Judgment;Summary — ECLI:EU:C:2025:405
Date: 2025-06-05
Language of the case: Czech
Court formation: Ninth Chamber
Subject matter: Energy;Consumer protection;Approximation of laws
Procedure: Reference for a preliminary ruling
Origin: Czechia

Anonymised version 
Translation C-749/23 – 1 
Case C-749/23 
Request for a preliminary ruling  
Date lodged: 
20 November 2023 
Referring court: 
Okresní soud v Teplicích (Czech Republic) 
Date of decision to refer: 
14 September 2023 
Applicant: 
innogy Energie, s.r.o. 
Defendant: 
QS 
  
ORDER 
The Okresní soud v Teplicích (the Teplice District Court), sole judge […] has 
ruled in the case of  
the applicant: innogy Energie, s.r.o., […] 
v 
the defendant: QS, […] 
with respect to the payment of CZK 6,609.66  
as follows: 
EN 
REQUEST FOR A PRELIMINARY RULING OF 14. 9. 2023 – CASE C-749/23 
 
2  
Anonymised version 
[…] The court hereby submits the following question to the Court of Justice of 
the European Union for a preliminary ruling, pursuant to Article 267 of the 
Treaty on the Functioning of the European Union: 
a. Does the spirit and purpose of Directive 93/13/EEC prevent Article 3 
thereof in conjunction with the Annex thereto, point 1(e), concerning 
unfair contractual terms in consumer contracts, in conjunction with 
Article 5 thereof concerning written terms drafted in plain and 
intelligible language, and the principle of effectiveness under Article 7 
thereof, from being interpreted to the effect that a contractual penalty 
set out in an adhesion contract in the part ‘Other Stipulations’, on page 
1/2 (first page of the contract) is deemed  even though (contrary to 
common practice in consumer contracts), this ‘first’ page does not 
feature any identification data of the parties, nothing is to be physically 
filled in, and the contractual penalty is included in the section ‘Other 
Stipulations’, which appears to be an unimportant provision  to 
constitute a regular part of a written contract between the consumer 
and the supplier, inasmuch as the consumer may be required to become 
duly acquainted with this page of the contract, when the second page 
of the contract (2/2), which is actually filled in and signed, features 
adequate indication that this is page two of the contract by being 
marked 2/2? 
b. Does the spirit and purpose of Directive 93/13/EEC prevent Article 3 
thereof in conjunction with the Annex thereto, point 1(e), and/or 
Article 12(3) of Directive (EU) 2019/944 of the European Parliament 
and of the Council from being interpreted such that, in the event of the 
termination of a fixed-price energy contract for a fixed term by the 
supplier due to a breach of obligation by the consumer, the amount of 
the actual direct economic loss sustained by the supplier due to the 
premature termination of the contract with the consumer is not 
decisive? 
[…] 
Grounds: 
(A) Subject of the proceedings 
In its action, the applicant seeks the payment of CZK 6,609.66 on the grounds that 
the defendant, on the basis of a bundled electricity supply contract, consumed 
electricity at the […] metering point, for use in his household, and undertook to 
pay the agreed price for the electricity supplied. The contract had been concluded 
for a fixed term, and a product had been agreed upon that guarantees a specific 
price of electricity for the duration of the contract (during the basic term of the 
contract, and for the subsequent period /prolongation/, it sets out a method of 
determining the price), featuring a lower unit price of electricity than unlimited 
INNOGY ENERGIE 
 
