
at the same time asserted the need for the registration system to disclose transfers of
mortgage loans and of mortgages in the primary market for the benefit of the parties and
third persons.


       So ELRA supports the concept of access to land register information for national
and foreigners at an equal basis, as well as the necessity to eliminate the hidden charges
so far as practicable, in order to assure that the real situation of the property is the one
shown on the land register (“mirror principle”, “principle of legitimacy”), as a requisite
for a secure mortgage market.


       But, apart from this general approach to the Green Paper, some particular
questions can arise from the Paper, since they can affect the role of land registration
authorities in a particular way. We refer to the provision of legal certainty for
consumers (point 31), and the question of the access to credit data in a general sense
(question 12).


       Referring to the provision of legal certainty to consumers, it is important to
remember the significance of the “lex rei sitae” principle in the field of mortgages. This
principle is related to all the aspects concerning registration, prelacy, foreclosure and
insolvency procedures. That is the reason why its extension to the credit -very much


                 ELRA Aisbl Avenue Cortenbergh, 66 – 2ème étage - 1000 Bruxelles
related to the mortgage in case of the mortgage credit- has been considered. The close
relationship between credit and mortgage would justify the extension of the “lex rei
sitae” principle from the mortgage to the underlying credit.


       It is also clear that in this case, the “lex rei sitae” is usually related to the
domicile of the consumer, as the law of situation of the mortgaged property.


       Finally, we refer to the access to credit data. The content of land registers can
imply information of credit data in a general sense and, concerning this issue, two
points should be considered: in the first place, the necessity to safeguard the European
(Directive 95/46 EC) and internal privacy laws as well as the internal law governing the
openness, or otherwise, of the land register to public scrutiny and, secondly, the
necessity to ensure equal access to the information contained in the land registers for
national and European lenders on equal terms.




                ELRA Aisbl Avenue Cortenbergh, 66 – 2ème étage - 1000 Bruxelles

				
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posted:7/20/2011
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