Royal Decree-Law 19/2017, of 24 November, on basic payment accounts, transfer of payment accounts and fee comparability

OFFICIAL GAZETTE OF THE STATE Núm. 287 Saturday, 25 November 2017 Sec. I. Page 114353 I. GENERAL PROVISIONS HEAD OF STATE 13644 Royal Decree-Law 19/2017, of 24 November, on basic payment accounts, transfer of payment accounts and fee comparability.

STATEMENT OF REASONS I The purpose of this Royal Decree-Law is to incorporate into the Spanish legal order the regime provided for in Directive 2014/92/EU of the European Parliament and of the Council of 23 July 2014 on the comparability of fees associated with payment accounts, the transfer of payment accounts and access to basic payment accounts (hereinafter, the Directive). This Directive complements both Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on payment services in the internal market, and Directive (EU) 2015/2366 of the European Parliament and of the Council of 25 November 2015, which establish basic transparency requirements for fees applied by payment service providers for services offered in connection with payment accounts, and which repeals the first with effect from 13 January 2018. The objectives pursued by the Directive are threefold: to facilitate access of potential customers to basic banking services, to improve the transparency and comparability of fees applied to payment accounts, and to improve the transfer of payment accounts. Commission Recommendation 2011/442/EU of 18 July 2011 on access to a basic payment account sought to address situations where potential customers cannot open a payment account because either that possibility is denied to them or no suitable product is offered. That Recommendation exhorted Member States to adopt the necessary measures to ensure its application at the latest six months after its publication. However, only a few Member States complied with the main principles of that Recommendation. In light of this situation, the Directive definitively resolves financial inclusion problems by creating a specific financial product it calls a basic payment account. Regarding account transfers, the Common Principles established in 2008 by the European Banking Sector Committee already provided a model mechanism for transfers between payment accounts offered by credit institutions located in the same Member State. Nevertheless, as they were not binding, they have been applied inconsistently across the Union and have proven ineffective. Furthermore, those Common Principles only addressed transfers between payment accounts on a national scale and not cross-border account transfers. The Directive seeks to foster effective and smooth long-term financial mobility by establishing a set of uniform rules to address the low mobility of customers and, in particular, to facilitate comparison between payment account services and applicable fees, incentivize account transfers and prevent consumers wishing to open and use a cross-border payment account from being discriminated against on grounds of residence. The transparency and comparability of fees were initially addressed in the Union through a self-regulatory initiative by the banking sector. However, as no minimally acceptable results were achieved in this area, this Directive establishes specific regulation on the matter. In short, the universal right of access to a basic payment account, transparency in information on payment account fees, and the possibilities of transferring them, will enable customers to compare products more easily and move within the Union, and consequently benefit from an internal market in the field of financial services. II Regarding the delimitation of the objective scope, it should be noted that the rule establishes specific regulation for basic payment accounts. Furthermore, it regulates the transfer and comparability of fees applied by services provided in any payment account, whether or not it has the status of basic. Special mention is required for basic payment accounts. They are configured as a standardized financial product, which all credit institutions are obliged to offer, with no exceptions other than a limited number of circumstances that allow for refusal. This does not mean they cease to be regulated by the general payment services legislation, and in particular by Law 16/2009, of 13 November, on payment services, and Order EHA/1608/2010, of 14 June, on transparency of information conditions and requirements applicable to payment services, to which must be added Order EHA/2899/2011, of 28 October, on transparency and customer protection for banking services. As for the subjective scope, it should be noted that the provisions of this rule apply to natural persons acting for a purpose outside their commercial, business, trade or professional activity, as derived from the definition made by the Directive itself. In this way, the protection rules established by the Directive regarding the transfer of payment accounts, the advertising and comparability of payment account services and fees, or access to basic payment accounts, do not extend to legal persons or to those acting within their commercial, business, trade or professional activity. This limitation is, moreover, consistent with the objectives of financial inclusion, on the one hand, and the enhancement of the European retail market, on the other; both objectives pursued by the Directive. On the side of service providers, the scope of application of the rule differs depending on the regulated matter. Thus, in the case of comparability of payment account services and fees or in the case of transfer of payment accounts, the subjects bound by the transposition legislation are payment service providers, a group that includes not only credit institutions, but all subjects referred to in Article 4.9 of Directive 2007/64/EC on payment services in the internal market. In contrast, in the case of the provision of the basic payment account service, the scope of application of the service is more limited, affecting only credit institutions, as authorized by Article 16 of the Directive. The objective pursued with the exercise of this national option in the manner indicated is to establish common rules of the game for all credit institutions regarding the obligation to offer these accounts, an option that in greater measure realizes the principle of regulatory neutrality that the rule must follow. III The Royal Decree-Law is structured in five chapters, which correspond to the essential lines of the regulation, two additional provisions, one transitional provision, one repealing provision and four final provisions. Chapter I contains the general provisions of the rule, specifies its object and establishes the definitions