Vietnam Business Law

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Can force majeure events be agreed in Vietnamese law contracts?

Article 161.1 of the Civil Code provides that an event of force majeure is an event which occurs in an objective manner which cannot be foreseen and which cannot be remedied by all possible necessary and admissible measures being taken. It is common that parties to a contract agree in advance a list of force majeure events (such as natural disasters, war or epidemic) and the nature and characteristics of a force majeure event. However, there is a risk that these events are not considered as force majeure under Vietnamese law if the parties cannot prove that these events actually satisfy the conditions of Article 161.1 of the Civil Code.

One possibility to overcome this risk is to provide that to the extent a force majeure event agreed in a contract is not considered as force majeure events under Article 161.1 of the Civil Code, such force majeure event will constitute an exemption event provided in Article 294.1(a) of the Commercial Law. This is because Article 294.1(a) of the Commercial Law allows the parties to a commercial contract to agree on exemption events the occurrence of which will exempt the affected party from liability under the contract.. 

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