Force Majeure and COVID-19
The term ‘force majeure’ is defined broadly in the Thai Civil and Commercial Code as an event that is unforeseeable, unpreventable, and unavoidable for an affected party, but no list of such events is provided.
Keywords: Mazars, Thailand, Legal, Force Majeure, COVID-19, Civil and Commercial Code, Law
Updated: 10 June 2021
Based on this definition, when determining whether a natural disaster (such as a tsunami, pandemic, or flood) and other uncontrollable events (such as a war, strike, or riot), constitute events of force majeure, events should be analysed on a case-by-case basis, while also taking Supreme Court precedent into account.
In Thailand, force majeure can be invoked to relieve or discharge a party from its contractual obligations and liabilities, regardless of whether the contract contains a force majeure clause. However, due to the broad definition of force majeure, the party invoking this as an excuse for failing to perform may have to deal with the uncertainty of how it will be interpreted by the Thai courts.
As the COVID-19 outbreak has now lasted for over a year, and it is impossible to predict when the situation will end, it could be inferred that the COVID-19 outbreak is considered an event of force majeure. For instance, the Ministry of Labour has announced that COVID-19 is considered an event of force majeure under the Social Security Act, so that an employer does not have to pay wages to an employee, and the employee can receive unemployment benefits from the Social Security Office. In addition to the COVID-19 outbreak being considered an event of force majeure in certain laws and ministerial regulations, in current commercial contracts, the COVID-19 outbreak is included in a force majeure clause.
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