The penalty clause is an important mechanism in civil contracts to protect the rights and interests of the contracting parties if one of them fails to fulfil its obligations. In the Republic of Moldova, this provision is regulated by the Civil Code, which sets out the conditions and limits under which a penalty clause may be included in civil contracts. When a contract is concluded, it is uncertain whether one partner or the other will fulfil their contractual obligations properly. Sometimes a contracting party may not be able to perform its obligations, sometimes it may, in bad faith, try to delay performance as long as possible. For diligent creditors, the legislator has regulated several ways in which it is possible to guarantee the performance of obligations. By guaranteeing obligations, we mean all the legal means, i.e. the rights and actions recognised directly by law or arising from the agreement of the parties to the obligation, the exercise of which ensures the enforcement of the claim. A penalty clause is a contractual provision whereby the parties assess the loss in advance, stipulating that the debtor must pay the creditor a sum of money or other property in the event of non-performance of the obligation. The purpose of this article is to analyse the regulations on the penalty clause in the Civil Code of the Republic of Moldova, to highlight its importance in civil contracts and to examine the conditions under which it can be applied, as well as its limitations and legal effects. It will go on to provide details on the concept of a penalty clause, how it can be included in contracts, its limitations and legal effects in the Republic of Moldova, as well as examples of situations in which the penalty clause can be used to protect the interests of the contracting parties.