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2020 | Buch

Control of Price Related Terms in Standard Form Contracts: General Report Kapitel lesen Erstes Kapitel lesen

Control of Price Related Terms in Standard Form Contracts

herausgegeben von: Yeşim M. Atamer, Pascal Pichonnaz

Verlag: Springer International Publishing

Buchreihe : Ius Comparatum - Global Studies in Comparative Law

Enthalten in: Springer Professional "Wirtschaft+Technik" , Springer Professional "Wirtschaft"

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Über dieses Buch

This book explores various approaches around the world regarding price term control, and particularly discusses the effectiveness of two major paths: ex ante regulatory and ex post judicial intervention. Price control and its limits are issues that affect all liberal market economies, as well as more regulated markets.

For the past several years, courts in many different countries have been confronted with the issue of whether, and to what extent, they should intervene regarding price-related terms in standard form contracts – especially in the area of consumer contracts. Open price clauses, flat remunerations, price adjustment clauses, clauses giving the seller/supplier the right to ask for additional payments, bundling or partitioning practices, etc.: a variety of price related terms are used to manipulate customers’ choices, often also by exploiting their behavioral biases. The result is an unfavorable contract that is later challenged in court. However, invalidating a given price term in standard forms e.g. of a banking or utilities contract only has an inter partes effect, which means that in thousands if not millions of similar contracts, the same clauses continue to be used. Effective procedural rules are often lacking. Therefore, pricing patterns that serve to hide rather than to reveal the real cost of goods and services require special attention on the part of regulators.

The aim of this book is to determine the various approaches in the world regarding price term control, and particularly to discuss the efficiency of both paths, ex ante regulatory and ex post judicial intervention. Thanks to its broad comparative analysis, this book offers a thorough overview of the methods employed in several countries. It gathers twenty-eight contributions from national rapporteurs and one supra-national rapporteur (EU) to the 2018 IACL Congress held in Fukuoka. These are supplemented by a general report presented at the same IACL Congress, which includes a comparative analysis of the national and supranational reports. The national contributors hail from around the globe, including Africa (1), Asia (5), Europe (17), the European Union (1) and the Americas (5).

Inhaltsverzeichnis

Frontmatter

General Report

Frontmatter
Control of Price Related Terms in Standard Form Contracts: General Report
Judicial Control and Other Means of Price Control
Abstract
Competitive market economies work with the basic assumption that the supply side cannot charge more than their cost of supply given that rational and perfectly well-informed customers know their preferences and are responsive to any price change in the market. However, markets are never fully transparent, and findings of behavioural sciences show that especially consumers act based on imperfect rationality due to systematic biases. Pricing structures that serve to hide rather than reveal the real cost of the goods and services pose one of the main challenges to markets as they abuse biases on the demand side to the greatest extent possible. “Hiding” price related terms in standard form contracts is a prominent way of creating non-salient prices and is therefore a debated issue in many recent high court decisions of different countries. This paper conducts a comparative study on developments in 28 jurisdictions and discusses the efficiency of ex ante regulatory as well as ex post judicial intervention. The results show that controlling prices and price related terms is a multifaceted and complicated issue which entails a holistic approach, involving more transparency, smarter information to be provided to customers, but sometimes also hard paternalistic interventions such as price caps. Besides, more effective ways of collective proceedings and redress mechanisms need to be implemented.
Yeşim M. Atamer, Pascal Pichonnaz

