Over 95% of applications for recognition of force majeure under Russian contracts were rejected

The head of the Russian Chamber of Commerce and Industry, Sergey Katyrin, noted that since the introduction of restrictions due to coronavirus, the flow of applications for conclusions confirming force majeure has grown sevenfold.

More than 95% of business requests for opinions on force majeure circumstances within Russian contracts are rejected due to inconsistency with force majeure. This was announced on Monday by TASS the head of the Chamber of Commerce and Industry (CCI) of Russia Sergey Katyrin.

In connection with the coronavirus pandemic, the territorial chambers of commerce and industry are involved in issuing opinions on force majeure circumstances under contracts between Russian business entities, as well as conducting consultations related to this free of charge.

"Our territorial chambers of commerce and industry are engaged in this work, we have several thousand appeals on this matter. But, I must say, somewhere more than 95% of appeals related to the issuance of relevant documents do not correspond to force majeure circumstances," Katyrin said .

Katyrin added, at the moment, the chambers in the regions of Russia issued "several dozen such documents [conclusions about force majeure circumstances]." He believes that the flow of applications will increase due to the extension of days off until the end of the month, which affects the operation of enterprises in the country.

As specified on the Moscow CCI website, in accordance with the law and the prevailing judicial practice, “entrepreneurial risks, in particular, the deterioration of the economic condition of an enterprise, the financial and economic crisis, change in the exchange rate, and the devaluation of the national currency, cannot be attributed to force majeure circumstances” . The site indicates that appeals with a link to such circumstances are common.

Appeals from foreign companies

Several foreign companies operating in Russia turned to the Chamber of Commerce and Industry of the Russian Federation to obtain conclusions on force majeure circumstances on foreign trade contracts due to the situation with the spread of coronavirus.

“I must say that we are contacted not only by Russian companies that are in a difficult situation with fulfilling their obligations, but also by a number of foreign ones. This applies to Italian, German, Turkish companies, as well as Lithuanian colleagues turned to us with the fact that they cannot fulfill of their obligations due to the restrictions that are introduced on the territory of the Russian Federation. Therefore, they apply for this kind of certificate [about force majeure], "Katyrin explained.

He noted that since the introduction of restrictions due to the coronavirus epidemic, the flow of applications for conclusions on the confirmation of force majeure has grown sevenfold. Over the past two weeks, chamber lawyers have issued 23 relevant opinions.

“In general, we can handle the flow of applications, the waiting time for applicants is no more than five to six days from the date of application. But such deadlines are set for complex contracts where lawyers need time to seriously work out,” Katyrin explained, adding that for others Applications are being reviewed faster. He believes that the flow of appeals "will continue to increase."

The Russian CCI is the only one in the country to issue opinions on force majeure circumstances under foreign trade contracts. As the force majeure circumstances of the CCI, the restrictive or other special measures taken by the government on the territory of Russia testify if the company operating in the Russian Federation cannot fulfill its contractual obligations to a foreign partner because of them.

Restrictive measures

Russian President Vladimir Putin previously ordered the extension of non-working days introduced from March 30 to April 30, but did not rule out a reduction in this period if the situation changes for the better. He explained that a long weekend would reduce the spread of coronavirus in the country. In most regions, the decrees of local authorities restricted or temporarily stopped the work of restaurants, cafes, bars, and non-food stores.

Source: https://tass.ru/