Monika Jurčová, Kristián Csach, Unfair Contract Terms Protection in Slovakia in:

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OER, Volume 66 (2020), Issue 1, ISSN: 0030-6444, ISSN online: 0030-6444,

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Monika Jurčová, Kristián Csach* Unfair Contract Terms Protection in Slovakia Abstract The unfair contract terms protection in Slovakia is currently regulated by a system of rules in the Slovak Civil Code; the path to the current extent of consumer protection has not been very straightforward. This article analyses the legislative framework on unfair terms, and questions of law enforcement. It further outlines selected issues and empirical evidence in the context of “surprising contract terms,” transparency of a contract term, legislative power of the judiciary, it discusses the controversial of the German approach to resolve conflicts revolving around unfair clauses. The article concludes that the current Slovak regulation of unfair terms in consumer contracts seems to fulfil the requirements set by the UCTD; however, all in all, Slovakia’s natio‐ nal regulation remains fragmented in the Civil Code, the Act on Consumer Protection and special sectoral regulation and supplemented by special procedural regulation. Introduction The unfair contract terms protection in Slovakia is currently regulated by a system of rules built around the provisions in the Sections 52–54 Slovak Civil Code1 (hereinaf‐ ter referred to as “CC”). The path to the current state of the art has not been very strai‐ ghtforward.2 The initial attempt to implement the Unfair Contract Terms Directive3 (UCTD) in‐ to CC in 2004 was rather unsuccessful. Criticized by legal writing, courts and even the European Commission, multiple further amendments brought the regulation up to the standards required. The unfair contract terms protection covers only consumer contracts. A consumer contract is any contract between the supplier and the consumer, both defined by the Slovak legislation mirroring the definitions used by UCTD. The Slovak definition of a consumer contract covers both B2C and C2B situations, irrespective of the fact I. * Monika Jurčová, PhD, Associate Professor, Rechtsfakultät der Universität Trnava/Slowa‐ kei; Kristián Csach, LL.M., PhD, RA, Associate Professor, Rechtsfakultät der Universität Trnava/Slowakei. 1 Zákon č. 40/1964 Zb. Občiansky zákonník (The Civil Code). 2 The transposition of the unfair terms in 2004 had also an impact on consumer contracts entered into previously. Under sec. 879 f para 3, 4 of CC consumer contracts concluded prior this date should be brought into accordance with the provisions of the CC and those contract terms that are not brought into agreement with the provisions of Section 53, 54 and 57 of the CC shall become invalid after the lapse of three months from the effective date of this Act. 3 Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts OJ L 95, 21.4.1993, pp. 29–34. OER 1/2020, DOI: 10.5771/0030-6444-2020-1-163 whether the consumer is on the demand or supply side of the transactions, in so far as both parties fulfil the definitions of a consumer and a trader. A consumer is a natural person who, when concluding and performing a consumer contract, does not act with‐ in the scope of his business or other entrepreneurial activity.4 The legal definition of consumer does not encompass dual purpose contracts (both private and professional purpose followed by the consumer in a particular transaction). The consumer role in that case is open for interpretation in conformity with the CJEU case law. Unfair terms protection in consumer law have not been extended to B2B trans‐ actions, neither by legislature nor by case-law. A sectoral regulation (grocery supply chains) covers unfair terms with a completely different method of regulation and en‐ forcement.5 Slovak contract law suffers from dualism of legal regulation of obligations in the Civil and Commercial Code.6 Particular contracts are regulated simultaneously by both Codes (e.g. sale, mandate), some are regulated only in the CC (lease), and some only in the Commercial Code (bank and other financial contracts). The consumer pro‐ tection is applicable under all circumstances, although the rules of commercial law should otherwise apply (Section 52 subs. 2 CC in fine). That leads to a counterintuiti‐ ve result that a contract regulated by the Commercial Code may also be considered a consumer contract. Legislative framework (substantive regulation) The general regulation of consumer contracts is contained in the CC and the Consu‐ mer Protection Act (CPA).7 General regulation is complemented by specific laws that regulate the various sectors of supply of goods and services to consumers (e.g. finan‐ cial services) and specific procedural rules. Legislation on consumer law in CC is split between the general regulation on un‐ fair terms (Section 52 – 54 CC) and consumer protection in the regulation of nomina‐ te (specific) contracts (e.g. consumer sale of goods). CPA consists of transposition of the several directives (unfair commercial prac‐ tices, general product safety, consumer rights directive, alternative dispute resolution for consumer disputes). This act plays an important role in the administrative enforce‐ ment of consumer rights including the protection against unfair contract terms and it also creates the legal basis for functioning of consumer associations. II. 4 Supplier is a person who, in concluding and performing a consumer contract, acts within the scope of its business or other entrepreneurial activity. The supplier may be both a sole trader (a natural person) and a company (a legal entity) if he acts within the scope of his business or other entrepreneurial activity. 5 Zákon č. 91/2019 Z. z. o neprimeraných podmienkach v obchode s potravinami a o zmene a doplnení niektorých zákonov (The Act on Unfair Terms in the Food Retail Market). 6 Zákon č. 513/1991 Zb. Obchodný zákonník (Commercial Code). 7 Zákon č. 250/2007 Z. z. o ochrane spotrebiteľa a o zmene zákona Slovenskej národnej rady č. 372/1990 Zb. o priestupkoch v znení neskorších predpisov (The Act on Consumer Protec‐ tion). 164 Monika Jurčová, Kristián Csach The Civil Dispute Procedure Code (hereinafter referred as “CDPC”)8 effective from 1 July 2016 has special provisions on consumer disputes. Act on Consumer Ar‐ bitration provides a separate regulation covering alternative dispute resolution me‐ thods applicable to contracts involving consumers.9 Unfair terms regulation in Section 52 – 54 of Civil Code According to the unfair terms general clause in Section 53 subs. 1 CC, consumer con‐ tracts shall not contain provisions which cause a significant imbalance in the rights and obligations of the parties to the detriment of the consumer.10 The unfairness of contract terms shall be assessed with regard to the nature of the goods or services for which the contract was concluded, and to all the circumstances of formation the con‐ tract at the time of concluding the contract, and to all other contract terms or other contracts such are dependent on (Section 53 subs. 12 CC). The general clause is supplemented by a non-exhaustive list of contract terms which are deemed unfair in Section 53 subs. 4 letters a) – w) CC. The indicative list of unfair terms in UCTD served as an initial inspiration but the Slovak legislator has added also further clauses into the list in order to react on the most abusive terms ap‐ pearing in the judicial practice.11 An unfair contract term is invalid (so-called absolute nullity of a contract term). In general, the nullity of a particular contract term does not result in the nullity of the 1. 8 Zákon č. 160/2015 Z. z. Civilný sporový poriadok (Civil Dispute Procedure Code). 9 Zákon č. 335/2014 Z. z. o spotrebiteľskom rozhodcovskom konaní a o zmene a doplnení niektorých zákonov (The Act on Consumer Arbitration). 