The interpretation and enforceability of contracts is a matter of governing law. The choice of law by the parties is accepted as a general principle, except when otherwise provided for by law; please, however, note that, in certain cases, there are rules of mandatory application – for instance, in the scope of contracts concluded with consumers.

The basic rule is that the parties may agree as to the law that will govern their contractual rights and as to the applicable jurisdiction in case of dispute. This freedom of election is subject to several limitations. Non-Argentine law will not be enforced in Argentine courts if it is contrary to Argentine public policy. Also, certain matters are necessarily governed by Argentine law; for example, if a business association is created in Argentina its organization and other corporate aspects will be governed by Argentine law. Decisions made by non-Argentine courts or arbitration tribunals are enforceable in Argentina only after going through a special procedure before the Argentine courts, in the context of which the decision will only be enforced if it complies with certain rules, particularly not violating Argentine public policy. In addition, certain matters (eg, deciding the validity of a patent issued in Argentina) are necessarily subject to Argentine jurisdiction.

Governing law and choice of jurisdiction (ie, venue for resolution) clauses are generally upheld by state and Federal Courts in commercial contracts, provided such choice of law does not, and will not, avoid any mandatory law (eg, the ACL for consumer contracts) that would otherwise be applicable. That is, for example, one cannot contract out of the ACL for a consumer contract in Australia by choosing the law of a foreign jurisdiction to apply to govern the contract.

Governing law and venue for resolution of disputes (including arbitration) specified in a commercial contract will generally be accepted and recognized, under certain limitations. The governing law is in general subject to ordre public reservation. Additional and more severe limitations apply to business-to-consumer contracts and employment contracts. Dispute resolution and arbitration clauses that materially disrupt the balance between the parties (e.g., one-way arbitration clauses) should be carefully assessed in each specific case.

Subject to the case law of the European Union on the conclusion of cross border online agreements, the Rome I and Recast Brussels I regulations, and the limitations they impose on consumer contracts and employment contracts, the governing law and venue for resolution of disputes (including arbitration) specified in a commercial contract will generally be accepted and recognized.

According to the conflict of laws principles set forth in Federal Decree-Law No. 4,657/1942 (the Introductory Law to the Brazilian Law Provisions), the obligations shall be governed by the law of the place where they are created and, when the parties are not at the same place when they sign a contract, the law of the place of the proposing party shall govern such contract. Even if a contract specifies foreign law as the governing law, if the agreement is performed in Brazil, Brazilian law may be applicable, and local courts would always have jurisdiction in relation to such contract.

An exception to the above rule is the agreements with an arbitration clause. Federal Law No. 9,307/1996 (Arbitration Law) expressly allows the parties to choose the laws or institutional rules governing the contract and the arbitration. The parties may also agree that the decision shall be based on equity.

Choice of law and forum selection clauses are enforced based on contract principles applicable in the province in question. Courts, as a rule, will enforce such clauses in contracts that parties have negotiated. However, standard principles such as inequality of bargaining power (particularly in the case of consumer transactions), ambiguity or manifest unfairness of the clause may make such a clause unenforceable in a particular case.

In the absence of a jurisdiction clause, Chilean law applies between Chilean parties. Clauses establishing the governing law, and venue for the resolution of disputes specified in a commercial contract will generally be accepted and recognized in Chilean Courts, as long as no consumers are involved.

Dispute resolution is litigation in Chile unless an alternative dispute resolution procedure, such as mediation or arbitration, is specified in the contract.

Generally, the governing law of a commercial contract can either be the PRC law or any foreign law if a contract involves a foreign related element (for example, if a party to the contract is a foreign company or the subject matter of the contract is outside of China)  

But, if a party seeks intellectual property protection in China, the Chinese law must apply in determining ownership and content of the intellectual property as well as the liability for infringement.

For a contract that involves any foreign related element, the parties can, at their discretion, select Chinese litigation, Chinese arbitration, foreign litigation or foreign arbitration as the  dispute resolution mechanism.. However, without applicable treaties or established reciprocity, it is almost impossible to recognize or enforce a judgment rendered by a foreign court in China. Thus, it is generally recommended not to choose foreign litigation if 1 of the contracting parties is a Chinese party.

In commercial contracts, it is understood that the governing law is Colombian law when the contract is to be executed in Colombia.

