In brief

  • The Constitutional Court dismissed, unanimously, the attack of four banks against the debt-for-asset settlement law. The irrebuttable hardship presumptions introduced in 2020 stay in force: the threshold of 52.6% for the rise in the exchange rate and the threshold of 50% for the rise in the monthly instalment caused by a variable interest rate.
  • Only one text dropped out of the discussion, Article 8(5) second and third limbs of Law no. 77/2016, but not because the banks won anything now. It had already been declared unconstitutional by Decision no. 432/2021, so the plea was dismissed as having become inadmissible.
  • The seven files reached the Court in the winter and spring of 2021. The decision was delivered on 25 November 2025 and published on 3 September 2026, 282 days later. From the date of publication it is final and binding on all courts.
Act: Constitutional Court Decision no. 644 of 25 November 2025
Published: Official Gazette of Romania (Monitorul Oficial) no. 743 of 3 September 2026
In force from: 3 September 2026, the date of publication, under Article 147(4) of the Constitution, invoked by the Court as the basis of the decision

Four banks asked the Constitutional Court to strike down the rule under which a customer gets rid of an unpaid loan by handing over the mortgaged flat, and the Court dismissed their request across the board. Decision no. 644 of 25 November 2025, published in Official Gazette of Romania no. 743 of 3 September 2026, confirms that Law no. 52/2020, the one that rewrote the debt-for-asset settlement law, is constitutional as a whole. This is the second day in a row on which the same law passes through the Court’s filter: on 2 September 2026 the decision on the 250,000 euro ceiling and the cumulative nature of the admissibility conditions was published, and now comes the one that touches the heart of the mechanism, the hardship presumptions.

To understand what is at stake, a ten year line has to be followed. Law no. 77/2016 entered into force on 13 May 2016 and gave the consumer the right to extinguish the whole loan, including all charges, by handing the mortgaged home to the creditor. The Court corrected it in the same year, by Decision no. 623 of 25 October 2016, published in Official Gazette of Romania no. 53 of 18 January 2017: the law stays standing, but only if the judge verifies in each case the existence of hardship (impreviziune), that is, of the change of circumstances that makes performance of the contract excessively onerous. Four years later, Parliament replaced that verification with two figures.

Law no. 52/2020, published in Official Gazette of Romania no. 386 of 13 May 2020 and in force since 16 May 2020, supplemented Article 4 of Law no. 77/2016 with paragraphs (11) to (13). The text says that hardship exists, on the one hand, where the exchange rate at which the loan currency is bought rises by more than 52.6% compared with the date the contract was signed, and, on the other hand, where the monthly instalment rises by more than 50% because of an increase in the variable interest rate. Paragraph (12) requires the threshold to be maintained over the last 6 months before the notice, and paragraph (13) adds the sentence that triggered the whole constitutional dispute: „The presumptions provided for in paragraph (11) are irrebuttable”. Irrebuttable means the bank can no longer prove the contrary.

That is where the four banks attacked. Credit Europe Bank NV of the Netherlands raised the plea in three files, Exim Banca Romaneasca, formerly Banca Romaneasca, in two, and BRD Groupe Societe Generale and Banca Transilvania in one each. The referrals came from the District Court of Bucharest Sector 3, the District Court of Bucharest Sector 4, the Botosani District Court and the Cornetu District Court, through seven orders delivered between 16 December 2020 and 8 March 2021. The Court joined them all to File no. 824D/2021, the first one registered.

The banks’ criticisms rested on three levels. The first, formal: the law was adopted without the opinion of the National Bank of Romania and without an impact assessment, and the wording „constitutes hardship” was said to be unclear and equivocal. The second, economic: the thresholds of 52.6% and 50% were said to be unfounded, and an analysis limited to the last 6 months of a loan taken out over 20 or 30 years cannot show that an increase in the instalment is irreversible. The third, patrimonial: the irrebuttable presumption shifts the currency risk onto the creditor, deprives it of any possibility of proving the contrary and, through Article 10(1) and Article 11, applies retroactively to claims acquired under the old law.

The courts that sent the files did not take the same position. The Botosani District Court, the Cornetu District Court and, in two of the files, the District Court of Bucharest Sector 3 considered the plea unfounded. The District Court of Bucharest Sector 4, in File no. 896D/2021, considered it well founded, relying on Decision no. 623/2016, on Decision no. 405 of 19 June 2018 and on Decision no. 731 of 6 November 2019. The District Court of Bucharest Sector 3 expressed no opinion at all in File no. 824D/2021, something the Court expressly records as contrary to Article 29(4) of Law no. 47/1992. The presidents of the two chambers of Parliament, the Government and the Ombudsman submitted no point of view.

