european contract law. a matter of consumer protection, citizenship, or justice

7/27/2019 European Contract Law. a Matter of Consumer Protection, Citizenship, Or Justice

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Centre for the Study of European Contract LawWorking Paper Series

No. 2006/04

European Contract Law: a Matter of Consumer

Protection, Citizenship, or Justice?

Martijn W. Hesselink

[email protected]

Centre for the Study of European Contract Law

Universiteit van Amsterdam

P.O. Box 1030

1000 BA Amsterdam

The Netherlands


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1

European Contract Law a Matter of Consumer Protection,

Citizenship, or Justice?*

Martijn W. Hesselink**

I. Introduction 2II. Consumer protection 3

A. The Community policy of consumer protection 3B. Contract law as consumer protection 4C. An expanding scope for a limited perspective 12

III. Citizenship 15A. European Union citizenship 15B. Contract law as a matter of citizenship 16C. A broader perspective, but a narrower basis 19

IV. J ustice 20A. A European area of freedom, security and justice 20B. Contract law as a matter of justice 24C. The need for a genuine area of civil justice 34

V. A matter of consumer protection, citizenship or justice? 35A. The European Commissions U-turn 35B. Roaming for rights, or: citizenship as consumer protection 38

C. Back to justice 41

* Paper presented at the SECOLA conference Constitutional Values and European

Contract Law', on 8 and 9 September 2006 in Berlin. A short opinion article based

on this paper was published European Voice, 19 October 2006: Are we human

beings or mere consumers.** Professor of European Private Law and Director of the Centre for the Study of

European Contract Law, Universiteit van Amsterdam.


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I. Introduction

In its First Annual Progress Report on European Contract Law and

the Acquis Review,1 the European Commission recently announced

that, within the Common Frame of Reference process, it will prioritise

the revision of the consumer acquis. This reprioritisation has a

number of practical consequences.2 However, the more fundamental

question is what the effect of a renewed focus on consumer

protection will be on the character of European contract law, and on

the way in which the Union addresses and views the people living in

Europe. This question will become all the more important if the

Commission is going to attempt, as it seems to envisage, some

comprehensive and exclusive European legislation with regard to

contracts with consumers (all or certain important ones, notably

sales).

Obvious alternatives to the consumer protection approach to the

Europeanisation of contract law include the perspectives of European

citizenship and of justice. Does it matter whether European contract

law is developed as a matter of consumer protection, citizenship or

justice? Or, to put it differently, does it make a difference for a

1 First Annual Progress Report on European Contract Law and the Acquis Review

(COM(2005) 456 final, 23.9.2005).2 These were discussed at the conference The Review of the Consumer Acquis

and the Common Frame of Reference progress, key issues, perspectives which

was hosted by the Austrian Council Presidency and took place on 25-26 May 2006

in Vienna. It was the second European Discussion Forum, following the first

Discussion Forum in London on 26 September 2005.

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contracting party whether she is treated as a consumer, a citizen or a

person?

This paper argues that it does. It presents the European policies with

regard to consumer protection, European citizenship and the Area of

justice, and discusses the kind of contract law that each of these

approaches leads to and the kind of society they contribute towards

(Sections II, III and IV). Both the citizenship and, in particular, the

consumer protection approach are rejected as an exclusive approach

to contract law because they are reductive. They fail to take into

account important aspects of human life which would be included in

an approach to contract law from the perspective of justice.

The conclusion is that European contract law should become a

matter of justice (Section V). As a consequence, the European Union

will need to provide a legal basis for treating contract law as a matter

of civil justice. Moreover, the Union will have to articulate a common

European conception of justice in contract law.

II. Consumer protection

A. The Community policy of consumer protection

Today, consumer protection is a well established area of EuropeanUnion policy. However, this has not always been the case. Indeed, it

was not until 1992 (Maastricht Treaty) that consumer protection was

mentioned in the treaties as a distinct Community policy.3 Until then

3 The Maastricht Treaty inserted a new title Consumer Protection into Part III

(Community policies) of the EC Treaty. The original Treaty Establishing the

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consumer policy was merely an aspect of the construction of the

internal market.4

B. Contract law as consumer protection

Dealing with European contract law from the perspective of

consumer protection is not merely a hypothetical exercise. Since

halfway through the 1980s, the European Community has enacted a

series of directives which have affected parts of the law relating to

contracts concluded by consumers.5 Indeed, most of the acquis

communautaire in the area of contract law concern only consumers.6

European Economic Community (Rome, 1957) did not refer to consumer

protection. Instead, the preamble affirmed as the essential objective of the

signatories, the constant improvement of the living and working conditions of their

peoples. European Consumer policy did not start until the 1970s. After the Paris

Summit (1972) had concluded that there was a need for consumer protection, a

Council resolution on a preliminary programme for a consumer protection and

information policy was adopted in 1975. That document was the first of acontinuous flow of policy documents. In 1999, consumer policy obtained full

institutional recognition as it was given (together with health policy) its own

Directorate-General, DG XXIV (now DG SANCO).4 The first reference to consumers in the founding Treaties came in 1986 when the

Single European Act inserted Article 100A EEC (now Article 95 EC) as an

additional legal basis for harmonisation, which stated that The Commission, in its

proposals envisaged in paragraph 1 concerning (...) consumer protection, will take

as a base a high level of protection. Most directives in the area on consumer

contract law are based on Article 100 EEC (now Article 95 EC).5 These include: Directive 85/374/EEC concerning liability for defective products;

Directive 85/577/EEC to protect the consumer in respect of contracts negotiated

away from business premises; Directive 90/314/EEC on package travel, package

holidays and package tours; Directive 93/13/EEC on unfair terms in consumer

contracts; Directive 94/47/EC on the protection of purchasers in respect of certain

aspects of contracts relating to the purchase of the right to use immovable

properties on a timeshare basis; Directive 97/7/EC on the protection of consumers

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What are the main characteristics of a contract law inspired by the

aim of consumer protection?

1. Protective rules

Obviously, the main character of rules inspired by the policy of

consumer protection is that they are protective. This means that the

rules of contract law aim at the protection of the consumer against

the other party to the contract (the professional). In order to make

this protection effective such rules are typically mandatory, ie they

cannot be waived.

2. Categorical protection

Moreover, the protection of consumers is categorical. Whoever falls

under the definition is entitled to protection, and to the same degree.7

Conversely, the other party is systematically deemed to be a party

against whom the consumer must be protected. In addition, thecategorical character of consumer protection also implies that

whoever does not fall within the scope of the definition (eg SMEs,

in respect of distance contracts; Directive 1999/44/EC on certain aspects of the

sale of consumer goods and associated guarantees; Directive 2002/65/EC

concerning the distance marketing of consumer financial services; Directive

2005/29/EC on unfair business-to-consumer commercial practices in the internal

market (Unfair commercial practices directive).

6 Directives which affect contract law but do not concern consumers: Directive86/653/EEC on the coordination of the laws of the Member State relating to self-

employed commercial agents; Directive 2000/35/EC on combating late payment in

commercial transactions.7 This is not always the case. For example, Directive 93/13/EEC on unfair terms in

consumer contracts provides, in Article 4 (1), that the unfairness of a contractual

term must be assessed (among other things) by referring to all the circumstances

attending the conclusion of the contract.

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non-profit organisations) is not entitled, as such, to consumer

protection, whatever the possible similarity of its condition.

