By Veronica Santa Cruz x CMBS Partners
Supply chains interrupted. Airspace closed. Insurance costs surging. Shipping routes cancelled.
The ongoing regional conflict in the Gulf has created a level of commercial disruption that very few businesses had planned for and many are now confronting a question they never expected to face:
Does what is happening qualify as a force majeure event under my contracts?
At CMBS Partners, we are advising clients across the UAE, Latin America, China, and Europe on exactly this issue. This article is a practical guide to help you understand your position and what to do next.
STEP ONE: CHECK YOUR CONTRACT NOT THE NEWS
Before you do anything else, the answer to whether you are protected lies in your contract not in the headlines.
Most national laws across the GCC and globally contain some provisions about the consequences of force majeure events, but you will rarely find a legal definition of what actually constitutes one. That definition almost always lives in your contract, and it varies.
Beyond the force majeure clause itself, look carefully for:
→ Extension clauses, which may allow you to prolong obligations under agreed conditions
→ MAC / MAE clauses: Material Adverse Change or Effect clauses, common in M&A and financing contracts, which may allow you to exit a contract
→ Suspension or hardship clauses which address unforeseen events and their consequences
→ Insurance contract references your contract may require you to consult specific policies
→ Silence if your contract contains no provisions for unforeseen events, speak to your legal counsel immediately
The governing law of your contract will then determine how these clauses are interpreted.
HOW THE MAJOR GOVERNING LAWS TREAT FORCE MAJEURE
English Law
Force majeure is not recognized implicitly under English law. It exists only if your contract expressly provides for it which makes the exact wording of your clause critical.
English courts will generally enforce contractual obligations even when performance becomes commercially difficult or uneconomic. If you wish to invoke force majeure, you must demonstrate that the triggering event specifically qualifies under your contract’s definition.
If your contract is silent, the common law doctrine of Frustration may apply but only in limited circumstances where performance has become truly impossible, not merely harder or more expensive.
French Law
French law offers two instruments for the current situation.
Article 1218 of the French Civil Code defines force majeure as an event beyond a party’s control, unforeseeable at the time of signing, and whose effects cannot be avoided by reasonable measures. If the impediment is temporary, the obligation is suspended. If permanent, the contract is automatically terminated.
Article 1195 goes further: if a change in circumstances makes performance excessively onerous, even if it doesn’t rise to force majeure the affected party may request renegotiation, while continuing to perform in the meantime. If renegotiation fails, a court may modify or terminate the contract.
If your contract is governed by French law, check whether any clause has lawfully modified Article 1218, and assess whether the current events make performance temporarily or permanently impossible.
German Law
German law does not define force majeure the term appears only sporadically in German statute. However, two provisions of the German Civil Code address the same concerns:
Article 275, Impossibility of performance: If a contractual obligation has become objectively impossible (no one could perform it) or subjectively impossible (only you cannot perform it, and insisting would be grossly disproportionate), the obligation may be extinguished.
Article 313, Cessation of the basis of the transaction: If the fundamental circumstances underlying your contract have changed so significantly that it would be unreasonable to hold a party to its original obligations, that party may demand modification or termination.
Both provisions require the triggering event to have been unforeseeable meaning they will not apply to obligations entered into after February 28, 2026.
UAE Law
The UAE presents a layered picture depending on where your entity is established.
On the mainland, Article 273 of the UAE Civil Code recognizes force majeure and allows for the extinguishing of obligations where performance becomes impossible. Article 249 also allows courts to reduce obligations that have become excessively onerous. A new Civil Transactions Law comes into force on June 1, 2026, largely maintaining the existing framework but obligations created after that date must account for the current situation as a known risk.
In the DIFC, force majeure is recognized under Section 82 of DIFC Law No. 6 of 2004, which sets out the conditions for excusing non-performance, addresses temporary impediments, and provides notification procedures.
In the ADGM, as a common law jurisdiction, the same rules as English law apply force majeure must be expressly provided for in your contract.
The CISG, UN Convention on the International Sale of Goods
If your cross-border delivery contract is governed by the law of a CISG contracting state such as Germany, France, or the US and you have not explicitly excluded the CISG, it may apply.
Note: In the GCC, only Bahrain is a contracting state. England is not. Most GCC contracts governed by English law are not subject to the CISG.
Under Article 79, the CISG introduces the concept of an “impediment beyond a party’s control” which must be unforeseeable, unavoidable, and impossible to overcome. This sets a high threshold. The current events may qualify, but each contract must be assessed individually.
Critically: Article 79 only limits the right to claim damages the other party retains all other remedies, including the right to declare the contract avoided.
THE MOST IMPORTANT DEADLINE YOU MAY HAVE MISSED
This applies across every governing law above:
For contracts signed after February 28, 2026, the current regional conflict is no longer considered unforeseeable.
This means that for any obligation you created after that date, the conditions required to invoke force majeure or equivalent protections under German, French, or UAE law are likely no longer met.
If you have entered into new contracts since late February without accounting for the current situation, speak to your legal counsel immediately.
WHAT TO DO RIGHT NOW, OUR RECOMMENDATIONS
1. List every contract that may be affected by the current disruptions supply, logistics, financing, M&A, service agreements.
2. Check the governing law and force majeure clause of each contract. Look for MAC, hardship, suspension, and extension clauses too.
3. Document everything government announcements, press releases, internal correspondence, disruption records. Keep documenting daily.
4. Negotiate first. You have likely built relationships with your suppliers and customers over years. Open dialogue is almost always more effective and less costly than a legal dispute. Both sides are affected. Agreements reached now protect long-term relationships.
5. Mitigate. Most force majeure regimes require you to demonstrate that you attempted to mitigate the impact of the event. Continue those efforts and document them.
6. Invoke force majeure properly only after negotiation has been exhausted or is not possible. Send the required notice in strict accordance with your contract and governing law. Involve your legal counsel before doing so.
HOW CMBS PARTNERS CAN HELP
CMBS Partners is a multilingual legal and tax advisory firm headquartered in the UAE, with offices in Latin America, China, and Europe. We advise businesses navigating complex, cross-border commercial environments including intimes of geopolitical disruption.
Our team is reviewing force majeure positions, contract exposure, and business continuity structures for clients across jurisdictions right now.
If you need clarity on where your contracts stand, we are here: info@cmbs-partners.com