Private Enforcement as a Deterrence Tool: A Blind Spot in the Omnibus-directive

Abstract

The Directive on better enforcement and modernization of EU consumer protection rules or Omnibus-directive does not acknowledge the deterrence function of private enforcement of EU consumer law. The article demonstrates that the balancing of the principles of effectiveness, proportionality and dissuasiveness requires more attention when it comes to ‘civil remedies’. Indeed, the Court of Justice of the European Union (CJEU) has in recent years put a clear emphasis on the deterrence function of the nonbinding effect of unfair contract terms, a civil sanction imposed by civil courts. These courts, however, are struggling with the implications of this function. They are actively searching for direction by referring new preliminary questions to the CJEU. Empirical research conducted in the Netherlands shows that Dutch district courts largely recognize their role as enforcer of EU consumer law. It also reveals that these courts consider the proportionality and the dissuasiveness of the sanction to be at odds when the gap left after the removal of an unfair contract term is not filled with national law. European consumer law, sanctions, civil law, unfair contract terms, civil courts