3. A uniform concept

The concept of a consumer is a uniform concept, maybe even with a

universal vocation. Obviously, consumers differ from country to

country (they have different preferences, a different attitude towards

risk etc), as do consumer policies (more or less protection, more or

less self-regulation etc). Nevertheless, consumers are usually

defined in a uniform way (ie without local exceptions) and their

protection is usually expressed in universal terms of the level of

protection on the same universal scale. A striking example is the

recent development, by the European Court of J ustice and the

European legislator, of the concept of 'the average consumer'.8 In

other words, cultural diversity is not a concept that is usually

associated with consumer protection.9 From this perspective, it is not

8 In a line of cases concerning advertising the ECJ has referred to the concept of

'the average consumer', who is reasonably well informed and reasonably observant

and circumspect'. See eg ECJ , 16 J uly 1998, C-210/96 Gut Springenheide GmbH,

Rudolf Tusky v Oberkreisdirektor des Kreises Steinfurt Amt fr

Lebensmittelberwachung [1998] ECR I-4657; ECJ , 13 J anuary 2000, C-220/98

Este Lauder Cosmetics GmbH & Co. OHG v Lancaster Group GmbH. The same

concept is referred to in Directive 2005/29/EC (Unfair commercial practices

directive), Article 2, where unfair commercial practices are defined: 'A commercial

practice shall be unfair if: (...) it materially distorts or is likely to materially distort theeconomic behaviour with regard to the product of the average consumer (...) or of

the average member of the group when a commercial practice is directed to a

particular group of consumers.' See also recital 18 which explicitly indicates that

the directive takes as a benchmark the concept of 'the average consumer' as

defined by the ECJ in the advertising cases.9 Nevertheless, both in the ECJ 's case law and in the Unfair commercial practices

directive the average consumer is defined 'taking into account social, cultural and

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surprising that the European Commission has recently proposed to

progressively give all European consumers the same level of

protection (full harmonisation).10

4. A corollary to the internal market

From the way in which the Union policy of consumer protection is

defined in art 153 EC it seems to follow that the Union is only

concerned with the interests of the consumer per se.11 However, both

the history of European consumer protection and the recent policy

documents reveal that confident consumers are also regarded by the

European Community as a means, to use a Kantian phrase, for the

creation of a properly functioning internal market.12

linguistic factors.' Thomas Wilhelmsson, 'The European Average Consumer - a

Legal Fiction?' (forthcoming), has argued for a broad interpretation of this cultural

exception.10 See the Commissions Consumer Policy Strategy 2002-2006 (COM(2002) 208

final) 12: There is a need to review and reform existing EU consumer protection

directives, to bring them up to date and progressively adapt them from minimum

harmonisation to full harmonisation measures.11 Art 153 EC, Paragraph 1: In order to promote the interests of consumers and to

ensure a high level of consumer protection, the Community shall contribute to

protecting the health, safety and economic interests of consumers, as well as to

promoting their right to information, education and to organise themselves in order

to safeguard their interests.12 In spite of the recognition by the EC Treaty as an autonomous policy area (and a

legal basis), consumer policy is still closely linked to the completion of the internal

market. Indeed, according to the third paragraph of Article 153 EC, the way in

which the Community shall contribute to the attainment of the objectives referred to

in paragraph 1 is through either (a) measures adopted pursuant to Article 95 EC in

the context of the completion of the internal market; or (b) measures which support,

supplement and monitor the policy pursued by the Member States.

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In its latest Consumer Policy Strategy the Commission remarked

that: The development of consumer policy at EU level has been the

essential corollary of the progressive establishment of the internal

market13 and according to the preamble to the Consumer Sales

Directive: Consumers who are keen to benefit from the large market

by purchasing goods in Member States other than their State of

residence play a fundamental role in the completion of the internal

market.14 The idea seems to be that confident consumers will be

more inclined to indulge in cross-border shopping. This will lead to

more economic growth which in turn will help to contribute to the

strategic goal that the Union has set itself in Lisbon in 2000 for the

following decade, ie to become the most competitive and dynamic

knowledge-based economy in the world, capable of sustainable

growth with more and better jobs and greater social cohesion (the

Lisbon agenda).15

Thus, consumer protection becomes market protection. Specifically

with regard to the CFR process, Commissioner Kyprianou recently

13 Consumer Policy Strategy 2002-2006 (COM(2002) 208 final) 6.14 Recital 4. See, as another example, Consumer Policy Strategy 2002-2006, 6:

The development of consumer policy at EU level has been the essential corollary

of the progressive establishment of the internal market. The free circulation ofgoods and services has required the adoption of common, or at least convergent,

rules to ensure at one and the same time sufficient protection of consumer

interests and the elimination of regulatory obstacles and competitive distortions.15 Presidency conclusions, Lisbon European Council 23 and 24 March 2000, 5.

According to these conclusions (ibidem, 6), if the Lisbon strategy is followed an

average economic growth rate of around 3% should be a realistic prospect for the

coming years.

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emphasised the link between a coherent consumer contract law and

the internal market:16

[The Common Frame of Reference] will bring clear benefits to

consumers and businesses in the internal market. By allowing

for increased coherence between different pieces of EU

contract law legislation, it will contribute to reducing obstacles

to trade, thus promoting trade and competitiveness within the

internal market in accordance with the Lisbon goals while

enlarging consumer choice.

Also, the type of protection given to consumers reflects economic

reasoning in terms of the market mechanism.17 Economists usually

distinguish two main causes of market failures: market power on the

supply side and a lack of information on the demand side. While the

former problem is taken care of, on a European level, by arts 81 et

seq EC, consumer protection policy is increasingly shaped in terms

of the latter.18 Hence, recent consumer contracts directives contain

16 'Greeting address on behalf of Commissioner Kyprianou' at the conference The

Review of the Consumer Acquis and the Common Frame of Reference progress,

key issues, perspectives, Vienna, 25-26 May 2006.17 Against such a narrow conception of consumer protection, see Geraint Howells

& Stephen Weatherill, Consumer Protection Law, 2nd ed, (Hants: Ashgate 2005) ,

7-8, 14, 'consumer law is not simply a matter of plugging a few gaps in the marketsystem. Consumer law raises issues that are central; to the determination of how

our society views the citizen (...) At stake are elements of the correction of market

failures and, additionally, the achievement of fairness to consumers (inter alia) as

the economically weaker parties. Consumer protection law has a wide range of

forms and objectives.'18 See eg Stefan Grundmann, European Contract Law(s) of What Colour, 1 ERCL

(2005), 184-201.

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extensive information duties which aim to restore the autonomy of

the consumer.19

5. A limited set of interests

Addressing a contracting party in her capacity as a consumer means

addressing her with a view to a limited set of interests. Usually, these

interests are considered to be mainly economic, in particular an

interest in a vast choice and in low prices. European consumer policy

is aimed at making this presumed wish to benefit fully from the

potential of the internal market come true:20

It is important that consumers have comparable opportunities

to benefit fully from the potential of the internal market in terms

of greater choice, lower prices, and the affordability and

19 See eg Directive 90/314/EEC on package travel, package holidays and package

tours; Directive 94/47/EC on the protection of purchasers in respect of certainaspects of contracts relating to the purchase of the right to use immovable

properties on a timeshare basis; Directive 97/7/EC on the protection of consumers

in respect of distance contracts; Directive 2002/65/EC concerning the distance

marketing of consumer financial services. Cf Consumer Policy Strategy 2002-

2006, 6: Measures have frequently sought to give consumers the means to

protect their own interests by making autonomous, informed choices. This typically

ensures that consumers will have sufficient, correct information before engaging in

transactions and certain legal rights in case the transaction does not deliver the

required outcome. These measures seek to redress structural imbalances betweenindividual consumers and business flowing from limits on the formers access to

information and legal expertise as well as on their economic resources..20 Communication from the Commission to the European Parliament, the Council,

the Economic and Social Committee and the Committee of the Regions Consumer

Policy Strategy 2002-2006 Brussels, 7.5.2002, COM(2002) 208 final, 7 (emphasis

in the original). See also Consumer Policy Strategy 2002-2006, 9 (under the

heading: Reaping the full benefits of the internal market).

