Legal Implications of COVID-19: Force Majeure and Contractual Obligations in International Sale of Goods

Abstract

The year 2020 has been challenging for businesses worldwide with COVID-19 leading to the disruption of the global economy. The unprecedented circumstances led by this pandemic, inter alia, raise concerns pertinent to the liability for failure to fulfil contractual obligations in international commercial contracts due to COVID-19. United Nations Convention on Contracts for the International Sale of Goods (CISG or Vienna Convention) performs a significant role in the spectrum of international sales. Article 79 of the CISG reflects the legal concept of force majeure, which provides a defence for non-performance of contractual obligations in certain enumerated circumstances beyond the parties’ control. In this respect, the current research, through the doctrinal research methodology, reviews the application of force majeure to grant relief for non-performance of contractual obligations due to COVID-19 where a contract is governed by the CISG. The study concludes that COVID-19 is likely to be considered an impediment beyond the control of the parties under Article 79 of the CISG even though the likelihood of successful invocation of the article will vary depending on the circumstances of each case.