Supranational Report: European Union

Frontmatter
Control of Price Related Terms in Standard Form Contracts in the European Union: The Innovative Role of the CJEU’s Case-Law
Abstract
The starting-point of this paper is an analysis of the regulatory framework provided by Directive 93/13/EEC on unfair contract terms regarding price-related terms, distinguishing between aspects that it regulates and those that it leaves out of its scope of application. I then examine the central role the Court of Justice of the European Union (CJEU) has played in the development of certain concepts related to the transparency principle as applied to contract prices (what it is, what it affects, how it should be applied, what terms are exempt, and the consequences of a lack of transparency). The Court has put forward autonomous and innovative interpretations of what it considers the main subject matter of a contract and the nature of the assessment of transparency (which goes beyond a mere grammatical or formal understanding); it has identified its basis in the trader’s duty of information; it has adopted an objective standard of the average consumer for assessment of the intelligibility of a term; and it has clarified the nature and consequences of the ineffectiveness which results from a lack of transparency of a term. Nonetheless, the CJEU may have exceeded its own powers of interpretation by treating the assessment of transparency as a particular case of unfairness, as Directive 93/13/EEC does not establish any consequence of non-compliance with the duty for plain intelligible language, other than requiring the interpretation most favourable to the consumer. Finally, this paper considers future issues, which are likely to arise in this area, which the CJEU will have to face and aspects of its existing case-law that it should refine, and it puts forward a critical approach to the scheme of controls designed by the Directive.
Sergio Cámara Lapuente

