Consumer Law and Policy Relating to Change of Circumstances Due to the COVID-19 Pandemic

Abstract

An unprecedented number of consumer problems has been caused by the COVID-19 pandemic, not least with regard to refunds of prepayments and the ability of consumers to keep up their monthly payments under loan and rental agreements. Based on a notion of societal force majeure sketched in this paper, we propose guiding principles in respect of the introduction of moratoria on recurring payments, the use of refunds or vouchers in respect of prepayments, and associated enforcement challenges. This analysis draws on experiences around the globe. Keywords Consumer law. COVID-19. Moratoria. Refunds. Guiding principles The COVID-19 pandemic has swept around the world. As well as huge suffering and high numbers of fatalities, it has had a heavy negative economic impact. Millions of consumers around the world are suffering financially, because many have lost their regular income, and many are fighting to obtain refunds of prepayments from struggling businesses whilst having to service loans and rental payments. In this contribution, we, a research group on consumer law with a global reach, offer an initial assessment of the legal difficulties consumers face. We argue for a principles-based way forward and evaluate a range of global initiatives taken thus far.

Force majeure and changed circumstances during the COVID-19 pandemic: the case of sports service contracts and judicial responses in China

“…Compared to contract termination, changing the contract is more conducive to maintaining the existing transaction and alleviating the impact of the pandemic on sports enterprises. Therefore, in the trial of relevant cases, courts should actively guide the parties to change the contract and provide incentives for the parties to reach cooperative solutions (Alderman et al 2020 ).…”

“…The legal ramifications of COVID-19 on a sports service business and its particular contractual obligations depend on the specific provisions of the contract and the particulars of the laws governing the interpretation and enforcement of the contract. An increasing number of studies have discussed force majeure and change of circumstances in the light of the COVID-19 pandemic (Alderman et al 2020 ; Li 2020 ; Rospigliosi et al 2020 ; Wang 2020 ; Yao and Que 2020 ). However, while many countries have established legal remedies to deal with changed contractual circumstances, the legal responses have been caught off guard by the large number of contract disputes that the COVID-19 pandemic has caused (Alderman et al 2020 ).…”

“…An increasing number of studies have discussed force majeure and change of circumstances in the light of the COVID-19 pandemic (Alderman et al 2020 ; Li 2020 ; Rospigliosi et al 2020 ; Wang 2020 ; Yao and Que 2020 ). However, while many countries have established legal remedies to deal with changed contractual circumstances, the legal responses have been caught off guard by the large number of contract disputes that the COVID-19 pandemic has caused (Alderman et al 2020 ). Improper relief for sports service contract disputes caused by COVID-19 could lead to the imbalance of interests of the contract parties and affect the resumption of work and operations of sports businesses.…”

Implementation of Hardship Principles on Financing Agreements Islamic Bank Due to Corona Virus Disease 2019

“…The people may plausibly argue that the scale of the pandemic takes it outside any potential scenario envisaged and thereby justify the renegotiation of existing contracts. Equally, in consumer contracts, any term that is imbalanced against consumers may be subject to challenge under laws controlling the use of unfair contract terms (Alderman et al, 2020).…”