Force Majeure

Force Majeure is a common exemption clause in international trade contracts. It refers to objective circumstances that, after the contract is signed, are unforeseeable, unavoidable, and insurmountable by the parties (such as natural disasters, war, government bans, strikes, epidemics, etc.), causing one party to be unable to perform or fully perform its contractual obligations, and that party may be partially or fully exempted from liability. Use scenarios include: the seller cannot deliver on time because the factory is flooded, or the buyer cannot receive the goods due to a sudden import ban in its country. Notes: 1) Force majeure events must be explicitly listed or defined in the contract, otherwise disputes easily arise; 2) The affected party must promptly notify the other party and provide proof within a reasonable period (such as certificates issued by chambers of commerce or government agencies); 3) Force majeure clauses are usually different from 'Hardship', which allows renegotiation rather than direct exemption; 4) Force majeure does not apply to situations caused by a party's own fault or financial difficulties. The difference from 'Frustration' is that force majeure is a contractual exemption ground, while frustration is a legal principle with stricter application conditions. Foreign trade practitioners should ensure that the force majeure clause in the contract covers common risks and clearly specifies notification obligations and proof requirements.