RSM India

Note on Force Majeure in Times of Covid-19

In present circumstances, given the various disruptions in the business and economic infrastructure caused by the COVID-19 pandemic, where contractual obligations of parties to an agreement may be disrupted, delayed, or even outright terminated (as may be provided in the respective agreements), it is essential to have a look at the ‘Force Majeure’ clause.

A ‘force majeure’ event generally covers all situations beyond reasonable control of the parties, such as acts of God, war, act of terrorism, strikes, lockouts, blockade, riots, floods, natural calamities, Acts of public enemies, fires, epidemics, pandemics, typhoons, earthquakes, or volcanic eruptions, etc. The contracting parties may agree on such additional circumstances which may be covered by the ‘force majeure’ clause, depending on the industry or business circumstances covered by the agreement.

In the note covering “Force Majeure”, we have endeavoured to cover the following significant aspects for your ready reference:

  • What is ‘Force Majeure’ clause?
  • Legal basis for the ‘Force Majeure’ clause 
  • Invoking the clause and duties of the parties 
  • Remedies that may be obtained under a force majeure clause
  • Actions that may be taken in the wake of the Covid-19 pandemic

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