The Court’s solution follows the prosecutor’s submissions exactly. The plea concerning Article 8(5) second and third limbs was dismissed as having become inadmissible, because those limbs had already been declared unconstitutional by Decision no. 432 of 17 June 2021, published on 21 September 2021, and Article 29(3) of Law no. 47/1992 prohibits a text already declared unconstitutional from being the object of a further plea. The rest, namely Article 1(1), Article 4(11) to (13), (3) and (4), Article 5(3) and (31), Article 7(4) and (51), Article 8(5) first limb, Article 10(1), Article 11 first limb and Law no. 52/2020 as a whole, was dismissed as unfounded, with a reference to a list of earlier decisions and a finding that no new elements had intervened.

What it changes in practice

The first consequence is that the law stays untouched. A decision dismissing a plea repeals nothing and suspends nothing. From 3 September 2026, the thirteen paragraphs and limbs checked by the Court, plus Law no. 52/2020 in its entirety, carry a certificate of constitutionality that can be relied on before every court.

The second consequence concerns the banks’ defence in pending proceedings. The challenge against a debt-for-asset settlement notice, governed by Article 7 of Law no. 77/2016, remains available, but with one argument fewer. The creditor can no longer ask a court to set aside the 52.6% threshold on the ground that the text is unconstitutional. What is left is the ground in Article 4(13) second limb, namely proof that the notice does not meet the admissibility conditions in Article 4(1)(a) to (d), and the factual verification of the thresholds, including whether they were maintained over the 6 months required by paragraph (12).

The third consequence is one of procedural calendar, and it is the hardest for creditors. Combining Article 5(3) with Article 7(4), from the moment of the notice every payment to the bank and every enforcement procedure is suspended, garnishments included, for at least 30 clear days and then until the challenge is finally decided, a moment the bank does not control. Over the same period, Article 5(31) prohibits the debtor from being entered in the Credit Bureau or in other databases of bad payers. All three texts have now been declared constitutional.

The fourth consequence touches the litigation risk of a bank that challenges and loses. Article 7(51), also upheld, says that penalties and damages arising from the notice procedure can be claimed only if the challenging creditor proves the debtor’s bad faith when filing the notice. In practice, a dismissed challenge stays, in most cases, at the bank’s expense.

The fifth consequence is for consumers who have already filed a notice or have proceedings under way. Nothing that applied to them changes, but the legal basis becomes firmer. A judge who might have wanted to stay proceedings pending a decision of the Court now has no reason to do so on any of the texts checked here.

What has changed compared with the previous situation

In the text of the law, nothing. This is the part most often misunderstood when the Constitutional Court appears in a headline. The version of Law no. 77/2016 in force, consolidated on 21 September 2021, looks exactly the same today as it did a week ago: paragraphs (11) to (13) of Article 4 are there, with the thresholds of 52.6% and 50%, with the requirement that they be maintained for 6 months and with the presumptions declared irrebuttable.

What has changed is what can still be challenged. Until 3 September 2026, a bank had one theoretical argument available: that the irrebuttable presumption contradicts the Court’s construction from 2016, where hardship had to be verified by the judge. That argument can no longer be raised as a plea of unconstitutionality on the texts examined, because it has been expressly rejected.

The density of the case law has also changed. In paragraph 42 the Court lists five earlier decisions in the same field: no. 623/2016, no. 806 of 7 December 2017, no. 432/2021, no. 749 of 14 December 2023 and no. 36 of 30 January 2025. With this one they become six. Ten years after it was adopted, the debt-for-asset settlement law is one of the acts most often carried before the constitutional court, and each time it has come out standing, apart from two limbs of Article 8(5) and one phrase in Article 11.

What has not changed, although it should have, is the body of the law itself. Article 8(5) second and third limbs ceased to produce legal effects on 5 November 2021, 45 days after the publication of Decision no. 432/2021, because Parliament did not intervene. They are still printed in the text of the law today, followed by an explanatory note. Likewise, the phrase „and from the depreciation of the immovable property” in Article 11 first limb ceased to produce effects on 4 March 2017 and has stayed where it was.

Advantages and disadvantages

What it improves

  • It closes an uncertainty that had lasted more than six years. Law no. 52/2020 has been in force since 16 May 2020, that is, 2,301 days by the date the decision was published. Throughout that time, the central mechanism of the law operated under a question mark.
  • Unanimity, with no separate opinions. The nine judges on the panel all voted the same way, which makes a reversal of the case law in the coming years unlikely.
  • A consumer with a foreign currency loan now has a firm benchmark. If the 52.6% threshold is reached and maintained for 6 months, the presumption can no longer be contested on the merits by the bank, and the bank can no longer plead that the text is unconstitutional.
  • Joining the seven files avoided divergent outcomes. Four courts with different opinions, one of them favourable to the banks, received a single answer instead of seven decisions delivered on different dates.

