Wars, natural disasters, sovereign decisions, and supply chain disruptions may prevent a contracting party from performing its obligations. This raises an important question: does the obligor remain liable for non-performance even where the cause is beyond its control, or may it invoke force majeure under Qatari law to be exempted from contractual liability?
The mere occurrence of an exceptional event is not sufficient for it to qualify as force majeure. Nor is it enough for contractual performance to become more expensive or difficult. The external cause must make performance genuinely impossible, the applicable legal conditions must be satisfied, and a direct causal link must be established between the event and the failure to perform the obligation.
Understanding the rules governing force majeure is particularly important for companies involved in supply, construction, transportation, infrastructure, and technology contracts, as these agreements may be affected by sudden events that disrupt the ability to perform.
What Is Force Majeure Under Qatari Law?
Force majeure is an exceptional event that occurs beyond the obligor’s control, could not reasonably have been foreseen or prevented, and makes performance of the contractual obligation impossible.
An event does not qualify as force majeure merely because it is described as such. Its legal classification depends on the nature of the event, the circumstances in which the contract was concluded, whether the event could have been anticipated, the measures that could have been taken to avoid or mitigate its effects, and the extent of its direct impact on the obligation in dispute.
The Qatari Court of Cassation has held that an event relied upon as force majeure, and as a basis for excluding liability, must be unforeseeable and unavoidable. In Civil Cassation Appeal No. 134 of 2015, the Court also confirmed that where the effects of an event could have been resisted through appropriate preventive measures, the event may not qualify as force majeure.
What Is the Legal Basis for Force Majeure in the Qatari Civil Code?
The Qatari Civil Code, promulgated by Law No. 22 of 2004, regulates the consequences of impossibility of performance caused by circumstances beyond a party’s control.
The principal provisions associated with force majeure are Articles 188, 256, and 258, together with Article 171, which addresses exceptional circumstances.
Article 188 and the Effect of Impossibility on the Contract
Article 188 governs the consequences of impossibility of performance in contracts binding on both parties, including sale, supply, construction, and lease agreements.
Where performance of one contracting party’s obligation becomes impossible due to a cause beyond that party’s control, the obligation is extinguished, the corresponding obligations are also extinguished, and the contract is automatically rescinded by operation of law.
Where impossibility is partial, the obligee may, depending on the circumstances of the contract, maintain the contract in respect of the part that remains capable of performance or seek rescission of the contract.
Although rescission may occur by operation of law once the relevant conditions are satisfied, court proceedings may still be necessary where the parties dispute the existence or scope of force majeure, its causal connection with non-performance, or the resulting financial consequences.
Article 256 and Exemption from Damages
Article 256 of the Qatari Civil Code provides that an obligor must compensate the obligee where the obligation is not performed in kind or performance is delayed, unless the obligor proves that the non-performance or delay was caused by circumstances beyond its control.
Accordingly, exemption from damages depends on proving both the external cause and the direct causal link between that cause and the non-performance or delay.
Article 258 and Contractual Allocation of Force Majeure Risk
Article 258 permits the parties to agree that the obligor will bear liability for force majeure or an unforeseen incident.
This means that the occurrence of an event satisfying the general conditions of force majeure is not, by itself, sufficient without reviewing the contract. The agreement may allocate risk differently or require one party to bear the consequences of events for which the law would otherwise exempt it from liability.
The force majeure clause, together with the liability, indemnity, and termination provisions, should therefore be reviewed before any legal action is taken or performance is suspended.
What Conditions Must Be Satisfied for an Event to Qualify as Force Majeure?
For an event to be legally recognised as force majeure, several interrelated conditions must be satisfied. Meeting only one of these conditions is not sufficient.
The Event Must Be Beyond the Obligor’s Control
The obligor must not have caused the event or contributed, through fault or negligence, to its occurrence or to the worsening of its effects.
A company cannot rely on force majeure where non-performance results from poor management, inadequate planning, failure to secure the necessary resources, or disregard of risks that were known when the contract was concluded.
