Banning outside food and drinks and setting minimum consumption are unfair clauses.
The Supreme People's Court stated in a written interview with our newspaper on February 12 that although the unfair standard clauses formulated by the catering industry (commonly known as "overlord clauses") do not fall under the Provisions of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Food and Drug Dispute Cases (hereinafter referred to as the "Provisions"), consumers may request the people's court to confirm the invalidity of such overlord clauses if they violate the Contract Law and the Law on the Protection of Consumer Rights and Interests (hereinafter referred to as the "Consumer Protection Law").
Article 16 of the Provisions issued by the Supreme People's Court on January 9 this year stipulates: “Where food and drug producers and sellers, by means of standard-form contracts, notices, statements, public announcements, or other such methods, make provisions that exclude or restrict consumers' rights, reduce or exempt business operators' liability, or increase consumers' liability, and such provisions are unfair or unreasonable to consumers, and a consumer requests pursuant to law that such content be declared invalid, the people's court shall support such request.”
Does a catering enterprise count as a food producer and therefore fall under the Regulation? Can consumers apply to a court to revoke unfair standard terms imposed by catering enterprises? In its reply to our newspaper’s interview request, the Supreme People’s Court stated that “no outside beverages allowed” and “minimum spending requirement for private rooms” in the catering industry constitute unfair standard terms in service contracts, and are unfair and unreasonable provisions imposed on consumers by catering businesses leveraging their dominant position in the course of providing catering services. The Regulation primarily addresses how to handle disputes between producers and sellers of food and drugs and consumers. Under Article 2 of the Law on the Protection of Consumer Rights and Interests, the Law applies when consumers purchase or use goods or accept services. Therefore, when consumers encounter disputes arising from unfair standard terms imposed by catering operators in the provision of services, the Law on the Protection of Consumer Rights and Interests applies, rather than the Regulation.
Regarding the view that "the food and catering industry is a fully competitive industry, and some unfair standard terms, such as 'no outside drinks allowed' and 'minimum spending in private rooms,' are not explicitly prohibited by law, and acts not explicitly prohibited are all lawful," the Supreme People's Court stated in an interview with our newspaper that the Provisions do not conflict with the view that "anything not explicitly prohibited by law is lawful."
The Supreme People's Court further pointed out in its reply that "prohibiting customers from bringing their own beverages" and "setting a minimum spending requirement for private rooms" both constitute unfair and unreasonable provisions imposed by food and beverage operators leveraging their dominant position to aggravate consumer liability. These provisions violate relevant legal regulations and qualify as unfair standard terms. Consumers may, in accordance with the above legal provisions, request the people's court to confirm the invalidity of such unfair standard terms.
● Relevant Legal Provisions
1. Article 40 of the Contract Law: If a standard clause falls under any of the circumstances specified in Articles 52 and 53 of this Law, or if the party providing the standard clause exempts itself from liability, aggravates the other party's liability, or excludes the other party's main rights, such clause shall be invalid.
2. Article 26, Paragraphs 2 and 3 of the Law on the Protection of Consumer Rights and Interests: Business operators shall not, through standard-form terms, notices, statements, in-store announcements, or other means, make provisions that exclude or restrict consumers' rights, reduce or exempt the operators' liability, increase consumers' liability, or otherwise impose unfair or unreasonable conditions on consumers, nor shall they use standard-form terms in conjunction with technical means to force transactions.
Standard clauses, notices, declarations, in-store announcements, or other means containing the content specified in the preceding paragraph shall be void.
