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“Force Majeure, Brief Considerations”

“Force Majeure, Brief Considerations”

  • Authorship HRA Advogados
  • Henrique Calvão Martins and Tiago Arouca Mendes

Some time has passed since the beginning of this millennium, when Elíso Macamo, a Sociology and African Studies Professor at the University of Basileia, drew attention to the vulnerability, in terms of Security, in northern Mozambique, especially in the Cabo Delgado Province – which had been noticing a radicalization of Islamic youths, dreaming of the Caliphate -, he pointed that, on the one hand, this problem was compounded by the distance of over 2,600 km, from the capital of this Province (Pemba) and the capital of the country (Maputo); whilst on the other hand, he insisted that this fact did not have to be a fatality, given the availability to help Mozambique offered by several foreign countries.

The sociologist Maria Isabel Casimiro, from Eduardo Mondlane University, shared the same view and made the same premonitory warning of Professor Macamo, insisting on the danger of the aforesaid radicalization.

The situation remained dormant until 2017, when Jihadists, linked to the Al-Shabbat group, attacked the military facility of Mocímboa da Praia and hoisted their flag there, after having committed carnage among the military and civilians. At that time, the Bishop of Pemba, D. Luis Lisboa, brought to attention the fact that there was a worrying silence, having tried to sensitize the Mozambican authorities and the International Community, to the danger that the population there was facing before so fearless and bloody attacks.

On the 24th of March, there was a massive attack in Palma, with high mortality and destruction, from a mere distance of 10 km of Afungi and of the site for the Exploration of Liquefied Gas in Northern Mozambique, a Mega project – the largest private investment in sub-Saharan Africa (more than 20 billion USD). This project, carried out by the Oil Company “Total”, had there about 3000 men and is deemed as a way forward for the development of Mozambique and it’s production phase was expected to start in 2024.

In view of this growing insecurity and proximity of real danger hanging around its facilities, after one week of the devastating attack, Total announced the suspension of the work (the progress of the Gas project in Afungi), invoking, as a cause, the situation of force majeure (“Force Majeure”). It’s important to note that Total´s spokeswoman (Anastasia Zhivulina) pointed out that “Suspending” … is not “abandoning” the Project: it will be resumed as soon as it is guaranteed a consolidated safety…

The importance of this mega-project is easily measured, considering that only the investment required for its implementation is higher than the gross domestic product of Mozambique (currently at 15 billion USD).

Thus, from this invocation of situation of force majeure under the contracts already concluded, it´s also easily attainable the size of the impact to the service providers/suppliers of products that embody most Mozambicans entrepreneurs involved, for now, in this industry (as conveyed by the CTA – Confederation of Economic Associations of Mozambique).

The force majeure figure is again catapulted into the limelight of formal and informal discussions (already fostered due to the effects of the Covid-19 pandemic), for what is now being analysed, in general terms, in which it translates into the Mozambican legal system.

First, the concept of “force majeure” does not exist as a legal institution in the Mozambican law (similar to Portuguese law or to the English law – noting that it exists in the French law); but this does not prevent the concept from being used in contractual practice, as the force majeure clauses are increasingly used in commercial contracts (with the International Chamber of Commerce in Paris to present one of, if not the more detailed formulation of the force majeure clause – ICC Force Majeure Clause 2020 -, in its “detailed” or “short version”, perhaps more suitable for the SMEs).

According to the prevailing doctrine, for the operationalization of this figure it is mandatory the verification of four requirements:  (i) the inevitable and insurmountable nature of the event; ( ii ) the unpredictability of the occurrence of the event at the time of the contract and in the circumstances in which it was entered into; ( iii ) exclusion of the event from the sphere of control of the party; ( iv ) impossibility, not impracticality or economic impossibility. This statement is important since everything should not be taken back to force majeure, as the law offers, in addition to the impossibility, several regimes that may be applicable (in situations where provision is possible although with disproportionate effort or costs for one or both parties): debtor’s delay, creditor’s delay, change of circumstances, wrongful default, non-blame default, abuse of right, disproportion between debtor’s costs and creditor’s benefit, among others.

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In this context, the events leading to force majeure, normally includes wars, tumults, industrial disputes, civil disturbances, fire, flooding, storms and other natural causes, epidemic / pandemic, any action or omission of the government or other competent authority, serious disruption of the activities or interruption of borders, flights, among others.

It is important to mention the that in the absence of a force majeure clause, the parties may use the subsidiary laws and regulations, deserving special mention the impossibility of fulfilment  regime (articles 790.º et seq. of Civil Code), whether temporary or definitive (with different consequences, of course) and the change of circumstances (articles 437.º et seq. of the Civil Code) – the last, as we have seen, still allowing, as a rule, the fulfilment of the obligation.

It should be noted that the consequences of the impossibility still depends on whether it is attributable to one of the parties, both or to neither of them, and the imputation criteria of the law are varied and the spheres of attribution of risks in a contract may not be equal for each of the parties.

As a summary, the goal was to have shown the importance of including and disentangle the range of a force majeure clause in a contract to be executed in Mozambique, to the extent that it is up to the parties to fill it (may be based on international examples, already mentioned); even that for certain contracts, are provided specific risk attribution rules, such as Article 1040.º of the Civil Code regarding the rental and leasing.

In case this is not particularly set out in the contractual document that binds the parties, the next steps will require a delicate exercise to frame the events in one of several identified regimes in order to define the distribution of that risk and to determine the respective consequences (to fulfil an obligation, indemnify, reduce the cost, among others).

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