Where now for bank charges?

by Ed Bowsher on 25 November 2009  |  0 comments
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The bank charges saga isn't necessarily over. The Supreme Court has suggested a new line of attack for the Office of Fair Trading. And MPs could do something too.

The bank charges saga may not be over. I've been reading through the Supreme Court's judgement and it's clear that the Office of Fair Trading (OFT) could pursue another route if it wishes. 

Today's case was all about differing interpretations of one section (Section 6) in the Unfair Contract Terms in Consumer Contracts Regulations 1999.  The OFT has lost on this issue, but the Supreme Court has invited the OFT to look at a different clause in the regulations - Section 5. 

Section 5 says that if a contract has not been individually negotiated - which is the case with bank charges - then a term can be unfair if it causes significant imbalance in the parties' rights and obligations. I'm no lawyer but it looks like the OFT should see if it could make progress on this point. 

The other issue is Parliament. The Unfair Contract Terms regulations come from EU law. When it came to implementing these regulations into national law, some EU countries introduced tighter consumer protection provisions than in the original EU regulations. 

But the UK decided to implement the regulations without any significant changes. In today's judgement, one judge suggests 'Parliament may wish to revisit that decision.' Sounds like a plan!

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