On 30 January 2020, the World Health Organisation declared the coronavirus outbreak a public health emergency of international concern. We continue to see the ripple effects of the outbreak including business and operational disruptions impacting many of our clients.

Our recent alert discussing force majeure from a Hong Kong law perspective outlines how business operations may be impacted in performing contractual obligations as a result of business disruptions. The doctrine of force majeure is recognized under PRC law and is defined in the PRC Contract Law. This alert provides you with the PRC perspective when dealing with contracts governed by PRC law.

Force majeure under PRC law

Force majeure exists as a doctrine under Article 180 of the PRC General Rules on the Civil Law (中国《民法总则》 ) and Article 117 of the PRC Contract Law (中国《合同法》 ). It is defined as objective event or situation which is unforeseeable, unavoidable and insurmountable (不能预见、不能避 免、不能克服的客观情况(事件) ). Where contracts have no provision on force majeure, the doctrine applies automatically under PRC Contract Law. Where the contract has a specific provision on force majeure, the contract provision will apply to the extent it does not conflict or derogate from the general principles set out under PRC Contract Law.

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