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party (the professional) taken into account as a matter of consumer

policy.

C. An expanding scope for a limited perspective

In sum, the consumer protection perspective on contract law (as on

other subjects) is a limited one in several respects. This is, of course,

not a problem if other aspects of the contractual relationship are

properly taken into account by other parts of the law. In other words,

as long as the scope of the consumer protection approach to contract

law is also limited, and supplemented and overridden where

necessary by contract rules inspired by other policies, there is no

reason for concern. However, things are entirely different if the

parties to a consumer contract are only or predominantly treated as

consumers and professionals respectively. Therefore, the crucial

question seems to be whether contractual relationships between

consumers and professionals are dealt with by consumer law only in

part or in their entirety.

Originally, consumer law developed as special legislation. The

presence of background rules of general contract law (or the law of

obligations or private law) was presumed: only certain aspects of the

contractual relationship are dealt with by special consumer rules,

usually of a protective nature; the ordinary rules which are applicable

to any contractual relationship (general contract law) apply to theremainder. In other words, the fact that a contractual relationship was

one between a consumer and a professional did not mean that the

civil code or the common law was inapplicable as such. Rather,

certain general rules were substituted or supplemented for this type

of relationship with specific rules, usually of a protective nature and

of a mandatory character.

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However, in recent policy documents the European Commission

seems to envisage comprehensive legislation which regulates the

entire contractual relationship between the consumer and the

professional, or the most part thereof. This would mean that people

would be treated, with regard to those relationships, (almost)

exclusively as consumers.

In its First annual progress report on European contract law and the

acquis review the Commission reports that with regard to the

revision of the consumer contract acquis the Commission can

choose between two options: a vertical approach, consisting of the

individual revision of existing directives or the regulation of specific

sectors; and a more horizontal approach, adopting one or more

framework instruments to regulate common features of the acquis.

As to the latter option, which it seems to favour, the Commission

remarks:

This framework instrument(s) would provide common

definitions and regulate the main consumer contractual rights

and remedies. Under the horizontal approach, the

Commission could, for example, prepare a directive on B2C

contracts of sale of goods. It would regulate consistently the

contractual aspects of sale, which are currently scattered inseveral directives.23

23 First annual report, 9-10. See also Commissioner Kyprianous opening address

at the Conference on European contract law: better lawmaking to the common

frame of reference (first European Discussion Forum), London, 26 September

2005.

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Adding the fact that the Commission envisages moving progressively

from minimum to full harmonisation, leaving the Member States with

no room for initiatives which might take these broader interests into

account, a somewhat worrying picture emerges of a European

consumer policy with a totalitarian aspiration.

Such an aspiration would be worrying because other ways of looking

at contractual relations, eg from the perspective of citizenship and

fundamental rights, or from the point of view of (social) justice, and

other aspects of contract law, both on a national and a European

level, would risk being overshadowed and marginalised. There is

more to a human being than her or his inclination to consume. It

should not be forgotten that the social system shapes the wants and

aspirations that its citizens come to have. It determines in part the

sort of persons they want to be as well as the sort of persons they

are.24

Even if the limited focus of the consumer protection approach to

contract law is not formally exclusive, as indeed it is not within the

present and future European constitutional frameworks, there is still a

serious risk that such a focus will obscure other interests and values

which would play a more central role if citizenship or justice would

shape the frame of reference for the Europeanisation of contract

law.25

24 J ohn Rawls,A Theory of Justice, revised edition [first edition 1971], (Cambridge,

Massachusetts: Belknap Press 1999), 229.25 Cf Michel Foucault, Les mots et les choses (Paris: Gallimard, 1966).

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III. Citizenship

A. European Union citizenship

The concept of European Union citizenship was introduced by the

Treaty on European Union (Maastricht, 1992).26 According to one of

the five objectives of the Union, as formulated in Article 2 Treaty of

European Union (Amsterdam, 1999), the aim of the introduction of a

citizenship of the Union was to strengthen the protection of the rights

and interests of the nationals of its Member States.27 Therefore,

fundamental rights lie at the very heart of the concept of citizenship

of the European Union.

However, the introduction of European citizenship did not add

anything spectacular to the rights that European citizens already

enjoyed. The main innovation brought about by the Treaty of

Amsterdam was the right to move and reside freely (Art 18 (ex 8a)

TEU), without reference to aneconomic activity; the other provisionsin Part Two on citizenship concern the political rights to vote (Art 19)

and to petition (Art 21), as well as the right to diplomatic protection

(Art 20). Indeed, in the words of Weiler: The treatment of European

citizenship both in the TEU itself and, subsequently, by the

26 The core provision of the new Part II of the EC Treaty was supplemented with a

second section, and renumbered, by the Treaty of Amsterdam (1997) and nowArticle 17 TEU (ex Article 8 TEU) reads as follows: 1. Citizenship of the Union is

hereby established. Every person holding the nationality of a Member State shall

be a citizen of the Union. Citizenship of the Union shall complement and not

replace national citizenship.

2. Citizens of the Union shall enjoy the rights conferred by this Treaty and shall be

subject to the duties imposed thereby.27 See for another of these objectives below, IV.

15
http://eur-lex.europa.eu/en/treaties/dat/11992M/htm/11992M.htmlhttp://eur-lex.europa.eu/en/treaties/dat/11992M/htm/11992M.html


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institutions and the Member States of the Union, is an

embarrassment.28

Nevertheless, in spite of the very limited specific substance given to it

by the Treaty of European Union, the concept of Union citizenship is

not one without potential.29 One example is the role of social rights.

As Van Gerven points out, the neo-liberal philosophy that was the

basis of the European Economic Community has been gradually

turned into a more socially-oriented philosophy: From a perspective

of citizen rights, this means that the rights that citizens enjoy by virtue

of EC law are no longer only market rights but have been enlarged

to include political rights as well, and slowly social rights in the

broad sense of the word, that is rights (and duties) concerned with

peoples welfare generally, including work, education, health, and

quality of life.30 According to Van Gerven this remarkable

transformation started with the incorporation by the Maastricht Treaty

of the new part II on Citizenship of the Union in the EC Treaty.

B. Contract law as a matter of citizenship

So far, the link between Union citizenship and private law has been

given little attention. On the one hand, this is surprising because

28 J .H.H. Weiler, To be a European Citizen: Eros and Civilization, in: idem, The

Constitution of Europe; Do the New Clothes Have an Emperor? and Other

Essays on European Integration (Cambridge: CUP 1999), 324-357, 332. Thecomments from many other lawyers were equally critical.29 Cf Antje Wiener, Citizenship, in: Michelle Cini, European Union Politics (Oxford:

OUP 2003), 397-414, 400: 'Lawyers tended to discuss Union Citizenship from the

perspective of what it was, whereas NGOs, lobby groups, and philosophers

discussed what it should become or ought to be. (emphasis in the original).30 Walter van Gerven, The European Union. A polity of States and Peoples

(Oxford: Hart Publishing 2005), 200.

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relations between Union citizens are regulated by private (civil) law.

