Credit Servicing and Loan Sales: Scope will be key in EU trilogue negotiations on proposed Directive
Trilogue negotiations will start shortly between the European Commission, the Council of the European Union and the European Parliament on the proposed directive on credit servicers and credit purchasers. Yesterday, the Council published a three-column document setting out the Commission’s proposal, together with the negotiating mandates of both the Council and the Parliament.
Notably, the three institutions have taken different positions on the proposed scope of the directive. The Commission’s proposal covers the servicing and sale of both performing loans and non-performing loans (NPLs) originated by licenced EU banks. However, the Council is proposing that the parts of the directive relating to credit purchasers apply only to disposals of NPLs. The Parliament is proposing that the provisions on both servicing and purchase deal only with NPLs. How this would work in practice, and whether agreement can be reached by the EU institutions on this point, will be closely watched as informal negotiations move ahead.
Further information on the directive in its current form is in our November 2020 update: Credit Servicing: Will the Irish regime need to change?