Abstract: The contribution aims to evaluate some problematic issues addressed by the UK Supreme Court decisions on penalty clauses, taking into account discussions among Italian scholars and rulings of Italian jurisprudence. The focus is put on the issue of whether the rule against penalties should be abrogated or extended, on the scope of application of the rule against penalties (i.e. if it is applicable to primary obligations), on the benchmark to assess whether the rule against penalties should be applied and, finally, on the interpretation of the expressions ‘imbalance in the parties rights’ and ‘contrary to the requirements of good faith’ established by the Unfair Terms Directive. In conclusion, in the light of the innovative judgment, an assessment of the relationship between contractual freedom and the need to protect the debtor of a penalty will be put forward.
European Review of Private Law