Unfair contracts

Financial firms must provide clear and fair contracts, and cannot enforce unfair terms. Find out how to report an unfair contract term to us.

We have powers to challenge unfair and unclear terms in consumer contracts.

When we find a contract term that we think is unfair or unclear, we can ask the firm to stop using the term or change the term. But, while we are legally allowed to challenge a contract term, only a court can ultimately decide if a term is unfair or unclear. 

We can look at contract terms relating to most financial products and services. These powers come under the Consumer Rights Act 2015 (and the Unfair Terms in Consumer Contracts Regulations 1999 for contracts entered into before 1 October 2015).

How to spot a contract term that could be unfair or unclear

A contract term can be unfair or unclear for many reasons, such as where it:

  • allows the firm to change the terms of the contract without telling you as soon as possible, or explaining why it has
  • binds you to hidden terms
  • excludes or limits your legal rights unfairly
  • charges a disproportionately large sum if you don't fulfil your obligations under the contract
  • automatically renews at the end of the contract without giving you the right to cancel
  • could be read in more than one way (and the contract doesn’t make it clear how the term is meant to be read)
  • doesn’t use clear or prominent wording to describe the product or service being supplied
  • doesn’t use clear or prominent wording to let you know the cost of the product or service

Remember, a term is not necessarily unfair or unclear because it looks like one of these examples. It depends on the details of the contract as a whole.

You can visit our library page for actions we’ve taken that we’ve made public.

Reporting a contract term to us

Before you report an unfair or unclear contract term to us, it’s important you're clear what we can and can’t consider, based on our powers.

We can only look at contracts that:

  • exist between a business and a consumer (business to business contracts are excluded)
  • have been entered into after 1 July 1995 

To report an unfair or unclear contract term, please complete our online form. The first part of the form will ask a few questions to help you work out if your issue is best dealt with by us, or whether you should direct it elsewhere within the FCA. Depending on your answers, you'll then be asked for some specific information about your issue.  

We consider every single report of an unfair or unclear contract term referred to us, and we appreciate the time and effort you spend in identifying these terms.

We consider the information you give us as part of our supervision of firms. Following past reports, we've:

  • asked firms to stop using or change the terms of their contracts
  • published some of the actions we've taken
  • secured compensation for consumers

Please note, for reasons of confidentiality, we won’t be able to discuss any action we may take as a result of the information you give us.

Follow the link below to complete the form and find out if we can consider your report. 

Make a report

More information

If you complete the form and find we can’t look into your report, then please get in touch using our general contact details.

If you want to complain about a firm, find out how, or if you want to report a scam, you can do so online.

You can get more information about your rights from Citizens Advice.

Page updates

09/10/2020: Information added House style updates and decision tree added to clarify FCA powers