What remains a problem

  • The reasoning on the merits takes up two paragraphs. Out of the 44 paragraphs and roughly 5,200 words of the decision, the actual examination of the substantive criticisms, paragraphs 42 and 43, runs to 145 words, that is, 2.8% of the text. The rest is procedure, quotation of the contested texts and a summary of the banks’ arguments.
  • Publication took 282 days. The five decisions the Court relies on were published 85, 159, 96, 259 and 153 days after delivery respectively. This is the slowest of all six.
  • The gap between the two thresholds remains unexplained. 52.6% for the exchange rate and 50% for the instalment driven by a variable interest rate are two presumptions of the same legal nature, separated by 2.6 percentage points that neither the law nor the decision justifies.
  • One file out of seven is left without the referring court’s opinion. The decision records the positions of the courts for six of the joined files. About File no. 895D/2021 it says nothing.
  • Decisions no. 405/2018 and no. 731/2019 do not appear in the Court’s own reasoning. They are invoked by the banks and by the District Court of Bucharest Sector 4, but in paragraphs 40 to 43 they are not discussed, even though Decision no. 731/2019 is the pre-promulgation review of the very law that introduced the presumptions.

Practical advice

  1. Check the threshold over 6 months, not just on the day of the notice. Article 4(12) requires the rise of 52.6% or 50% to be maintained over the last 6 months before the notice is sent. A single day on which the threshold is reached is not enough, and this is the first check a court will make.
  2. Calculate the percentage using the National Bank rates, not those of the commercial bank. The text says so explicitly: the rate published by the National Bank of Romania on the date the notice is sent, compared with the rate published by the same institution on the date the loan agreement was signed.
  3. Do not confuse the two presumptions. The first concerns the exchange rate and applies only to loans in a currency other than that of your income. The second concerns the rise in the monthly instalment caused by an increase in the variable interest rate and works for loans in lei as well.
  4. Banks: prepare the challenge on admissibility, not on constitutionality. Article 4(13) second limb leaves you the burden of proving that the conditions in Article 4(1)(a) to (d) are not met, among them the ceiling of 250,000 euro at the time the loan was granted. That is the only gate left open.
  5. Note the date from which the decision produces effects. It is 3 September 2026, the date of publication, not 25 November 2025, the date of delivery. The difference matters for the written submissions filed in the case during the 282 days between the two moments.
  6. Read the law in its consolidated form, not in the form printed in the decision. Paragraph 38 reproduces the texts as they were criticised in 2020 and 2021. Article 8(5) second and third limbs have produced no effects since 5 November 2021, and the phrase „and from the depreciation of the immovable property” in Article 11 first limb has produced no effects since 4 March 2017.

