Dear WIL UAE Community,
The past week has brought unprecedented uncertainty to our region. As legal professionals, our community members have been fielding urgent questions from clients, employers, and colleagues about contractual obligations, performance obligations, and legal exposure — often in real time, and often without the luxury of careful deliberation.
This morning, we convened an emergency legal webinar on Force Majeure , drawing on the expertise of Stephenson Harwood LLP’s managing partner, Rania Tadros, with 13 years of UAE legal experience. The session covered the key doctrines, the applicable statutory provisions, and the practical steps you and your clients should be taking right now.
This newsletter distils the essential insights from that session. As always, nothing here constitutes legal advice, but we hope it gives you a solid foundation to navigate the weeks ahead with clarity and confidence.
Laura Reynaud | Founder, Women in Law UAE
WHAT IS FORCE MAJEURE — AND WHAT IT IS NOT
Force majeure is, at its core, a risk allocation tool. It addresses the question every contract must answer: when something unexpected happens, and someone suffers loss, who bears that cost?
At law, a force majeure event is an extraordinary event or circumstance beyond a party’s control that prevents contractual performance. War and natural disasters are the classic examples. What matters — and what the briefing made clear — is that force majeure is not a blanket excuse for non-performance. The threshold is high, and its misuse can expose companies to significant liability.
Key Principle Courts look retrospectively at how parties tried to perform. The more evidence you have of genuine efforts to fulfil your obligations, the stronger your position — whether you ultimately succeed or not. |
FORCE MAJEURE UNDER UAE LAW
The Statutory Framework
UAE law is unique in that force majeure is a recognized legal doctrine even in the absence of an express contractual provision. The UAE Civil Code contains several provisions that work together to protect parties affected by force majeure events.
Article 273 — Total, Partial, and Temporary Impossibility
This is the primary force majeure provision. In a bilateral contract, if force majeure arises that makes performance impossible, the corresponding obligation is extinguished, and the contract is automatically cancelled. It covers three distinct scenarios:
The keyword is impossible — not difficult, not expensive, not inconvenient. The test is genuinely high.
Article 287 — Extraneous Cause
This article provides that where loss arises from an extraneous cause — including natural disaster, unavoidable accident, or force majeure — in which the non-performing party played no part, that party shall not be bound to make good the loss. It operates as a liability shield, distinct from the contract cancellation mechanism in Article 273.
Article 249 — The Doctrine of Exceptional Circumstances
This provision is particularly significant in the current environment. Unlike Article 273, which deals with impossibility, Article 249 deals with obligations that have become onerous or burdensome — but not impossible — due to unforeseen exceptional events.
Where such circumstances arise, a court may intervene to rebalance the contract, reducing burdensome obligations to reasonable limits in the interests of justice. Notably, any agreement to contract out of Article 249 is void.
Practical Note on Article 249 This is not an automatic right to exit the contract — it is a basis for negotiation. In these early days of the crisis, counterparties are more likely to engage in good-faith discussions. Use Article 249 as a framework for that conversation rather than rushing to court. |
Key Requirements to Invoke Force Majeure Under UAE Law
FORCE MAJEURE UNDER ENGLISH LAW
English law takes a fundamentally different approach. There is no inherent doctrine of force majeure — if you want it, you must contract for it. The court’s starting point is the contract, and only the contract.
This means the drafting of your force majeure clause is not merely important — it is everything. Parties that have not reviewed their force majeure provisions since COVID-19 should do so now.
What to Look for in Your Clause
The triggering threshold matters enormously. Courts have interpreted different words to impose very different standards:
Beyond the trigger, your clause should address: which events are covered (and whether there is a catch-all provision), whether performance is suspended or terminated, specific notice requirements and timeframes, and the duration of the event before termination rights arise.
Common Drafting Gap Many force majeure clauses were reviewed and updated post-COVID, but focused on pandemic-specific language. War and acts of armed conflict should be expressly addressed — particularly the threshold of impact required (must the UAE itself be at war, or does an act of war affecting performance in the region suffice?). |
FRUSTRATION UNDER ENGLISH LAW
Where there is no force majeure clause — or where a clause does not cover the circumstances — English law offers a narrow safety valve: the doctrine of frustration.
Frustration applies where, after the contract is formed, an event occurs that: was not foreseeable at the time of contracting; is so fundamental as to strike at the root of the contract; is not the fault of either party; and renders further performance impossible, illegal, or radically different from what was contemplated.
The threshold is extremely high. Courts have declined to find frustration even where: aircrafts were grounded during a pandemic and standby letters of credit obligations became unworkable; and a major European agency could no longer practically occupy its leased London headquarters following Brexit.
However, contracts affected by war have historically been found to be frustrated — particularly where performance becomes illegal, or where the destruction of the subject matter makes the contract’s purpose impossible to achieve.
Frustration vs. Article 273
The briefing raised a thought-provoking parallel: is Article 273 of the UAE (automatic cancellation on impossibility) functionally similar to frustration? The key distinction is that frustration terminates only future obligations — rights and obligations that crystallized before the frustrating event remain enforceable. Article 249, with its rebalancing mechanism, has no equivalent in English common law.
CURRENT ISSUES: STRAIT OF HORMUZ, SHIPPING, AND CLOUD SERVICES
Shipping and Insurance Cancellations
A key question raised during the briefing concerned the cancellation of marine insurance for vessels transiting the Strait of Hormuz — and whether this could constitute a force majeure event or frustration.
The answer is nuanced. Ships are still transiting the Strait (42 vessels in the past eight days at the time of the briefing). It would therefore be difficult to argue absolute impossibility. However, arguments exist around: crew members who are unwilling or unable to undertake the voyage; the extraordinary cost and unavailability of insurance coverage; and the distinction between financial impossibility and physical impossibility.
Watch Point Contracts often have specific provisions for delay caused by force majeure. The question of whether a prolonged situation escalates from ‘force majeure delay’ to genuine impossibility — justifying termination — is one to monitor in real time. |
Technology and Cloud Services
Another question raised the scenario of AWS or similar cloud infrastructure being rendered inoperable due to regional hostilities. The analysis is not a blanket one. Companies and their counsel must ask: which specific services can no longer be provided, and is that impossibility genuine? Simply invoking force majeure across all obligations because cloud services are impacted is likely too broad and risks a successful challenge.
PRACTICAL GUIDANCE: WHAT TO DO RIGHT NOW
If You Are Considering Invoking Force Majeure
On Force Majeure Notices
Your notice should address, at a minimum, why the event was unforeseeable at the time of contracting; the steps taken to try to perform; why performance is now impossible or materially impacted; the causal link between the event and the non-performance; and a clear statement that the non-performance is not due to any fault of your own.
Most Common Mistake Conflating general operational disruption with force majeure. Just because the situation is difficult — even extremely difficult — does not mean a force majeure notice is warranted. The most common error is invoking force majeure for obligations that could still be performed, with some effort or cost. Courts have no sympathy for this, and it damages your credibility across all your other claims. |
A NOTE ON FREE ZONE ENTITIES
Several members asked about entities incorporated in the DIFC or ADGM. The critical point is that the applicable law is determined by your contract, not by your place of incorporation. A DIFC-registered company contracting under UAE law will be governed by the provisions of the UAE Civil Code discussed above. An onshore UAE company contracting under English law will be subject to the English law framework. Review your contract’s governing law clause — and if it is silent, seek advice.
Thank you, Rania, for your time, efforts, and support!
©2025-2026 Women in Law. All Rights Reserved.
Maintained by Onestop Website Solution