International Loan Contract Jurisdiction

Summary

In the EU, consumer contracts are generally governed by the consumers domicile under Regulation No. 1215/2012. However, a forum selection clause in a contract can complicate jurisdiction if it favors a foreign court, like in Mr. Buchs case with the Austrian bank. Such clauses are valid unless they create an unfair imbalance. Mr. Buch, as a consumer, might contest the clause if it significantly disadvantages him. Legal advice is recommended to assess the enforceability of the forum selection clause and explore potential arguments against it.

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In *, Mr. Buch, a German national domiciled in Munich (Germany), will sign a loan contract for an amount of *,* euros with Bank AG (Austrian bank based in Salzburg). This sum will be sent in cash to the Esmentat Banc branch in Munic (Germany). Mr. Buch had requested the loan with the intention of expanding and renovating his habitat. The loan contract includes in its six general conditions a forum selection clause in favor of the Austrian courts. On November *, *, following the non-payment of the loan by Mr. Buch during several months and subsequent unsuccessful claims, the Austrian financial entity will decide to sue him before the Austrian courts for contractual non-compliance.
To address your situation, here are some general guidelines regarding international jurisdiction and the consumer regime in the EU:
- Consumer Contracts: According to the EU Regulation No. */* (Brussels I), consumers can only be sued in the courts of their domicile. However, if Mr. Buch signed the contract with a forum selection clause favoring Austrian courts, this complicates matters.

- Forum Selection Clause: Such clauses are generally valid unless it's proven that they cause an unfair imbalance in the parties’ rights. Given that Mr. Buch is a consumer, he may argue that the clause is not enforceable if it puts him at a significant disadvantage.
Does Mr. Buch have any arguments or evidence that the forum selection clause creates an unfair imbalance?