10 It should be noted that in comparison to the latter transposition of the Directive 2005/29/EC on Unfair Commercial Practices where Slovak legislator used Slovak term “nekalý” that closely reflects the term “unfair” in English, when transposing UCTD the term “neprijateľný” has been introduced, which may be translated as “unacceptable”. In the further text we mostly prefer term “unfair” for better understanding in the European context. 11 In comparison to indicative list in UCTD pursuant to Section 53(4) of CC also terms in consumer contracts shall be considered as unfair provided that they r) allow disputes between parties in arbitration proceedings to be settled without meeting the conditions set out by a special Act, s) require the consumer to provide security for the fulfilment of his obligation in a value that is disproportionately higher than the amount of the consumer's obligation arising from the consumer contract at the time of entering into an agreement on the security for the fulfil‐ ment of the consumer's obligation, t) require the consumer to provide performance for a service that is provided by the supplier but which, for the most part, is not for the consumer's benefit, u) require the consumer to be bound by the contract for an unreasonably long time, even if it is obvious when entering into the contract that the subject-matter of the contract can be achieved in a considerably shorter time, v) require the consumer to pay any performance about which the consumer was not demons‐ trably informed prior to entering into the contract, or the payment of which was not provided for in the contract, or for which the consumer does not obtain the agreed consideration, w) require the consumer to provide or remit to, or in favor of, a third party of any perfor‐ mance arising out of or relating to a consumer contract that does not predominantly pursue his interests, or to perform any obligations in respect of that performance to a third party. Unfair Contract Terms Protection in Slovakia 165 consumer contract itself.12 The law does not state the possibility of a consumer to choose to be bound by the term, and moreover, the absolute nullity is considered as non-negotiable by the parties and might not be validated by the acting of parties.13 In general, all contract terms of a consumer contract are subject to the fairness re‐ view, however, some exemptions foreseen by the UCTD were also implemented into Slovak regulation. If the terms are excluded from the scope of protection, they are not reviewed under the unfair contract terms regulation but are still scrutinized as to their conformity with general fairness clauses (good morals under Section 39 CC). Firstly, contract terms referring to the main subject matter of performance or ade‐ quacy of the price, if such contract terms are expressed distinctly, clearly and conci‐ sely, are exempted from the unfair terms control. Secondly, individually negotiated terms are also excluded from the review. Slovak law defines individually negotiated terms in a slightly misleading and negative way. According to Section 53 (4) CC, contract terms that the consumer had an opportunity to familiarise himself with before the signing of the contract but could not affect the content thereof, shall not be considered as individually agreed contract provisions. The fact that a particular contract term has been individually negotiated does not pre‐ clude the review of the remaining consumer contract if the overall evaluation of the contract indicates that it is nevertheless a pre-prepared standard contract. Following the UCTD, a contract term is presumed to be a standard term unless the trader proves it was individually negotiated (Section 53 subs. 3 CC). The third exemption covers contract terms that mirror regulatory provisions of the law. Although this exemption is not explicitly stated in the law, it is widely accepted that the legislator already reviewed the fairness of the legislation14 and flows also from the CJEU case law.15 In contrast to the UCTD, the Slovak legislator did not implement the sectoral ex‐ emptions listed in the preamble to UCTD (contracts relating to employment, contracts relating to succession rights, contracts relating to rights under family law and con‐ tracts relating to the incorporation and organization of companies and partnerships).16 When the contract is a consumer contract (the positions of the parties would be consu‐ mer against a trader), the contract would fall under the unfair terms review. 12 For a specific rule linking the nullity of a particular contract term with the nullity of a contract see Part 2 d (Section 53 d CC). 13 A. Dulak. Právne skutočnosti (Legal facts). in: J. Lazar (ed.). Občianske právo hmotné 1. Bratislava, 2018, p. 140. 14 K. Csach, Štandardné zmluvy [Standard contracts]. Pilsen: Aleš Čeněk, 2009, pp. 225–227; J. Drgonec. Spotrebiteľské zmluvy v právnom poriadku Slovenskej republiky (Consumer Contracts in the Legal Order of the Slovak Republic). Justičná revue 3/2007, p. 361. See also M. Maliar, Typové spotrebiteľské zmluvy [Standard consumer contracts]. Justičná revue, 11/2006, p. 1695. 15 Judgment of CJEU of 14. 3. 2013 C-415/11 Azíz. See also Rozsudok Krajského súdu v Bratislave, file Nr. 10Co/95/2018 zo dňa 25. 10. 2018 (the decision of Regional court in Bratislava file Nr. 10Co/95/2018 from 25. 10. 2018, para 11). 16 The tenth recital in the preamble to the UCTD. 166 Monika Jurčová, Kristián Csach Supplementary regulation in Civil Code and the font size rule Various additional protective instruments have been introduced into the regulation of unfair terms in consumer contracts in CC making it an intricate set of provisions that are partially unrelated. One of the most significant protective principles of consumer law is its unilateral mandatory character. The consumer contract terms might not deviate from the rules of CC to the detriment of the consumer. Thereby, otherwise non-mandatory rules be‐ come binding in consumer contracts. This is emphasized by the prohibition of waivers of consumer´s rights granted by CC or special consumer protection laws or forbidden possibility otherwise deteriorate consumer´s contractual position by agreement in ad‐ vance (Section 54 subs. 1 CC). The rule on unilateral mandatory character is probably based on the legislator's assumption that law (even the non-mandatory norms) offers a balanced and fair arrangement of the rights and obligations of the parties. According to a survey performed by Rostáš and Zavadová,17 a significant number of decisions rendered by courts or administrative bodies were not justified by unfairness of the contract term but invalidity has been derived from the prohibition of a unilateral dero‐ gation from the CC rules (Section 54 subs. 1 CC). The prohibition of derogation from the rules of the CC to the detriment of the consumer is applicable also to individually negotiated terms and therefore allows courts to control/ review the consumer contract much easier. On the other hand, it may result in an unjustified and undesirable interfe‐ rence by the court with the content of the contract. Besides the unilateral mandatory principle, in the course of multiple amendments, miscellaneous provisions setting the upper percentage limit of the annual percentage rate of charge (APR) if the consumer has to return money provided to them by the supplier (Section 53 subs. 6 CC), prohibiting of fiduciary transfer of title as security in consumer contracts (Section 53 subs. 7 CC), regulating unrequested performance (Section 53 subs. 8 CC), maturity on partial default of the consumer (Section 53 subs. 9 CC) and limits as to the execution of security lien (Section 53 subs. 10 CC) were inserted into the regulation of unfair terms. In order to strengthen the transparency of consumer contracts the legislator intro‐ duced also a relative and an absolute font size rule for written contracts. Firstly, the subject-matter and the price must not be written in smaller letters than other parts of the same contract, except for the title of the contract and its parts.18 According to the latter, the provisions of a consumer contract, including the standard terms or any text in any other contractual documents related to the consumer contract must not be writ‐ ten in letters that are unreadable for a consumer or smaller than as set out in an imple‐ menting regulation (Section 53 c CC). In contrast to the first drafts of the implemen‐ ting regulation which ordered the use of a specific font (Times New Roman) and font 2. 