The Role of the Penalty Clause in Business

Abstract

The interest in this topic is determined, on one hand, by the way of interpreting the provisions which regulate the contractual liability in general and of those regarding the penalty clause in particular, and, on the other hand, by the formulation of certain proposals de lege ferenda. By stipulating the penalty clause, the law seeks to execute the contractual obligations, and not to collect penalties. The legal base of the ancillary character of the penalty clause is article 1538, paragraph 3 of the Civil Code.