The Event Must Have Been Unforeseeable
Foreseeability is assessed by reference to the circumstances existing at the time the contract was concluded.
Where a risk already existed, had been announced, or was customary in the relevant business sector when the contract was signed, it may be difficult to characterise it as unforeseeable, even if it later causes substantial losses or serious disruption to performance.
The assessment may also vary according to the nature of the business, the parties’ experience, the place and duration of performance, and the information available when the contract was entered into.
Read also: Sick Leave Salary in Qatar: How Is Salary Calculated Under the Labour Law?
The Event and Its Effects Must Have Been Unavoidable
The obligor must not have been reasonably able to prevent the event or overcome its effects using the means available.
If the obligation could still be performed legally and practically through an available alternative, the requirement of impossibility may not be satisfied.
Where the alternative is unrealistic, legally prohibited, or incapable of delivering the agreed subject matter of the obligation, the assessment will depend on the nature of the obligation, the contractual provisions, and the available evidence.
There Must Be a Direct Causal Link
The event must be the direct cause of the impossibility of performance.
It is not enough to establish that a war, closure, or natural disaster occurred. The party relying on force majeure must demonstrate exactly how that event affected the specific contractual obligation.
If non-performance would have occurred even without the exceptional event, or if it resulted from internal causes attributable to the obligor, force majeure will not provide an exemption from liability.
Performance Must Become Impossible, Not Merely More Expensive
Force majeure requires impossibility of performance, not merely an increase in cost or a reduction in the expected profit margin.
If performance remains possible but becomes excessively burdensome and exposes the obligor to a substantial loss, the case may fall within the doctrine of exceptional circumstances rather than force majeure.
The Difference Between Force Majeure and Exceptional Circumstances
Confusing force majeure with exceptional circumstances may lead a party to rely on the wrong legal basis, weakening its position in negotiations or before the courts.
Force Majeure
Under force majeure, performance of the obligation becomes impossible because of a cause beyond the obligor’s control.
Total impossibility may extinguish the obligation and result in rescission of the contract, while partial impossibility gives rise to the options available to the obligee under Article 188 of the Qatari Civil Code.
Exceptional Circumstances
Article 171 of the Qatari Civil Code governs exceptional circumstances. It applies where exceptional events of a public nature, which could not reasonably have been foreseen, occur after the contract is concluded.
Performance remains possible, but becomes excessively onerous for the obligor and threatens it with substantial loss.
In that situation, the contract is not automatically rescinded. After balancing the interests of both parties, the court may reduce the onerous obligation to a reasonable level.
The key differences are as follows:
- Force majeure means that performance of the obligation has become impossible.
- Exceptional circumstances mean that performance remains possible but has become excessively onerous.
- Force majeure may extinguish the obligation or result in rescission of the contract.
- Exceptional circumstances allow judicial intervention to reduce the onerous obligation to a reasonable level.
Do Price Increases or Material Shortages Constitute Force Majeure?
An increase in the prices of raw materials, shipping costs, or labour does not automatically constitute force majeure because increased cost does not necessarily make performance impossible.
Likewise, insufficient liquidity, reduced profits, inaccurate pricing assumptions, or general business difficulties are not, by themselves, sufficient to exempt a party from contractual liability.
The outcome may differ where a material shortage results directly from a comprehensive ban, sovereign decision, or closure that prevents supply in a manner that could not reasonably have been anticipated or overcome, and where no practical and lawful alternatives are available to perform the obligation.
In every case, the nature of the event, the contractual wording, the available alternatives, and the causal connection between the event and the non-performance must be assessed.
Do Wars and Government Decisions Constitute Force Majeure?
Wars, government decisions, and the closure of ports or airspace may constitute force majeure, but they do not do so automatically.
The party relying on the event must prove that:
- The event was not reasonably foreseeable when the contract was concluded.
- The event could not have been prevented or its effects overcome.
- The event directly made performance of the obligation impossible.
- The obligor had not contractually agreed to bear the relevant risk.
- No practical and lawful alternative means of performing the contract was available.
If a war merely increases shipping costs, the conditions for force majeure may not be met.