necessary for a better understanding of the terms used in it. Chapter II collects the provisions relating to basic payment accounts, regulating the right of access to them, the circumstances in which credit institutions may deny access to them and the manner in which such denial must be notified to the potential customer. In addition, it regulates the possibility for credit institutions to terminate basic payment account contracts and the notification of such termination. Finally, this chapter regulates the services associated with basic payment accounts, the method for setting the fees that credit institutions may charge for their opening and maintenance and for associated services, and in general the information that credit institutions must provide about them. Chapter III refers to the transfer service for any payment account, the circumstances that enable payment service providers to deny the transfer of payment accounts, the procedure that payment service providers must follow for the transfer and the financial detriment that may be caused to the customer. It also regulates the possibility of denying the transfer of the balance when there are due and pending payment obligations, such as those made with cards of the entity itself, in particular. The comparability of fees is regulated in Chapter IV, establishing the regulation of the most representative services associated with a payment account, the fee information document, the fee statement, comparison websites and the information that payment service providers must provide to customers. Finally, Chapter V is dedicated to the regulation of the sanctioning regime and the designation of the Bank of Spain as the competent authority to verify compliance with the rights and obligations created by this Royal Decree-Law. For these purposes, the obligations established in this Royal Decree-Law have the character of regulatory and disciplinary rules. IV The additional provisions, two in total, regulate specific areas, such as the exclusion of the Official Credit Institute from the application of the law, since it does not provide banking services to retail customers, who are the beneficiaries of the regulation contained in the rule, and the resolution of disputes through out-of-court claims procedures. The single transitional provision establishes an adaptation period in the matter of fee comparability, so that the Bank of Spain can carry out the necessary regulatory development to comply with the Royal Decree-Law. Without the authorization contained in this latter rule, such development would not be possible. Likewise, it is provided that until the entry into force of the order of the Minister of Economy, Industry and Competitiveness provided for in Articles 9.2, 10.1 and 13.6, the regime in force at the approval of this Royal Decree-Law will apply in those areas. The Royal Decree-Law contains four final provisions. The first modifies Law 16/2009, of 13 November, on payment services, with the aim of establishing a quick and simple procedure for the termination of framework contracts for any payment account. The second final provision sets out the competence title of the Royal Decree-Law, and the third states that this Royal Decree-Law incorporates into the Spanish legal order Directive 2014/92/EU of the European Parliament and of the Council of 23 July 2014 on the comparability of fees associated with payment accounts, the transfer of payment accounts and access to basic payment accounts. Finally, the fourth final provision establishes the entry into force of the Royal Decree-Law. V Regarding the recourse to the Royal Decree-Law as a transposition instrument, it should be noted that the Constitutional Court in its judgment 1/2012, of 13 January, validates the concurrence of the enabling condition of extraordinary and urgent need of Article 86.1 of the Constitution when there is «patent delay in transposition», the existence of «infringement proceedings against the Kingdom of Spain» and the material importance of the situation to be regulated. In this case, reasons concur that fully justify the extraordinary and urgent need to transpose the various directives through this Royal Decree-Law. First, the transposition of Directive 2014/92/EU through this Royal Decree-Law is motivated by the expiry of the transposition deadline. According to its Article 29, Member States were required to bring into force the legal, regulatory and administrative provisions necessary to comply with its provisions by 18 September 2016 at the latest. Second, with regard to the specific situation to be regulated, it is necessary to guarantee the universal right of access to a basic payment account, transparency in information on payment account fees, and the possibilities of transferring them. Only in this way is the obligation incumbent on the Kingdom of Spain to ensure the proper functioning of the internal market and the development of a modern and socially inclusive economy fulfilled. In sum, the achievement of the financial inclusion objectives imposed by Union law requires the universal provision of payment services, which makes the immediate approval of the transposition rule urgent and necessary. Finally, regarding the existence of «infringement proceedings against the Kingdom of Spain», it should be noted that the European Commission initiated a formal infringement procedure by means of a Letter of Formal Notice 2016/0741 of 23 November 2016. Subsequently, by Reasoned Opinion 2016/0741 of 27 April 2017, it gave a two-month deadline to adopt the necessary legal, regulatory and administrative provisions to comply with the directive. Subsequently, on 4 October 2017, given that Spain has not incorporated this Directive into its national legal order, the College of Commissioners adopted the decision to bring an action before the Court of Justice of the European Union. Consequently, it is of extraordinary and urgent need to proceed with the transposition before the action is formalized before the Court of Justice, thereby avoiding the termination of the procedure by a judgment declaring that the Kingdom of Spain has failed to comply with its obligations under Union law. Therefore, the circumstances of extraordinary and urgent need required by Article 86 of the Spanish Constitution as the enabling condition for resorting to this type of rule concur to the extent that, by their nature, purpose and the context in which they are issued, they are adopted. By virtue thereof, making use of the authorization contained in Article 86 of the Spanish Constitution, on the proposal of the Minister of Economy, Industry and Competitiveness and after deliberation by the Council of Ministers in its meeting on 24 November 2017, I HEREBY ORDER:

Index Chapter I. General Provisions. Article 1. Object. Article 2. Definitions. Chapter II. Basic Payment Accounts. Article 3. Right of access to a basic payment account. Article 4. Denial of access to a basic payment account. Article 5. Notification of the denial of access to a basic payment account. Article 6. Termination of basic payment account contracts. Article 7. Notification of the termination of basic payment account contracts. Article 8. Services associated with basic payment accounts. Article 9. Fees and associated costs. Article 10. General information on basic payment accounts. Chapter III. Transfer of Payment Accounts. Article 11. Payment account transfer service. Article 12. Denial of balance transfer. Article 13. Procedure for the transfer of payment accounts. Article 14. Customer financial detriment. Chapter IV. Comparability of Payment Account Fees. Article 15. Most representative services associated with a payment account. Article 16. Fee information document. Article 17. Fee statement. Article 18. Bank of Spain comparison website. Article 19. Other comparison websites. Article 20. Information to customers. Chapter V. Sanctioning Regime and Competent Authority. Article 21. Sanctioning Regime. Article 22. Competent Authority and Cooperation Regime. Additional Provision First. Official Credit Institute. Additional Provision Second. Out-of-court claims procedures. Single Transitional Provision. Adaptation Period. Single Repealing Provision. Repeal of Legislation. Final Provision First. Modification of Law 16/2009, of 13 November, on Payment Services. Final Provision Second. Competence Title. Final Provision Third. Incorporation of European Union Law. Final Provision Fourth. Entry into Force.