17 D. Rostáš, D. Zavadová. Databáza rozhodnutí súdov SR v oblasti ochrany spotrebiteľa. (the Database of the Slovak Consumer Case Law). 3.1.2020. 18 The formulation of the contractual documents incl. advertisements and other information in different font sizes might constitute an unfair commercial practice. Rozhodnutie Krajského súdu v Trnave file Nr. 43 Sa/32/2016 zo dňa 26. februára 2018 (The decision of the Regio‐ nal Court in Trnava from 26. 2. 2018). Unfair Contract Terms Protection in Slovakia 167 size (12 pt), the adopted regulation19 requires the usage of letters not smaller than 1,9 mm.20 Any contract made contrary to this provision shall be invalid. It must be however noted that this law has not been very well welcomed by acade‐ mia mostly because of the impracticability of the rule itself (requiring expert testimo‐ ny) and in particular in the e-commerce contracts, the lack of clear definition of “con‐ tractual documents” bearing the risk of extending the rule also on documents that do not include binding texts as advertisements or service documents and also because of the unclear interaction of the rule with the general rules on validation of lacking for‐ mal requirements by the actual performance of the contract. It might be noted that the rule is almost not applied by the case law.21 Consumer Protection Act The CPA covers predominantly public law aspects of consumer protection but with a significant impact on private law as well. Prior to the introduction of unfair terms control into CC it enshrined also the review of standard contract terms in consumer contracts. Even after the regulation had been moved into the CC and harmonized, CPA has still retained its significance for the unfair terms review. In particular, it sums up consumer rights including inter alia: the right for protection against unfair terms in consumer contracts, the right to associate with other consumers in associati‐ ons and to protect the legitimate interests and to enforce rights of consumers through these associations; in case of infringement of consumer rights it explicitly declares the right to seek protection and the right to address an alternative dispute resolution entity in order to protect consumer rights (Section 3 CPA). Some of the CPA provisions may seem rather declaratory, but still they establish the legislative basis for the administrative enforcement of consumer law. Authorities frequently refer to the provision that spells out the obligations of the seller including the obligation to follow private law regulation on unfair terms (Section 4 CPA). Moreover, CPA includes also provisions of pure substantive private law regulation relating to unfair terms protection. It prohibits imposing obligations and liabilities upon the consumer without legal reason (Section 4 subs. 2 CPA), to charge fees for the selected payment method (Section 4 a CPA) or provides for limits of securities provided by the consumer and for the representation of a consumer by a pre-selected representative (Section 5 a CPA). 3. 19 Nariadenie vlády Slovenskej republiky č.87/1995 Zb., ktorým sa vykonávajú niektoré ustanovenia Občianskeho zákonníka (Section 1 b) (Governmental Decree on Implementation of Some Provisions of the Civil Code). 20 Reasoning behind the rules employs the argument that the font size of printed letters of the paper version of the Collection of laws is 1.99 mm. 21 We were able to identify only a single court decision applying the font size rule. Even though the consumer contract did not fulfil the font size rule and the court could declare the contract null, the court opted for the dismissal of the claim as time barred. Rozhodnutie Okresného súdu vo Svidníku spis zn. 4C/192/2011 (the Decision of the District court Svidník, File Nr. 4C/192/2011), published by M. Budjač, Spotrebiteľské zmluvy. (Consumer contracts). In: M.Števček, A. Dulak, J. Bajánková, M. Fečík,, F. Sedlačko, M. Tomašovič, et all (eds.) Občiansky zákonník I., 2nd ed. Bratislava 2019, p. 718. 168 Monika Jurčová, Kristián Csach CPA creates the legal basis for administrative enforcement of consumer rights and regulates the operation of the national enforcement authority – the Slovak Trade In‐ spection (Sections 19 -27 CPA). Specific legislation Besides the general regulation on unfair terms, specific legislation for financial ser‐ vices, the supply of gas and electricity and the telecommunication sector also applies. These regulations include some specific issues which are exempted from the unfair contract terms review, as the unilateral contract amendments or the regulation on in‐ corporation of contract terms. Moreover, a link between unfair terms and unfair practices is established via Sec‐ tion 53 d CC, under which a consumer contract is invalid if it includes a contract term that was adjudicated as unfair and the contract was concluded with the use of unfair commercial practice (or by usury). General fairness control mechanisms (good morals and usury) The unfair terms review is not the only applicable control mechanism to scrutiny the substantive fairness of consumer contracts. The fairness of the contract is also review‐ ed under the general clauses of good morals (Section 39 CC leading to nullity), usury (Section 39 a CC leading to nullity) and abuse of hardship (Section 49 CC granting a right of contract rescission). Enforcement The competence to review the fairness of contract terms in consumer contracts is divi‐ ded between courts, arbitration tribunals and administrative authorities. They all fulfil different functions and their competences are partially overlapping. Judicial protection The basic mechanism of legal protection against unfair terms in Slovakia is represen‐ ted by the judicial review. It is carried out in two fundamental procedural ways: by a review based on an individual legal action in the relationship between a consumer and a supplier; and by a (later introduced) abstract review of a consumer contract. The ab‐ sence of an explicit option to initiate an abstract review of a consumer contract22 in 2010 caused the legislators to create a sort of an intermediate regulation: a substantive 4. 5. III. 1. 