Update the Unfair Contract Terms directive for digital services
PE 676.006 11
the cumulative effect that the clause has together with other penalty clauses that are incorporated in
the contract.
9
Circumstances that occur after the conclusion of the contract – e.g. in the case of a clause
notably limiting liability, the actual magnitude of the damage sustained by the consumer and the
degree of fault that can be attributed to the seller or supplier causing the actual damage – may not be
taken into account when assessing the unfairness of the clause.
The good faith requirement in the unfairness test refers to the question whether the trader, dealing
fairly and equitably with the consumer, could reasonably assume that the consumer would have
agreed to such a term in individual contract negotiations.
10
Whether or not a term significantly
disadvantages the consumer is to be determined by establishing to what extent the term derogates
from the otherwise applicable provision of law.
11
A significant imbalance can already result from the
fact that consumer rights under the contract are restricted, that the exercise thereof is constrained or
that additional obligations are imposed on the consumer that were not envisaged by national law.
12
The unfairness may be taken away by a compensating advantage. However, it is often difficult to
ascertain whether a particular advantage, such as a lower price, is actually related to an otherwise unfair
term. The CJEU made clear that the mere fact that the contract term itself indicates that it is
compensated by a lower price does not constitute proof of that relation.
13
1.1.2. Transparency principle
Article 5, first sentence, UCTD provides that a term in writing must be drafted in plain, intelligible
language. This sentence codifies the requirement of transparency with regard to contract terms in
consumer contracts. The CJEU has made clear that this principle is to be interpreted broadly and that
the mere fact that a term is formally and grammatically intelligible, does not mean that the term meets
the requirements of transparency.
14
It requires the trader to draft a term in such a way that ‘the average
consumer’ – who, in the words of the CJEU, ‘is reasonably well informed and reasonably observant and
circumspect’
15
– would be able to determine, on the basis of clear, intelligible criteria, which economic
consequences follow for them from the term.
16
The assumption is that the average consumer, who is
expected to have read the terms before the conclusion of the contract, would then be able to
determine whether they wish to be contractually bound by agreeing to the terms previously drawn up
by the trader.
17
The consumer is not expected to possess legal knowledge. For this reason, a contract
term indicating that the contract is governed by the law of Luxembourg without indicating that the
consumer may also rely on the mandatory law of their country of residence, if the trader resides in that
same country or targets its commercial or professional activities to that country, is not transparent.
18
Similarly, the French Tribunal de Grande Instance de Paris, in a collective action case against Google,
held that a clause in the Terms of Use of Google + indicating that in some countries consumers may
invoke mandatory national consumer protection rules and that Google +’s Terms of Use do not
9
Judgment of 21 April 2016, Radlinger/Finway, case C-377/14, EU:C:2016:283, paragraph 95.
10
Judgment of 14 March 2013, Aziz, case C-415/11, EU:C:2013:164, paragraph 69.
11
ibid, paragraph 69; judgment of 16 January 2014, Constructora Principado, case C-226/12, EU:C:2014:10, paragraph 21.
12
Judgment of 16 January 2014, Constructora Principado, case C-226/12, EU:C:2014:10, paragraph 23.
13
ibid, paragraph 29.
14
Judgment of 30 April 2014, Kásler, case C-26/13, EU:C:2014:282, paragraphs 71 and 72; judgment of 26 February 2015, Matei,
case C-143/13, EU:C:2015:127, paragraph 73; judgment of 23 April 2015, Van Hove, case C-96/14, EU:C:2015:262, paragraph 40.
15
The notion is developed in judgment of 16 July 1998, Gut Springenheide, case 210/96, EU:C:1998:369. It is also applied to
unfair terms legislation, see judgment of 30 April 2014, Kásler, case C-26/13, EU:C:2014:282, paragraph 74.
16
Judgment of 30 April 2014, Kásler, case C-26/13, EU:C:2014:282, paragraphs 73-75; judgment of 26 February 2015, Matei,
case C-143/13, EU:C:2015:127, paragraph 74; judgment of 23 April 2015, Van Hove, case C-96/14, EU:C:2015:262, paragraph 41.
17
Judgment of 23 April 2015, Van Hove, case C-96/14, EU:C:2015:262, paragraph 42.
18
Judgment of 28 July 2016, VKI/Amazon EU, case C-191/15, EU:C:2016:612, paragraphs 66-71.