Judgment

Case C-488/11

Decision:

"On those grounds, the Court (First Chamber) hereby rules:

1.      Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts must be interpreted as meaning that, subject to contractual terms which reflect mandatory statutory or regulatory provisions set out by national law, which is a matter for the national court to ascertain, it applies to a residential tenancy agreement concluded between a landlord acting for purposes relating to his trade, business or profession and a tenant acting for purposes which do not relate to his trade, business or profession.

2.      Directive 93/13 must be interpreted as meaning that:

- where a national court, before which an action has been brought by a seller or supplier against a consumer concerning the performance of a contract, has the power, under internal procedural rules, to examine of its own motion whether the term upon which the claim is based is contrary to national rules of public policy, it must, in the same way, where it has established that that term falls within the scope of that directive, assess of its own motion whether that term is unfair in the light of the criteria laid down in that directive;

- where the national court has the power, under internal procedural rules, to annul of its own motion a term which is contrary to public policy or to a mandatory statutory provision the scope of which warrants such a sanction, it must, as a rule, after having invited each of the parties to set out its views on that matter, with the opportunity to challenge the views of the other party, annul of its own motion a contractual term which it has found to be unfair in the light of the criteria laid down by that directive.

3.      Article 6(1) of Directive 93/13 must be interpreted as meaning that it does not allow the national court, in the case where it has established that a penalty clause in a contract concluded between a seller or supplier and a consumer is unfair, merely, as it is authorised by national law, to reduce the amount of the penalty imposed on the consumer by that clause, but requires it to exclude the application of that clause in its entirety with regard to the consumer."