The Chamber of Commerce of Ukraine, against the background of the introduction of restrictive measures and the announcement by the Cabinet of Ministers of Ukraine of quarantine at the national level, issued an explanation of what could be considered force majeure circumstances.
The Chamber of Commerce recalled that it does not provide a certificate of force majeure circumstances on the basis of general situations or on the basis of introduced/existing regimes. Thus, quarantine in itself cannot be recognized as force majeure.
However, quarantine can lead to specific restrictive measures and consequences that could lead to the inability to fulfill obligations.
A party that refers to force majeure should contact the Chamber of Commerce of the country (or another authorized body), where force majeure has arisen, with a request to receive the relevant document (certificate), and present it to the counterparty in accordance with the terms of the contract.
The list of extraordinary and inevitable circumstances that objectively make it impossible to fulfill the obligations stipulated by the terms of the contract (agreement) are listed in Art. 14 of the Law “On Chambers of Commerce and Industry in Ukraine”, and can also be determined by the parties under an agreement, contract, legislative, and/or other regulations that affected obligations in such a way that made it impossible to fulfill it within the prescribed time.
This means that in addition to the circumstances of a particular situation, the terms of the contract should be evaluated – a list of facts determined by the parties and the legal consequences of their occurrence.
The presence in the list of events such as “epidemic”, “emergency”, “restrictive actions of the authorities” strengthens the position, but the party must still prove that the coronavirus or measures to combat it are taken at a national level are force majeure.
A party that declares the occurrence of force majeure circumstances, to confirm it must provide documents that indicate:
– the extremeness of such circumstances;
– unpredictability of circumstances;
– a causal connection between a circumstance/event and the inability to fulfill their specific obligations.
Force majeure circumstances, in any case, will not be considered:
– financial and economic crisis;
– the growth of official and commercial exchange rates of currencies;
– non-compliance / violation of their obligations by the counterparty of the debtor;
– lack of goods needed to fulfill the obligation on the market;
– the lack of necessary funds by debtor.