Frequently asked questions

What exactly did the Constitutional Court decide?
It dismissed the plea on two points. First: the plea concerning Article 8(5) second and third limbs of Law no. 77/2016 was dismissed as having become inadmissible. Second: the remaining criticisms were dismissed as unfounded, and Article 1(1), Article 4(11) to (13), (3) and (4), Article 5(3) and (31), Article 7(4) and (51), Article 8(5) first limb, Article 10(1), Article 11 first limb, as well as Law no. 52/2020 as a whole, were declared constitutional. The vote was unanimous.
What does an irrebuttable presumption of hardship mean?
It means that, if the factual situation described in the law is proved, hardship is considered to exist and can no longer be countered with evidence to the contrary. The bank can show that the threshold was not reached, but it cannot show that, although the threshold was reached, the contract did not become excessively onerous. The rule is written in Article 4(13) of Law no. 77/2016.
Where does the figure of 52.6% come from?
It is the threshold set by the legislature through Law no. 52/2020 for the rise in the exchange rate at which the loan currency is bought. Neither the law nor the Court’s decision explains why this number was chosen. In practical terms, a rate of 2 lei on the date of the contract has to reach 3.052 lei for the threshold to be met.
Who can use debt-for-asset settlement?
A consumer who cumulatively meets the conditions in Article 4(1) of Law no. 77/2016: he must be in a relationship with a credit institution, a non-banking financial institution or an assignee of claims; the amount borrowed must not have exceeded, when granted, the equivalent of 250,000 euro; the loan must have been taken out for housing or be secured on a dwelling; there must be no final conviction for offences connected with that loan; and the hardship condition must be met. „First home” loans are expressly excluded.
What happens to my payments after I send the notice?
Article 5(3) suspends every payment to the creditor and every judicial or extrajudicial procedure started against the consumer, from the moment of the notice. The first date for appearing before the notary cannot be earlier than 30 clear days or later than 90 days. If the bank files a challenge, Article 7(4) keeps the suspension in place until that challenge is finally decided.
Can I be entered in the Credit Bureau during this period?
No. Article 5(31) prohibits, during the notice period and during the resolution of the applications under Articles 7 and 8, the entry of the debtor in the Credit Bureau or in other databases of risky debtors or bad payers, whoever might make the entry. The text was declared constitutional by this decision.
Can the banks still attack the law?
Not on the texts checked here and not with the same criticisms. What remains open is the challenge based on Article 7, in which the bank proves that the notice does not meet the admissibility conditions, as well as any factual argument about how the thresholds were calculated. The unconstitutionality of Article 4(11) to (13) can no longer be usefully invoked.
What happened to Article 8(5)?
The second and third limbs, which created a presumption of hardship for a debtor whose mortgaged property had already been sold in enforcement, were declared unconstitutional by Decision no. 432 of 17 June 2021 and ceased to produce legal effects on 5 November 2021. By the present decision, the plea on those limbs was dismissed as having become inadmissible, while the first limb, the one granting the right to ask for the debts to be extinguished, was declared constitutional.
Why did it take almost six years?
The first referral order is that of the Cornetu District Court, of 16 December 2020. The last, that of the District Court of Bucharest Sector 4, of 8 March 2021. The Court delivered its solution on 25 November 2025 and published it on 3 September 2026. From the first referral to publication, 2,087 days passed, and the decision does not explain the interval.
Does the decision change anything for someone with proceedings already under way?
It does not change the applicable texts, but it closes off one line of defence. Courts that stayed proceedings or waited for clarification can carry on. Identical pleas of unconstitutionality raised in other files will be dismissed as inadmissible, because criticisms already settled cannot be raised again.
From what date does the decision apply?
From 3 September 2026, the date of publication in the Official Gazette of Romania, under Article 147(4) of the Constitution, which the Court invokes as the basis of the decision. The decision is final and generally binding, so it applies to all courts and authorities.

Errors and inconsistencies in the published text

  • Point 2 of the operative part declares Article 11 first limb of Law no. 77/2016 constitutional, even though part of that text has produced no legal effects since 4 March 2017. By Decision no. 623 of 25 October 2016, published in Official Gazette of Romania no. 53 of 18 January 2017, the Court upheld the plea of unconstitutionality against the phrase „precum și din devalorizarea bunurilor imobile”, that is, „and from the depreciation of the immovable property”, contained in Article 11 first limb, and the phrase ceased to produce legal effects on 4 March 2017, under Article 147(1) of the Constitution, because the legislature did not intervene within the 45 day period. The present decision reproduces in paragraph 38 Article 11 first limb in full, with the phrase included and without any note, and in point 2 of the operative part declares it constitutional without any reservation. The same decision cites Decision no. 623/2016 in paragraph 42, as a case law benchmark. For Article 8(5) second and third limbs, which are in an identical position after Decision no. 432 of 17 June 2021, the Court applied Article 29(3) of Law no. 47/1992 and dismissed the plea as having become inadmissible, in paragraphs 40 and 41. From the decision it is impossible to establish whether the phrase in Article 11 is still in force or not, and the two possible answers change the basis on which the law applies to contracts running on 13 May 2016.

Editorial analysis

The outcome surprises nobody. The Court had already upheld Law no. 77/2016 five times, and in 2020 and 2021 the banks brought criticisms which, for the most part, they had made before. The problem with this decision is not what it says, but how little it says and how long it took to say it. Out of 44 paragraphs and roughly 5,200 words, the Court’s own examination occupies paragraphs 40 to 43. Of these, two deal with the inadmissibility of Article 8(5) second and third limbs, while the entire merits, that is, thirteen paragraphs and limbs plus a whole law, are settled in paragraphs 42 and 43: 145 words, 2.8% of the text. Paragraph 42 lists five earlier decisions, paragraph 43 finds that no new elements have intervened. Nowhere is it said which of the five decisions covers which of the thirteen texts.

