Thursday, 13 September 2012

Unfair gas prices increase even if properly notified? - AG Trstenjak in RWE Vertrieb (C-92/11)

13 September 2012: Opinion AG Trstenjak in RWE Vertrieb (C-92/11)

Advocate General Trstenjak issued an opinion today on the interpretation of the provisions of the Unfair Contract Terms Directive 93/13. Unfortunately, it is not yet available in English, but here is a short summary of the case and the opinion (translated from German).

A German consumer rights organisation representing 25 consumers claimed reimbursement from the gas provider company - RWE Vertrieb. RWE Vertrieb raised the gas prices four times in the period 2003-2005, pursuant to their standard contract terms, which referred to standard, regulatory gas prices. However, these standard gas prices should not have been applied to consumers, claimed the German consumer rights organisation and claimed reimbursement of the paid amounts. It was undisputed, that whenever a consumer contested the application of standard gas prices prior to signing the contract, the gas company concluded a different contract with such a consumer, on more beneficial terms. For the 25 consumers who concluded a standard agreement there was no possibility to switch a gas provider after the prices were raised (due to the liberalisation of the energy market). The German consumer rights organisation considered the clause in standard contract terms as unfair.

The AG Trstenjak examined firstly Article 1(2) of the Directive which states that:

"The contractual terms which reflect mandatory statutory or regulatory provisions and the provisions or principles of international conventions to which the Member States or the Community are party, particularly in the transport area, shall not be subject to the provisions of this Directive."

The first question asked by the German Supreme Court concerned the material scope of the Directive by asking for the interpretation of the term 'mandatory statutory or regulatory provisions'. AG Trstenjak stated that this term must be interpreted as referring only to such provisions that will automatically apply to the contracting parties and their intended type of contract, and it is immaterial whether these provisions are binding in nature, that is whether a contracting party may derogate from them. This opinion was made based on teleological arguments and legal history of the term. In the given case it could mean that since the standard gas prices were not supposed to apply to consumer contracts, they could not be seen as mandatory provisions.

Secondly, the principle of transparency was the subject of the referral, since the RWE Vertrieb claimed that it notified consumers properly about the increase of the gas prices and that they could have terminated their contracts upon such a notification. AG Trstenjak decided that the violation of the principle of transparency (Art. 3 and 5 of the Directive) may take place even if the gas company guarantees to notify its customers of any price increases within a reasonable time in advance, and even if consumers are given a right to terminate the contract, if they do not want to accept the changed conditions they have been informed about.

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