Force Majeure

Force majeure is a legal term used in contracts to release the parties from their performance obligations if unforeseeable, extraordinary events make it impossible or excessively difficult to fulfill the contract. Force majeure clauses are common in many areas of commercial law, including in the IT and media industry.

Legal basis:

1. freedom of contract: Force majeure clauses are subject to freedom of contract. The parties are free to agree the scope and legal consequences of force majeure. 2. SECTION 275 BGB: German law does not directly recognize the concept of force majeure. However, similar legal consequences arise from § 275 BGB (impossibility of performance). 3 UN Convention on Contracts for the International Sale of Goods (CISG): In the international sale of goods law, force majeure is regulated in Art. 79 CISG. 4. supreme court case law: The courts have specified the requirements and legal consequences of force majeure events in various decisions.

Typical force majeure events:

1. natural disasters such as floods, earthquakes, hurricanes, etc. 2. wars, civil wars, terrorist attacks 3. strikes and lockouts 4. embargoes and trade restrictions 5. pandemics and epidemics 6. official orders and bans

Legal consequences:

1. suspension: The affected party is released from its performance obligations for the duration of the force majeure event. 2. right of termination: It is often agreed that the parties can terminate the contract if the force majeure event lasts longer than a certain period of time. (3) Duty to inform: The affected party must inform the other party immediately of the force majeure event and its effects. 4. compensation for damages: As a rule, liability for damages caused by force majeure is excluded.

Design aspects:

(1) Definition: The concept of force majeure should be clearly defined, either by a general description or by a list of specific events. 2. delimitation: It should be made clear that only external, unforeseeable and unavoidable events constitute force majeure. 3. legal consequences: The legal consequences (suspension, right of termination, duty to inform, etc.) should be precisely regulated. 4. mitigation obligation: It can be agreed that the affected party must make all reasonable efforts to minimize the effects of the force majeure event. 5. burden of proof: It should be stipulated that the party invoking force majeure bears the burden of proof for the existence of the conditions.

Special features in the IT and media industry:

1. data loss and cybercrime: It is controversial whether data loss due to hacker attacks or malware can constitute force majeure. 2. cloud services: In the case of cloud services, the question arises as to whether outages due to problems in the provider’s infrastructure can be force majeure. 3. pandemics: The COVID-19 pandemic has shown how important force majeure clauses can be in the industry, e.g. when events are canceled or production is delayed. 4 Creative services: In the case of creative services (e.g. software development, media production), the delimitation of force majeure can be difficult, as many risks are within the control of the parties.

Strategic considerations:

1. risk management: force majeure clauses should be part of a comprehensive risk management system. Companies should analyze the specific risks of their industry and business activities and address them accordingly. 2. insurance: Companies should consider whether and to what extent force majeure risks are insurable (e.g. business interruption insurance). 3. business continuity management: companies should develop plans on how to maintain or quickly resume business operations in the event of force majeure events 4. supply chains: When drafting supply contracts, companies should ensure that force majeure clauses are consistent and that risks are appropriately allocated. 5. bargaining power: The ability to enforce favorable force majeure clauses often depends on the relative bargaining power of the parties.

Conclusion:

Force majeure clauses are an important risk management tool in the IT and media industry. They allow the parties to protect themselves against unforeseeable, external events that make it impossible or excessively difficult to fulfill the contract. However, they also harbor risks, especially if they are unclear or unilaterally onerous. When drafting force majeure clauses, careful consideration of the interests of both parties and precise contract wording are required. Companies should also proactively manage risks and develop plans for dealing with force majeure events. Overall, force majeure clauses remain an indispensable element of contract drafting in the IT and media industry. However, their effective use requires a deep understanding of the specific risks and a forward-looking, strategic approach.