Freedom of Contract in the Post-Crisis Era: Quo Vadis?
European Review of Contract Law, Vol. 10, No. 3, pp. 390-421, 2014
University of Groningen Faculty of Law Research Paper No. 2015-03
33 Pages Posted: 25 Sep 2014 Last revised: 20 Jan 2015
Date Written: September 23, 2014
Abstract
This article explores to what extent the future development of European financial services contract law will be determined by the information paradigm in the post-crisis era. By using the examples from the field of investment services and consumer credit, it shows that the regulatory measures affecting financial contracts are becoming increasingly more interventionist incorporating elements of ‘hard’ paternalism. The latter is associated with mandatory substantive rules which aim to stop individual behaviour which may result in significant harm for a private party and/or be detrimental to the public interest. The author argues that we are currently witnessing a major shift from ‘soft’ towards ‘hard’ paternalism; a shift which implies major limitations on freedom of contract in financial transactions and poses major new challenges to regulators.
Keywords: freedom of contract, paternalism, financial services, investment services, consumer credit, European contract law
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