Right now, many contractors across the Middle East are considering reliance on Force Majeure or Exceptional Event provisions because of the current conflict.

But here is an important point that is often misunderstood.

Events such as war, hostilities, invasion, or acts of foreign enemies do NOT automatically give rise to entitlement under construction contracts.

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Events Typically Covered by These Provisions

Many standard forms of construction contract, including FIDIC, contain provisions which may entitle the Contractor to an Extension of Time and Cost arising from events such as:

• War
• Hostilities (whether war be declared or not)
• Invasion
• Acts of foreign enemies

However, the existence of such events does not automatically create entitlement, and the contractual threshold is higher than many realise.

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Key Point

Under FIDIC contracts, entitlement arising from these events depends on whether the event actually prevents the Contractor from performing its contractual obligations.

In simple terms, the contractual test is prevention of performance, not merely disruption, delay or increased cost.

If the works can still be performed, even if more slowly, less efficiently or at greater cost, the contractual threshold for entitlement may not be met.

Contractors should therefore think carefully before relying on these provisions.

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Consider the Wider Legal Position

Where the contractual thresholds are not clearly satisfied, this does not necessarily mean that no entitlement may arise.

Depending on the governing law of the contract, other legal considerations or remedies may become relevant where external events materially affect contractual performance.

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Final Thoughts

The current conflict understandably creates uncertainty for contractors across the region. However, the existence of events such as war, hostilities, invasion or acts of foreign enemies does not, by itself, establish entitlement.

Under FIDIC contracts, the key issue is whether the relevant event actually prevents the Contractor from performing its contractual obligations, not merely whether the event makes performance more difficult.

Contractors should therefore:

1. Carefully review their contracts
2. Consider the actual impact of events on the performance of the works
3. Consider seeking legal advice where appropriate

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In many cases, it may be prudent to seek advice before relying on Force Majeure or Exceptional Event provisions, rather than addressing the issue only after a dispute has arisen.