National Reports

Frontmatter
Control of Price Related Terms in Standard Form Contract in Argentina
Abstract
Under Argentine current Civil and Commercial Code, as enacted and in effect since August 1 2015, the price in consumer relations cannot be contested by Consumers. The Code merely confirmed such principle established that under former specific consumer legislation ratified by the Code, the consumer right is to return the unused product within 10 days and get his money back. The research question proposed by the Academy is whether under Argentine law contract terms that are ancillary or connected to the price of the product or service imposed to consumers by suppliers have an aggregate effect of increasing the “quoted” price for consumers and therefore may be legally challenged.
The review of jurisprudence shows that argentine cases reject challenges to the amount of the price itself and do not consider those terms as accessories. There is however a Court case at the Supreme Court level that considered objectionable the amount of a bank commission versus the rate of interest paid by the bank to his client. The rate was indeed fixed by the bank and did have the prior authorization of the Central bank, but the rate of interest was fixed freely by the bank. The Court ordered to revert all paid commissions in excess of the interest rate when found that the commission over the years was increased by the bank in excess of the interest rate paid to the client. This precedent but may lead to future challenges
Osvaldo Jorge Marzorati
Control of Price Related Terms in Standard Form Contracts in Austria: Judicial Control and Other Means of Price Control
Abstract
This chapter describes and analyses the tension between freedom of contract and contractual justice with regard to price terms in standard contract terms. It focuses on the considerable body of judicial decisions by Austrian courts and provides general information about the Austrian legal framework with regard to price terms in standard contract terms. Thus, the chapter deals with general rules of private law as well as sector specific regulation in the field of consumer protection.
Florian Heindler
Control of Price Related Terms in Standard Form Contracts in Belgium
Abstract
The main objective of this national report is to offer an insight into the way that control of price related terms in standard form contracts takes place in Belgium. It will be shown that prices are in principle determined by the market mechanism. The principles of freedom of contract and the autonomy of the will imply that parties can also agree freely on price related terms (in standard form contracts). However, consumer legislation and sector-specific rules have a substantial impact on the parties’ freedom. Most far-reaching are rules determining the maximum price that can be charged and the limitations of the possibility to insert price alteration clauses in (consumer) contracts. Both aim at protecting the weaker party.
Reinhard Steennot
Control of Price Related Terms in Standard Form Contracts in Brazil
Abstract
Freedom of contract lies among the fundamental principles of the economic order established by the 1988 Brazilian Constitution. Even though the Brazilian legal system protects free-market institutions, there are important hypotheses of legislative, regulatory and judicial price controls, which should be taken into account in order to understand the dynamics of freedom of contract. The Brazilian legal system contains multiple and disperse hypotheses of direct price control, whether on primary price terms or ancillary price terms, and this diversity makes the complete coverage of these cases an almost impossible task. However, this report shall try to systematize the most common or most important price control of standard contract terms in Brazilian Law.
Ana Frazão
Control of Price Related Terms in Common Law Canada: Piecemeal Solutions to Demonstrated Problems of Unfairness
Abstract
Common law Canada displays a marked disjunction between ex ante and ex post price control strategies. The federal government and provinces are avid price regulators, imposing explicit price controls and transparency mandates applicable to many consumer contracts. However, their legislative and regulatory strategy has been a piecemeal one, with most regulations applying to individual industry sectors, in particular those where popular pressure to crack down on deceptive practices or high prices generates political momentum. By contrast, the courts have assigned themselves a strictly limited role in regulating price terms ex post. They continue to hew to traditional notions of freedom of contract, and to invalidate price terms in exceedingly narrow circumstances derived from historically-recognized categories of unfairness—piecemeal solutions of a different kind. Neither the courts nor the legislatures have developed a general theory or policy of contractual unfairness, in standard contracts or otherwise. The overall effect is that ex ante regulation of price terms is stringent where it exists but uneven in application, while ex post control of price terms by the courts is widely available in principle but rarely if ever occurs in practice.
Joshua Karton
Control of Price Related Terms in Standard Form Contracts in Canada (Civil Law): Le prix dans les contrats de consommation, les contrats d’adhésion et les contrats réglementés – pouvoir d’intervention des tribunaux et autres modes de contrôle des prix en droit québécois
Abstract
