Legal concerns

Category: ABS Regulation

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Consumer protection uncertainties highlighted

A recent European Court of Justice (ECJ) ruling on consumer rights in German loan agreements amplifies legal uncertainty regarding information that needs to be included in contracts, Fitch suggests. The implications for Fitch-rated German auto ABS have been limited so far, but the rating agency says it remains important to monitor the impact on borrower behaviour and how far this increases exposure to originator creditworthiness, as well as developments in deal documentation.

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