The calendar is the second problem, and it becomes visible only when compared with the Court’s own benchmarks. Between delivery, 25 November 2025, and publication, 3 September 2026, 282 days passed. The five decisions on which this judgment rests were published 85 days (no. 623/2016), 159 (no. 806/2017), 96 (no. 432/2021), 259 (no. 749/2023) and 153 days (no. 36/2025) after delivery, an average of 150. Decision no. 644/2025 is 88% slower than the average of the very case law it invokes. And counting from the first referral order, that of the Cornetu District Court of 16 December 2020, the result is 2,087 days, five years and almost nine months in which courts heard challenges against notices without knowing whether the texts would hold, with the suspension of payments running throughout in the debtors’ favour.

The third observation is the one that does not show up when you read the decision from beginning to end and requires two moments to be placed side by side. In 2016, the Court’s entire construction on this law was an interpretative reservation: by Decision no. 623 of 25 October 2016, Articles 4, 7 and 8 of Law no. 77/2016 were declared compatible with the Constitution only in so far as the court verifies in concrete terms the conditions of hardship. In 2020, Parliament replaced that verification with two numerical thresholds and wrote, in Article 4(13), that the presumptions are irrebuttable, that is, precisely that the judge no longer verifies anything beyond the figure. In 2025, the Court upholds the irrebuttable presumptions and lists, among the decisions supporting them, Decision no. 623/2016 itself, delivered more than three and a half years before the upheld texts existed. The two cannot be applied literally at the same time. A judge who receives a challenge today and has to decide whether he may still analyse hardship above the 52.6% threshold has in front of him two binding decisions that say different things, and the new one nowhere declares that it departs from the old one, but on the contrary cites it.

The fourth observation concerns the rigour of the file. The Court joined seven cases but records the opinions of the referring courts for six of them: 824D/2021, where the District Court of Bucharest Sector 3 did not express itself and the Court notes the breach of Article 29(4) of Law no. 47/1992, then 854D, 880D, 894D, 896D and 897D. About File no. 895D/2021 nothing appears, neither an opinion nor a note that it is missing. The same heading covers the way two decisions insistently invoked by the parties are treated: no. 405 of 19 June 2018 and no. 731 of 6 November 2019. The second is the constitutional review carried out before promulgation of the very law that introduced the presumptions, and the banks argued that the legislative solution censured then was taken up again in the body of the law after re-examination. Neither of the two appears in paragraphs 40 to 43. The only court that sided with the banks, the District Court of Bucharest Sector 4 in File no. 896D/2021, had based its opinion precisely on them.

What should be changed

  • The Court should say explicitly how the irrebuttable presumption in Article 4(13) fits with the interpretative reservation in Decision no. 623/2016. The practical effect: trial courts would no longer have to choose, on their own responsibility, between two binding decisions of the same Court. A single sentence of reasoning saying either that the reservation has been superseded or that it continues to apply above the threshold would close hundreds of identical files.
  • Express exclusion, from the object of the plea, of the phrase in Article 11 first limb that has already been declared unconstitutional. The practical effect: the operative part could no longer be read as validating a text that has produced no effects since 2017. The Court did exactly that with Article 8(5) second and third limbs, so the mechanism is close at hand.
  • Parliament should bring Law no. 77/2016 into line with Decision no. 432/2021 and with Decision no. 623/2016. The practical effect: anyone opening the law today reads two limbs of Article 8(5) that have produced no effects since 5 November 2021 and a phrase in Article 11 that has produced no effects since 4 March 2017, both printed as text in force, with the explanation hidden in a footnote. That is almost five years of delay on the first text and more than nine years on the second, in the same act.
  • Public reasoning for the two thresholds, 52.6% and 50%. The practical effect: the banks’ main reproach, that the figures are arbitrary, would disappear. As long as neither the law, nor the explanatory memorandum, nor the decision explains where the two numbers come from and why they differ by 2.6 percentage points, any consumer sitting at a 51% rise in the exchange rate is left without a remedy and without understanding why.
  • A maximum deadline between delivery and publication for decisions on pleas of unconstitutionality. The practical effect: courts hearing identical disputes would stop working for months on end with an outcome known from a press release and reasoning they cannot read. A limit of 90 days would be more generous than the time in which four of the five decisions cited in this case were drafted.
  • Recording, in every decision joining cases, the position of each referring court or the reason why it is missing. The practical effect: the gap around File no. 895D/2021 disappears and it becomes verifiable whether Article 29(4) of Law no. 47/1992 was complied with in all the cases, not only in the one where the Court chose to say so.

Original text of the legal act

The text below is reproduced in Romanian, the official form of publication.

The full text, as published in the Official Gazette of Romania

Official Gazette of Romania no. 743 of 3 September 2026 16 pages PDF, 173 KB the act starts on page 2

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