On the other hand, however, this is not so surprising since the (little)

substance that has been given to the concept in the Maastricht and

Amsterdam Treaties deals nearly exclusively with vertical

relationships.31

In many Member States (notably Germany), the horizontal effect of

several fundamental rights has been recognised. Similarly, European

fundamental rights, including social rights, may have direct (or,

according to some, indirect: through general clauses like good faith)

horizontal effect. In practice, the effect of the horizontal effect of

fundamental rights often means a limitation on the freedom (or the

enforceability) of contract. A well-known example are the German

cases on personal guarantees.32

According to Weiler, giving horizontal effect to some fundamental

rights would enrich the notion of a human right as part of

citizenship.33 One step further would be an attempt to entirely

reconceive horizontal relationships, on the European level, in terms

of the values expressed in these European fundamental rights. For

example, an (optional) code of contracts could be based on the

values of human dignity, freedom, equality and solidarity.

This would not be merely a nice idea. In 2000, in Nice, the EuropeanParliament, the Council and the Commission solemnly proclaimed a

31 Private law is not limited to citizens. It may also apply, through the rules of

private international law, to citizens of third countries, who are present (legally and

illegally) in the Union, and to parties abroad.32 See in particular, BverfGE 89, 214, NJW 1994, 36.33 Weiler (1999), n 28 above,356.

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set of rights as the Charter of Fundamental Rights of the European

Union. The Treaty establishing a Constitution for Europe (signed in

Rome, 2004) incorporates the charter, as Part II. The Constitution

has not (yet) been ratified by all Member States.34 However, today

the Charter is already binding on the institutions of the Union and on

Member Stateswhen they are implementing Union law.35 This means

that the European legislator has to take the Charter into account also

when enacting provisions of European law, including contract law.

Rodot, one of the authors of the Charter, has even argued that any

act codifying private law has to be coherent with the provisions of the

Charter. Hence, according to Rodot, the weakness of an approach

that considers codification as a simple rationalization of existing

legislation, as a pure restatement of the acquis communautaire:

The materials to be put in order and embodied in a single text

have originated from an institutional context that is prevailingly,

and at times exclusively, dominated only by the market logic, thus

by a system of values not corresponding to those set out, in

particular, in the Charter of Fundamental Rights.

The fundamental values embraced by the Nice Charter are: human

dignity, freedom, equality and solidarity. It is important to point out

that there is no hierarchy among them.36 Therefore, when formulating

34 As to the prospects, the European Council, meeting on 16 and 17 June 2005,

said: 'We do not feel that the date initially planned for a report on ratification of the

Treaty, 1 November 2006, is still tenable, since those countries which have not yet

ratified the Treaty will be unable to furnish a clear reply before mid-2007.'.35 Van Gerven (2005), n 30 above.36 As Maduro points out, in the Nice Charter social rights are systematically placed

in an equivalent position to other economic rights (Miguel Poiares Maduro,

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rules of European contract law these values will have to be balanced.

It seems likely that, as Rodot suggests, the outcome of such a

process would be quite different from a mere revision of the

consumer contract acquis with a view to its internal coherence.

C. A broader perspective, but a narrower basis

Clearly, the citizenship perspective on European contract law would

be much broader than the essentially economic conception in terms

of consumer protection and market regulation. Fundamental values

like human dignity, freedom, equality and solidarity would play a

central role.

However, the reality is that whereas contract law legislation based on

the policy of consumer protection has a secure legal basis,37 none of

the articles in the Part on Citizenship in the Treaty nor any other

Treaty provision (nor indeed the Nice Charter) seems to provide a

legal basis for enacting provisions (let alone a code) of Europeancontract law as matter of European citizenship.

European Constitutionalism and Three Models of Social Europe, in Martijn W.Hesselink (ed), The Politics of a European Civil Code (The Hague: Kluwer Law

International 2006), 125-141). See Stefano Rodot, The Civil Code within the

European Constitutional Process', according to whom in the Charter, the

indivisibility of the civil, political and social rights has been affirmed. (in: Ibid p

115-124, 119.)37 Indeed, effectively a double basis: Articles 95 EC (internal market) and 153 EC

(consumer protection).

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IV. J ustice

A. A European area of freedom, security and justice

The Treaty of European Union (Amsterdam, 1997) formulated as an

objective that the European Union should become an area of

freedom, security and justice (AFSJ ).38 In order to achieve this

objective the European Council of Tampere (1999) adopted a work

programme (the Tampere programme).

Even though the focus of the Tampere process has been clearly on

criminal justice (notably terrorism, organised crime, drugs) and

immigration rather than on civil justice,39 nevertheless civil justice has

been explicitly addressed from the beginning. According to the

Tampere Council conclusions,40 [i]n a genuine European Area of

38 See Art 2 TEU: The Union shall set itself the following objectives: (...) to

maintain and develop the Union as an area of freedom, security and justice, inwhich the free movement of persons is assured in conjunction with appropriate

measures with respect to external border controls, asylum, immigration and the

prevention and combating of crime, (...). The Preamble to the Nice Charter also

refers to the concept: [T]he Union is founded on the indivisible, universal values of

human dignity, freedom, equality and solidarity (...). It places the individual at the

heart of its activities, by establishing the citizenship of the Union and by creating an

area of freedom, security and justice. See also the Treaty establishing a

Constitution for Europe, Art I-3 (The Unions objectives), Para 2: The Union shall

offer its citizens an area of freedom, security and justice without internal frontiers,and an internal market where competition is free and undistorted., and Chapter 4

of Title III. See also Art I-42 (Specific provisions relating to the area of freedom,

security and justice), where the approximation of laws is mentioned as the first way

in which the Union will constitute an area of freedom, security and justice.39 See Title VI TEU Provisions on Police and Judicial Cooperation in Criminal

Matters (Arts 29-42).40 Presidency Conclusions, Tampere European Council 15 and 16 October 1999,

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J ustice individuals and businesses should not be prevented or

discouraged from exercising their rights by the incompatibility or

complexity of legal and administrative systems in the Member

States. Under the heading Greater convergence in civil law they

announce the following:41

As regards substantive law, an overall study is requested on

the need to approximate Member States legislation in civil

matters in order to eliminate obstacles to the good functioning

of civil proceedings. The Council should report back by 2001.

The Commissions Communication of 2001 was meant to respond to

this request.42 Indeed, according to insiders, the Action Plan process

was triggered by the Tampere conclusions.43 The suggested

measures described in the Action Plan insert themselves, according

to that Plan, within the Unions objective of developing an area of

freedom, security and justice.44 In the Commissions

SI (1999) 800, 28.41 Presidency Conclusions, Tampere European Council 15 and 16 October 1999,

SI (1999) 800, 39.42 Communication from the Commission to the Council and the European

Parliament on European Contract Law, 11 J uly 2001, COM(2001) 398 final (OJ

2001/C 255/01), 4: this Communication can be considered as a first step towardsthe implementation of the Tampere conclusions.43 Cf Dirk Staudenmayer, The Commission Action Plan on European Contract

Law, ERPL 2003, 113-127.44 Communication from the Commission to the European Parliament and the

Council, A More Coherent European Contract Law; An Action Plan, 12 February

2003, COM (2003) 68 final (OJ 2003/C63/01), 12. See also the European Unions

official website Europa, where, HEuropean contract lawH is presented as part of

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communications on the Tampere process, the Action Plan process is

also presented as part of the implementation of the Tampere

programme.

In its Assessment of the Tampere programme and future

orientations, the Commission says:45

Turning to substantive law, the Commission is already

engaged in drafting a Common Reference Framework to

ensure greater consistency in the acquis communautaire and

improve its quality in the field of contract law. The work should

be completed in 2008. This Common Reference Framework

might serve in the longer term as the basis for an optional

instrument on the law of contracts that the parties could freely

choose to use as the law applicable to their contract, thus

enhancing certainty as to the law in cross-border transactions.