Quebec civil law deals with issues relating to price control by various means. Even though questions of lesion (or unconscionable contracts) play a very limited role in the general rules of contracts, it is given particular attention in consumer law. An extensive revision of the Civil Code, completed at the end of the twentieth century, did not include significant changes which would allow the contestation of contracts perceived as lesionary under the general rules of contract. It does offer, however, greater relief to vulnerable contracting parties in relation to contracts of adhesion in which clauses deemed abusive are subject to a sanction of nullity or of reduction of the obligations included therein. Moreover, certain contracts or stipulations may be subject to specific rules set out by federal or provincial provisions relating to price control, or to expectations of transparency on the part of economic actors for clauses having an impact on prices. Thus, the pertinent rules vary considerably according to their source and their scope. The application of these rules may present interesting variations from a procedural point of view since related litigation is not necessarily limited to individual lawsuits but may, in certain circumstances, form the basis of a class action.
Marie-Claude Desjardins, Nathalie Vézina
Control of Price Related Terms in Standard Form Contracts in Chile: Price Control and the External Intervention of Contracts in Chilean Law
Abstract
In this chapter we analyse the evolution and current status of the price control regulation in Chile. It should be noted that Chilean law does not provide for general rules for an external price control, so neither the Civil nor the Commercial Code regulate mechanisms granting powers to any judicial or administrative authority to review the economic terms of a contract. Exceptionally, the Civil Code provides rules for the invalidation of certain contract due to laesio enormis, but, in the context of a sales agreement, it is limited only to those referred to real estates. Special rules have been incorporated to the Chilean legal system since the last decades of the twentieth century, once disregarded the model of a public regime of price fixing, mainly focussed in the need for a stronger consumer protection. However, such amendments do not include a regulation of “standard term contracts”, but only to abusive clauses in “contracts of adherence”, which do not expressly incorporate the possibility that judge may intervene in the economic terms of the contract.
Jaime Alcalde Silva, Juan Luis Goldenberg Serrano
Control of Price Related Terms in Standard Form Contracts in China
Abstract
The freedom of contract has been acknowledged as one of the underlying principles in Chinese contract law. In some cases the courts avoid price terms in standard contracts by employing rules on controlling standard contract terms. In more cases, the courts are reluctant to review price terms and rule against the standard contracts provider insofar as the price terms are consistent with government-guided prices. The Price Law and relevant administrative regulations are in dominance in price controlling system. Nevertheless, competition in market is expected to play a more fundamental role in generating fair prices, while the administrative control of price terms in the area of, for example, financial services and telecommunication services should be more restricted.
Shiyuan Han, Teng Wu
Control of Price Related Terms in Standard Form Contracts in Croatia
Abstract
Party autonomy or freedom of contract represents one of the main principles of any national contract law and the Croatian law is no different. There are, however, restrictions to this freedom, notably in the interest of consumers. One of the means to ensure that the contractual provisions are not to the detriment of consumers is the control of standard contract terms. General provisions on control of standard contract terms are provided for in the general law on obligations and it is applicable to all contracts, irrespective of the contracting parties. On the other hand, legislation on consumer protection provides for control of standard contract terms in consumer contracts and it is not surprising that the provisions therein are mirror image of the relevant EU legislation. In addition, control of standard control terms is afforded in special legislation on particular services.
Very generally, it may be stated that one of the principal mechanisms of consumer protection is the price disclosure and, even in broader terms, that the price related terms are clear and transparent. As to the control of these terms in standard contracts, so far scarce case law points out that in the course of assessing the price-related terms contained in the standard contract terms, the Croatian courts have not distinguished between main and ancillary terms affecting the price and every term which has an impact on a price is generally considered a price-related term. Thus, all the subject-matter and price related contract terms are treated equally and they are subject to an assessment against their unfairness only provided that these terms do not meet the transparency requirements.
The courts are competent to control standard contract terms, including the price related terms. However, besides them, the competence to control standard contract terms (including price related terms) in some special consumer contracts (e.g. in the sectors of energy, financial services and electronic communication) is given to the relevant independent regulators. There are significant disparities in terms of various aspects of this control (e.g. timing of control /ex ante or ex post/, personal scope of protection provided, power of entities which control standard contract terms, legal protection provided and legal effects of the decision of the competent body regarding the unfairness of a standard contract term).
Marko Baretić, Siniša Petrović