22 A certain option for carrying out an abstract review was in the form of legal actions brought by consumer associations to refrain from violating the consumer law – using unacceptable clauses. However, this general claim was not used more fundamentally, as the effects of a court’s decision were not extended to all consumers. Until the new procedural regulations were adopted in 2015, there was no clear legal framework for this type of dispute. Unfair Contract Terms Protection in Slovakia 169 law extension of the effects of a court decision in the proceedings for an individual review of unfair terms (Section 53 a of the CC). In any proceedings in an individual legal action brought by a consumer or a supplier in a consumer dispute, the court shall ex offo examine whether the claim filed is based on unfair contract terms or not. Consumer disputes are disputes between a supplier and a consumer arising out of, or related to, a consumer contract.23 They are regulated by specific procedural rules as disputes with a weaker party and show several differences from traditional types of litigation, especially in regard to the ta‐ king of evidence24 or issuing payment orders.25 Specifically, in relation to the review of unfair terms, there is a court option which stands out from others: namely, the opti‐ on to state the text of the contract terms considered unfair and relevant to the decision on the merits of the case in the operative part of the decision, even if the plaintiff sought to recover performance and not the declaration of the nullity of such a clause (Section 298 of the CDPC). Since the introduction of the new CDPC in 2016, the abstract review procedure is a special dispute procedure, where the court reviews the fairness of contract terms (and unfair practices) in consumer contracts and relating contractual documents inde‐ pendent from any concrete situation.26 This particular procedure shall compensate the deficiencies of individual proceeding.27 Enumerated privileged entities (consumer as‐ sociation or a consumer protection/ national enforcement authorities like STI or NBS) have active legal standing. Only three regional courts have jurisdiction in such pro‐ ceedings in the first instance28 and the Supreme Court being the appellate court. This shall introduce a much higher degree of professionalism and unity in the decision ma‐ king in contrast to the individual cases which are heard among dozens of district courts in Slovakia. Like the proceeding in individual disputes, the abstract review be‐ longs to proceedings with a weaker party29 and the court may obtain evidence that has not been produced by the parties. 23 For more details on the definition of the consumer dispute see K. Csach. Spotrebiteľský spor a spotrebiteľské rozhodcovské konanie (The Consumer Dispute and the Consumer Arbitra‐ tion). Právny obzor 3/2016, pp. 234–244. 24 A court may also take evidence which a consumer has not proposed, if it is necessary for a decision based on the merits of the case. Even without a proposal, the court will obtain or secure such evidence (Section 295 of the CDPC). 25 If a right to the payment of a monetary amount under a consumer contract is exercised and a consumer is the defendant, the court will not issue a payment order if the consumer contract or other contractual documents related to the consumer contract contain a contractual term which is unacceptable (Section 299 Subsec. 2 of the CDPC). 26 Section 301 CDPC. 27 According to the explanatory report, the new type of procedure is justified by the implemen‐ tation of Directive 2009/22/EC on injunctions for the protection of consumers´ interests (explanatory report to section 301 of CDPC). 28 Regional Courts in Bratislava, Banská Bystrica and Košice. Generally, the regional courts are courts of the second instance, here they act as the first instance courts. 29 This is rightly criticized by Maslák. M. Maslák, Úskalia erga omnes účinkov rozsudku v konaní o abstraktnej kontrole v spotrebiteľských veciach. Súkromné právo 3/2017, p. 108. See also the CJEU case law (C‑413/12, para 48). 170 Monika Jurčová, Kristián Csach If the court upholds the action, it determines the unfairness of the contract term and expressly states the text thereof in the operative part of the decision. It will also forbid the defendant from applying this contract term, or a contract term with the sa‐ me meaning, in all its consumer contracts or other contractual documents relating to the consumer contract.30 The final judgment is said to be binding upon everybody.31 It is disputed whether the judgments apply to all consumers (but not to other suppliers),32 or also to all suppliers using the same contract term.33 Moreover, the claimant is entitled to publish the judgment at the costs of the losing party. The abstract review of unfairness finds its way to the courts only with considera‐ ble difficulties.34 The consumer associations are not very active (as opposed to their individual review activities), and the supervisory bodies make minimal use of this competence.35 A larger number of proceedings relate to the fact that the courts of ge‐ neral jurisdiction seek to reclassify the individual consumers’ proceedings into ab‐ stract review proceeding and refer them to other courts.36 Extending the effects of a court judgement pursuant to Section 53 a of the CC is a certain intermediate step between the abstract and specific (individual) review of consumer contracts. Under sec 53 a subs 1 of CC if the court determined some con‐ tract term in the consumer contract to be invalid due to the unfairness of such term, or did not award the performance to the trader due to such term, the trader shall refrain from using such term or any term with the same meaning in contracts with all consu‐ mers. The trader shall have the same obligation even if the court ordered the trader to render the consumer unjust enrichment, compensate for damages or pay adequate fi‐ nancial compensation on grounds of such term. The legal successor of the trader shall have the same obligation. Stricto sensu, the rule does not regulate a distinct procedure but a specific substantive law effect of a rendered judgement that is not limited to the individual relationship between the parties to the proceeding and their contractual re‐ lation, but it could be regarded as extended to all contracts concluded between the gi‐ ven trader and different consumers. Some authors argue that sec 53 a of CC may be understood as an establishment of precedential character of the judicial decisions in 30 Section 305 CDPC, the same applies to unfair commercial practices. 31 Section 306 CDPC. 32 D. Závadová. Konanie o abstraktnej kontrole v spotrebiteľských veciach. Súkromné právo 1/ 2017, pp. 25–26. 33 M. Števček in: M. Števček, S. Ficová, J. Baricová, S. Mesiarkinová, J. Bajánková, M. Tomašovič, et al (eds.) Civilný sporový poriadok (Commentary to CDPC). C. H. Beck, 2016, pp. 1045; Maslák, Fn. 29, p. 111 with reference to the fact that the decision would create a black list of conditions that would always be unfair under any circumstances. 34 The introduction of a special procedure on abstract review had led some lower courts to the conclusion that the fairness of the contract terms shall not be tested in individual procee‐ dings. Fortunately, this eccentricity did not last very long and was briefly overturned by the Supreme court in its decision file Nr. 6 Ndc 20/2016 from 23. 1. 2017. 35 Only one decision rendered in the course of abstract review is known, based on an action of the Slovak National Bank against the insurance company Rapid life životná poisťovňa, a.s. (Judgment of the Regional court in Košice file Nr. 14C/1/2016 from 17 October 2018). 36 E.g. uznesenia Najvyššieho súdu Slovenskej republiky file Nr. 7Ndc/9/2017 zo dňa 26. 7. 2017, file Nr. 2 Ndc 16/2016 zo dňa 30. 11. 2016. (Decisions of the Supreme Court, file Nr. 7Ndc/9/2017 from 26. 7. 2017, file Nr. 2 Ndc 16/2016 from 30. 11. 