3 
Anonymised version  
term contracts. The applicant offsets this benefit with a contractual penalty, 
requiring that the customer’s obligation, consisting of due performance of the 
contract for the agreed term, will be fulfilled. The contractual penalty represents at 
the same time a flat-rate compensation for damage that the applicant may incur in 
the event of a failure to purchase the electricity contracted for the customer, given 
that, for fixed-term contracts, the applicant purchases the electricity for the 
customer in advance for the entire term of the contract on volatile wholesale 
markets, on the basis of reasonably expected consumption. Due to the fact that the 
defendant breached its obligation to duly pay the price of electricity, the applicant 
discontinued the supply of electricity on 11 September 2020, in line with the 
energetický zákon (the Energy Law), and by letter of 23 September 2020, it 
withdrew from the contract. In the context of the withdrawal, the applicant billed 
the defendant, in accordance with the fixed-term contract, for a contractual 
penalty of CZK 8,800, by means of a bill for a contractual penalty issued on 
13 September 2020, which was due on 23 September 2020. The contractual 
penalty sought amounts to CZK 400 for each month, starting on 11 September 
2020 through to 24 July 2022, that is, for 22 months, amounting in total to 
CZK 8,800. The defendant made a partial payment of CZK 2,190.34, and the 
defendant’s outstanding debt equals the amount sought in litigation. 
The defendant did not provide a statement with respect to the action. 
The defendant failed to appear at the hearing ordered without an excuse, and the 
court conducted the proceeding in his absence, in line with the občanský soudní 
řád (Code of Civil Procedure), taking documentary evidence from the file and 
informing the applicant (its legal counsel) that, in view of the defendant’s position 
as a consumer, the court has doubts about the compatibility of the contractual 
penalty with EU consumer protection legislation. The applicant did not comment 
on that procedure. 
From the evidence taken, the Court made the following partial findings of facts: 
The Court finds, from the bundled electricity supply contract of 24 January 2020 
concluded by the applicant and the defendant as a consumer, that this is a standard 
form contract printed in advance by the applicant which is physically filled in and 
signed exclusively on page 2/2. Effective from 24 January 2020, the applicant 
undertook in that contract to permit electricity consumption at the […] metering 
point and the defendant undertook to pay the purchase price for the consumption 
of electricity in line with the applicable price list. Monthly advances of 
CZK 1,2000 were agreed, with the product being the distribution set 
‘STANDARD DO2d’ and planned consumption being 1.8 MWh/year. The page 
of the contract designated as 1/2, in the section ‘Contract Conclusion and 
Term’, states that the contract has been concluded for a fixed term of 30 months 
(‘Basic Period’) and, during that time, it cannot be prematurely terminated. 
The disputed provision is in the section ‘Ostatní ujednání’ (‘Other 
Stipulations’), which states that the customer shall provide to innogy without 
REQUEST FOR A PRELIMINARY RULING OF 14. 9. 2023 – CASE C-749/23 
 
4  
Anonymised version 
undue delay the cooperation required for the commencement of supply on the 
basis of the contract, in particular not to take any legal or other act preventing it 
from fulfilling its obligation (including the implementation of a switch of 
suppliers) except for those acts that it is entitled to take by law. In the event of a 
breach of that obligation, the customer is obliged to pay a penalty to innogy, 
amounting to CZK 3,000 in the Households category and CZK 10,000 in the 
Entrepreneur category. The customer is obliged to pay the same penalty if it 
misleads innogy by terminating the contract by agreement and, in breach of the 
declared grounds for its conclusion, carries on consumption by purchasing from a 
different supplier at the same metering point. If the customer makes any legally 
relevant expression of its will without innogy’s consent (regardless of whether it 
was or was not made in regard to and/or delivered to innogy, whether that took 
place out of time, or whether it suffered from defects, and regardless of who 
subsequently completes the contract/supply or how it was completed) aimed at a 
premature termination of a fixed-term contract and/or supply from innogy (in its 
role as a balance responsible party with respect to the market operator) taking 
place on the basis of such a contract (such expression of will includes a power of 
attorney for switching suppliers or the late delivery of a notice of termination of a 
fixed-term contract during the contractually-agreed term; on the other hand, such 
expressions of will shall not include a mere proposal of a premature termination of 
the contract by agreement) and/or the customer repeatedly (that is, twice or more 
times) breaches any payment obligation arising from the contract (regardless of 
whether it is the same obligation or different obligations and whether the contract 
is subsequently unilaterally terminated by innogy and/or whether the customer, by 
its actions, renders impossible the supply, innogy shall be entitled to bill a penalty 
to the customer that also includes compensation for any damage incurred by 
innogy by its failure to purchase the electricity contracted for the customer, 
amounting to CZK 400 in the Households category and CZK 2,000 in the 
Entrepreneur category for each calendar month or a part thereof that follows after 
the date of termination or interruption of supply by innogy due to the customer’s 
actions described above, until the end of the agreed contract term (including any 
prolongation). In the case of customers with the distribution rate D01d or C01d as 
per the price list, the penalty amounts set out in the previous sentence shall be 
reduced by half. The customer shall pay to innogy a penalty of CZK 100 for each 
individual case of default on any payment pursuant to this contract in excess of 
10 days. The customer shall pay the penalty billed by the bill due date in line with 
the business terms and conditions. In the event of a penalty for the premature 
termination of a contract/supply in breach of the contractual terms, the customer 
can effectively release himself from the obligation to pay it if he recalls or 
withdraws such an expression of will, aimed at terminating the contract 
prematurely, and remedies any adverse effects thereof towards innogy. Unless 
otherwise stipulated above, innogy shall have, in addition to the right to a penalty 
arising from a breach of the customer’s obligation, also a right to damages and 
default interest arising from the breach of the same obligation. Withdrawal from 
the contract shall not extinguish innogy’s right to a penalty arising from a breach 
INNOGY ENERGIE 
 