Control of Price Related Terms in Standard Form Contracts in Denmark: Pragmatism and General Clauses
Abstract
This chapter concerns Control of Price Related Terms in Standard Form Contracts under Danish law. It first highlights some essential features of the freedom of contract under Danish law as a historical and current cornerstone of contract law. It then addresses the legislative control of price terms, which is encompassed by a general reasonableness standard that applies universally to all contract terms. Then, the control of contract terms at the judiciary and other authorities are presented. Finally, it examines some examples of regimes that are subject to price caps, before addressing the legislative and private efforts to promote transparency.
Kasper Steensgaard
Control of Price Related Terms in Standard Form Contracts in Estonia: Judicial Control and Other Means of Price Control
Abstract
The principle of party autonomy enjoys a great importance in the Estonian law and it has generally been held that parties are free to agree upon the contractual price. However, the law also provides numerous statutory restrictions, e.g. concerning APRC caps for consumer credit contracts, contractual penalties, damages, claims or late payment interest, in order to protect the weaker party of the contract. Those restrictions are relevant not only for standard terms but also for individually negotiated contracts. Governmental price control is foreseen for the so-called natural monopolies.
There is no general competence for judicial price control in Estonia and price clauses in standard terms are exempt from unfairness test. However, the Supreme Court has, on several occasions, acknowledged the dangers associated with absolute party autonomy and declared void certain abusive clauses in consumer contracts. The intervention of the Supreme Court has been based upon, firstly, a general rule that transactions violating good morals are void and secondly, on subjecting certain price-similar standard terms (ancillary price clauses) to unfairness control.
Estonian law contains no specific prohibition of price bundling or price partition. A general restriction on bundling of goods and services is set forth for consumer contracts concluded on standard terms but the case law is scarce and there seems to be a general enforcement gap. The transparency requirements which would balance the effect of price-partitioning or price bundling are mostly based on different EU legislative acts.
Karin Sein
Control of Price Related Terms in Standard Form Contracts in France
Abstract
Recent developments in French contract law reflect a greater focus on the balance of bargaining power before the conclusion of contract. Standard form contract is regarded as a criterion of unequal bargaining power, both in consumer law and in ordinary contract law. Nevertheless, the control of price terms is not subject to uniform and consistent treatment.
Gaël Chantepie
Control of Price Related Terms in Standard Form Contracts in Germany
Abstract
The question whether or not a price-related term can be subject to a fairness test is highly debated in Germany. The judiciary differentiates between principal and ancillary price terms; only ancillary price terms shall be subject to a fairness test. However, the results of this approach are at least partly unconvincing. A preferable approach is presented by parts of the academic literature: the decisive measure is whether a free-market competition can be established with regard to the respective clause. Only if this is the case a fairness test is not justified since there is no reason for a judicial control of a decision based on freedom of contract.
Matthias Fervers, Beate Gsell
Three Modes of Regulating Price Terms in Standard-Form Contracts—The Israeli Experience
Abstract
Regulation of the content of standard-form contracts usually focuses on the invisible terms that customers hardly ever read. It does not refer to the price, because price is a salient component of the transaction, to which customers usually pay attention and sometimes even compare between suppliers. However, it is often difficult to draw the line between the price and price-related, invisible terms.
This chapter analyzes the Israeli experience concerning the regulation of prices and price-related terms. The Israeli experience is interesting for several reasons. These include the fact that in 1964, Israel was the first country to enact a specific Law regulating the content of standard-form contracts, which established both a framework for ex post judicial supervision and a mechanism for ex ante, administrative/quasi-judicial supervision; the various reforms made in these mechanisms throughout the years, including the de facto abolition of the administrative/quasi-judicial mechanism in 2014; and the activist policy adopted by the Israeli Banking Supervisor. While Israeli law—much like other systems—has long imposed strict disclosure duties on banks, insurers, and other suppliers, unlike some other systems, it has always regulated the content of contracts, as well. This regulation was vital during the 2008 subprime crisis, in which Israel suffered little, and recovered.
Eyal Zamir, Tal Mendelson
Control of Price Related Terms in Standard Form Contracts in Italy
Abstract
