EUROPEAN COMMUNITIES (UNFAIR TERMS IN CONSUMER CONTRACTS) REGULATIONS 1995 - REGULATION 3
3. (1) Subject to the provisions of Schedule 1, these Regulations apply to any term in a contract concluded between a seller of goods or supplier of services and a consumer which has not been individually negotiated.
(2) For the purpose of these Regulations a contractual term shall be regarded as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations under the contract to the detriment of the consumer, taking into account the nature of
the goods or services for which the contract was concluded and all circumstances attending the conclusion of the contract and all other terms of
the contract or of another contract on which it is dependent.
(3) In determining whether a term satisfies the requirement of good faith, regard shall be had to the matters specified in Schedule 2 to these
(4) A term shall always be regarded as having not been individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence its substance, particularly in the context of a pre-formulated standard contract.
It seems to me that we have a pre-formulated standard contract, but the complexity is that Afilias themselves did not operate direct contracts with consumers (non-business customers), but rather, operated a contract which imposed terms for consumers through a second (registrar-consumer) contract which was dependent on Afilias's contract with the registrar.
Certainly, there are strong arguments for suggesting that the contract operated in bad faith creating the "significant imbalance in parties' rights and obligations" to the detriment of the consumer.
What I'd appreciate is opinion as to whether Afilias could be prosecuted under this (or other) EC law, on the grounds that their contracts created an imbalance (implemented in bad faith?) which caused unfairness, to the detriment of the consumer.
The contracts they imposed on Registrars defined and determined the contracts that had to be imposed on consumers (Afilias have admitted as much).
Does this make Afilias liable for the impact their (bad faith?) contracts had on consumers effected at one business layer below, in that the consumers contracts with registrars were those defined and required by Afilias?