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Art. 5 LCP readopted the provision of the fLCP governing unfair
terms with a broader scope. This provision aims to provide more spe-
cific and comprehensive protection of consumers than the protection
foreseen under the TCO. The underlying reason for this specific pro-
tection is that, a consumer is usually more vulnerable when faced with
general terms, being in a position where he cannot exercise his free-
dom of contract, avoid general transaction terms, and is obliged to
accept the terms and conditions set forth by the counter party. Thus
ultimately, the consumer has to make a choice between accepting the
transaction terms or renouncing the contract as a whole.
LCP Provisions
Definition and Consequences of the Unfair Terms
Art. 5 LCP defines unfair terms. Accordingly, a contract term will
be deemed as an unfair term if two conditions are met.
First, said term should be included in the contract without being
negotiated with the consumer. The wording of Art. 6 fLCP expressly
stated that terms unilaterally included by the seller or the provider
could be deemed unfair. Nonetheless, the LCP does not expressly spec-
ify the person who prepared or drafted a contract, but only requires that
the term not be negotiated by the consumer in order to be considered
an unfair term.
The law also specifies cases where a relevant contract term will be
deemed non-negotiated. Accordingly, previously drafted clauses in
standard form contracts whose content cannot be altered by the con-
sumer are deemed to be non-negotiated. Moreover, if the party having
drafted the contract alleges that a term had been negotiated with the
consumer, he is under the burden of proof of such allegation.
Second, this term should result in an unfair imbalance between the
rights and obligations of the parties arising from the contract, which is
incompatible with the good faith principle.
Moreover, pursuant to the final paragraph of Art. 5 LCP, the
Ministry of Customs and Trade (“Ministry”) shall define the terms
which are deemed unfair terms with a regulation. The terms specified
in the regulation shall be considered unfair terms, regardless of
whether the above conditions are met or not.
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