The control of price related terms in consumer contracts in Italy is governed by a complex set of rules and regulations. In this field, the traditional distinction between private and public law has given way to new approaches, spanning the public law/private law divide. The civil code and the consumer code (which implements EU law on unfair contract terms) provides limited assistance in this matter, while special regulations do offer substantial relief against unfair price related terms in certain contractual contexts. The enforcement of rules protecting consumers in this respect is no more the exclusive preserve of Courts; administrative agencies and alternative resolution bodies are regularly involved in the same exercise. Nonetheless, at least some of the major problems that arise with respect to the control of price conditions in mass transactions are still directly dealt with by the legislature, even after waves of privatisation. The policy in favour of more informed consumer decisions still has to be fully achieved, while the regulators are beginning to react to marketing techniques that tend to exploit consumers’ cognitive biases.
Michele Graziadei
Control of Price Related Terms in Standard Form Contracts in Japan
Abstract
This national report provides an overview of Japanese law on the topic of control of price terms in standard form contracts. After providing general background information on the primacy of freedom of contract and control of standard terms in general under the Japanese legal system, the report turns to the central question of private law control of price terms in standard contract terms. However, this has not been an issue that has been fully discussed or developed under Japanese law, and therefore, there is a lack of a coherent analytical framework. Nonetheless, there are recent high-profile Supreme Court cases that utilize private law rules such as the Consumer Contract Act to control price terms. In addition, public law regulations that may affect price terms also exist. One recent area that is gaining academic as well as public attention is the pricing practice in mobile telecommunication contracts. These movements may become a trigger for the development of rules on control of price terms in Japan.
Hiroo Sono
Control of Price Related Terms in Standard Form Contracts in the Netherlands: Exclusion of Clauses Pertaining to the Core of the Contract
Abstract
In the 1970s, most European countries adopted legislation on unfair contract terms. Clauses pertaining to the core of the contract were usually exempted from this control. The fear of a return to the ancient iustum pretium doctrine was behind this. Not every country has adopted this exception. The Nordic states, for example, have declined to do so. This paper will briefly study the Nordic system to highlight that excluding the price clauses is not a necessity. It will then focus on giving a closer look at the Dutch system of control. The freedom of contracts principle, as well as the Dutch control of both unfair contract terms and price terms will be presented. The most important Dutch cases will also be studied.
Ewoud Hondius
Control of Price Related Terms in Standard Form Contracts in Romania
Abstract
This contribution seeks to analyse the regime of control of the price related terms in standard form contracts under Romanian law. First, it highlights the relevant status of freedom of contract for the control of standard contract terms and presents the general and sectorial regulatory provisions promoting price transparency and competition, as well as authorizing the control of price terms under Romanian Law. Against this background, the report describes the judicial control of standard contract price terms in Romanian courts, under the new Romanian Civil Code (focusing on laesio enormis and hardship) and under the special regulations on business-to-consumer contracts (with a particular interest in the unfair terms CJEU case-law originated from Romania and the peculiar datio in solutum mechanism related to credit agreements).
Adriana Almăşan, Lucian Bercea
Freedom of Contract in Respect of Price Terms in Russian Law: With a Special Focus on Price Terms in Standard Form Contracts
Abstract
Control of price-related terms in either standard form contracts or B2C contracts has hardly become topical in Russia. This is true for legislature and judiciary as well as for academia.
Apart from price regulation for carriage by rail, energy supply, public utility services, compulsory automobile liability insurance, etc. as well as a general prohibition against setting different prices for different customers of the same category in contracts having particular social significance (‘public contracts’), regulatory interventions providing for such control are rare, and they do not seem to be based on a clear and coherent general model or idea.
The courts remain reluctant so far to police price-related terms even though the Russian law provides for an array of tools that might be used for this purpose.
The only domain in which control of price-related terms has gained careful attention from the legislature and judiciary is consumer credit.
Artyom G. Karapetov, Andrey M. Shirvindt
Control of Price Related Terms in Standard Form Contracts in Singapore
Abstract
Singapore embraces ‘free market’ principles and the associated principle of ‘freedom of contract.’ Nevertheless, there are controls over contractual unfairness, be it procedural or substantive unfairness. This report provides an overview of the existing controls, focusing on the controls over contract terms in Singapore. Most of these controls, whether ex-ante legislative or administrative ones, or ex-post judicial ones, do not specifically target standard form contracts, B2C or B2B contracts, or even price terms. Where price or price related terms are concerned, the Singapore government relies mainly on ex-ante legislative (and administrative) rather than ex-post judicial control. Even then, it makes light use of ex-ante regulation to limit price terms, preferring to let price terms be regulated by market forces, with legislation or administrative regulations compelling disclosure in specific sectors of industries, while encouraging self-regulatory initiatives in others.