5 
Anonymised version  
of the customer’s obligation prior to such withdrawal. The provisions of ‘Other 
Stipulations’ shall take effect on the effective date of the contract. 
In this case, the contract is completed by the applicant’s staff directly in an 
electronic environment (by computer) and a consumer has the option to preview 
the document on a monitor, while the text of the contract is moved around by the 
applicant’s staff member using a mouse. The document is subsequently signed 
using a tablet and the final signed contract is sent to the consumer by e-mail. At 
the customer’s request, the contract can be printed out at any point during the 
negotiation process. 
By letter of 21 July 2020, the defendant was asked to pay advances of CZK 1,200 
due for the months of June and July 2020. Subsequently, by letter of 23 September 
2020, the applicant withdrew from the contract on the grounds that the defendant 
failed to pay its receivables despite repeated notices. By invoice […], the 
applicant generated a final bill and billed an overpayment on electricity supply 
between 4 February 2020 and 11 September 2020 amounting to CZK 316.36. By 
its letter of 13 September 2020, the applicant billed the defendant for a contractual 
penalty of CZK 8,800 for 22 months of non-consumption at CZK 400 per month, 
due on 23 September 2020. 
(B) National legislation 
Zákon č. 89/2012 Sb., občanský zákoník, v platném znění (Law 89/2012, the Civil 
Code, as amended). 
Paragraph 2048(1) 
Where the parties have agreed on a contractual penalty in a certain amount or on a 
method whereby a contractual penalty amount will be determined in the event of a 
breach of an agreed obligation, the creditor may demand the contractual penalty 
regardless of whether the breach of the confirmed obligation caused it damage. A 
contractual penalty may be agreed upon in consideration other than financial. 
Paragraph 580(1) 
Legal action that is contrary to good morals is void, as is a legal action that runs 
contrary to the law, so long as the spirit and purpose of the law so require. 
Paragraph 1811(1) 
An entrepreneur shall make all communication towards a consumer clearly and 
understandably in the language of the contract. 
Zákon č. 458/2000 Sb., energetický zákon – Law 458/2000, the Energy Act 
[Provisions of national law of no temporal relevance]Note: Harmonisation with 
Directive (EU) 2019/944 of the European Parliament and of the Council was 
REQUEST FOR A PRELIMINARY RULING OF 14. 9. 2023 – CASE C-749/23 
 
6  
Anonymised version 
implemented by the above-mentioned provisions effective from 1 January 2022 – 
until then (until 31 December 2021), the regulation in the Czech legal order was in 
Paragraph 11a, with the heading ‘Certain provisions on customer protection’ and 
its text does not apply to this case. 
Paragraph 28(1) 
A customer is entitled to  
(e) choose and switch electricity suppliers free of charge; 
Paragraph 28(2) 
A customer is obliged  
(l) in exercising his right to choose a supplier pursuant to subparagraph 1(e), to 
adhere to the agreed duration of the termination period in the event of a contract 
for an indefinite period. 
(C) European Union legislation  
European Union legislation concerned: 
Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer 
contracts 
Article 3 
1. A contractual term which has not been individually negotiated shall be 
regarded as unfair if, contrary to the requirement of good faith, it causes a 
significant imbalance in the parties’ rights and obligations arising under the 
contract, to the detriment of the consumer. 
2. A term shall always be regarded as not individually negotiated where it has 
been drafted in advance and the consumer has therefore not been able to influence 
the substance of the term, particularly in the context of a pre-formulated standard 
contract. 
The fact that certain aspects of a term or one specific term have been individually 
negotiated shall not exclude the application of this Article to the rest of a contract 
if an overall assessment of the contract indicates that it is nevertheless a pre-
formulated standard contract. 
Where any seller or supplier claims that a standard term has been individually 
negotiated, the burden of proof in this respect shall be incumbent on him. 
3. The Annex shall contain an indicative and non-exhaustive list of the terms 
which may be regarded as unfair. 
INNOGY ENERGIE 
 