Governing law and venue for resolution of disputes specified in a commercial contract will generally be accepted and recognized by courts.

Dispute resolution is litigation before state courts, unless agreed otherwise which typically would be an arbitration before an established or ad hoc arbitral tribunal.

The parties have contractual freedom in relation to the choice of law. Governing law and venue for resolution of disputes specified in a commercial contract are generally accepted and recognized by Danish courts.

In business-to-consumer relations, specific consumer protection rules and rules on civil procedure apply.

In business-to-business relations, district courts have jurisdiction over disputes as a main rule unless an alternative dispute resolution procedure, such as arbitration, is specified in the contract. If a trader has directed its business towards Denmark, the consumer will generally be able to take legal actions against the trader in Denmark and invoke the Danish rules if this is more attractive to the consumer.

Clauses regarding choice of jurisdiction are generally considered binding between business parties, even in the case of shrinkwrap online terms.

In the B2C context, however, consumers are always granted access to the local legal system regardless of the governing law specified in the contract.

Governing law and venue for resolution of disputes specified in a commercial contract are generally accepted. However, a consumer in France will be entitled to the protection of French law if French law is more favorable to the consumer than the stipulated governing law. In all cases, French law that is considered by French courts to rise to the level of public policy will be applied by a French court. In respect of international contracts (eg, where a party is not French), there is little case law holding which types of French law are public policy in international matters.

The interpretation and enforceability of commercial contracts is a matter of governing law. The governing law is the law of the country chosen by the parties or, for lack of a valid choice of law provision, the law applicable on the basis of the respective legal provisions, in case of disputes before the courts within the European Union.

Regulation (EC) No 593/2008/ of June 17, 2008 on the law applicable to contractual obligations (Rome I) sets out the principles relating to law applicable in the absence of a choice of law by the parties. As a general rule, consumer contracts are governed by the law of the country where the consumer has their habitual residence provided that the business party pursues its commercial or professional activities in that country or where the business party directs such activities to and that the relevant contract falls within the scope of such activities (Article 6 (1) Rome I).

The governing law chosen by the parties is generally accepted, provided that the choice is made expressly or is obvious from the terms of the contract or the circumstances of the case. For consumer contracts, such a choice may not, however, have the result of depriving the consumer of the protection afforded to them by provisions that cannot be derogated from by agreement by virtue of the law which, in the absence of choice, would have been applicable (Article 6 (2) Rome I).

Where all other elements relevant to the situation at the time of the choice of law are located in a country other than the country whose law has been chosen, the choice of the parties shall not prejudice the application of provisions of the law of that other country which cannot be derogated from by agreement (Article 6 (3) Rome I).

Parties are free to select the governing law and venue for resolution of disputes specified in a commercial contract, and this is accepted and recognized by Hong Kong courts.

Parties are free to opt for litigation or alternative dispute resolution such as arbitration and mediation.

From a litigation perspective, there have been arrangements in place for the reciprocal recognition and enforcement of monetary judgments in commercial matters between Hong Kong and Mainland China since 2008.

To establish a more comprehensive mechanism, the Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters signed by the courts of Mainland China and Hong Kong has recently come into force on January 29, 2024.

Previously, only judgments issued pursuant to a written exclusive jurisdiction clause in favor of the court which made the judgment (ie Hong Kong or Mainland China) were reciprocally enforceable. Under the new arrangement, the test will no longer be focused on “exclusive jurisdiction”, instead the applicant will have to show that the dispute in the Hong Kong proceedings has a sufficient nexus with Hong Kong (eg the defendant has a place of residence in Hong Kong, the place of contractual performance is in Hong Kong etc.).

In addition, the scope of judgments that can be enforced in Mainland China or Hong Kong has been expanded to cover both monetary and non-monetary judgments that are civil and commercial in nature, as well as judgments in criminal proceedings that contain an order for the payment of a sum of money in respect of compensation and damages, subject to an excluded list of cases (eg certain maritime cases, cases on natural person’s qualification as a voter, certain cases involving IP rights etc.).

