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Office Memorandum on Force Majeure Clause (FMC) – April 2026

Force Majeure Clause Summary

Summary of Office Memorandum on Force Majeure Clause (FMC)

Key Points

  • Force Majeure Definition: Extraordinary events beyond human control (e.g., natural calamities, war, strikes) that prevent parties from fulfilling contractual obligations. It suspends, rather than entirely excuses, non-performance for the duration of the event.
  • Notice Requirement: The affected party must give notice within a reasonable time, ideally within 14 days of occurrence.
  • Contract Termination: If the FMC event delays performance for more than 90 days, either party can opt to terminate the contract without financial repercussion.
  • Penalty Exemption: Suppliers are not liable for punitive sanctions (e.g., Liquidated Damages) if the delay/failure is caused by a covered FMC event. Delivery or completion periods should be re-fixed without penalties.
  • West Asia Situation: The ongoing situation in West Asia is explicitly recognized as a "war" and a valid trigger for invoking the FMC if it disrupts contractual obligations.
  • Extension Period: For obligations due on or after February 28, 2026, an extension of 2 to 4 months may be granted without costs or penalties to the contractor. The exact extension is determined on a case-by-case basis.
  • Conditions for Invocation: Parties must not have been in default of their obligations as of February 27, 2026. The FMC only covers non-performances directly attributable to the West Asia situation. Contractual obligations will resume after the extension period ends.
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