SEBESTYEN V RAIFFEISEN BANK ZRT

[2014] EUECJ C-342/13, Court of Justice of the European Union, 3 April 2014

Arbitration - Validity of arbitration clause - Unfair Terms in Consumer Contracts Directive, Council Directive 93/13/EEC

The claimant sought to have an arbitration clause in a mortgage loan set aside on the ground that it was an unfair contract term, contrary to the Unfair Terms in Consumer Contracts Directive, Council Directive 93/13/EEC. The CJEU held that it was for the national court concerned to determine whether the clause was unfair. In so deciding, the court had in particular, to: verify whether the clause had the object or effect of excluding or hindering the consumer's right to take legal action or exercise any other legal remedy; and take account of the fact that the communication to the consumer, before the conclusion of the contract, of general information on the differences between the arbitration procedure and ordinary legal proceedings did not alone make it possible to rule out the unfairness of that clause.