The European Union's top court ruled borrowers could have Swiss franc-denominated mortgages converted into złoty or invalidated. The court decided on Thursday that EU law doesn't prevent Polish courts from striking out unfair clauses in foreign currency mortgage contracts. This means that a Polish court may cancel the entire loan agreement if it contains an abusive clause, i.e. unfair terms.
The ruling doesn’t automatically force banks to convert the loans. But it allows borrowers to take their contracts to Polish courts, which could either convert mortgages to złoty, while keeping lower interest rates or invalidate them.
The Swiss franc along with the shares of Polish banks fell after the ruling. The borrowers' representatives celebrated the court's decision with champaign at a press conference.