Interestingly, the Commission further remarks:46

To meet these ambitious challenges for judicial cooperation in

civil and commercial matters, it will be advisable to have

adequate legal means. The Constitutional Treaty will provide

them. But it will be necessary to avoid a situation where in

J udicial cooperation in civil matters under JHustice, freedom and securityH

(http://europa.eu/scadplus/leg/en/s22003.htm).45 Communication from the Commission to the Council and the European

Parliament, Area of Freedom, Security and Justice: Assessment of the Tampere

programme and future orientations, Brussels, 2.6.2004 COM(2004) 4002 final, p

11 and footnote 10.46 Ibid p 11 and footnote 11.

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each Member State there are two separate legal regimes, one

relating to the disputes with a cross-border implication and the

other to purely internal disputes. In the long term such a dual

system could be inconsistent with the aim of a single area of

justice for all and could raise questions of discrimination; it

could in addition complicate legislation at the expense of the

transparency which individuals, practitioners and companies

need.

However, in the follow-up, the Hague programme (2004) and the

Hague Action Plan (2005), as regards civil matters, the focus is

mainly on judicial cooperation, in particular the mutual recognition of

judicial decisions, (and on the introduction of a European Day of Civil

J ustice to be celebrated annually on October, 25th)47 rather than on

the approximation of laws.48 Indeed, the only mention of the Common

Frame of Reference (CFR) is as a toolbox to improve coherence and

quality of EU legislation.49

47 'The main idea is to create a symbolic event, a date on which we recall that

justice is first and foremost a service to citizens which enables them to settle their

private conflicts and assert their rights. Civil law is omnipresent in the life of all

citizens - at work, or when they get married, have children, or buy goods and

services. This is what led to the idea of dedicating a day to Civil J ustice.' (Press

release in 2003 by Commissioner Vitorino).

48 See also the Communication from the Commission to the Council and theEuropean Parliament Report on the implementation of the Hague programme for

2005, Brussels, 28.6.2006, COM(2006) 333 final, and the Communication from the

Commission to the Council and the European Parliament Evaluation of EU

Policies on Freedom, Security and J ustice, Brussels, 28.6.2006 COM(2006) 332

final.49 Communication from the Commission to the Council and the European

Parliament - The Hague Programme: Ten priorities for the next five years. The

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In the light of the Council Conclusions in Tampere, which clearly link

the action plan process on contract law to the aim of creating a

genuine European area of justice, this recent development is

somewhat surprising. Equally surprising is the Councils reaction to

the Commissions first progress report, which welcomes the

prioritisation of the review of the consumer acquis.50 Indeed, the

Councils position is in sharp contrast to that of the European

Parliament which, in its reaction to the Commissions progress report,

calls for the Commission to give the primary responsibility of the CFR

process to the J ustice, Freedom and Security Directorate-General,

which is responsible for the AFSJ .51

B. Contract law as a matter of justice

1. The need for a common European concept of justice

What would it mean to treat European contract law as a matter of

justice? And how would such an approach differ from the approaches

to contract law as a matter of consumer protection or as a matter of

citizenship?

Partnership for European renewal in the field of Freedom, Security and J ustice,

COM (2005) 184 final: 'Regarding the EU substantive contract law, a Common

Frame of Reference (CFR), to be used as a toolbox to improve coherence and

quality of EU legislation, will be adopted in 2009 at the latest.'

50 Conclusions of the Competitiveness Council, 28-29 November 2005, no 11.51 European Parliament resolution of 23 March 2006 (P6_TA(2006)0109), 14:

Calls for the Commission as a whole, under the primary responsibility of the

Justice, Freedom and Security DG andwith the involvement of the Internal Market

and Services and the Health and Consumer Protection DGs in particular, to

participate in this work, and for the material and human resources which are

necessary given the importance and extent of the project to be made available;

(emphasis added).

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First, of course, the scope of European contract law would be

considerably broader. Not only does justice also affect citizens other

than consumers. J ustice is not even limited to European citizens: it

also addresses European companies and other entities having legal

personality, and - through the rules of private international law - non-

citizens, ie natural and legal persons having their place of residence

or business outside the Union (including illegal immigrants).

The most significant implication seems to be, however, the need for a

common European concept of justice. It seems to be simply

unthinkable to deal with the Europeanisation of contract law, as an

aspect of the creation of a truly European area of justice, without

developing a common European concept of justice.

Before discussing different conceptions of justice, a terminological

point needs to be addressed. Does the concept of an area of justice

refer to justice in the sense of social or distributive justice

(Gerechtigkeit in German) or rather to the administration of justice

through the judiciary (Justiz in German), or to both? This question

was recently raised by J acques Ziller with regard to the different

language versions of the Constitution for Europe. He points out that

where the English text of the Constitution uses justice (and the

French justice), the German version sometimes speaks of

Gerechtigkeit (a concept referring to social or distributive justice) buton other occasions, including Articles III-269 and III-270 on the area

of freedom, security and justice, of J ustiz (the administration of

justice through the judiciary).52 This seems to indicate that the area

52 J acques Ziller, The Value of J ustice in the European Constitution, EUI Working

Papers, Law No 2006/08. Interestingly, in another Germanic language, ie Dutch,

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of civil justice might be merely about the administration of justice and

not about social justice. Still, contract law as it has been discussed

within the framework of the Tampere and Action Plan processes,

where the focus has been entirely on substantive (as opposed to

procedural) rules - think, in particular, of the common frame of

reference -, necessarily has to be regarded as a matter of social

justice rather than of the administration of justice.

Moreover, whatever the exact meaning of the term justice in the

specific expression of an area of freedom, security and justice, it is

clear that the present European Constitution (ie the EC and EU

Treaties and the case law of the ECJ ) and the new Constitution

either explicitly refer to the concept of social justice or use concepts

that imply the existence of a notion of social justice.53 Indeed, several

observers have argued that it is time to develop such a common

European notion of social justice. For example, Miguel Maduro

argues that European integration has reached a point where its

emerging European demos and its redistributive and majoritarian

the area is actually an area of justice in the sense ofGerechtigkeit, at least in the

Dutch language versions of the Treaty of Amsterdam and of the Conventions draft

Constitution: De Unie biedt haar burgers een ruimte van vrijheid, veiligheid enrechtvaardigheid zonder binnengrenzen, en een interne markt waar de

mededinging vrij en onvervalst is., but not in the Dutch language versions of the

final text of the Constitution, Artikel I-3: De doelstellingen van de Unie (...) 2. De

Unie biedt haar burgers een ruimte van vrijheid, veiligheid en recht zonder

binnengrenzen, en een interne markt waarin de mededinging vrij en onvervalst is..53 Constitution for Europe, Art I-3 (The Unions Objectives), Para 3: [The Union]

shall promote social justice).

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elements can no longer be socially accepted and legitimized without

an underlying social contract and a criterion of distributive justice.54

2. Theories of justice in contract law

What should a common European concept of justice in contract law

look like? Obviously, this is not the place to discuss the various

theories of justice in contract law in detail. Nevertheless, a very brief

overview may give an impression of the variety of theories that exist

and the level of disagreement. In other words, if the European Union

is to develop a European concept of social justice (even if merely for

contract law) choices will have to be made.55

a. THE MIRAGE OF SOCIAL J USTICE (HAYEK)

First of all, there are theorists who challenge that there is such a

thing as social or distributive justice. The most well known is Hayek.56

54 Miguel Poiares Maduro (2006), n 37 above, 125-141, 135. Cf, in more general

terms, J ohn Rawls (1999), n 24 above, 4: A set of principles is required for

choosing among the various social arrangements which determine the division of

advantages and for underwriting an agreement on the proper distributive shares.

