Abusive clauses in consumer and insurance contracts: Recent developments in Europe

Abstract

Consumer law has undergone a profound change in Europe in the recent years. Since the 1970's the scope of consumer protection has been widening very fast. This development had been triggered by the macroeconomic and microeconomic challenges and needs of the European market regarding the sale of goods and the provision of services. Problems found in the market were mostly identified where contracts with a consumer had not been individually negotiated. This also applied to insurance contracts. Many similarities can be found in the actions for consumer protection against the abusive clauses undertaken in the European Union member states, recently. This relates, inter alia, to the harmonisation of the matter under the Council Directive 93/13/EEC of 5 April 1993 on Unfair Terms in Consumer Contracts. Recent developments in abusive clause regulations in the EU member states throughout its extent coincide with recent interpretation of terms of the insurance contracts, that became very restrictive as well. The change of the attitude towards the interpretation of contractual clauses can be seen on the national legislation level. It is mainly connected with the need to adapt to meet the requirements of the European Union directive harmonising the issues regarding the unfair terms in member states. This resulted in the lists of abusive or suspicious clauses in the national statutory legislation and, in some legislations, special registers of prohibited clauses operated by national courts or other bodies. Depending on the national legislation structures and general legal structures, some of the member states applied also other measures in this respect e.g. automatic nullity of the abusive clauses, bans on the use of such clauses. Also, collective actions of cessation and activity of authorities for consumer protection and supervisory bodies in forms of reports and direct penalties imposed on entrepreneurs, have been implemented in some of the member states. The majority of measures are of a coercive nature, but recently companies tend to be persuaded to meet adequate consumer standards without legal proceedings being undertaken against them. A number of informative publications on abusive clauses of national or international character became a tool for both, the consumers and entrepreneurs in the European Union to avoid entering into contracts containing or proposing wording that could be treated as abusive clauses. This article aims at presenting some of the developments regarding protection against abusive clauses in consumer and insurance contracts in terms of the measures undertaken by the EU member states in the last few decades.