On 5 April 2022, the Spanish Council of Ministers approved a Draft Bill on the creation of an Independent Financial Ombudsman (Autoridad Administrativa Independiente de Defensa del Cliente Financiero, the “Financial Ombudsman“). The Financial Ombudsman will take over the functions of the consultations and claims services currently performed by the regulators of the financial sector (including, the Consultations and Claims Section of the Directorate General of Insurance and Pension Funds (“DGSFP“), in the case of claims against insurers and insurance brokers). The new procedure establishes that decisions rendered in claims for less than €20,000 are binding on the financial institution involved.

Nature of the authority created by the proposed regulation

The aim of the Spanish legislator is to set up an Independent Financial Ombudsman (Autoridad Administrativa Independiente de Defensa del Cliente Financiero). According to the legislator, this will encourage the out-of-court settlement of conflicts between consumers and financial institutions, financial services providers and insurers. In a nutshell, the Financial Ombudsman will deal with consumer claims that were previously processed by either the Bank of Spain, the National Stock Market Commission (“CNMV“), and the insurance sector regulator (the DGSFP). It will therefore unify the three consumer-complaint services under the umbrella of a single body.

The reform intends to continue bolstering legislative mechanisms aimed at alternative dispute resolution among consumers and financial institutions. To that end, a unified system is established for claims in the financial sector, where decisions rendered on claims lower than €20,000 will be binding on the undertakings involved. The Financial Ombudsman will bring together the three consumer-complaint services until now performed by the financial system regulators (DGSFP, Bank of Spain and the CNMV). From an organisational standpoint, the Financial Ombudsman will be divided into Departments (Secciones) which will handle claims based on their subject matter; A Special Department (Sección Especial) will also handle new or complex issues.


The Financial Ombudsman will have jurisdiction over claims filed by financial sector customers concerning both:

  • Potential infringements of regulatory standards of conduct, Good financial practices; and
  • abusive clauses included in contracts provided the disputed clause has already been declared abusive by the (i) the Spanish Supreme Court; (ii) the ECJ; or a final judgment that has already been included in the Spanish register of general contractual terms and conditions.

The new system is aimed at handling claims only, which must have a pecuniary component – complaints, therefore, fall outside the remit of the Financial Ombudsman. Claims include any request by a customer (the following are included within the definition of customer: insured, policyholders, beneficiaries, injured third parties and successors of all of them, as well as participants in and beneficiaries of pensions plans) for the return or repair of their interests or rights, when it is understood that they have been breached in the provision of a service or within a contract. Consumer associations and organisations may also file claims.

Large risks are excluded from the system, except for third-party liability and maritime, river and lake-class vessels when the policyholder or the insured are deemed to be consumers. The Draft Bill, as it currently stands, does not expressly refer to the position of the injured third party in third party liability insurance policies, although it would seem logical for them to be accepted in these cases.

Relevant procedural aspects

The Financial Ombudsman will only handle claims which have already been filed with the customer services department or similar of the financial institution concerned. A claim filed with the Financial Ombudsman will only be processed if:

  • the claim was not accepted by the financial institution concerned;
  • the claim was dismissed by the customer services department of the financial institution concerned, at least partially; or
  • a month has elapsed since filing the claim without the customer services department of the financial institution concerned has issued a decision (If the claim was related to payment services, that period is reduced to 15 business days).

The deadline for filing a claim with the Financial Ombudsman is one year from the date on which the claims was filed at the financial institution's customer services department.

Resolution of claims is now subject to a fee of €250, which will accrue upon “admission of the claim” and must be paid by the financial institution against which the claim is made.

The Financial Ombudsman has a maximum of 90 calendar days within which to issue a decision starting from the date on which it has received the complete documentation – that period may be extended by a further maximum 90 days in the case of particularly complex disputes. The decision will be rendered based on the law.

If it is found that a claim has been filed recklessly or in bad faith, a grounded sanction may be imposed, but only if each and every one of the requests made in the claim has been dismissed in full. That sanction may be up to €1,000.