These principles are the principles of social justice: they provide a way of assigning

rights and duties in the basic institutions of society and they define the appropriate

distribution of the benefits and burdens of social cooperation.

55 Compare Rawls, op cit, 174: the question whether legislation is just or unjust,especially in connection with economic and social policies, is commonly subject to

reasonable differences of opinion.56 F.A. Hayek, The Road to Serfdom, [first edition 1944] (London and New York:

Routledge Classics 2005); F.A. Hayek, Law, Legislation and Liberty; A new

statement of the liberal principles of justice and political economy, [first edition

1973] (London and New York: Routledge 2003), in particular, Volume 2: The

mirage of social justice.

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In his view individuals have different conceptions of what would be a

just outcome. In 1944 he wrote, with regard to Europe:57

Who imagines that there exist any common ideals of

distributive justice such as will make the Norwegian fisherman

consent to forgo the prospect of economic improvement in

order to help his Portuguese fellow, or the Dutch worker to pay

more for his bicycle to help the Coventry mechanic, or the

French peasant to pay more taxes to assist the

industrialisation of Italy? If most people are not willing to see

the difficulty this is mainly because, consciously or

unconsciously, they assume that it will be they who will settle

these questions for the others, and because they are

convinced of their own capacity to do this justly and equitably.

For contract law the main implication seems to be that ample space

should be given to freedom of contract.58 For example, Hayek

explicitly rejects price interventions.59 Nevertheless, Hayeks version

of liberalism (individualism) firmly rejects laissez faire libertarians.60

Indeed, not only did he advocate strong policies against power

concentrations and more generally against inequality of opportunity,61

57 Hayek (2005), n 56 above.

58 Hayek has recently been invoked with regard to European contract law, byStefan Grundmann, European Contract Law(s) of What Colour, 1 ERCL (2005),

184-201, and J an M. Smits, European Private Law: a Plea for a Spontaneous

Legal Order, in: Deirdre M. Curtin, J an M. Smits, Andr Klip and J oseph

McCahery, European Integration and Law (Antwerp and Oxford: Intersentia 2006).59 Hayek (2005). n 56 above, 38, 115, 133.60 Ibid18.61 Ibid106: in a system of free enterprise chances are not equal, since such a

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he also saw a wide and unquestioned field for state activity, eg the

prevention of fraud and deception (including exploitation of

ignorance).62

b. WELFARE MAXIMISATION (KAPLOW & SHAVELL)

In a controversial recent book Kaplow & Shavell have argued that

policy decisions should never be guided by notions of justice or

fairness.63 According to this theory, which is a modern version of

utilitarianism and which aims to provide a theoretical foundation for

the economic analysis of the law, contract law, like any legislation

and policy, should aim exclusively at the maximisation of social

welfare, ie on the aggregate welfare of individuals. The most efficient

way of maximising welfare is the allocation of resources through the

market mechanism. Only if social welfare can be increased by a

certain distribution of welfare which is considered to be fair (ie when

individuals have a taste for fairness),64 must redistributionist policies

be pursued. However, it is unlikely that contract law can do this in amore efficient way than the tax system.65 Therefore, this is another

theory which rejects a role for distributive justice in contract law.66

system is necessarily based on private property and (though perhaps not with the

same necessity) on inheritance. There is indeed a strong case for reducing this

inequality of opportunity as far as congenital differences permit and as it is possible

to do so without destroying the impersonal character of the process by which

everybody has to take his chance and no persons view about what is right anddesirable overrules that of others.62 Ibid 41.63 L. Kaplow & S. Shavell, Fairness versus Welfare (Cambridge, Massachusetts:

Harvard University Press, 2002). For some of the criticism see eg @.64 Ibid 21.65 This is an empirical claim. See Louis Kaplow & Steven Shavell, 'Why the legal

system is less efficient than the income tax in redistributing income, 23 J . Legal

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c. COMMUTATIVE J USTICE (CANARIS)

In another view, distributive justice is an important notion but it hasno role to play in contract law. This view refers to the classical

distinction between distributive and commutative justice, which was

first made by Aristotle.67 In this view, which has been the dominant

view at least since the 19th century when most European

codifications were conceived, the realisation of distributive justice is

not a function of contract law;68 contract law is a matter of only

commutative justice. Moreover, commutative justice is conceived in a

rather narrow way: a contract is just when there is an exchange of

equal value, in the eyes of the parties.69 Indeed, today it is generally

accepted that the iustum pretium doctrine, which was developed in

the Middle Ages by Thomas Aquinas and others on the basis of

Aristotles concept of commutative justice,70 is not part of contract

law, at least not as such.71

Stud (1994) 667.66 The difference with Hayek is that his theory is individualist and not utilitarian, ie

he would not accept a rise in social welfare at the expense of a limitation to

individual freedom.67 Aristotle, The Nicomachean Ethics, V, 12.68 See eg Claus-Wilhelm Canaris, Die Bedeutung der iustitia distributiva im

deutschen Vertragsrecht (Munich: Verlag der Bayerischen Akademie der

Wissenschaften, 1997).69 Cf Thomas Hobbes, Leviathan [first edition 1651] (London: Penguin Books,

1985) 208: The value of all things contracted for, is measured by the appetite of

the Contractors: and therefore the just value, is that which they be contented to

give.70 See J ames Gordley, The Philosophical Origins of Modern Contract Doctrine

(Oxford: OUP 1991).71 See Hein Ktz, European Contract Law, Part I (Oxford: OUP 1997), 130ff.

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d. CONTRACT AS PROMISE (FRIED)

Very similar results are reached, albeit on a very different basis, bythe theory which was advocated by Charles Fried. In his view the

binding force of contract is based on the moral obligation to keep

promises, which in turn is based on the Kantian concept of

autonomy:72

There exists a convention that defines the practice of promising

and its entailments. This convention provides a way that a person

may create expectations in others. By virtue of the basic Kantian

principles of trust and respect, it is wrong to invoke that

convention in order to make a promise, and then break it. In this

view there is no external standard of contractual justice: the

justice lies in the promises of the party as an act of autonomy.

e. TWO PRINCIPLES OF J USTICE (RAWLS)

Today, more than 30 years after its publication, RawlsA Theory of

Justice is probably still the leading theory of social justice.73 In the

words of Nozick, Political philosophers now must either work within

Rawls theory or explain why not.74 Rawls presents two principles of

72 Charles Fried, Contract as Promise; A Theory of Contractual Obligation

(Cambridge, Massachusetts: Harvard University Press, 1981), 17.

73 J ohn Rawls (1999), n 24 above. See also J ohn Rawls, Political Liberalism,expanded edition [first edition 1993] (New York: Columbia University Press 2005),

and J . Rawls, Justice as Fairness: A Restatement (Cambridge, Massachusetts:

Belknap Harvard Press, 2001).74 Robert Nozick,Anarchy, State and Utopia, [first edition 1974] (Oxford: Blackwell

Publishing 2006) 183. See also Samuel Fleischacker, A Short History of

Distributive Justice (Cambridge, Massachusetts: Harvard University Press 2004)

116.

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justice, the first of which has priority over the latter:75 (1) maximum

equal liberties for all, and (2) social and economic inequalities must

be to the greatest benefit of the least advantaged (the difference

principle). These principles are applicable to what Rawls calls the

basic structure of a given society. Unfortunately, Rawls was

ambiguous about the meaning of the concept of the basic structure.