2016). Unfair Contract Terms Protection in Slovakia 171 consumer matters.37 The effect of Section 53 a CC has always been doubted. After the introduction of abstract judicial review, some authors consider the rule to be obsole‐ te,38 at least from a private law perspective. From a public law perspective, violation of the rule by trader is considered as a particularly serious breach of his obligations that could even lead to the suspension of his trade licence (sec 58 of Trades Licencing Act). Both the abstract review and the extension of the effects of a judgment according to Section 53 a CC creates an environment allowing the courts to create a black list of unfair terms.39 Currently, there is no public register of adjudicated unfair contract terms,40 although one was offered by the academia.41 Collective claims of consumer associations are also heard within ordinary civil litigation.42 The collective claims are defined not only by the claimant but also – re‐ dundantly – by a collective interest. Collective interests of consumers are defined as interests of consumers which are not just the mere sum of the individual interests of consumers affected by a breach of consumer rights, but it is a conduct of the infringer towards all consumers (Section 3 subs. 5 CPA). However, these do not fall under indi‐ vidual consumer disputes, as they are not disputes between a consumer and a supplier. The consumer associations, which are listed in the register maintained by the Ministry of Economy, may propose a consumer protection authority or a court to order an inte‐ rim measure (interlocutory injunction), represent a consumer in legal proceedings, or may act as a so-called special entity (by-standing party) in the proceedings, or may initiate proceedings for an abstract review.43 Moreover, the association may file a pe‐ tition to the court ordering the trader to refrain from using the unfair terms. The inter‐ action between an action to refrain from using of unfair terms and the abstract review is unclear. 37 I. Fekete. Občiansky zákonník. 1. zväzok. (Všeobecná časť).Veľký komentár, 2.ed. Bratis‐ lava 2014, p. 622. 38 In favour of obsolescence Ľ. Pagáč in: M. Števček, S. Ficová, J. Baricová, S. Mesiarkinová, J. Bajánková, M. Tomašovič, et al (eds.) Civilný sporový poriadok. C. H. Beck, 2016, p. 1038. Against obsolescence Maslák, Fn. 29, p. 104–106. 39 Maslák, Fn. 29, p. 107. 40 According to the internal governing rules, the courts are required to send a counterpart of the decision to the Ministry of Justice of the Slovak Republic. However, there is still no single and structured model of disclosure that can be reasonably searched. 41 Rostáš, Zavadová, Fn. 17. 42 M. Maslák. Kolektívne nároky spotrebiteľov (Collective Claims of consumers). in: M. Lenhart, J. Andraško,. J. Hamuľák (eds.) Kolektívne uplatňovanie nárokov. Bratislavské právnické fórum 2016. Bratislava, 2016, onferencie_a_podujatia/bpf_2016/Zbornik_BPF2016_sekcia_07.pdf. 03/01/2020, p. 55. 43 K. Gešková, Spotrebiteľské združenia ako subjekt kolektívnej ochrany spotrebiteľských práv (Consumer associations as the subject of the collective protection of the consumers’ rights). in: M. Lenhart, J. Andraško, J. Hamuľák (eds.) Kolektívne uplatňovanie nárokov. Bratis‐ lavské právnické fórum 2016. Bratislava, 2016, Veda/Konferencie_a_podujatia/bpf_2016/Zbornik_BPF2016_sekcia_07.pdf. 3.1.2020, pp.13 – 21. 172 Monika Jurčová, Kristián Csach Consumer arbitration Arbitration has historically been considered as the weakest link in the chain of consu‐ mer protection in Slovakia. Suppliers have often been related to arbitrators or perma‐ nent arbitration courts (their founders) by property or a contract. The fact that the ar‐ bitral awards represented the same enforceable title as judgements of the courts of ge‐ neral jurisdiction facilitated their enforcement. Judicial practice has been developed to act against the risks, according to which the arbitration clauses in consumer contracts were deemed unfair unless they were in‐ dividually negotiated. According to the case law,44 the unfairness of an arbitration clause results in the nullity of an arbitral award, which could also be reviewed in the enforcement of an arbitral award. This led to a general suspension of distraints on the basis of arbitral awards. Negative experience led the legislators to adopt a special procedural regulation – the Act on Consumer Arbitration.45 It laid down specific requirements for the validity of an arbitration clause concluded with a consumer, as well as requirements for arbi‐ tration and institutional arrangements for arbitration. Only the persons entered in the register maintained by the Ministry of Justice may act as arbitrators in consumer dis‐ putes, and they are also subject to its disciplinary authority. The establishment of per‐ manent arbitration courts which are competent to resolve consumer disputes is condi‐ tional upon a licence issued by the Ministry of Justice. Arbitral awards in consumer matters are reviewable by a court to the full extent of the arbitrator´s legal considerati‐ ons (including compliance with the right to consumer protection), as opposed to the arbitral awards that are issued in ordinary arbitration proceedings. Otherwise, all that has been stated in relation to judicial protection shall apply to consumer arbitration. However, the abstract review of unfair terms is not an arbitrable dispute in consumer arbitration and arbitral awards do not seem to enjoy the extension of effects under Section 53 a CC. Administrative protection A review of unfair terms is also ensured in an administrative way. The basic adminis‐ trative body for consumer protection is Slovak Trade Inspection (authorised admi‐ nistrative authority, hereinafter referred as ´STI´), which is competent to deal with consumer protection issues, unless there is a special body authorised. Special supervi‐ sory bodies operate in different market segments.46 Consumer protection in the area of financial services is provided by the National Bank of Slovakia. In addition to 2. 3. 44 Rozhodnutie Najvyššieho súdu Slovenskej republiky file Nr. 3Cdo 122/2011 zo dňa 9.2.2012 (the Decision of the Supreme Court, file Nr. 3Cdo 122/2011 from 9.2.2012); Rozhodnutie Krajského súdu v Trnave file Nr. 10CoE/308/2011 zo dňa 31. 5. 2012 (the Decision of the Regional court in Trnava file Nr. 10CoE/308/2011 from 31. 5. 2012). 45 Zákon č. 335/2014 Z. z. o spotrebiteľskom rozhodcovskom konaní a o zmene a doplnení niektorých zákonov (The Act on Consumer Arbitration). 46 The Regulatory Office for Network Industries does not have an authority in the area of unfair commercial practices or unfair contract terms, but it is authorised to approve of the contract terms of providers of the universal service in the area of gas and electricity supply. Con‐ Unfair Contract Terms Protection in Slovakia 173 these bodies, there is also the Commission on the Assessment of Terms in Consu‐ mer Contracts and of Unfair Commercial Practices established at the Ministry of Justice, (hereinafter referred as ´Commission on Assessment´), which is an advisory body to the Ministry of Justice and can give non-binding opinions and advice to asso‐ ciations or a supervisory bodies to file a motion in order to initiate legal procee‐ dings.47 Administrative authorities might review the fairness of contractual terms in three different ways. Firstly, they may issue preliminary injunctions on their own initiative or on the initiative of the consumer associations, in cases where the conduct of a business jeo‐ pardises the consumers’ collective interests. By issuing a preliminary measure, they may impose the obligation to refrain from infringing on consumers’ rights and initiate an administrative procedure (Section 21 of the Act on Consumer Protection). Secondly, in an administrative procedure, they may punish violations of the con‐ sumer law and impose fines on particular infringers for specific infringements. Howe‐ ver, a supervisory body may also impose a fine for a violation of the consumer law without deciding a particular case of an individual consumer, but only while abstract‐ ly assessing the fairness of the supplier´s contract terms. Thirdly, a consumer protection authority is entitled to file a motion to initiate an abstract review of a consumer contract by a court. However, as we have already mentioned, a motion to carry out an abstract judicial review is made by the authorities only rarely. Any administrative proceeding is by its nature retrospective – ex post sanctioning the wrongdoers for using unfair terms. Only occasionally it is prospective. Slovak Na‐ tional Bank aims also at shaping the market by its preventive measures. It issues sta‐ noviská [positions] indicating its future practice