FCA Sharpens Unfair Contract Terms Guidance With Dedicated Blog and Clause Library

The Not-So-Fine Print: What the FCA's Unfair Contract Terms Push Means for Firms

The Financial Conduct Authority has sharpened its public guidance on unfair contract terms, publishing a dedicated blog post titled "The not-so-fine print: making consumer contracts fair" and maintaining a structured library of examples at fca.org.uk/firms/unfair-contract-terms. The moves signal continued supervisory attention on how financial services firms draft and present consumer-facing agreements.

The Regulatory Framework

The core domestic statute is the Consumer Rights Act 2015, which under section 62 establishes that a term is unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations to the detriment of the consumer. That statutory test anchors the FCA's own supervisory expectations, which are set out in guidance available through the FCA's published handbook.

The FCA's jurisdiction in this area runs in parallel with the Competition and Markets Authority's. The CMA published its own guidance for businesses — CMA37 — to help firms ensure contract terms and notices are fair and transparent. CMA37 was originally published on 31 July 2015 and has since been updated, most recently on 22 July 2026, giving firms two complementary sets of authoritative guidance to consult.

The FCA maintains a dedicated unfair contract terms library offering firms worked examples and guidance — a resource that sits alongside its broader Consumer Duty framework and the CMA's parallel jurisdiction under CMA37.

The Library and What Firms Should Look For

The FCA operates an unfair contract terms library, accessible at fca.org.uk/firms/unfair-contract-terms/library, specifically to provide firms with practical examples and regulatory context. Regulators have historically scrutinised clause types such as broad unilateral variation rights, wide exclusions of liability and asymmetric termination provisions, though firms should consult the library directly to understand which specific entries the FCA has included and how it has characterised them.

In regulatory terms, the library functions as a supervisory signal: firms can observe the kinds of drafting that have drawn scrutiny and assess their own agreements accordingly. The absence of a formal enforcement action is not, analysts note, the same as regulatory clearance — the library is designed to prompt proactive review rather than reactive amendment.

Consumer Duty Overlay

The FCA's Consumer Duty framework, with dedicated publications and resources available at fca.org.uk/firms/consumer-duty/publications-resources, adds a further layer of expectation. Firms should consult the FCA's primary Consumer Duty publications directly to understand how the Duty's outcome areas interact with existing unfair contract terms obligations; the FCA's resources for firms set out that structure in full.

In practice, the two regimes are complementary rather than duplicative. A contract term that fails the Consumer Rights Act 2015 section 62 unfairness test will also be difficult to reconcile with Consumer Duty expectations around consumer outcomes — a point that increases the compliance stakes for firms that have not recently audited their standard terms.

The European Dimension

For firms operating across borders, the European Commission maintains its own Unfair Contract Terms Directive as part of EU consumer contract law, and is currently conducting a broader review of EU consumer law. That review means the EU framework may evolve, adding complexity for firms managing compliance obligations in multiple jurisdictions simultaneously.

Why It Matters

The combination of the FCA's blog publication, its maintained library, and the parallel CMA37 guidance creates a dense but navigable signposting environment for firms. The FCA's firms page at fca.org.uk/firms/unfair-contract-terms is the logical starting point for any compliance review. Firms that treat contract review as a periodic exercise rather than a standing obligation may find themselves exposed: regulatory expectations in this area are not static, and both the FCA and CMA have invested in keeping their public guidance current. With the European Commission also revisiting its consumer law framework, the direction of travel across jurisdictions points toward greater scrutiny of standard-form consumer contracts — not less.