Similar to the arrangements simplifying enforceability of Hong Kong court judgments in Mainland China, arbitral awards rendered in Hong Kong pursuant to the Arbitration Ordinance (Cap. 609) may be enforced in Mainland China and vice versa, save for certain limited situations. In addition, an arrangement is in place between the Hong Kong government and the PRC Supreme Court, under which parties to Hong Kong-seated arbitrations may obtain interim measures (ie, interim preservation of assets and evidence and conduct) from PRC courts that will be enforceable in the PRC. As a result, Hong Kong arbitration is a sensible consideration for contracts where 1 party to the contract is a Mainland China entity. 

Governing law and venue for resolution of disputes specified in a commercial contract will generally be accepted and recognized. As a member of the EU the regulations on applicable law (Rome I, 593/2008/EC and Rome II, 864/2007/EC) and jurisdiction (1215/2012/EU) shall be applicable.

Dispute resolution means litigation in courts unless an alternative dispute resolution procedure, such as mediation or arbitration, is specified in the contract.

Governing law

Contracting parties have the right to choose the governing law of a contract. However, where the governing law is not mentioned in the contract, courts in India follow the "closest connection" test to determine governing law, meaning that the court would identify the legal system with which the transaction has its closest and most real connection. Various factors that the courts would look into are the place where the contract was made, place of performance, place of domicile, residence or business of parties and subject matter of contract.

It may be relevant to note that foreign law is not recognized by Indian courts and is required to be pleaded as facts, with expert evidence, under the Indian Evidence Act 1872.

Jurisdiction / venue

Jurisdiction of Indian courts arises from the Code of Civil Procedure, 1908 (CPC). The jurisdiction of civil courts is subject to territorial and pecuniary limitations. In cases of international commercial contracts, parties may choose the jurisdiction or venue of disputes. However, even in such cases, Indian courts may assume jurisdiction after analyzing the balance of convenience in cases where a party claims that the choice of foreign jurisdiction would result in undue disadvantage to that party.

Alternate dispute resolution 

Parties may specify an alternative dispute resolution mechanism, such as arbitration, conciliation or mediation. Indian courts recognize and enforce decisions of recognized foreign arbitral tribunals, subject to limitations prescribed under the Indian Arbitration and Conciliation Act 1996.

The governing law and venue for dispute resolution, as specified in a commercial contract, will generally be accepted and recognized by the Indonesian Courts under the principles of "freedom of contract" based on Article 1338 of the Indonesian Civil Code.

However, foreign court judgments are not recognized by Indonesian Courts as Indonesia is not a party to any treaty on the reciprocal enforcement of court judgments. This means that a lawsuit must be filed in Indonesia for a foreign court judgment to be enforced in Indonesia.

If the parties intend to apply foreign law as the governing law of the contract, the better alternative is to use such foreign law and to elect a foreign arbitration as the dispute resolution mechanism. Indonesia has ratified the New York Convention (Convention on the Recognition and Enforcement of Foreign Arbitral Awards).

Accordingly, Law Number 30 of 1999 on Arbitration and Alternative of Dispute Resolution (Arbitration Law) facilitates the enforcement of foreign awards in Indonesia, provided they meet the following conditions:

• The international arbitration award must be made by an arbitrator or panel of arbitrators in a country which is bound by agreement with Indonesia, either bilateral or multilateral, on the acknowledgment and enforcement of international arbitration awards.

• The international arbitration award in paragraph (a) is limited to awards which, pursuant to Indonesian law, is in the scope of commercial law.

• The international arbitration award as referred to in paragraph (a) can only be enforced in Indonesia if it is not contrary to public policy.

• The international arbitration award can only be enforced in Indonesia after obtaining an execution judgment from the Head of the Central Jakarta District Court.

• The international arbitration award in paragraph (a) involving the State of the Republic of Indonesia as a party in the dispute can only be enforced after obtaining an execution judgment from the Supreme Court of the Republic of Indonesia which is further assigned to the Central Jakarta District Court.

For its enforcement in Indonesia, a foreign award must be registered at the Central Jakarta District Court (CJDC). To enforce an international arbitration award, the Head of CJDC must recognize the foreign arbitration award and issue an execution enforcement judgment. If the Head of CJDC recognizes the foreign arbitration award through its judgment, then the judgment becomes final and binding. If the Head of CJDC does not recognize the foreign arbitration award through its judgment, the judgment still may be appealed to the Supreme Court. The judgment of the Supreme Court is a final and binding judgment.