On occasions he seemed to embrace a narrow theory according to

which contract law was not a part of the basic structure, and, hence,

outside the scope of the principles of justice.76 On other occasions he

seems to have understood the concept in a much wider way in which

contract law would indeed be a part of the basic structure. It has

been argued that there is no good reason why the basic right to

individual property should be part of the basic structure, as Rawls

acknowledges, and not the basic freedom of at least some contract

options.77 If the theory does indeed apply to contract law this means,

among other things, that contract law must be instrumental to

improving the situation of the least advantaged (the difference

principle).

75 This does not imply, however, that freedom of contract has priority over the

difference principle, because Rawls does not regard the freedom of contract as a

basic liberty. See Rawls,A Theory of Justice, 54: Of course, liberties not on the

list, for example, the right to own certain kinds of property (eg means of production)

and freedom of contract as understood the doctrine of laissez-faire are not basic;and they are not protected by the priority of the first principle.76 See Rawls, Political Liberalism, 265-269 where he emphasises the need for fair

background conditions which should be distinguished from the rules governing

agreements and individual transactions.77 Kevin A. Kordana & David H. Tabachnick, Rawls and contract law, 73 Geo

Wash L Rev (2005) 598, 600: For Rawlsianism, contract law is properly

understood as one of the many loci of distributive justice.

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C. The need for a genuine area of civil justice

Clearly, different philosophies lead to different foundations for, andconceptions of, freedom of contract, which in turn lead to different

views on what occasions and for what reasons this freedom can be

limited. The Commissions remark, in the Action Plan,83 with regard

to the Common Frame of Reference, that [i]n this context contractual

freedom should be the guiding principle; restrictions should only be

foreseen where this could be justified with good reasons, really begs

the question: it seems very difficult to have a meaningful discussion

on what might be good reasons without first having some common

European understanding of social justice and contractual justice.

This is all the more important since contract law affects the everyday

lives of people in Europe, both citizens and non-citizens, in their

private lives and their businesses.84 For many important aspects of

our life (food, work, housing, health, travelling, being a couple) many

of us depend, at least in part, on contracts.85

Paradoxically, however, as we saw, today there does not seem to be

a clear legal basis for the Union to approach European contract law

from a justice perspective. In spite of the ambitions expressed with

83 COM (2003), n 44 above, 62.

84 See Study Group on Social J ustice in European Private Law, Social J ustice inEuropean Contract Law: a Manifesto (2004) 16 European Law Journal, 653-674.85 See (critical) Alain Supiot, Homo Juridicus; essai sur la fonction anthropologique

du Droit (Paris: Seuil 2005), 142: Le contractualisme, lide selon laquelle le lien

contractuel serait al forme la plus acheve du lien social et aurait vocation se

substituer partout aux impratifs unilatraux de la loi, est une composante de

lidologie conomique, qui conoit la socit comme un amas dindividus mus par

la seule vertu du calcul dintrts.

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regard to an area of civil justice by the European Council in

Tampere, the Treaties today simply do not provide a legal basis for

greater convergence in civil law (and neither does the Constitution

for Europe).

V. A matter of consumer protection, citizenship or justice?

A. The European Commissions U-turn

The first fifteen years of the Europeanisation of contract law were

clearly dominated by the perspective of consumer protection. The

European legislation that directly affected contract law consisted

almost entirely of directives on consumer contract law.

The Action Plan process was meant to bring about a radical change.

The Commission realised that the exclusive focus on specific

measures of consumer protection and the occasional specific

measure in other areas meant a threat to the coherence of contractlaw in Europe. In order to restore coherence, the Commission

decided to address the subject from the perspective of (general)

contract law. An additional reason for the shift from consumer

protection to general contract law was that general contract law is not

only applicable to consumer contracts (b2c) but also to commercial

contracts (b2c): the focus on general contract law would allow the

Commission at the same time to tackle another perceived problem:the fact that diverging national contract laws in the Member States

might be an obstacle to cross-border trade in Europe and hence to

the proper functioning of the internal market.86

86 Communication from the Commission to the European Parliament and the

Council; A More Coherent European Contract Law; An Action Plan, 12 February

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The first two Communications from the Commission were focussed

entirely on European contract law as a subject. See the titles: On

European contract law (2001) and A more coherent European

contract law: an action plan (2003). And even though in the third

communication the revision of the acquis was added as an additional

focal point (European contract law and the revision of the acquis: the

way forward),87 the suggested structure of a Common Frame of

Reference still focuses on general contract law. Moreover, all three

documents referred extensively to the Convention on contracts for

the international sale of goods (Vienna, 1980), the commercial

agency directive and the late payment directive, all of which, of

course, have nothing to do with consumer law.

Thus, the Action Plan process was started with two policy aims in

mind: 1) improving the coherence of the existing EC legislation on

consumer contracts, and 2) paving the way for new European

facilitative legislation for commercial contracts (an optional code of

contracts). Both these aims, it seemed, could be achieved by

developing a set of European rules or principles on general contract,

a Common Frame of Reference.

However, the First annual progress report on European contract law

and the acquis review announced a prioritisation of the revision of

2003, COM (2003) 68 final (OJ 2003/C63/01).87 Communication from the Commission to the European Parliament and the

Council European Contract Law and the revision of the acquis: the way forward,

Brussels, 11.10.2004, COM(2004) 651 final.

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the consumer within the CFR process.88 The details and implications

of this shift in opinion within the Commission were discussed at a

conference which was hosted by the Austrian Presidency of the

European Council.89 As said, the Commission is now considering a

horizontal approach to the revision of the acquis. Under the

horizontal approach, the Commission could, for example, prepare a

framework directive on the consumer sale of goods.90 Whereas the

CFR process has been referred to as a significant step towards a

European civil code,91 the resent reprioritisation (which seems to

88 Report from the Commission: First Annual Progress Report on European

Contract Law and the Acquis Review, Brussels, 23.9.2005, COM(2005) 456 final.

See also Commissioner Kyprianous opening address at the Conference on

European contract law: better lawmaking to the common frame of reference (first

European Discussion Forum), London, 26 September 2005: When I first looked

into this project, I was surprised to see how ambitious it is in terms of scope. (...)

Also, there is no clear decision as to the legal nature and final outcome of the CFR.

This project should not be an academic exercise or legal theory. On the contrary, itshould bring practical concrete results due to be used both in the existing acquis

and in new legislative measures for the benefit of European consumers. (...) We

intend, in the CFR, to clearly prioritise issues that are relevant to the consumer

contract law acquis.89 See Hugh Beale, 'The European Commission's Common Frame of Reference

Project: a progress report', 2 ERCL (2006) 303-314, 106: 'It appears that there has

been a shift in opinion within the Commission as to what is wanted'. The

conference The Review of the Consumer Acquis and the Common Frame of

Reference progress, key issues, perspectives took place on 25-26 May 2006 inVienna. It was the second European Discussion Forum, following the Hfirst one in

London.H90 COM (2005), n 88 above, 9-10.91 See eg M.W. Hesselink, The European Commissions Action Plan: Towards a

More Coherent European Contract Law? (2004) ERPL 397419 (a European civil

code in disguise); E.H. Hondius, Towards a European Civil Code, in: A.S.

Hartkamp et al. (eds), Towards a European Civil Code (The Hague, London, New

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reflect a power struggle within the European Commission, even

within one DG, ie Sanco) rather has the traits of a first step towards a

European Code of Consumer (Contract) Law.