Wee Ling Loo
Control of Price Related Terms in Standard Form Contracts in Slovenia
Abstract
In Slovenian Law of standard contracts terms in B2C contracts, the terms relating to the main subject matter of the contract or the adequacy of the price and remuneration (“core terms”) are exempt from judicial fairness assessment insofar as they are in plain intelligible language. In a number of pending cases relating to credit contracts in Swiss Francs, the fairness assessment of the foreign currency clauses depends on the question whether these clauses are in plain intelligible language. In a recent case the Supreme Court assessed the fairness of a term which, although it influenced the price, did not belong to “core terms”. In another case, the Court assessed the fairness of the price calculation mechanism. The Slovenian Obligations Code contains a possibility to avoid the contract due to laesio enormis—a particular form of mistake. However, in most cases, the courts reject such claims as they consider the mistake of a party with regard to the price/value to be inexcusable. A contract can be also found usurious and thus, null and void, where, in addition to significant imbalance, a party one party has knowingly exploited a difficult situation of the other party the result of which was an imbalanced contract.
Damjan Možina
Control of Price Related Terms in Standard Form Contracts in South Africa
Abstract
Many South African consumers are vulnerable to exploitation through the abuse of non-negotiable and non-transparent price-related standard terms. The common law of contract provides only limited relief in these circumstances. Some potential exists for developing common-law principles, such as those relating to when terms or their enforcement are contrary to public policy, in order to provide greater protection against unfair price-related terms. But the prospects for such a development are not promising, even though the South African Constitution allows courts to develop the common law to give effect to a horizontally-applicable Bill of Rights. By and large, the courts adopt a fairly conservative approach, which generally emphasises sanctity of contract.
However, the legislature has been quite active in creating regulatory standards, systems and structures that deal with the control of price-related terms. Notable examples include a general provision in the Consumer Protection Act 68 of 2008, which determines that the price or terms of a consumer contract must not be unfair, and other provisions which prohibit certain terms or misleading practices, or which presume certain terms to be unfair. Unfortunately, the enforcement of consumer legislation by statutory bodies has not been particularly strong.
Apart from these general provisions, consumers may also obtain relief against abuse of price-related terms through relying on rules that regulate specific industries. Thus, some success has been achieved in regulating the costs of credit and there are also strong signs of increased intervention in the problematic area of the high costs of electronic communication. Competition law has also proved to be effective in combatting some exploitative practices. Ultimately, the South African experiences indicate that rules aimed against the abuse of price-related standard terms must be backed up by effective enforcement mechanisms, especially where individual consumers lack the ability to enforce their rights.
Jacques du Plessis, Wiaan Visser
Control of Price Related Terms in Standard Form Contracts in Spain
Abstract
The control of standard terms implies a significant inroad into classic contract theory as the fairness assessment moves from formation (procedural justice) to the content of contracts (substantial justice). When it comes to price terms, the challenge faces freedom of contracts and competition—two sources of undoubted interest for academics and practitioners. The chapter aims to present the status of the control of price related terms in Spanish law. It includes an introduction to the validity of standard form contracts in general and an analysis of content control in B2C contracts as the more far-reaching one. The assessment is not limited to statutory controls. Judicial activism has been significant in this field, as case law has defined unfairness criteria for specific types of contracts and ancillary terms. Additionally, courts have increasingly resorted to the requirement of transparency to control main price terms. The contours of the assessment of non-transparent terms and its consequences are not entirely defined nor homogenous, which brings about a relevant issue of legal certainty.
Francisco de Elizalde
Control of Price Related Terms in Standard Form Contracts in Switzerland—The Control of Standard Contracts Terms: The Swiss Approach
Abstract
The Swiss legal and judicial control of price (related) terms in standard form contracts is fairly complex. For historical reasons and partially by coincidence, the legislator relies on a hybrid approach that combines elements of the law of obligations and the law against unfair competition. As a result, the control of standard contract terms lacks legislative coherence and raises challenging questions of interpretation for legal scholars and courts.
With regard to the law of obligations, standard contract terms are subject to control under three aspects: First, standard terms must be included in the contract by the parties’ mutual consent. Secondly, judicial guidelines have emerged as to the proper interpretation of standard contract terms and, thirdly, standard contract terms must comply with Swiss mandatory law, i.e. their content must neither be unlawful nor immoral.