The Irish courts will generally recognize the governing law and venue for resolution of disputes (including arbitration) specified in a commercial contract. Specific rules apply to consumer contracts.

It is a specific requirement that business-to-consumer traders must include a link on their website to the European Commission's Online Dispute Resolution platform.

In general, governing law provisions, including foreign governing law provisions, specified in a commercial contract will be accepted and recognized by Israeli courts. However, in certain circumstances, the Israeli courts may be prepared to apply Israeli law, such as when immediate temporary relief is required, with regard to civil legal procedures or where the agreement is deemed to be a standard Contract (as further discussed above).

It should be noted that, in some recent decisions of the Israeli district courts (which are not binding case law, but rather guidance for lower courts), it has been ruled that, with respect to standard contracts entered into between multinational corporations and numerous Israelis, with respect to services provided to or targeting Israelis, that determine a foreign jurisdiction and foreign governing law, Israeli courts will apply Israeli jurisdiction and law on the basis that such determination of foreign jurisdiction and law is considered a prejudicial term in a standard contract. In addition, the Supreme Court ruled in May 2018 in a case relating to a major technology company that, notwithstanding the agreement between the parties (which constituted a standard contract), Israeli courts would have jurisdiction but the governing law would be the contractually agreed foreign law, as the plaintiff had failed to demonstrate that such law was unfairly prejudicial. This decision constitutes a binding precedent.

With regard to B2B contracts, governing law can be freely decided by the parties, but, if 1 of the parties is an Italian entity, the Italian law mandatory provisions will still apply to the agreement.

With regard to B2C contracts entered with Italian consumers, some provisions shall necessarily be governed by the Italian law irrespective of the governing law of the agreement.

Choice of governing law and venue for resolution of disputes specified in a contract is generally accepted and recognized by courts in Japan.

It should be noted that under Japanese conflict law, in consumer contracts, a consumer may require additional application of the law of the consumer's residence in addition to agreed governing law.

Subject to the case law of the European Union on the conclusion of cross-border online agreements, the Rome I and Brussels Ibis regulations and the limitations they impose on consumer contracts and employment contracts, the governing law and venue for resolution of disputes – including arbitration – specified in a commercial contract will generally be accepted and recognized.

Governing law and venue for resolution of disputes specified in a commercial contract corresponds to federal courts, although state courts may accept venue.

Dispute resolution is litigation in federal courts unless an alternative dispute resolution procedure, such as mediation or arbitration, is specified in the contract.

Subject to the conflict of law provisions as laid down in the Rome I and Brussels I regulations and in the Dutch Civil Code, and the limitations they impose on, for example, consumer contracts and employment contracts, the governing law and venue for resolution of disputes (including arbitration) specified in a commercial contract will generally be accepted and recognized.

Governing law and choice of forum for disputes that have been expressly specified in a commercial contract will generally be accepted and recognized in New Zealand courts. However, in some cases the subject matter or the type of contracting party (consumers for example) may justify challenging an express choice of law clause. There are also particular statutes that may apply regardless of any express choice of law clause (such as the Commerce Act 1986, the Consumers Guarantees Act 1993 and the Fair Trading Act 1986).

Arbitration may be a preferred option for parties and is governed by the Arbitration Act 1996. There are also a number of alternative dispute resolution procedures including private mediation and judicial settlement conferences. In some industries, such as telecommunications and utilities, specific dispute resolution forums have been established.

Governing law and venue for resolution of disputes specified in a commercial contract will generally be accepted and recognized by the courts as Nigerian law does not provide a unified set or rules solely applicable to commercial contracts.

The parties have a contractual freedom in relation to choice of law. Governing law and venue of resolution of disputes specified in a commercial contract will generally be accepted and recognized by Norwegian Courts.

In a business-to-consumer situation, specific rules may apply.

District courts have jurisdiction over disputes unless an alternative dispute resolution procedure, such as arbitration, is specified in the contract.

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Governing law and venue for resolution of disputes specified in a commercial contract will generally be accepted and recognized by the courts.

Dispute resolution is litigation in courts unless an alternative dispute resolution procedure, such as mediation or arbitration, is specified in the contract. Waivers of class action arbitrations require special attention to be enforceable against consumers.

The parties are free to choose any governing law for the contract. However, Polish law may contain so-called overriding mandatory provisions which would be applicable despite the law chosen by the parties.