By contrast, where a war results in a complete legal prohibition preventing the export or import of the agreed goods, a force majeure claim may be more likely to succeed, depending on the contractual wording and the facts of the case.
Can a Cyberattack Constitute Force Majeure?
In principle, a cyberattack may raise a force majeure issue, but it is not classified as force majeure merely because it is an electronic attack.
The scale and sophistication of the attack must be examined, together with whether it could reasonably have been anticipated or prevented, the level of cybersecurity measures adopted by the company, and whether any fault or negligence existed in protecting systems and data.
This is an application of the general force majeure conditions, not a rule that every cyber intrusion constitutes an external cause exempting a party from liability.
If the intrusion results from a clear failure to update systems or from inadequate protective measures, reliance on force majeure may be difficult.
However, where the attack is widespread and could not have been prevented despite appropriate cybersecurity measures, some elements of an external cause may be present. The final assessment will still depend on the facts and the contractual provisions.
Does a Supplier’s Failure Exempt the Company from Liability?
A supplier’s failure, by itself, is not sufficient to exempt a company from liability.
The company must prove that the cause of the supplier’s failure itself satisfied the force majeure conditions, directly made performance of the company’s obligation impossible, and that no alternative supplier was practically and legally available.
If another supplier could reasonably have been used, or an alternative supply method was available, it may be difficult to establish impossibility of performance.
The contract must also be reviewed to determine whether the party expressly assumed the risks associated with subcontractors, sub-suppliers, or supply chains.
What Is the Effect of Force Majeure on the Contract?
The effect of force majeure varies according to the scope of the impossibility, the nature of the obligation, and the contractual terms.
Total Impossibility
Where performance of an obligation becomes wholly impossible due to a cause beyond the obligor’s control, the obligation is extinguished.
In contracts binding on both parties, the corresponding obligation is also extinguished and the contract is automatically rescinded under Article 188.
Partial Impossibility
Where force majeure affects only part of the obligation, the obligee may maintain the contract in respect of the part that remains capable of performance or seek rescission.
The appropriate option depends on the circumstances of the contract, the significance of the impossible part, and the extent to which it affects the contract’s principal purpose.
Temporary Effect
Where the effect of the event is temporary, it should not automatically be assumed that the obligation is extinguished or that the contract is suspended.
The force majeure clause, the nature of the obligation, and the duration of the impossibility must be reviewed to determine whether performance is temporarily suspended, the performance period is extended, or either party acquires a right to terminate after a specified period.
Unaffected Obligations
The occurrence of force majeure does not necessarily suspend the entire contract.
Its effect is determined by the scope of the impossibility and the contractual provisions, while taking into account the options available to the obligee in cases of partial impossibility.
What Steps Should Be Taken When a Force Majeure Event Occurs?
A party intending to invoke force majeure should act promptly and in an organised manner rather than merely issuing a general statement that an exceptional event has occurred.
Review the Contract
The party should review the contractual definition of force majeure, the events included or excluded, notice deadlines, required supporting documents, the effect of the event on performance, and any suspension or termination periods.
It should also determine whether any clause requires one party to bear the risk of the event or the risks associated with suppliers, transportation, or government decisions.
Notify the Other Party in Writing
Written notice should be issued within the period specified in the contract and should include:
- A description of the event and the date on which it occurred.
- The obligation affected by the event.
- How the event affects performance.
- The expected duration of the impact, where this can reasonably be estimated.
- The measures taken to mitigate the damage.
- Any official documents or decisions supporting the notice.
- Periodic updates when circumstances change.
A delay in giving notice does not necessarily eliminate the right to rely on force majeure in every case. However, it may constitute a breach of the contractual notice requirements or weaken the party’s ability to prove its position.
Document the Event and Its Effects
The party should retain official decisions, correspondence, supplier reports, shipping records, technical reports, and evidence of attempts to identify alternatives.
It is not sufficient to document the occurrence of the event itself. The party must also document how the event directly affected performance of the obligation.