7 
Anonymised version  
Article 5 
In the case of contracts where all or certain terms offered to the consumer are in 
writing, these terms must always be drafted in plain, intelligible language. Where 
there is doubt about the meaning of a term, the interpretation most favourable to 
the consumer shall prevail. This rule on interpretation shall not apply in the 
context of the procedures laid down in Article 7 (2). 
Article 7 
1. Member States shall ensure that, in the interests of consumers and of 
competitors, adequate and effective means exist to prevent the continued use of 
unfair terms in contracts concluded with consumers by sellers or suppliers. 
Annex: 
Terms referred to in Article 3(3) 
1. Terms which have the object or effect of: 
…  
(e) requiring any consumer who fails to fulfil his obligation to pay a 
disproportionately high sum in compensation; 
Directive (EU) 2019/944 of the European Parliament and of the Council of 
5 June 2019 on common rules for the internal market for electricity and 
amending Directive 2012/27/EU 
Article 12 
Right to switch and rules on switching-related fees 
1. Switching supplier or market participant engaged in aggregation shall be 
carried out within the shortest possible time. Member States shall ensure that a 
customer wishing to switch suppliers or market participants engaged in 
aggregation, while respecting contractual conditions, is entitled to such a switch 
within a maximum of three weeks from the date of the request. By no later than 
[1 January] 2026, the technical process of switching supplier shall take no longer 
than 24 hours and shall be possible on any working day. 
2. Member States shall ensure that at least household customers and small 
enterprises are not charged any switching-related fees. 
3. By way of derogation from paragraph 2, Member States may permit 
suppliers or market participants engaged in aggregation to charge customers 
contract termination fees where those customers voluntarily terminate fixed-term, 
fixed-price electricity supply contracts before their maturity, provided that such 
fees are part of a contract that the customer has voluntarily entered into and that 
REQUEST FOR A PRELIMINARY RULING OF 14. 9. 2023 – CASE C-749/23 
 
8  
Anonymised version 
such fees are clearly communicated to the customer before the contract is entered 
into. Such fees shall be proportionate and shall not exceed the direct economic 
loss to the supplier or the market participant engaged in aggregation resulting 
from the customer's termination of the contract, including the costs of any bundled 
investments or services that have already been provided to the customer as part of 
the contract. The burden of proving the direct economic loss shall be on the 
supplier or market participant engaged in aggregation, and the permissibility of 
contract termination fees shall be monitored by the regulatory authority, or by 
another competent national authority. 
(D) Relevant case-law 
Judgement of the Nejvyšší soud (Supreme Court) of 30 August 2022, ref. no. 33 
Cdo 2151/2021-106, annulled the decision of the Krajský soud v Ústí nad 
Labem – pobočky v Liberci (Liberec branch of the Ústí nad Labem Regional 
Court) of 11 February 2021, ref. no. 29 Co 165/2020-40, returning the case for 
further proceedings. 
The Court notes in this regard that decisions pertaining to similar (identical) 
claims can be found in the database of anonymised court decisions kept by the 
Ministerstvo spravedlnosti ČR (Ministry of Justice of the Czech Republic) at 
www.justice.cz. 
Final decisions confirming the invalidity (or nullity) of the said provisions include 
final judgments in […][reference to judgments of national courts of first and 
second instance]. 
To a similar extent however, there are also final decisions which did not find a 
breach of law and assessed the agreed contractual penalty as being valid, granting 
the claim. 
The position of defendants is passive in the vast majority of the cases (they do not 
attend hearings, do not give their statements on the action). 
(E) Grounds for the first question 
The issue of unfair stipulations had already been [addressed] by legal regulation 
that was in force before 1 January 2014, and the Ústavní soud České republiky 
(Constitutional Court of the Czech Republic) had already ruled on it in the context 
of the legal regulation effective until 30 December 2013, in its decision of 
11 November 2013, ref. no. I ÚS 35112/11, not limiting itself to noting that 
‘penalty clauses’, in order not to be deemed unfair, must be part of the contract 
and a reference to general business terms and conditions does not suffice to 
validly agree to them; it also addressed the fact that the text of a consumer 
contract, especially in the case of a pre-formulated contract, must be sufficiently 
legible for the average consumer, clear, and logically structured, the contractual 
stipulations must be of a sufficient font size and must not be placed in a section in 
which they give the impression of being irrelevant. 
INNOGY ENERGIE 
 
