Regulatory functions of European contract law : theoretical foundations and practical applications

Defence date: 13 February 2013Examining board: Professor Fabrizio Cafaggi, European University Institute, Florence (Supervisor) Professor Dennis Patterson, European University Institute, Florence Professor Giuseppe Bellantuono, University of Trento Professor Marek Safjan, European Court of Justice, Luxembourg.PDF of thesis uploaded from the Library digital archive of EUI PhD thesesContract law is increasingly becoming an important part of the European regulatory landscape. The increasing recourse to contract law as a regulatory technique triggers fundamental questions about the aims and the effects of contract law. This thesis tackles these questions by investigating the topic of regulatory functions of European contract law. The objective of the analysis is to see which contract law instrument performs which specific regulatory function at each institutional level (European and Member States). Claiming that traditional accounts of contract law do not yield satisfactory results when applied to the analysis of European contract law, I develop a theoretical framework based on the public interest theory of regulation with its central concept of market failure. Application of this framework demonstrates incentive effects that contract law creates for market actors. Because of these incentive effects, contract law can be regarded as a regulatory technique, equivalent to other techniques of social and economic regulation. I argue that regulatory use of contract law concerns not only the European but also the Member State level, and in both cases contract law regulates at all three stages of the regulatory process (standard-setting, monitoring and enforcement). Focusing on three general tools – mandatory rules, default rules, and the general clause of good faith – I demonstrate that each of them plays a different regulatory function. More importantly, regulatory functions of selected contract law instruments vary across institutional levels. Selected examples of the acquis communautaire, including the decisions of the Court of Justice of the European Union, serve as a major testing ground for regulatory functions of European contract law. Given the multi-level character of European contract law, I look at the national level as well. In order to emphasize the regulatory role of civil judges, specific examples are drawn from selected European jurisdictions