while reviewing the fairness of con‐ sumer contract terms. They are adopted after a consultation process and represent an elaborated guideline for the contractual practice reacting also on recent CJEU and na‐ tional case law.48 National bank allows the stakeholders to implement the conclusions of its positions within three months after they are published. cerning the Regulatory Authority for Electronic Communications and Postal Services, this body is not explicitly authorised for enforcement of horizontal directives, this competence probably belongs to STI. The relevant act regulates cooperation between this regulatory Authority and STI. The division of the competence between STI and this authority is not however absolutely clear. This can be demonstrated by the notice of STI published in April 2015 on their web pages containing the instruction that in the area of the fees for services of electronic communication (quality and price), the Regulatory Authority for Electronic Communications and Postal Services is the authorised body. For further explanation see Jurčová, M., Maslák, M. Study for the Fitness Check of EU consumer and marketing law, Final report Part 3 – Country reporting, Slovakia, cfm?doc_id=44842. 4.1. 2020, p.1023 ff. 47 Vyhláška Ministerstva spravodlivosti č. 406/2008 Z. z. o zložení, rozhodovaní, organizácii práce a postupe komisie na posudzovanie podmienok v spotrebiteľských zmluvách [The Promulgation of the Ministry of Justice on the Establishment of the Commission on the Assessment of Terms in Consumer Contracts and of Unfair Commercial Practices]. 48 E. g. Position of National Bank of Slovakia regarding agreements on the instalments in the enforcement process or a position regarding the effects of a particular CJEU judgment. https:// 174 Monika Jurčová, Kristián Csach Interaction between the systems The interlapping of the competences of judicial and administrative bodies or the inter‐ action between different types of proceedings results in multiple problems that have still not been sufficiently resolved, neither by the doctrine nor by the case law. Firstly, a collision between the individual legal actions and the results of an ab‐ stract review of unfair terms is dealt with. Under the procedural law, the judgment in an abstract review proceeding has res iudicata effects erga omnes, and this should al‐ so be taken into consideration in an individual review proceeding.49 Some authors propose that a court deciding an individual dispute may deviate from the previous as‐ sessment in the abstract review in the event of a serious change in circumstances or in specific situations.50 Moreover, a consumer could invoke the validity of a clause which was considered unfair in a previous abstract review proceeding. Conversely, in an abstract review, a court is not bound by the result of its previous assessment of fairness in an individual review. The most complex problems are caused by a conflict between administrative and judicial reviews of unfair terms. An administrative body imposes a sanction if it as‐ certains that an administrative offence has been committed – an infringement of the consumer’s rights has occurred (an unfair term is included in a consumer contract). Under the general judicial procedural rules, a decision of an administrative body on the administrative offence and on the person of the offender is also binding upon the court in private law proceedings.51 It is lively debated whether an administrative bo‐ dy’s decision in relation to the assessment of a contractual clause as unfair constitutes a binding preliminary ruling for private law proceedings.52 4. pdf. 4.1.2020. 49 Maslák, Fn. 29, p. 110–111. 50 Zavadová, Fn. 32, p. 27. 51 Section 306 CDPC. 52 In favour of the binding effect K. Csach, Nesúdna ingerencia do zmlúv a možnosti jej súdnej korekcie. [The non-judicial intervention into contracts and the possibilities of its judicial review] in: Ingerencia súdov do súkromnoprávnych zmlúv. Zásahy súdov do obsahu súkrom‐ noprávnych zmlúv. Pezinok 2014, pp. 58–59. PD_Omsenie_Final_WEB.pdf. 4 January 2020. Against the binding effect see Maslák, Fn. 42, pp. 60–62; K. Gešková, Je súd viazaný rozhodnutím správneho orgánu o neprijateľnej zmluvnej podmienke? [Is the court bound by a decision of an administrative authority on unfair terms?] in: M. Maslák (ed.): Vybrané otázky implementácie európskych právnych predpisov reglementujúcich zvýšenú ochranu slabšej strany. Trnava 2017, pp. 49–60; R. Földeš, R. Luby. Limity koncepcie duálnej právomoci pri posudzovaní neprijateľnosti zmluvných podmienok [Limits of the concept of dual competence of assessing the unfairness of contract terms]. in: M. Maslák, (ed.): Vybrané otázky implementácie európskych právnych predpisov reglementujúcich zvýšenú ochranu slabšej strany. Trnava 2017, pp. 72–77. ds/2018/05/Maslak-Zbornik-_WEB.pdf. 4 January 2020. Unfair Contract Terms Protection in Slovakia 175 Selected issues and empirical evidence Incorporation of standard contract terms and surprising terms control in consumer contracts Only terms that form part of the contract are subject to the fairness review. Therefore, the first step before the fairness review of a consumer contract is the ascertaining of its content. It is tested whether all contractual documents, terms and conditions had been correctly incorporated – whether they had become part of the contract. Without proper incorporation, the contractual term under consideration would not be conside‐ red as being part of the content of the contract. The consumer would not be bound by such terms and there would be no reason to examine them from a material point of view. Therefore, a rather formal review precedes the fairness test. Slovak law does not offer any specific regulation on the incorporation of standard terms of contract into consumer contracts,53 nor a general test of surprising terms. It is widely accepted that two conditions must be satisfied for the standard terms of con‐ tract to be incorporated into the contract: the agreement on a clear incorporation clau‐ se and the accessibility of the standard terms of contract depending on the circumstan‐ ces of negotiation.54 The requirement of incorporation is also expressed in Section 53 subs. 4 (a) CC, according to which the contractual provisions to be complied with by the consumer and which he was not acquainted with before the conclusion of the con‐ tract are considered unfair. The provision bundles the incorporation with the fairness review. An interesting test of surprising terms has been elaborated by the case law. Surpri‐ sing terms have been held as not covered by the will of the parties – the courts make use of the phrase that according to the evidence produced in the course of the procee‐ ding, the will of the parties to agree on a surprising clause was not sufficiently pro‐ ven. However, the empirical evidence is too scarce to consider this as an accepted doctrine.55 Transparency of a contract term Contractual transparency requirement proved to be one of the most effective measures under UCTD.56 It is not established in the Slovak legal doctrine whether the lack of IV. 1. 2. 53 The sole provision on incorporation of standard contract terms in commercial relations can be found in Section 273 of Commercial Code. 54 Csach, Fn 14, p. 56–85; M. Jurčová, Záväzky vznikajúce zo spotrebiteľských zmlúv (Obli‐ gations arisen from consumer contracts). In: J. Lazar (ed.). Občianske právo hmotné 2. Bratislava, 2018, p.85. 55 Csach, Fn 14, pp. 135–138; Z. Takácsová Platnosť inkorporácie dojednaní o zmluvnej pokute (odstupnom) v zmluvných podmienkach cestovných kancelárií z pohľadu ich prijateľnosti. [Validity of incorporation on contractual penalty clauses in travel agency contract terms from the perspective of their fairness]. Justičná revue 8 -9/2019, pp. 869–875. 