9 
Anonymised version  
Large corporations responded to this conclusion by adapting their contracts and 
including penalties in the text of the relevant contract. The applicant did the same; 
nevertheless, it integrated them into the contract in a manner that gives rise to 
doubts as to whether it was indeed done in line with the principle on which 
Council Directive 93/13/EEC is based. That is, whether the placement of a term 
that has not been negotiated individually in a part of the contract designated as 
page 1/2, in which individually agreed stipulations are not written, in an ‘residual 
section’ titled as ‘Other Stipulations’, when all individual contractual stipulations 
are set out exclusively on page 2/2, complies with the conditions set out in 
Article 5 of the Directive. 
As for the conclusion of contracts in electronic form versus ‘paper’ form, the court 
does not find any difference in this case, as the consequence of the placement of 
the text of penalty provisions in an adhesion contract on a page that is not 
physically filled in, that does not follow that part of the contract, and on the 
contrary, is only its introduction, which can be overlooked in the course of the 
conclusion of the contract in any manner, or may not be given as much relevance 
as the information under which a signature is directly placed, is comparable in 
both cases. 
(F) Grounds for the second question 
The abovementioned contractual penalty affects the consumer, (among other 
cases) in the event of the termination of the contract due to the consumer’s failure 
to fulfil his payment obligations. As for the termination of the contract by the 
supplier’s withdrawal, the most frequent ground is the consumer’s failure to 
perform its financial obligations. The applicant is claiming a contractual penalty 
for the months during which there was no consumption under a fixed-term 
contract, amounting, in the case of consumers, to CZK 400 per month, without 
having to document the amount of its actual direct financial loss, as would be the 
case if the penalties were to be applied against a consumer if he terminated the 
contract due to switching suppliers during the contractual term. Both cases involve 
contract termination before the duly agreed term, but if the contract is terminated 
by the supplier, it is not burdened with the obligation to document actual direct 
financial losses when claiming a contractual penalty, unlike when the relationship 
is terminated by the consumer who does this voluntarily, and there is a clear limit 
on the penalty in the amount of the direct financial loss. 
The court notes that, in the case at hand, there was not an underpayment on the 
price of energy, but, on the contrary, there was an overpayment, even though the 
defendant clearly failed to pay at least two monthly advances on the energy, of 
CZK 1,2000, and the subject of the agreement did not include any commitment of 
the defendant – consumer to purchase a minimum volume of energy. No 
obligations of the supplier itself are secured with a contractual penalty, not even 
the basic one – the due supply of energy. 
(G) Closing notes  
REQUEST FOR A PRELIMINARY RULING OF 14. 9. 2023 – CASE C-749/23 
 
10  
Anonymised version 
This case constitutes a low-value dispute concerning performance not exceeding 
CZK 10,000, in which the ruling cannot be challenged by an appeal pursuant to 
national law […]. Hence, the court was obliged to approach the Court of Justice of 
the European Union in line with Article 267 of the Treaty on the Functioning of 
the European Union. 
Furthermore, it should be pointed out that this is not an isolated case: the same 
question is being addressed in a large number of court disputes and the answer of 
the Court of Justice of the European Union to the above questions will be of 
relevance to a large number of court disputes. 
[…]