The Chinese Government is issuing force majeure certificates to companies who are unable to satisfy the commercial terms under their contracts. The aim here is to attempt to protect those companies from breach of contract claims in light of the coronavirus outbreak.
Where do we contractually stand in the UK?
Will future travel restrictions or lockdowns driven by the coronavirus impact on your ability to perform your contracts or to require the other party to perform?
The intervention of the Chinese Government is welcome and appears to provide comfort to those parties affected, but under a contract governed by English law the party seeking to exclude or limit its obligations under the contract will need to rely on the contractual terms agreed with its counterparties. These usually take the form of exclusion clauses and force majeure clauses.
What is force majeure?
The concept of force majeure does not exist in English law, the term “force majeure” is derived from French law.
A force majeure clause will usually provide details as to what happens if certain unforeseen events arise, which impact on a contractual party and which events were beyond the control of the party relying on the clause.