I. Formal Level - The Constitution amended for the Euro-crisis

a) Art.93 CE - Gateway clause: allows transfer of constitutional powers to EU.
b) Art.135 CE Reform of 7 September 2011 - This is the core of banking constitutionalisation.

The Sovereign Debt Crisis and the Reform of Article 135 of the Spanish Constitution, by means of which the principle of balanced budget and the restricting of the public expenditure are constitutionalized.

After Spain requested €100bn for bank recapitalisation in June 2012, EU forced constitutionalization of the golden rule. New Art.135:

• Introduces budgetary stability as a constitutional principle
• Gives absolute priority to payment of public debt interest and capital
• Requires Organic Law 2/2012 to enforce EU Fiscal Compact
• Links directly to Banking Union conditions

Only two constitutional amendments have ever been made in Spain, both prompted by EU. The first was Art.13.2 for Maastricht, the second was Art.135 for banking / fiscal union.

II. Material Level - Banking Union as new constitutional order

Spain moved from Banco de España supervision to a European constitutional banking law:

1. Single Supervisory Mechanism - SSM: Council Regulation (EU) No 1024/2013 conferring specific tasks on ECB. Came fully into operation 4 Nov 2014. For Spain, this meant ECB directly supervises Santander, BBVA, CaixaBank, Sabadell etc. Spanish Constitution Art.24 right to effective judicial protection now has to be exercised against ECB acts via EU courts, not Spanish courts.

The banking union is a key component of the economic and monetary union... currently based on two fully operational pillars: the Single Supervisory Mechanism (SSM) and the Single Resolution Mechanism.

2. Single Resolution Mechanism - SRM: Regulation 806/2014. Spanish FROB is now execution arm of Single Resolution Board in Brussels.

3. The 2012 MoU: The Spanish Memorandum is related to the financial assistance of the Banking Sector. It had quasi-constitutional force - Parliament had to transpose BRRD, CRD IV, and create SAREB (bad bank).

III. Private Banking Law Constitutionalised through EU Consumer Law

This is the most litigated area in Spain. Directive 93/13/EEC on Unfair Terms became de facto constitutional law via Art.51 CE (consumer protection) and Art.24 CE (effective judicial protection).

The Spanish mortgage crisis forced Constitutional Court and ECJ into dialogue:

1. Foundational Cases:

C-618/10 Banco Español de Crédito v Calderón Camino - 14 June 2012
Spanish proceso monitorio (order for payment) did not allow judge to examine unfair terms ex officio.
ECJ: Violates Directive 93/13. National court MUST have power to examine unfairness of its own motion.
Consequence: Spanish LEC reformed, specialized banking courts created.

C-415/11 Aziz v Caixa d'Estalvis de Catalunya - 14 March 2013
Spanish mortgage enforcement law did not allow debtor to oppose enforcement based on unfair terms (like default interest 18%, unilateral quantification).
ECJ: Spanish procedural law contrary to principle of effectiveness. Created new Spanish Law 1/2013 reinforcing protection of mortgagors.

On May 14th 2013 the reform of several provisions of the Spanish Code of Civil procedure and related Laws was enacted by Ley 1/2013, which aimed at reinforcing the protection of mortgage debtors

2. Floor Clauses Saga - Constitutional clash:

Joined Cases C-154/15, C-307/15, C-308/15 Gutiérrez Naranjo v Cajasur, Banco Popular, etc. - 21 Dec 2016
Spanish Supreme Court had limited retroactivity of nullity of cláusulas suelo (floor clauses) to May 2013 for financial stability reasons.
ECJ Grand Chamber: Declaration of nullity of unfair term under Art.6(1) must have full retroactive restitution. National judicial limitation contrary to EU law.

Followed by C-421/14 Banco Primus v Gutiérrez García - 26 Jan 2017
Spanish Constitutional Court had to react. In PRESS RELEASE No. 28/2019, the Plenary declared it had to apply ECJ judgment C-421/14 on abusive clauses even against its own res judicata doctrine. Constitutional Court accepted EU primacy in banking consumer law over Spanish procedural autonomy.

C-869/19 Unicaja Banco - 2022
Temporal limitation on repayment of amounts overpaid to banks based on floor clause was contrary to effectiveness. Confirms Gutiérrez Naranjo.

3. Current frontiers:

C-125/18 Gómez del Moral Guasch v Bankia - 3 March 2020 Grand Chamber - IRPH Index
Spanish courts must verify that contractual term providing variable interest based on index of Spanish savings banks is plain and intelligible. IRPH potentially unfair if not transparent. Over 1 million mortgages in Spain affected.

C-484/21 Caixabank and C-561/21 etc. - Mortgage costs
Terms stipulating all mortgage creation costs (notary, AJD tax) to be paid by consumer are unfair. Starts limitation period only from when consumer knew of unfairness. Nullifies Spanish Supreme Court doctrine of sharing costs.

C-450/22 ADICAE v Banco Santander, BBVA, etc. - 4 July 2024
Collective action on floor clauses. Mortgage loan agreements - clauses limiting variation of interest rates - 'Floor' clauses. Allows collective actions to have erga omnes effects.

IV. The Constitutional Model in Spain Today

Spanish banking law is now three-layer constitutional pyramid:

1. EU Treaties + SSMR/SRMR + BRRD as higher constitutional law (Art.93 + 135 CE)
2. Spanish Constitution Arts. 51, 24.1, 38, 135 interpreted in conformity with EU law
3. Ordinary banking laws - Ley 10/2014 de ordenación, supervisión y solvencia, Royal Decree-Law 1/2007 General Defence of Users

Any Spanish judge in a mortgage case is now a European constitutional judge: must set aside Spanish LEC if it prevents EU consumer protection - doctrine of ex officio control established in Banco Español de Crédito.