UAE Force Majeure: Save Your Contracts from Pandemics, Wars & Disasters

In an increasingly volatile global environment, the concept of force majeure in the UAE has become a critical legal safeguard for businesses operating in the UAE. From pandemics and geopolitical conflicts to natural disasters, unforeseen events can disrupt contractual performance in ways that require clear legal interpretation. Under UAE law, force majeure is not merely a contractual concept but a statutory principle embedded within the Civil Transactions Law, offering defined pathways for relief when obligations become impossible to perform.

Legal Foundation of Force Majeure in UAE Law

Force majeure is primarily governed by Articles 273 and 287 of Federal Law No. 5 of 1985, which remains applicable until the introduction of the updated Civil Transactions Law in June 2026. These provisions establish that a party may be excused from performing contractual obligations where an exceptional event renders performance objectively impossible.

This statutory framework distinguishes UAE law from common law jurisdictions, where force majeure is typically dependent on contractual wording rather than codified legal principles.

Key Criteria for Invoking Force Majeure

To successfully rely on force majeure, specific legal thresholds must be met. The event must have been unforeseeable at the time the contract was formed, unavoidable despite reasonable mitigation efforts, and must result in actual impossibility of performance rather than mere difficulty or increased cost.

The burden of proof rests on the party invoking force majeure, requiring clear and substantiated evidence demonstrating that all conditions have been satisfied.

Impact on Contractual Obligations

Article 273 outlines the legal consequences depending on the nature and extent of the impossibility. In cases of total impossibility within bilateral contracts, the contract is automatically rescinded, and obligations are extinguished. Where impossibility is partial, only the affected portion of the contract is terminated.

In situations of temporary impossibility, particularly in ongoing contracts, obligations may be suspended for the duration of the event. If the disruption persists, the affected party may seek rescission, provided proper notice is given.

Exemption from Liability for Damages

Article 287 provides that a party will not be held liable for damages arising from events beyond its control, such as natural disasters or external crises. This protection reinforces the principle that liability should not arise where performance is prevented by circumstances outside the parties’ influence.

However, this exemption is contingent on meeting the strict criteria for force majeure and does not apply where negligence or lack of mitigation is established.

Distinction from the Hardship Doctrine

It is essential to distinguish force majeure from the hardship doctrine under Article 249. While force majeure applies where performance becomes impossible, hardship addresses situations where performance remains possible but becomes excessively onerous.

In such cases, UAE courts may intervene to adjust contractual terms to restore balance rather than terminate the agreement entirely. This distinction is critical in determining the appropriate legal strategy.

Good Faith, Notification, and Mitigation

UAE law imposes a duty of good faith under Article 246, requiring parties to act reasonably and responsibly when invoking force majeure. This includes providing prompt notification to the counterparty and taking all reasonable steps to mitigate the impact of the disruptive event.

Failure to comply with these obligations may weaken or invalidate a force majeure claim, even where the underlying event qualifies.

Practical Considerations for Contract Drafting

While force majeure is recognised by statute, carefully drafted contractual clauses remain essential. Businesses are advised to include detailed provisions specifying qualifying events, notification procedures, and the consequences of disruption.

In sectors such as construction and real estate, additional provisions under Articles 893 and 894 may apply, particularly in relation to partial completion and payment entitlements. Tailored drafting ensures alignment with both statutory protections and commercial realities.

Looking Ahead: New Civil Transactions Law

The introduction of Federal Decree-Law No. 25 of 2025, effective from June 2026, is expected to refine aspects of the existing framework. Businesses should monitor these developments closely and review their contractual arrangements to ensure continued compliance and protection under the updated legal regime.

Conclusion

Force majeure under UAE law provides a robust mechanism for addressing unforeseen disruptions, but its application is subject to strict legal criteria and procedural requirements. Understanding the distinction between impossibility and hardship, complying with notification and mitigation obligations, and ensuring well-drafted contractual provisions are all essential to safeguarding business interests. In a rapidly changing global environment, proactive legal planning is the most effective defence against uncertainty.

For businesses seeking guidance, Al Kabban & Associates, with over 30 years of experience in UAE law and recognition by Legal 500, stands ready to help corporations build resilience against legal risks while ensuring compliance with local and international standards. For more information or to schedule a consultation, contact us at +971 4 453 9090 or visit www.alkabban.com. You can also follow us on social media for more updates on everything law related in the UAE: @Alkabban_Law

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