Examples of unfair terms

How to spot an unfair term and avoid including it in a consumer contract.

Examples of potentially unfair terms include those that:

  • charge the consumer a large sum of money or an amount that goes beyond what would be considered a reasonable pre-estimate of loss incurred by the firm, if a consumer doesn’t fulfil their obligations under the contract or cancels the contract
  • require a consumer to fulfil all their contractual obligations, while letting the firm avoid its own
  • automatically renews a fixed length contract on the date of expiry, where the deadline for the customer opting not to extend is unreasonably short
  • allow a firm to change the price payable under the contract after a consumer has agreed to the conditions in the contract
  • bind consumers to hidden terms
  • limit a firm's obligation to honour its agents' commitments to the consumer
  • allow the firm to transfer its rights and obligations under the contract, where this may reduce guarantees for the consumer, without the consumer’s agreement
  • mislead the consumer about the contract or their legal rights
  • exclude or limit the consumer’s legal rights or remedies when the firm has failed to meet its obligations under the contract

Firms should have regard to Schedule 2 of the Unfair Terms in Consumer Contracts Regulations 1999 (UTCCRs) and of the Consumer Rights Act 2015 (CRA), as these Schedules contain an indicative and non-exhaustive list of types of terms in consumer contracts that may be regarded as unfair.

Our unfair contract terms library page gives details of our publications on unfair contract terms.

Terms not covered

The CRA and UTCCRs do not apply to terms that:

  • appear in contracts between businesses
  • appear in contracts between two private individuals
  • appear in contracts where one party is not acting in a capacity as a consumer or where an individual enters into a contract for business purposes
  • for the CRA, appear in contracts entered into before 1 October 2015, or for the UTCCRs appear in contracts entered into before 1 July 1995
  • use clear (and in the case of the CRA also prominent) wording to set the price or define the product or service being supplied