56 Judgment of CJEU of 26 February 2015 C-143/ 13 Bogdan Matei and Ioana Ofelia Matei v SC Volksbank România SA, Judgment of CJEU of 30 April 2014 C-26/13 Árpád Kásler and Hajnalka Káslerné Rábai v OTP Jelzálogbank Zrt. 176 Monika Jurčová, Kristián Csach transparency is a reason for the unfairness of a contractual term per se, or if it is me‐ rely a criterion to be considered in determining unfairness, or if it is a criterion rele‐ vant to the incorporation of a contractual term. The legislation requires an examinati‐ on of transparency only when assessing the main subject of the performance of a con‐ tract and the adequacy of the price [Section 53(1), second sentence of the CC]. Accor‐ ding to some decisions, the non-transparency of an arrangement is a reason for its un‐ acceptability per se.57 Numerous court decisions and findings of the Commission on the Assessment have been based on the breach of transparency requirement.58 Legislative power of the judicature The Slovak legislation on the protection against unfair terms has not been regarded as exemplary for a long time. The implementation of UCTD has also been lengthy and complex.59 Therefore, the Slovak courts have helped themselves with an interpretati‐ on of the national law that is in conformity with the directive and have also involved the Court of Justice in Luxembourg in the transformation of the national rules. Thus, they have had an impact not only on the national law and its application, but also on the interpretation of the European rules – especially the UCTD. A significant number of recent CJEU judgments has been rendered based on preliminary references raised by Slovak courts.60 Especially the first and second instance courts in the Prešov regi‐ on became an influential stronghold of consumer protection in Slovakia providing ar‐ gumentation patterns (and textual templates) followed by other courts.61 It does not come as a surprise that the protective courts of Prešov region were also very active in preliminary references. The activity of the courts in matters of consumer protection has not been ignored by the legislation. The legislators have retrospectively reacted to the new case law and changed the regulations on voluntary auctions in terms of the form of exercise of a lien, rules for consumer arbitration, legal provisions on consumer loans and security institutes – the‐ re is a restriction of the use of promissory notes or legal provisions on wage deduc‐ tions for securing obligations arising from consumer contracts. The protection that the courts have started to provide as protection for the unfair terms has been translated into the legislation that has covered much broader regulations and because of short‐ comings in legislative technique bears the risk to backfire.62 3. 57 Rozhodnutie Krajského súdu v Prešove, file Nr, 6Co/34/2014 zo dňa 15. 1. 2015 (Decision of the Regional Court Prešov, file Nr. 6Co/34/2014 from 15. 1. 2015 para 29). 58 Jurčová, Maslák, Fn. 46. 59 Csach, Fn. 14, pp. 166–168. 60 Slovak courts submitted 15 references for a preliminary ruling regarding the interpretation of UCTD. 61 Moreover, as the region of Prešov is one of the economically less developed regions in Slovakia, it does not surprise that the main portion of the cases handled belong to the core of consumer protection: consumer credit and enforcement procedures. It is hard to understand the Slovak case law without realizing the position of this particular court’s activities. 62 For example, terms allowing the trader to nominate the representative of the consumer in advance with the authority to create a security in the name of consumer, to acknowledge the Unfair Contract Terms Protection in Slovakia 177 Path dependence: the German template and the legislative reaction The legal regulation on unfair terms in consumer contracts was a novelty and really required a Copernican Revolution in the thinking of the law-applying authorities. Therefore, it is not surprising that the results of the decision-making activities of the courts of other EU countries, especially the German courts, were quite quickly found its way into the justifications of the Slovak court decisions.63 The ideological basis for this approach is embodied in the preliminary ruling question submitted by the Regio‐ nal Court of Prešov on 3rd August 2012 in the case of GIC Cash a.s. / Marián Gunčaga (C-373/12). The referring court asked, inter alia, whether a judgment of the court of a member state on the unfairness of a contract term might be used in a pro‐ ceeding in another member state when reviewing a term with a similar or identical content. Since the preliminary reference submitted was later withdrawn due to the course of the proceedings that took place before the submitting court, we did not find out the outcome of this question, which was undoubtedly approached in a revolu‐ tionary manner. The practice of the Slovak courts of adopting the German solution to a particular problem (especially those involving loan processing fees or loan management fees) has also provoked criticism, as the original solutions were built on a different legisla‐ tive basis and the adoption patterns were considerably selective – a judgment of an another member state leaning towards the opposite view has been ignored.64 The Ger‐ man tests of fairness have thus been used instead of the criteria listed in Section 53 subs. 1 CC.65 The evolving judicial interpretation of the general clause by Slovak courts and the critical views of the academia and practice led the Slovak legislator to introduce new unfair clauses into the list of terms considered unfair mirroring the German doctrinal interpretation of the general clause.66 Thereby, the Slovak list of un‐ fair terms moved further from its legislative model – the list in the UCTD annex. 4. debt, etc. The nominated representative was usually a person related to the trade. Such practices and terms had been banned by the courts and later introduced into a casuistic regulation in Section5 a of CPA. 63 The most quoted was the decision of Oberlandesgericht Karlsruhe, file Nr. AZ 17 U 192/2010 from 3. 5. 2011. Cited by decisions of the Regional court in Prešov, File ref. 18 Co 109/2011 of 21 November 2012; File ref. 6Co/34/2014 of 15 January 2015 Para 11; File ref. 17‐ Co/219/2016 of 28 February 2017. 64 Office of Fair Trading v Abbey National plc and Others [2009] UKSC 6. 65 “And the elements of an unacceptable contractual condition are also fulfilled by a condition which is vague or contradicts ‘ratio legis’. An unacceptable contractual condition also means a condition that gives rise to a consumer’s financial obligation for a performance which has not in fact been provided to him and serves only the supplier’s interests (in most cases, these are fees in consumer loan relationships that are neither certain nor specific nor proportio‐ nate to the performance provided.” Rozsudok Krajského súdu v Prešove file Nr. 19‐ Co/199/2017 zo dňa 5. 6. 2018, para 30 (Decision of Regional Court Prešov file nr.19‐ Co/199/2017 from 5. 6. 2018). 66 As listed in Fn. 11. 