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The Italian competition authority can declare unfair and therefore null and void clauses in consumer contracts and issue sanctions for the lack of compliance with its orders according to a procedure recently established.
Not only can consumers and consumers’ associations challenge clauses in consumers’ contracts but also companies themselves will have the right to request a preventive opinion on the “fairness” of some of their contractual clauses. Indeed, according to the Italian Consumers’ Code implementing among others the EU Directive on Unfair Terms in Consumer Contracts clauses that are deemed unfair in standard contracts can be deemed null and void which might considerably damage businesses that relied on such clauses.
Consumers’ protection provisions on unfair clauses up until now had been rarely enforced since in most of the cases consumer contracts (such as Ts&Cs of websites, terms of sale of electronic devices and any other type of consumer goods, warranty terms of appliances etc.) have a low value that does not justify the costs of a potential dispute. However, the right granted to consumers to ask for an opinion from the competition authority on contractual clauses at no cost for them grants them a very dangerous “weapon” against businesses that attempt to adopt aggressive contractual structures.
In order to prevent potential issues in a dispute with consumers including the potential negative publicity, businesses will consider to require the scrutiny of the competition authority on their more relevant contractual clauses. Indeed for instance the clauses that are currently under the review of the competition authority relate to the retention of property rights, automatic renewal clauses, warranty terms, applicable laws, liquidated damages/penalties for breach etc.
This is likely to create considerable concerns in B2C transactions and as usual feel free to contact me, Giulio Coraggio, if you want to discuss.
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