The interpretation and enforceability of contracts is a matter of governing law. The choice of law by the parties is accepted as a general principle, except when otherwise provided for by law (please, however, note that in certain cases there are rules of mandatory application – for instance, in the scope of contracts concluded with consumers). 

Governing law and the venue for resolution of disputes specified in a contract will generally be accepted and recognized subject to mandatory provisions in relation to the jurisdiction of the Romanian courts.

Jurisdiction clauses in consumer contracts that provide for a different court than the court located in the area where the consumer lives are not enforceable if signed before the consumer's right to damages arises.

The law can be freely chosen by the parties. However, the parties must consider the possibility of certain "super-imperative" provisions of Russian laws which may be applicable regardless of the choice of law (eg, registration of contract, currency control regulations and consumer laws).

Contracting parties generally have the right to choose the governing law of a contract (although the position is different when contracting with government entities in KSA).

Consideration should be given to the most suitable governing law and jurisdiction for resolving disputes to be specified in the contract, depending upon the nature of the contract, the parties and other specific circumstances.

The governing law and venue for resolution of disputes specified in a commercial contract will generally be accepted and recognized by the courts. It should be noted that the use of Singapore law as governing law and the Singapore International Arbitration Centre as the forum for any disputes has become increasingly common.

Choice of governing law and choice of forum for resolution of disputes specified in a commercial contract are generally accepted and recognized by courts. In the absence of a specification in contract, rules under the Slovak Act No. 97/1963 Coll. on International Private and Procedural Law, as amended, Regulation No. 593/2008 (Rome I) and Regulation No. 1215/2012 (Brussels I) shall apply.

If specified by the parties in the contract, alternative dispute resolution procedure, such as mediation or arbitration, is also generally possible.

While the choice of law agreed by parties is generally respected by the Korean court and thus designating a foreign law for a contact would be valid, the Korean court may apply mandatory Korean laws and deny the application of the selected foreign law which violates Korean public order and good morals.

In general, the forum selection agreed between the parties is enforceable under Korean law. In order to select a foreign court as exclusive jurisdiction (and contractually preclude the jurisdiction of Korean courts), however, Korean courts require that:

• The case is not under the exclusive jurisdiction of the Korean courts under Korean law.
• The foreign court in question selected by the parties has valid jurisdiction under the laws of the foreign court.
• The case has reasonable connection with the foreign jurisdiction.
• The agreement on the exclusive jurisdiction is not grossly unreasonable or unfair.

Under Regulation No. 593/2008 of the European Parliament and of the Council of June 17, 2008 on the law applicable to contractual obligations (Rome I), directly applicable in Spain, the parties to a contract are allowed to choose the law governing the contracts, whether or not it is the law of a EU member state. If the contracting parties do not make a choice (or if the choice is invalid), the law of the country of habitual residence of the characteristic performer when the contract is concluded, or in the case of a company, of its central administration, in principle applies.

Alongside this general rule, the EU Rome I regulation on the law applicable to contractual obligations establishes certain guarantees as to the requirements for the parties to be able to determine the applicable law in certain cases (consumer contracts and individual employment contracts) and if no choice is made, specific forms of jurisdiction that take precedence over the presumptions referred to above. Spanish laws (eg, Consumers and Users Protection Act RDL 1/2007) also do establish certain limitations on the choice of law of the parties when dealing with certain specially protected groups, like consumers.

The parties' contractual freedom applies to choice of law. Governing law and venue for resolution of disputes specified in a commercial contract will generally be accepted and recognized by Swedish Courts. However, even though parties may generally agree on the governing law and venue for disputes, certain mandatory local law provisions may still be applicable. For example, mandatory provisions on termination fees in agency agreements.

In a business-to-consumer situation, specific rules may apply.  For example, the Swedish consumer protection legislation will apply and cannot be deviated from in business-to-consumer situations. 

Dispute resolution is litigation in district courts unless an alternative dispute resolution procedure, such as mediation or arbitration, is specified in the contract. Arbitration is generally not enforceable in a business-to-consumer situation.

Subject to consumer contracts, governing law and forum specified in a commercial contract will generally be accepted and recognized by state courts.