As for the judicial review of standard contract terms pursuant to the law against unfair competition, Art 8 UCA (2011) states that the “use of general terms and conditions which, in contradiction to the principle of good faith, provide for a substantial and unjustified disproportion between the contractual rights and obligations to the detriment of the consumer” are deemed unfair. The practical bearing of this provision, which aims at the protection of consumers, remains unclear as it combines elements that are hard to reconcile. How and when can the use of “bad faith” standard contract terms be justified? The answer is far from clear and case law has not given any answer to date. Recent legal doctrine suggests that if a substantial disproportion of contractual rights and obligations is established, the court has to assess whether such disproportion violates the principle of good faith, i.e. whether the contracting party having supplied the standard terms could assume in good faith that the other party (consumer) would have accepted those terms without objection even if they had been subject to individual negotiation. In case a substantial disproportion of contractual rights and obligations turns out to be contrary to good faith, the presumption arises that it is also unjustified. The burden of proof falls then on the party having supplied the (unfair) standard terms to provide conclusive evidence that the disproportion of contractual rights and obligations is adequately counterbalanced by concrete and material advantages granted by other contract terms. Although Art 8 UCA (2011) does not say so, the dominant opinion considers that unfair contract terms are null and void.
As regards the judicial control of contractual price terms, two aspects should be kept apart: on the one hand, the question whether and, if so, to what extent price (related) terms in standard form contracts are subject to judicial review and, on the other hand, whether price adjustment clauses in standard form contracts are valid.
Thomas Probst
Control of Price Related Terms in Standard Form Contracts in Taiwan: Control of Price Related Terms Through the Legislator, the Judiciary and the Administration
Abstract
This chapter first shows how the principle of freedom of contract works in Taiwan, then discuses the control of price related terms in standard form contracts under Taiwanese law. The control maybe due to special legislation like the Civil Code or the Consumer Protection Act or due to judicial, or administrative interventions. The special feature in Taiwan is that the competent authorities can promulgate “Prohibited Provisions in Standard Form Contracts” to control the content of standard form contracts. Finally, this chapter also elaborates on regulation fostering price disclosure in Taiwan.
Ming-En Hsiang, Ting-Su Chen
Control of Price Related Terms in Standard Form Contracts in Turkey: Judicial and Other Means of Price Control
Abstract
Turkish law, in accordance with the principle of “freedom of contract”, rarely interferes with price terms, as the price is a salient element of a contractual relation and therefore subject to competition in the market. This stance is acknowledged explicitly in the legal regime for standard form contracts where the Consumer Code excludes price terms from the unfairness analysis. However, as the findings of behavioural economics reveal, in many contractual settings, price terms could become incomprehensible to consumers and competition in market place may not produce desirable outcomes. This problem is exacerbated by the fact that firms, knowing the instances where consumers are prone to cognitive problems, are incentivised to utilise contracts in which price terms are obscured and complicated. Hence there is a valid ground for controlling price in standard form contracts when prices are non-salient. Turkish consumer law recognizes this problem and provides a provision, which enables courts to interfere with the prices terms when those terms are non-transparent, a condition which could be construed compatibly with the findings of behavioural sciences. However, Turkish judicial practice, which could be characterized as enthusiastic interventionist when it comes to price control, has ignored the transparency condition and employed its own criteria when controlling prices. Extensive and incoherent interference with prices has created enormous burden for judicial system and markets. Finally lawmaker has adopted explicit provisions in the Consumer Code and has chosen to solve the problem with regulation, which seems to be a better policy alternative.
Kerem Cem Sanlı
Control of Price Related Terms in Standard Form Contracts in the UK: Regulating Prices and Charges in the UK: Information Versus Substance, General Clauses Versus Rules Developed by Regulators
Abstract
This paper considers how UK law regulates the price and other charges in contracts. It asks how dominant the information paradigm is as a regulatory approach, and also considers the limits of this paradigm in providing consumer protection. Assuming a more substantive paradigm of regulation is desirable, the paper considers how to achieve this. It considers the respective roles that should be played by a legislative general clause; and on the other hand by more concrete rules developed by regulatory bodies, each rule designed for specific charges in particular types of contracts in different trade sectors.
Christopher Willett
Metadaten
Titel
Control of Price Related Terms in Standard Form Contracts
herausgegeben von
Yeşim M. Atamer
Pascal Pichonnaz
Copyright-Jahr
2020
Verlag
Springer International Publishing
Electronic ISBN
978-3-030-23057-9
Print ISBN
978-3-030-23056-2
DOI
https://doi.org/10.1007/978-3-030-23057-9

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