The arbitration clause in general terms and conditions of business transactions: Current trends in international trade versus consumer arbitration

Abstract

This paper shows the diverging tendencies in the understanding of the arbitration clause contained in the general terms conditions of business transactions (GT&CBT) in (international) commercial law and consumer protection law. The results show that inverse logic is currently used regarding the issue of bringing attention to the arbitration clause contained in a GT&CBT and the necessity for such an arbitration agreement to be contained in a separate and personally signed document. International commercial arbitration, encompassing both legal dogma and arbitration and court praxis, has shown a tendency towards a more liberal and flexible understanding of the written form in the past several decades, in terms of the validity of the arbitration clause contained in a GT&CBT referred to in an underlying substantive contract. By contrast, in consumer protection law, there is a tendency for the arbitration clause contained in a GT&CBT, which has not been brought to attention, to be considered a null and void provision. Namely, it is required for the arbitration clause to be contained in a separate document signed by both parties. This points to the conclusion that special attention should be paid to consumer disputes that are to be resolved by arbitration, while court and arbitration praxis in international commercial disputes lately records cases in which the court explicitly took the opposite position. Traders' claims stating that they were not aware that the GT&CBT contained an arbitration clause and that no attention was drawn to it are considered unfounded by the courts. Namely, the application of both GT&CBTs and arbitration in international trade are, nowadays, considered ordinary.