Abstract
This paper 1 considers how social justice influences EU financial consumer law. It provides a new way of looking at social justice in consumer law by showing that equality of status based social justice has increasingly come to the fore in modern EU financial consumer law. This emergent and complex set of private and regulatory rules on credit, insurance, investment and payment products has responded to the consequences of inequality between financial firms and consumers by engaging in product and rights regulation that balances the parties’ rights and duties and protects consumers from the consequences of status-based inequality. Looking forward the paper recommends that this social justice approach must be made transparent and become an express part of EU law and policy, both in order to raise consumer trust in the internal market and to more clearly set the future law and policy agenda.
Highlights
This paper considers how social justice values are reflected in modern ‘EU financial consumer law’.1 Using philosophical concepts of social justice, it shows that equality of status based social justice has increasingly come to the fore in EU financial consumer law
The paper argues that financial consumer law pursues a form of social justice when it goes beyond an information paradigm,[8] and regulates the substance of the firm-consumer relationship via product and rights regulation
There are three notable differences in the approach taken here compared to prior work on social justice: first, little attention has previously been given to contractualequality, and none of the authors have framed their thinking in terms of equality of status; second, prior work often focusses on the position of especially vulnerable consumers while the focus here is on whether protections aimed at the generality of consumers are inspired by social justice aims; third, much of the previous work is about social justice in general EU or national consumer law, whereas this paper is focused on the specialized area of EU financial consumer law
Summary
This paper considers how social justice values are reflected in modern ‘EU financial consumer law’.1 Using philosophical concepts of social justice, it shows that equality of status based social justice has increasingly come to the fore in EU financial consumer law (an emergent and complex set of private law and regulatory rules[2] on credit, insurance, investment and payment products). ‘Inequality’ here refers to the consumers’ weaker position in terms of information and bargaining power in the process leading to contract conclusion; and the consumers’ vulnerable position in terms of bearing the consequences of the resulting relations that are often weighted in favor of the firm These inequalities exist in most consumer-business relations, they are especially marked in financial transactions because of the nature of financial products. The second key contribution of the paper is to demonstrate that an equality of status based version of social justice influences EU financial consumer law. The paper argues that financial consumer law pursues a form of social justice when it goes beyond an information paradigm (considered usually ineffective to respond to the above inequalities),[8] and regulates the substance of the firm-consumer relationship via product and rights regulation. Part 6 summarizes the arguments and highlights the importance of giving more explicit recognition to the role of social justice in EU legal policy on financial consumer law
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