Filing a claim before the financial institution's customer services department and, subsequently, at the Financial Ombudsman will suspend the statutory limitation period for bringing legal action.

The parties may not bring a court or out-of-court claim against each other in relation to the object of a claim being heard by the Financial Ombudsman. However, the customer may at any time withdraw the claim filed before the Financial Ombudsman, in which case either party may bring against the other any court or out-of-court legal action concerning the object of that claim.

If, when the new regulation enters effect, a customer has a pending court claim on a matter that falls within the jurisdiction of the Financial Ombudsman, the customer will be able to withdraw its court claim unilaterally and file a claim before the Financial Ombudsman provided that a decision on the merits has not been delivered by the court.

New obligation to keep documentation

Within the process, the financial institution has the burden of proving that it has fulfilled applicable standards of conduct and good business practices to defend its position in respect of the client's claim. For this purpose, financial institutions are required to keep pre-contractual and contractual documentation for at least six years after the relevant contract comes to an end (six years since the pre-contractual documentation was handed over to the financial client if a contract was not ultimately executed).

Decisions, appeals and procedural costs

Only decisions on claims with a monetary value of less than €20,000 will be binding, and they will only be binding on the financial institution concerned. The financial institution concerned must comply with the decision within 30 business days.

Binding decisions rendered by the Financial Ombudsman may be challenged before the contentious-administrative courts. If the challenging party does not obtain from the court a more favourable ruling than delivered by the Financial Ombudsman, it will have to pay court costs.

If the Financial Ombudsman does not notify its decision on the claim within the 90-days period (or extension thereof) it will be understood that the claim has been dismissed, albeit only for the purpose of making it possible to file a contentious-administrative appeal.

In the case of non-binding decisions that find against the financial institution, the latter has 30 days from the notice of the decision to notify whether or not it accepts the decision and, if it does so, provides evidence of how it has remedied the situation with the customer. If it does not accept the decision, it must offer reasoned grounds for its rejection.

Unification of criteria

Within the context of the procedure, where previous decisions exist on claims that are based on substantially the same facts, requests or merits, or where claims affect several claimants or different kinds of financial services or departments' areas of jurisdiction, the Department handling a claim can file a preliminary question to the Special Department to unify criteria.

If a preliminary question is filed, this will suspend the proceedings until it has been resolved, although not exceeding the maximum extended term established.


The Financial Ombudsman has the power to impose pecuniary sanctions on financial institutions that breach the following obligations:

  • Submit to the Financial Ombudsman, by electronic means, all relevant documents and arguments in respect of a claim made by a financial client (the specific means for doing so may be the subject of further regulation);
  • keep all precontractual and contractual documentation related to the financial services among the entity's records for the mandatory minimum period
    (ie. 6 years);
  • be able to provide evidence of the fulfilment of applicable rules of conduct and good business practices; and
  • abide by the binding decisions issued by the Financial Ombudsman within 30 business days.

Breaches of these obligations constitute either minor or serious infringements depending on the number of people affected, recidivism or the impact on customer confidence and the stability of the financial system.

The sanctions cannot exceed 1% of the net annual turnover of the financial institution (for minor infringements); or 5% of the net annual turnover of the financial institution (for serious infringements). Sanctions will need to be effective, proportionate and act as a deterrent and – other than the nature of the infringement, whether minor or serious – the Financial Ombudsman will consider the following factors when graduating the sanctions it imposes:

  • The amount of the transactions affected by the breach.
  • The profits obtained as a result of the omissions or acts constituting the breach.
  • Whether or not the financial institution has on its own initiative proceeded to remedy the breach.
  • The number of final administrative sanctions imposed on the financial institution for different types of breaches in the last five years under this law.
  • The financial institution's degree of responsibility or intent in respect of the events in question.
  • The seriousness and duration of the breach.
  • Losses to third parties caused by the breach.
  • The financial institution's economic capacity when the sanction is a fine.
  • The degree by which the financial institution cooperates with the competent authorities.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.