This project is ongoing.
Principle Investigator
Dr. Benedikt Schmitz, LL.M.
Funding
Sectorplan SSH, OCW Starting Grant
Small businesses form the backbone of the European Union’s economy, contributing significantly to employment and value creation. However, they often struggle against economically stronger businesses that dictate unfavourable contract terms. Unlike consumers, small businesses lack dedicated legal protection despite facing similar vulnerabilities. The changing economic landscape, characterised by online trade, platformisation, and geopolitical shifts, necessitates stronger legal safeguards.
While the European Commission has introduced SME-support initiatives, contract law issues remain unaddressed. The principle of freedom of contract allows large businesses to impose unfair terms, subject small businesses to foreign legal systems, limit market alternatives, and create economic dependency. This project investigates how contract law and private international law can systematically protect small businesses.
Key challenges include defining which small businesses qualify for protection, assessing the European Union’s legislative competence, identifying methods of protecting small businesses, and ensuring applicability across jurisdictions. Employing a comparative legal analysis of EU, Dutch, and German law, alongside interdisciplinary insights, this research aims to develop a coherent framework. It bridges gaps in the existing literature, which tends to be fragmented or sector-specific, and will provide policymakers with the available tools to implement small business protection in general contract law.