SCHIRP & PARTNER Rechtsanwälte mbB: ECB negative interest rates are allegal. Banks can reclaim 40 billion EURO. Bank customers can fend off bank charges. Press conference on October 1st in Berlin

Negative interest rates charged by European Central Bank (ECB) are unlawful. Leading German law professor submits expert opinion: Banks can reclaim 40 billion EURO paid as negative interest since June 2014. And: Bank clients can fend off being debited with negative rates. Since June 11^th, 2014, European Central Bank (ECB) and national central banks in the EURO zone are charging negative interest rates from all banks within their jurisdiction. The aim of this measure was to promote extensive lending and to keep deflation at bay. Currently, the ECB negative interest rate stands at ./. 0,5 % p.a. All in all, banks have paid 40 billion EURO as negative interest in the five years since this measure has been imposed. While the economic effects of negative interest rates are at best dubious, a new expert opinion brought forward by a leading German law professor in cooperation with banking lawyers shows that the practice is also unlawful. Furthermore, this finding erodes the basis upon which the passing on of negative interest rates to bank customers has so far been justified. Prof. Dr. Kai-Oliver Knops who is teaching banking and capital market law as a full professor at the university of Hamburg affirms: "The negative rate practice adopted by the ECB council in 2014 is a violation of EU law. The ECB council had no authority to establish these rules.The decision lacks any rationale, and the Parliamentary Assembly was sidelined. The principles of subsidiarity (art. 5 III EU treaty) and of proportionality (art. 5 IV EU treaty) were sacrificed. Also, there were several breaches of relevant national laws. The whole practice violates the law for a multitude of reasons." Banking lawyer Dr. Wolfgang Schirp from Berlin agrees with Prof. Knops and foresees a wave of litigation rolling towards ECB and national central banks: "Over the five years since negative rates have been adopted by ECB, banks have paid an estimated 40 billion EURO to ECB and their respective national central banks. These banks are entitled to reclaim their monies, and it will be their obligation vis-à-vis their shareholders to push through with this. Bank clients who have been debited with negative interest rates can also reclaim what they have paid. As early as 2019, we are going to see massive legal action since otherwise the statute of limitation could commence." Both Prof. Dr. Kai-Oliver Knops and Dr. Wolfgang Schirp will be available to explain their thoughts in a press conference on October 1^st, 2019, at 10 a.m. The press conference will be held in the "Tagungszentrum im Haus der Bundespressekonferenz", Schiffbauerdamm 40, 10117 Berlin / Germany. If you wish to attend, please confirm by e-mail to mail@schirp.com. For further information please contact: Dr. Wolfgang Schirp, Fachanwalt für Bank- und Kapitalmarktrecht, Schirp & Partner Rechtsanwälte mbB, Leipziger Platz 9, D - 10117 Berlin, Tel. 0049-30-3276170, mail: schirp@schirp.com.