B. Roaming for rights, or: citizenship as consumer protection

This recent development has to be seen, it seems, in the broader

perspective of the recent rediscovery of the consumer by the

European Commission. After the rejection of the Constitution for

Europe in the French and Dutch referendums the Barroso

Commission realized that it was not likely to regain the hearts of

European citizens merely by implementing the Lisbon agenda. It

decided that the benefits of the EU for its citizens had to be more

visible. Therefore, the Commission recently presented A Citizens

Agenda.92

In that Agenda the European citizens are addressed primarily in their

capacity as consumers. As issues which have direct effects oncitizens, the Commission discusses energy prices, roaming charges

for mobile phone users and banking charges.93 In sum, roaming

York: Kluwer Law International 2004), 13, (a pre-code); H. Collins, The

Common Frame of Reference for EC Contract Law: a Common Lawyers

Perspective, in M. Meli and M. R. Maugeri (eds), Larmonizzazione del diritto

privato europeo (Milan: Giuffr, 2004) 107124 (Lets just call it a Code); House ofLords (European Union Committee), European Contract Law - the way forward?

(HL Paper 95) (London: The Stationery Office Limited 2005), 115 (Once the CFR

has been agreed it would not be a major task to convert or adapt it into an optional

instrument. [T]he CFR may turn out to be something of a Trojan Horse.)92 Communication from the Commission to the European Council A Citizens

Agenda. Delivering Results for Europe, Brussels, 10.5.2006, COM(2006) 211 final.93 P. 4.

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instead of rights.94 Such a narrow interpretation of citizenship as

mere consumer protection is not unique. On the contrary, on several

other occasions the Commission has recently identified the concept

of European citizenship with consumer protection. See, as an

example, Europa, the official website of the European Union:

Consumer policy is central to the EU's objective of

continuously improving the quality of life of all EU citizens.95

Weiler warned against the conflation of the citizen with the consumer.

All too frequently he said, human rights are commodified and

represent just another goodie with which to placate a disaffected

consumer of European integration.96 He expresses his concern

about the degration of the political process:97

of consumer replacing citizen, of a Saatchi and Saatchi

European citizenship. To conceptualize European citizenship

around needs (even needs as important as employment) and

94 Proposal for a Regulation of the European Parliament and of the Council on

roaming on public mobile networks within the Community and amending Directive

2002/21/EC on a common regulatory framework for electronic communications

networks and services, Brussels, 12.7.2006, COM(2006) 382 final.

95 Http://ec.europa.eu/consumers/overview/index_en.htm. See also: Every citizenis a consumer and the European Union takes great care to protect their health,

safety and economic well-being. (http://europa.eu/pol/cons/index_en.htm).96 Weiler(1999), n 28 above, 334.97 Ibid 335. See also Alain Supiot, Homo Juridicus, 165: Au nom dune citoyennet

dfinie non plus par rfrence ltat, mais par rfrence aux droits du

consommateur sur le march, le Droit des contrats tend son emprise sur les biens

et services publics au fur et mesure des progrs de la privatisation.

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rights is an end-of millennium version of bread-and-circus

politics.

Frankly, phrases like the Commission commits itself to removing the

remaining barriers to a single market, to enable European citizens

and entrepreneurs to enjoy the full benefits of the EU,98 make one

think of exactly such a Saatchi & Saatchi European citizenship. Not

surprisingly, the Commissions sudden passion for the everyday life

of consumers99 has been rejected as populism.100

In its recent Amended proposal for a programme of Community

action in the field of consumer policy (2007-2013) the Commission is

even more explicit. It says:

The overall goal of the EU Consumer Policy is to improve the

quality of life for EU citizens, in terms of their consumer

interests. This will contribute to making Europes citizens safer

and more confident, providing the means for economic and

social inclusion, and thus giving substance to EU

citizenship.101

98 P. 4.99 Bruxelles cherche sduire les consommateurs, Le Monde 22 July 2006.100 Populist or socialist - which jibe hurts Barroso more?, European Voice, 20 J uly

2006.101 Amended proposal for a Decision of the European Parliament and of the

Council establishing a programme of Community action in the field of consumer

policy (2007-2013), Brussels, 24.5.2006, COM(2006) 235 final, 2005/0042 B

(COD): The overall goal of the EU Consumer Policy is to improve the quality of life

for EU citizens, in terms of their consumer interests. This will contribute to making

Europes citizens safer and more confident, providing the means for economic and

social inclusion, and thus giving substance to EU citizenship.

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Giving substance to European Union citizenship by taking care of

consumer interests, European citizens as confident cross-border

shoppers: a narrower conception of citizenship can hardly be

imagined.

C. Back to justice

It makes a difference whether the Europeanization of contract law is

carried out as a matter of consumer protection, citizenship or justice.

According to J ohn Rawls, justice is the first virtue of social

institutions, as truth is of systems of thought.102

The civil law has traditionally addressed human beings as

persons.103 In such an approach matters of contract law are

regarded quite naturally as matters of justice in the fullest possible

sense.104 However, European contract law does not address us as

persons who should be treated with justice nor as citizens who havefundamental rights, but, most of the time, as consumers. Moreover,

as we saw, in the European Union consumer protection is often

regarded as a policy which is instrumental to the construction of the

internal market. The combination of reducing persons to citizens,

citizens to consumers, regarding the latter as instrumental to market

building and moving towards horizontal and full harmonisation brings

us very far away from contract law as a matter of justice.

102 Rawls,A Theory of Justice, 3.103 Gaius, Institutiones, Book 1, 9.104 This is not necessarily so if contract law is regarded as a matter of patrimonial

law and patrimony is defined in a narrow, monetary way, which excludes purely

emotional interests, as the Dutch Hoge Raad did in a controversial tort case (HR 9

October 1998 (J effrey), NJ 1998, 853).

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From this perspective, the recent prioritisation of the revision of the

consumer acquis is clearly a step in the wrong direction. Instead, the

European Union should have moved in the opposite direction. It

should have given priority to justice. Rather than merely a matter of

consumer protection, European contract law should become a matter

of justice. The European Union should develop a truly European

notion of contractual justice for a genuine area of civil justice.

A practical implication seems to be that from the perspective of social

justice it would be best if the CFR process was guided, as the

European Parliament has requested, by DG J ustice, Freedom and

Security, because this would allow - and oblige - the European

legislator to adopt the broadest possible social justice perspective on

contract law.105

To be sure, the Commission is not the only one, probably not even

the first, to be blamed. The structure of the existing European

constitution hardly provides a legal basis for such a justice-oriented

approach to European contract law. Would it be too naive to think

that the occasion of the stalling of the ratification process of the

Constitution for Europe could be taken up as an opportunity to insert

a legal basis for treating contract law, which affects the everyday life

of individuals in many important ways, as a matter of justice?106

105 Indeed, one would expect that DG to be very active in the area of private law

since, in the words of the Commission in the Hague Programme, civil law (...)

concerns citizens in their everyday lives. (The Hague Programme for

strengthening freedom, security and justice in the European Union as approved by

the European Council at its meeting on 5 November 2004).106 The European Parliaments recent call for a wider CFR on general contract law

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issues going beyond the consumer protection field, underlining that the final long-term outcome could be a binding instrument; all the various possible options for the

purpose and legal form of a future instrument should be kept open (European

Parliament resolution of 7 September 2006 (P6_TA(2006)0352), 3 and 5), is

essentially a call for the preparation of legislation for which there is no legal basis

today. Coherence would require, it seems, that the Parliament should also call for

the introduction of a legal basis to enact a binding instrument on European contract

law.

european contract law. a matter of consumer protection, citizenship, or justice

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