China: Companies use 'force majeure' as defence amid coronavirus outbreak

Amid constant efforts of Chinese government to curb dely coronavirus outbreak, multiple companies tring in Chinese market have increased use of legal defence Force Majeure.  death toll in China continues to rise with international media reporting that re are nearly 43,090 infected and 1,016 de due to infection in China as for Tuesday morning. 

Force Majeure is used to refer to external circumstances that prevent a party to a contract from meeting ir obligations. According to international media, experts have claimed that coronavirus likely qualifies for Force Majeure but a company invoking clause is bound to show that it is impossible for m to perform ir contractual duties amid viral outbreak. 

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French Oil Company rejected defence

On February 6, China’s largest importer of Liquefied Natural Gas, LNG China National Offshore Oil Corp (COC), invoked force majeure to suspend contracts with last three suppliers, international media citing a source reported. After a day following anuncement, French oil major Total anunced that it has rejected application of Force Majeure from a major Chinese LNG buyer. Last week, international media reported that a copper smelter in southwest China has also declared Force Majeure on deliveries of copper concentrate.

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On Jan 31, a Chinese international tre promotion ncy said it would offer Force Majeure certificates to companies struggling to cope with impact of coronavirus on ir business with overseas partners. It neir identify any of companies which were affected r disclosed wher it h received any requests or t.  

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