Dispute resolution takes place through litigation in state courts, unless an alternative dispute resolution procedure such as mediation or arbitration is specified in the contract.

Governing law and jurisdiction for resolution of disputes specified in a commercial contract will generally be accepted and recognized by Taiwan courts. The parties are free to opt for litigation or alternative dispute resolution such as arbitration and mediation.

Under Ukrainian legislation, parties to the agreement may choose the governing law provided that a foreign element is present in respective contractual relations. In particular, a foreign element is considered to be present in the following cases:

• One of contracting parties is a foreign legal entity
• An object of legal relationship is located on the territory of the foreign state or
• Legal fact in result of which legal relations arise, which changes or terminates the legal relationship, takes place in the territory of the foreign state.

At the same time, it should be noted that Ukrainian legislation envisages certain exceptions when governing law regulated by agreement shall not apply and Ukrainian law shall be found applicable.

Namely, the governing law of the agreement will not apply if its application causes consequences that are incompatible with the public order of Ukraine. In addition, the imperative norms of the Ukrainian legislation will still apply. At this point, we note that Ukrainian law does not define which provisions are imperative (presumably, these are provisions of public nature – for instance, payment of taxes or antimonopoly issues, but it should be decided in each particular case based on complex analysis of Ukrainian law whether certain provisions of Ukrainian law should be treated as imperative).

Furthermore, please note that, according to Ukrainian law, the law applicable to legal relations in the area of protection of intellectual property rights shall be the law of the country where the protection is sought. In the event there is any dispute between the parties to the agreement in connection with the protection of intellectual property rights within the territory of Ukraine, the laws of Ukraine will apply.

Ukrainian laws also provide that, if it turns out that application of the chosen law is not possible in determining the order of fulfillment of the agreement or measures to be applied in the event of non-fulfillment or improper fulfillment of such agreement, the law of the country of performance of the agreement shall be applied. Therefore, theoretically, Ukrainian law may be found applicable to the agreement in regard to the order of its fulfillment and the measures to be applied in the event of its non-fulfillment or improper fulfillment.

In relation to the choice of jurisdiction, the parties to the contractual relations with foreign element (eg, foreign entities) are free to choose foreign jurisdiction. However, it should be noted that Ukrainian courts would still have exclusive jurisdiction over certain kinds of disputes with a foreign element – in particular, in disputes regarding intellectual property rights which are subject to patenting or obtaining a certificate in Ukraine, as well as disputes regarding real estate located within the territory of Ukraine, among others.

While parties are free to choose a foreign law to govern an agreement, the UAE Courts may as a matter of practice set aside such a provision and apply UAE law. Issues may arise as to the enforceability of a foreign law decision on disputes which relate to the infringement of intellectual property rights where there is a nexus with the UAE, eg, where one or more of the infringers reside in the UAE. This is because such infringements are considered to be criminal in nature, which allows UAE Courts to assume exclusive jurisdiction and apply UAE laws.

Parties are free under Scots and English law to choose the governing law and jurisdiction of a contract as well as any arbitration institution they may see fit. Generally, both the Scottish and English Courts uphold an express choice of law. However, such freedom of choice is unlikely in the case of a consumer contract. Moreover, in some circumstances, an express choice of law may be challenged and the applicable law modified (eg, if a different law has been chosen solely to avoid the application of the UK's "unfair contract terms" legislation). In the event that there is no express choice of law in the contract, then, for contracts created on or after December 17, 2009, the provisions of Rome I Regulation apply. For contracts created before December 17, 2009, the provisions of the Rome Convention apply.

Arbitration is often used by parties to resolve commercial disputes. It is private and confidential and governed by the Arbitration Act 1996 and, in Scotland, Arbitration (Scotland) Act 2010. There are also a number of alternative dispute resolution procedures. These include mediation, early neutral evaluation and adjudication. Traders other than health service providers now have access to alternative dispute resolution (ADR) providers in their sectors should they choose to resort to the ADR to resolve any disputes with consumers concerning contractual obligations arising from a sales or service contract.

Governing law and venue for resolution of disputes specified in a commercial contract are generally accepted and recognized by state and federal courts.

Dispute resolution is litigation in state and federal courts unless an alternative dispute resolution procedure, such as mediation or arbitration, is specified in the contract. Waivers of class action arbitrations require special attention to be enforceable against consumers.