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Validity and Invalidity of SLAs. The Protection for Consumers

This article discusses the validity and invalidity of provisions in Service Level Agreements (SLAs) pertaining to e-services offered to European consumers. It examines the legal implications of clauses that limit the liability of ICT providers and their ability to modify or terminate services. Consumer protection and applicable laws are also explored.

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Validity and Invalidity of SLAs. The Protection for Consumers

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  1. Validity and Invalidity of SLAs. The Protection for Consumers Davide M. Parrilli Interdisciplinary Center for Law and ICT – K.U. Leuven – IBBT davide.parrilli@law.kuleuven.be Internet of Services 2009 Business Models & SLAs – Brussels 11/6/2009 http://www.law.kuleuven.be/icri

  2. Question: are all provisions in typical SLAs (supply of e-services) with European consumers valid? Is it legal to state that the ICT provider will not be liable for any failure and that he can modify or interrupt the service whenever he wants? Consumer is every person acting outside his trade or profession for personal purposes.

  3. Applicable law ex lege (Rome Convention/Rome I Regulation): the SLA shall be governed by the law of the country where the consumer has his habitual residence if the ICT provider by any means (e-commerce) directs his activities to that country or to several countries including that country.

  4. This happens if (e.g. target country Germany): • The ICT provider does not state that the services are only for sale in countries other than Germany, or if credit cards issued in Germany are accepted for payment; • The website that advertises the services and allows the conclusion of the contract is in German (this does not apply vice versa!); • The website is an active website (possibility to conclude the agreement) and the above conditions are met.

  5. Parties can state that another law (e.g. California) will govern the contract, but consumer protection rules of the country of residence of the consumer apply. Invalidity of clauses that are too unbalanced in favor of the provider (Directive 93/13/EEC), e.g. • Clauses that exclude legal rights of the consumer in case of non performance of the contractual obligations by the provider; • Clauses that allow the provider to unilaterally modify or terminate the agreement.

  6. Conclusions: The analysis of the validity/invalidity of clauses in SLAs must be assessed on a case-by-case basis. The general rule is that provisions that limit extremely the liabilities of the provider are void: the judge will apply the legal regime instead.

  7. Thanks for you attention! Davide M. Parrilli ICRI-K.U. Leuven-IBBT davide.parrilli@law.kuleuven.be

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