Personalized unfair terms control – EU law meets innovative US doctrines

According to part of the US scholarship, the use of big data and prediction algorithms could entail a paradigmatic change in contract law: No longer would one have general and abstract legal norms, but rather granular and personalized ones, customized on the needs and features of the contracting parties. This shift to a law tailored to specific individuals could affect both default and mandatory rules and provide for a more efficient and just legal system. The argument goes that such a flexible and technology-driven regulation is also capable of addressing the issue of unfair personalized pricing schemes applied by businesses in online transactions. The present contribution adopts a futuristic approach and investigates whether these doctrinal proposals could possibly pave the way for an amendment of the Directive 93/13 on unfair terms in consumer contracts. In doing so, the main elements of the unfair terms control are highlighted, together with their link with national default rules, which serve both as a benchmark for the assessment of the unfair character of the clause and as gap-fillers. Based on a comparison with the findings of US scholars, it then explores how the unfair terms control may change in order to reduce cross-subsidies to a minimum and tackle discriminatory pricing schemes. Finally, this article elaborates further on how the modifications could be implemented within a new enforcement mechanism, using a technology that would also cover so-called smart contracts.