178 Monika Jurčová, Kristián Csach The German template has also affected the application of rules on interpretation of consumer contracts. Some Slovak courts67 and STI68 apply the principle of German (and Austrian) law of contract interpretation in abstract fairness review, that the most burdensome interpretation for the consumer shall be preferred by the court. However, Slovak authorities seem to apply the principle also in individual review cases. General clause vs. special clauses (black or grey list) It is questionable whether in the case of terms contained in the list of unfair terms in Section 53(4) of the CC, the criteria of a general clause should also to be examined, or whether it is sufficient to meet the requirements stated in this list in order to conclude that the terms are unfair. The essence of the first view is simply referred to as the grey list of unfair terms, while that of the second view is referred to as the black list. The legal text did not give any clear answers and was open for both interpretations. There was almost a general consensus among academics and the courts that the list of con‐ tract terms is a black list, nowadays, the opposite position seems to prevail, at least in the legal writing.69 Nonetheless, the sheer number of the listed contract terms con‐ sidered unfair and their very detailed formulations do not leave very much space for a general test of unfairness. Active legal standing of a consumer in preventive declaratory fairness review of contract terms The active legal standing of a consumer in regard to petitions for declaration of nullity of an unfair term is currently a lively debated issue. According to our procedural ru‐ les, an action for declaration of nullity is available only if allowed by a special regula‐ tion or in case an urgent legal need for the declaration is present (Section 137 CSP). This is to underline the subsidiary character of actions for declaration in contrast to actions for payment or specific performance. It is questioned, whether consumers are entitled to apply for a declaration of nulli‐ ty of a particular contract term even in case they may claim performance directly (i. e. 5. 6. 67 Rozhodnutie Krajského súdu Prešov file Nr. 3Co/66/2016 from 4. 10. 2016, para 27 quoting the decision of the Brandenburgisches Oberlandesgericht File Nr. 7 U 17/06 from 21. 6. 2006. 68 Decision of the Inspectorate of STI in Bratislava file Nr. P/0025/01/2015 from 9. 3. 2017, page 29. 69 In favour of black list Csach, Fn. 14, p. 191, likewise M. Budjač, Fn 21, p. 577. Opposite view, in favour of the grey list J. Lazíková, M. Števček. Ochrana spotrebiteľa v civilnom procese. [Protection of the consumer in the civil proceedings]. Bulletin Slovenskej advokácie 6/2013, p. 24; M. Jurčová, M. Novotná. Šedý alebo čierny, to je otázka [Grey or black, this is a question]. In: J. Suchoža, J. Husár, R. Hučková (eds.) Právo, obchod, ekonomika. Košice, 2016, pp. 289 – 290; M. Hamřík, Nič nie je čierno-biele? Zopár úvah k čiernemu/ šedému zoznamu neprijateľných zmluvných podmienok. [Ain’t nothing black or white? Some thoughts on grey / black list of unfair terms]. In: M. Maslák (ed.): Vybrané otázky imple‐ mentácie európskych právnych predpisov reglementujúcich zvýšenú ochranu slabšej strany. Trnava 2017, pp. 90–104. The Slovak Supreme court implicitly followed the grey list as in the decision on fairness of an opt-out arbitration clause file Nr. 3 Cdo 80/2017 from 26. 7. 2018. Unfair Contract Terms Protection in Slovakia 179 unjust enrichment) or even in the case where there is no risk of the term being made use of by the supplier (preventive declaration). The case law allows such claims and performs the fairness review of such contract terms.70 The doctrine is divided.71 Concluding remarks After a struggling effort, the current Slovak regulation of unfair terms in consumer contracts seems to fulfil the requirements set by the UCTD. The national regulation roots in both private and public law and is fragmented in the Civil Code, the Act on Consumer Protection and special sectoral regulation and supplemented by special pro‐ cedural regulation. The protection is granted by courts and administrative authorities with partially overlapping competences. The protection should also be granted by consumer arbitral tribunals, regulated and subjected to disciplinary competence of the Ministry of justice. Slovakia has also introduced some peculiar regulation – a font size rule and the extension of effect of judgments rendered in individual review proceedings. However, basing on empirical evidence, the regulation does not seem to have a significant im‐ pact. Issues derived from the interaction between multiple methods of protection and types of proceedings, both judicial and administrative are discussed in the doctrine. Although the introduction of a special proceeding on abstract review has been welco‐ me, in practice it is almost non-existent. The administrative authorities that were sup‐ posed to play a significant role as applicants for a judicial abstract review, resorted to perform their own administrative review and not to apply for an abstract judicial re‐ view. Review in individual proceeding prevails. Slovak legislation also suffers from a tendency to rely on rather casuistic regulati‐ on and technical norms and technical limits set by administrative regulation (laid down by the government). In general, a rather complicated framework of private and public regulation provi‐ des protection from unfair contract terms. The protection is also supplemented by other legislation aiming at improving the situation of consumers as debtor (debt relief as a simplified insolvency procedure). The future of consumer protection in Slovakia is not very clear. The intention to codify consumer protective rules in the unified Consumer Code has been proposed by the Ministry of Economy. Contrary to such a proposal, the recent draft of recodificati‐ on of the CC presented by the Ministry of Justice included also the current regulation V. 70 Rozhodnutia Najvyššieho súdu SR file Nr. 6 Cdo 127/2017 zo dňa 30. 1. 2019 a sp. zn. 6 Cdo 27/2018 zo dňa 28.3.2019 (Supreme court decisions file nr. 6 Cdo 127/2017 from 30. 1. 2019 and file nr. 6 Cdo 27/2018 from 28.3.2019). 71 Approving notes on the decision by P. Mészáros, Súkromné právo 3/2019, pp. 121–124, dissenting notes to the decision by M. Novotný, Súkromné právo 4/2019, pp. 170–174. 180 Monika Jurčová, Kristián Csach on unfair terms with some minor changes.72 In general, no significant changes in the regulation of unfair terms in consumer contracts are awaited.73 72 Interestingly, the legislation on consumer protection is divided between the Ministries of Economy and Justice. The unfair terms protection – being part of the CC- falls under the competence of Ministry of Justice. The public law regulation – including the entire ACP – falls under the competence of the Ministry of Economy. 73 This work was supported by the Slovak Research and Development Agency under the contract no. APVV-17–0562. Unfair Contract Terms Protection in Slovakia 181


The unfair contract terms protection in Slovakia is currently regulated by a system of rules in the Slovak Civil Code; the path to the current extent of consumer protection has not been very straightforward. This article analyses the legislative framework on unfair terms, and questions of law enforcement. It further outlines selected issues and empirical evidence in the context of “surprising contract terms,” transparency of a contract term, legislative power of the judiciary, it discusses the controversial of the German approach to resolve conflicts revolving around unfair clauses. The article concludes that the current Slovak regulation of unfair terms in consumer contracts seems to fulfil the requirements set by the UCTD; however, all in all, Slovakia’s national regulation remains fragmented in the Civil Code, the Act on Consumer Protection and special sectoral regulation and supplemented by special procedural regulation.



Osteuropa Recht behandelt Gegenwartsfragen der Rechtssysteme und Rechtswissenschaft im östlichen Europa sowie deren völkerrechtliche Einbindung. Im Fokus stehen die ost-, ostmittel- und südosteuropäischen Staaten sowie der Kaukasus und Zentralasien. Die Zeitschrift dokumentiert und analysiert Gesetzgebung, Rechtsprechung und rechtswissenschaftliche Debatten in den einzelnen Staaten der Region und leistet einen Beitrag zum internationalen Rechtsvergleich. Die Zeitschrift erscheint vierteljährlich und ist peer-reviewed. Publikationssprachen sind Deutsch und Englisch. Osteuropa Recht wurde 1954 von der Deutschen Gesellschaft für Osteuropakunde e.V. gegründet.