Effectiveness of MiFID transposition before



Directive 2004/39 / EC should be applied even before its transposition into domestic law.

That is the criterion established by the Supreme Court in its judgment of 15 July 2016.

For, the company Semper Ballester S.L. (hereinafter SB) the 28 November 2007 signed a swap agreement which caused a negative settlements by 115.618 euros. When they tried to cancel the product, the bank asked them 400.000 euros.

So SB filed suit against Banesto S.A.. requesting invalidity of a Contract of Financial Operations (IRS o Swap). He claimed that he was not explained the risks of the product, nor it was informed about the possible scenarios and the cost of cancellation. Hiring error had occurred and requested its annulment.

Banesto said that the applicant was a company with a high turnover, its representatives knew and understood the product, advised by its financial director, and that in any case, It would be attributable to the applicant not having had the necessary advice.

The Court of First Instance No. 17 Valencia, in sentence 30 May 2012, dismissed the claim. He considered that the regulations trasponía Directive 2004/39 / EC, (MiFID) It was not applicable since entered into force at a later date to the contract, so they could not understand infringed the duties established in this standard.

SB appealed and the Ninth Section of the Provincial Court of Valencia, in Case 18 December 2012 it dismissed. For Hearing, because there was no error in the contract and in the brochure warned of the risks and intervened in hiring the applicant CFO. Also, he understood that the MiFID had been incorporated into our domestic law after the conclusion of the contract.

The applicant brought extraordinary resources for procedural infringements and a cassation to the Supreme Court.

It rejects the first not to a finding of patent and obvious error in assessing the evidence.

El recurso de casación se basa en que en el momento de la contratación (November 2007) MiFID and it should have been transposed by what has interpretive effectiveness and courts must interpret national law in the light of the letter and the purpose of that directive (despite that he was not transposed).

The High Court considers the appeal. The Securities Market Law in its pre transposition of MiFID version already established the obligation of financial institutions "Make sure you have all the necessary information about your customers and keep always adequately informed".

Therefore, regardless of MiFID, the bank must meet a high standard of compliance with reporting duties towards its customers, both gathering information on the profile and needs of them, como para transmitirles información sobre la naturaleza y riesgos del producto.

Regarding MiFID, not only it was already in force but also, the deadline had passed for transposition.

Already in the STS 18 April 2013, the High Court said that even if the period for transposition has passed a Directive, domestic law should be interpreted by judges in the light of the letter and purpose of it.

For the sake, having passed the period for transposition, its interpretive influence is even greater. And in this sense, cites STJUE de 11 July 1996:

"But nevertheless, The Court held, in applying national law, whether before or after the directive provisions, the national court must interpret it is required to do everything possible, in the light of the wording and the purpose of the Directive, to achieve the result pursued by this and thus comply with the third paragraph of Article 189 the EC Treaty ".

The Royal Decree 629/1993 establishing high standards of information. The breach of that duty, affect the occurrence of the error excusability (SSTS 20 January 2014 and 10 septiembre 2014).

The fact were a company and count on your template with a degree in business, is not necessarily the expert character client. Not enough common knowledge of the business world but are necessary expertise in this type of financial products that can be ruled out or considered inexcusable error (SSTS 22 October 2015, 19 November 2015 and 19 May 2016).

Banesto did not report that the benefits of part were the mirror image of the other losses (STS 19 May 2016) and therefore, There is a conflict of interest.

Neither it reported the initial market value of the swap, or how much you should pay for early cancellation, in different scenarios.

Ultimately, the nullity of the contract is declared with the consequences restitutive Article 1.303 Civil Code.

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