CHAPTER I General Provisions Article 1. Object. This Royal Decree-Law aims to regulate: a) The right of customers or potential customers to open and use basic payment accounts; b) the transparency and comparability of fees applied to customers or potential customers of payment accounts; c) the transfers of payment accounts within Spain and the facilitation of the opening of cross-border accounts for customers or potential customers.

Article 2. Definitions. For the purposes of this Royal Decree-Law, the following shall be understood: a) «Customer or potential customer»: Natural persons acting for a purpose outside their commercial, business, trade or professional activity. b) «Payment account»: An account opened in the name of one or more payment service users and used for the execution of payment transactions. c) «Basic payment account»: That payment account, denominated in euros, opened at a credit institution that allows providing, at least, the services set out in Article 8, identified as such by credit institutions. d) «Payment service provider»: Public bodies, entities and companies authorized to provide payment services in Spain or in any other Member State of the European Union, whether or not they benefit from the exceptions provided for in Article 26 of Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on payment services in the internal market, amending Directives 97/7/EC, 2002/65/EC, 2005/60/EC and 2006/48/EC and repealing Directive 97/5/EC, as well as those from third countries, that professionally engage in the provision of payment services. e) «Durable medium»: Any instrument that enables the consumer to store information addressed personally to that consumer in a way that is accessible for a period of time adequate to the purpose of the information, and that allows the unchanged reproduction of the stored information.

CHAPTER II Basic Payment Accounts Article 3. Right of access to a basic payment account. Credit institutions offering payment accounts shall be obliged to offer basic payment accounts to those potential customers who: a) Legally reside in the European Union, including customers without a fixed domicile; b) are asylum seekers; c) do not have a residence permit but their expulsion is impossible for legal or factual reasons.

Article 4. Denial of access to a basic payment account.

1. Credit institutions shall deny access to basic payment accounts when any of the following circumstances occur: a) The potential customer fails to provide the information required by the institution based on the customer's money laundering or terrorist financing risk level within the framework of Chapter II of Law 10/2010, of 28 April, on the prevention of money laundering and terrorist financing, and its implementing regulations, b) its opening is contrary to national security or public order interests defined by laws, European norms or the case law of the Court of Justice of the European Union, in cases where this has been agreed by the Council of Ministers, upon proposal of the Minister of Economy, Industry and Competitiveness, or c) the potential customer is already the holder in Spain of an account with a payment service provider that allows them to perform the services contemplated in Article 8.1, unless the latter has notified their unilateral decision to terminate the framework payment account contract. In this case, before opening a basic payment account, the credit institution may verify whether the customer has or does not have an account in Spain that allows them to perform the aforementioned services. Credit institutions may rely for this purpose on a sworn declaration signed by the customer themselves. The institution shall retain the documents and the analysis on which this decision is based.
2. Access to the basic payment account may not be made conditional on the acquisition of other services, nor on the acquisition of shareholdings in the capital, or analogous instruments, of the credit institution, unless imposed by applicable legislation or a mandatory requirement for the entire clientele of the institution.

Article 5. Notification of the denial of access to a basic payment account.

1. The credit institution must inform the potential customer of the denial of the opening of a basic payment account, unless this is incompatible with what is established in Law 10/2010, of 28 April, or with the national security or public order interests that motivated the denial.
2. The denial shall be notified to the potential customer in writing and free of charge, stating the specific reasons on which it is based, without unjustified delay, and at the latest within a maximum period of ten working days from the date of receipt of the complete application.
3. Furthermore, when notifying the rejection of the application, institutions shall inform the potential customer of the procedure to be followed to lodge a complaint against the denial and of their right to refer to the claims procedure provided for in Article 30 of Law 44/2002, of 22 November, on Measures for the Reform of the Financial System, and its implementing regulations.

Article 6. Termination of basic payment account contracts. Credit institutions may unilaterally terminate a framework basic payment account contract, without prejudice to what is provided in Law 16/2009, of 13 November, on payment services, when any of the following conditions are met: a) That the customer has deliberately used the account for illicit purposes. b) That n