In the last few months, the Coronavirus (Covid 19) outbreak has adversely affected the health and lives of millions of Vietnamese people and billions of people all over the planet. The outbreak also hurts the commercial life of hundreds of thousands of Vietnamese companies. Inevitably, parties to commercial contracts will now have to consider whether they can be exempt from liabilities on the ground of force majeure if they cannot perform contracts due to Coronavirus outbreak.

In a series of articles, we will now discuss the force majeure regime under Vietnamese law and its connection with Coronavirus outbreak. The first article will address how a force majeure event is defined under Vietnamese law and whether the coronavirus outbreak could qualify as a force majeure event. This article is written by Nguyen Quang Vu and Tran Thuy Tien.

In summary,

• On its face, the definition of force majeure event under Vietnamese law contains three usual elements of a force majeure event which are objectivity, unforeseeability, and irresistibility. However, it is not clear if the coronavirus outbreak could satisfy all the elements of a force majeure event under the Civil Code 2015.

• In Vietnamese, “objectivity” (khách quan) means (1) something which cannot be controlled by people’s mind, or (2) something which is based on factual events. Accordingly, a self-induced event may still qualify as an event, which occurs in an objective manner.

• A force majeure event should be unforeseeable by the person affected by such an event (not by a “reasonable person” or “any person”). A force majeure event could be unforeseeable during the performance of the contract not just at the time of execution of the contract. It may not be necessary that all facts relating to a force majeure event need to be unforeseeable. Accordingly, parties to contracts signed after the outbreak may still be able to claim force majeure depending on the circumstances.

• Human contact and human interaction contribute greatly to the growth of the coronavirus outbreak. Therefore, if a company does not follow good prevention practices (e.g., social distancing, and remote working) then such company may be considered as not taking all possible necessary and capable measures to remedy the force majeure event.

• The Civil Code 2015 does not have a list of specific events that could be considered as force majeure events. However,  examples of force majeure events are provided in various legislations. And only a few definitions include pandemic or quarantine as a type of force majeure event.

  Please see the full article here: https://legalcentrix.com/media/view/148842