Volume 50 (2013) / Issue 1/2
The central bargain of CESL is to provide firms that do business throughout the European Union the protection of a set of uniform rules that will override the many local laws that now govern consumer and small business transactions. The price for that protection is that firms that opt into CESL must accept an onerous set of mandatory terms intended to protect consumers and SMEs. In practice that price is too steep. The key objective of all contractual arrangements is to secure mutual gains from trade for both sides. That objective is hampered by insisting on intrusive mandatory terms that make contracting more costly and less efficient that it ought to be. A far better approach, fully consistent the principle of subsidiarity, allows any firm to pick its preferred standardized terms for any given class of transactions. That approach has been adopted in the American decision in Carnival Cruise v. Shute. It should work equally well in the European context.
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