Take Reasonable Steps to Mitigate the Damage
Reasonable efforts should be made to reduce the impact of the event, such as seeking an alternative supplier, using a different transport route, or performing the unaffected part of the obligation, where this is possible and consistent with the contract.
Failure to take reasonable steps may cast doubt on whether the event and its effects were genuinely unavoidable.
The Importance of Drafting a Clear Force Majeure Clause
It is not advisable to rely solely on broad wording such as “wars, disasters, and any events beyond the parties’ control.”
Ambiguous drafting creates disputes over whether an event is covered, what procedures must be followed, and how the event affects the parties’ obligations.
A well-drafted force majeure clause should address the following:
- The definition of a force majeure event and the conditions it must satisfy.
- A non-exhaustive list of covered events.
- Events that are expressly excluded.
- The treatment of wars, civil unrest, government decisions, epidemics, and cyberattacks.
- The exclusion of ordinary commercial risks and mismanagement, where appropriate.
- The deadline and method for giving notice.
- The documents that must be provided.
- The affected party’s obligation to take reasonable mitigation measures.
- The effect of the event on performance deadlines.
- The treatment of payments during any suspension period.
- The period after which a continuing force majeure event gives rise to a termination right.
- The allocation of risks relating to subcontractors, suppliers, and transportation.
- The effect of partial or temporary impossibility.
- The governing law and the dispute resolution mechanism.
Precise drafting is particularly important in light of Article 258 of the Qatari Civil Code, which allows the parties to agree that the obligor will bear liability for force majeure or an unforeseen incident.
Read also: Is an Employee Entitled to Refuse Overtime Work? Legal Cases Under Labour Law
Frequently Asked Questions About Force Majeure Under Qatari Law
Does Force Majeure Automatically Rescind the Contract?
Where performance of one of the reciprocal obligations becomes wholly impossible due to a cause beyond the obligor’s control, Article 188 provides that the obligation is extinguished and the contract is automatically rescinded.
Court proceedings may nevertheless be required to resolve a dispute concerning whether the force majeure conditions were met, the scope of the event, or its legal and financial consequences.
Who Bears the Burden of Proving Force Majeure?
The party relying on an external cause bears the burden of proving the event, its unforeseeability and unavoidability, and its direct connection with the impossibility of performance.
General evidence that the event occurred is not sufficient. The evidence must connect the event to the specific obligation that could not be performed.
Is a Company’s Financial Crisis a Force Majeure Event?
A financial crisis or lack of liquidity does not ordinarily constitute force majeure.
Such circumstances are usually connected with the company’s financial position or internal management and do not necessarily make performance impossible due to an external cause.
Does an Increase in Performance Costs Exempt the Obligor from Liability?
Not automatically.
Increased costs may amount only to ordinary commercial difficulty. In specific cases, they may fall within the doctrine of exceptional circumstances where they make performance excessively onerous and threaten the obligor with substantial loss.
Force majeure, by contrast, requires performance to have become impossible.
May the Parties Agree on Specific Force Majeure Events?
Yes.
The events, procedures, and consequences should be defined precisely, while taking account of mandatory legal rules, the nature of the contract, and the allocation of risk between the parties.
Is Sending a Force Majeure Notice Sufficient to Exempt a Party from Liability?
No. Notice is an important procedural step, but it does not, by itself, establish that force majeure exists.
The party must still prove that the event satisfies the legal and contractual conditions, that it directly caused the impossibility of performance, that the contractual procedures were followed, and that reasonable mitigation measures were taken.
Conclusion
Force majeure under Qatari law is not an easy mechanism for escaping contractual obligations. It is a legal regime designed for situations in which performance becomes impossible due to a cause beyond the obligor’s control.
A successful force majeure claim depends on the nature of the event, the contractual wording, the causal link, the speed of notification, the quality of the supporting evidence, and the reasonable measures taken to reduce the event’s impact.
Force majeure clauses should therefore be reviewed before contracts are signed, with the relevant events, procedures, and consequences clearly defined, rather than waiting for a crisis to reveal that the agreement failed to address the issue adequately.
