Section 11: Account overdrafts

The provisions of 1° to 3° of article L. 312-6 and those of articles L. 312-16, L. 312-17, L. 312-27, L. 312-38, L. 312-39, L. 312-44, L. 312-48, L. 312-49, L. 312-54, L. 312-55, L. 312-56 and L. 312-85 to L. 312-91 apply to credit granted in the form of an overdraft facility repayable within a period of more than one month and less than or equal to three months….

Prior to entering into a transaction referred to in the first paragraph of Article L. 312-84, the lender shall provide the borrower, on paper or on another durable medium, with information enabling the borrower to clearly understand the extent of its commitment. The list and conditions of presentation of this information are set by decree in the Conseil d’Etat.

If the creditor is prepared to grant credit, he shall provide the borrower, free of charge, at his request, on paper or any other durable medium, with the information provided for in the second paragraph of Article L. 312-87.

The credit agreement is drawn up on paper or on another durable medium. It constitutes a document distinct from any advertising medium or document. The list of information appearing in the contract is set by decree in the Conseil d’Etat.

For transactions granted in the form of an overdraft authorisation repayable within a period of more than one month, the lender is required to send the borrower, on a regular basis, on paper or on another durable medium, a statement of account including information, the list and content of which are set by decree in the Conseil d’Etat.

In the event of an increase in the borrowing rate or in the charges for which the borrower is liable, the borrower is informed on paper or on another durable medium before these changes come into force. Where the change in the borrowing rate results from a change in the reference rate, the new reference rate is made public by appropriate means and information on the new reference rate is…

The borrower may terminate an open-ended overdraft authorisation at any time and free of charge, unless the parties have agreed a period of notice. This period may not exceed one month.

If the credit agreement so provides, the lender has the option of terminating the open-ended overdraft authorisation subject to at least two months’ notice being provided to the borrower on paper or on another durable medium. In the event of a legitimate reason, such termination may be effected without notice, in which case the lender shall provide the borrower with the reasons, if possible prior to termination. .

Where the account agreement referred to in second paragraph of I of Article L. 312-1-1 of the Monetary and Financial Code provides for the possibility of an overrun, this agreement mentions the borrowing rate, the conditions applicable to this rate, any index or reference rate that relates to the initial borrowing rate, the applicable charges and, where applicable, the conditions under which these charges may be modified. In all cases,…

Where the overrun continues for more than three months, the creditor shall without delay offer the borrower another type of credit transaction within the meaning of 4° of Article L. 311-1, under the conditions governed by the provisions of this chapter.