The European Communities (Unfair Terms in Consumer Contracts) Regulations apply to standard contracts taken out by which party?

• A. Small companies
• B. Large companies
• C. An individual acting in the course of his or her business
• D. An individual acting outside his or her business

Answer: (B)

These Regulations protect consumers in standard form contracts. A consumer here means a natural person who signs or accepts a contract for purposes outside their trade, business, or profession. The party taking out the contract under these rules is the consumer—an individual acting outside their business. The other party is the seller or supplier offering the standard form contract. Large companies or individuals acting within their business aren’t covered as consumers, so they’re not the focus of these protections. The underlying idea is to prevent terms that create a significant imbalance to the detriment of the consumer in standard consumer contracts.