Hardship and Force Majeure in International Commercial Contracts - Institute Dossier XVII

No. E796E

ISBN : 978-92-842-0483-0

Force Majeure and Hardship are commonly invoked in international trade when unforeseen events occur making performance impossible or impracticable. Most national legislators provide rules to deal with these issues, but the specific solutions adopted in domestic laws vary substantially from one country to another.

In recent years the growing complexity of trade in a globalized world has greatly increased the number of situations where a party can invoke force majeure or hardship. Parties need to be able to analyse the nature and characteristics of force majeure and hardship and look for contractual clauses which can regulate these issues in conformity with their needs.

Written by international practitioners, this dossier explores the evolution of the rules on hardship, the ICC Clause on Hardship and the perspectives of contract adaptation by arbitrators. The section on Force Majeure includes an overview of recent arbitral case law (impediment beyond sphere of control and risk of the obligor; foreseeability; causation; notice requirement), analysis of the ICC 2003 Force Majeure Clause and an update on its revision. Two other important themes are included: the relationship between force majeure and applicable law, general principles of law and trade usages as well as the impact of economic sanctions.

Code ISBN : 978-92-842-0483-0
Language : English

Foreword by Yves Derains... 5

Introduction by Fabio Bortolotti and Dorothy Ufot, SAN... 8


1.     The Evolution of the Rules on Hardship by Marcel Fontaine... 11

Introduction... 11

The 1976 Study on Hardship Clauses... 12

Hardship Regulated... 14

The ICC Clause on Hardship... 33

Conclusion... 35

Notes... 37

2.     Adaptation of Contracts by Arbitrators by Pascale Accaoui Lorfing... 41

Introduction... 41

The reality of contract adaptation by arbitrators... 42

The perspectives of contract adaptation by arbitrators... 54

Conclusion... 71

Notes.... 72

3.     Rules on Force Majeure as Illustrated in Recent Case Law by Christoph Brunner... 82

Introduction... 82

The force majeure excuse as a general principle of law... 84

Salient features of the force majeure excuse as illustrated by recent case law... 86

Conclusion... 107

Notes... 107

4.     Analysing the ICC Force Majeure Clause 2003 by Prof Filip De Ly... 113

Introduction... 113

The ICC Force Majeure Clause 2003... 114

Conclusion... 121

Notes... 121

5.     Revision of the ICC Force Majeure and Hardship Clause by Prof Dr H. Ercüment Erdem... 123

Introduction... 123

New FM Clause... 123

New Hardship Clause... 127

Conclusion and Next Steps... 129

6.     Force Majeure Clauses and their Relationship with the Applicable Law, General Principles of Law and Trade Usages by Klaus Peter Berger... 137

Introduction... 137

ICC Award No. 4462 (National Oil Corporation v Libyan Sun Oil Company)... 138

ICC Award No. 19299 (Gujarat State Petroleum Corp. et al v Republic of Yemen et al)... 143

ICC Award No. 8873 (French claimant v Spanish respondent)... 147

Conclusion... 154

Notes... 155

7.     Economic Sanctions, Force Majeure and Hardship by Dr Mercédeh Azeredo da Silveira... 161

Introduction... 161

Characterisation of Economic Sanctions from a Private Law Perspective... 162

Application of Economic Sanctions by Domestic Courts and Arbitral Tribunals... 165

Effects of Economic Sanctions on the Rights and Obligations of Private Operators under International Law Instruments... 171

Concluding Remarks... 187

Notes... 188

Conclusion... 212

About the Authors... 213

About the Editors... 217

Index... 219

Cases... 221

ICC Dispute Resolution Publications... 228

Pascale Accaoui Lorfing

Mercédeh Azeredo da Silveira

Klaus Peter Berger, LL.M.

Christoph Brunner

Filip De Ly Prof

Dr H. Ercüment Erdem

Marcel Fontaine

Fabio Bortolotti

Dorothy Ufot, SAN

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