The doctrine of force majeure, meaning “superior force,” refers to extraordinary events beyond the control of contracting parties that prevent the performance of contractual obligations. It functions as an exception to the fundamental principle of pacta sunt servanda, which requires agreements to be honored. In recent years, global disruptions such as the COVID19 pandemic and the ongoing Iran-US conflict have brought renewed attention to this doctrine. In regions like the United Arab Emirates (UAE) and the broader Gulf, where economies are deeply interconnected with global trade and energy markets, force majeure has become a crucial legal and commercial tool.

Concept and Application of Force Majeure

Force majeure is rooted in the idea that no party should be held liable for failure to perform when performance becomes objectively impossible due to circumstances beyond their control. It is not sufficient that performance becomes more difficult or expensive; the impossibility must be absolute.

For a successful invocation, courts generally require:

1. An external event beyond the parties’ control
2. Unforeseeability at the time of contract formation
3. Unavoidability despite reasonable efforts
4. A direct causal link between the event and non-performance

The doctrine may operate either through express contractual clauses or statutory provisions, depending on the legal system. In commercial practice, force majeure clauses often specify events such as wars, natural disasters, government actions, and pandemics. A key distinction must be drawn between force majeure and hardship. While force majeure results in termination or suspension of obligations due to impossibility, hardship arises where performance is still possible but excessively onerous. This distinction is particularly important in civil law jurisdictions like the UAE.

Legal Framework under UAE Law

The UAE adopts a codified approach under the Civil Transactions Law (Federal Law No. 5 of 1985), which clearly regulates the doctrine of force majeure.

1. Article 273 (soon to be repealed and replaced by Article 236 of Federal Law No. 25 of 2025)^[1] provides that if a force majeure event renders performance impossible, the obligation is extinguished and the contract is automatically terminated.^[2]
2. Article 287 exempts a party from liability for damages arising from such events, provided there is no fault or negligence.^[3]
3. Article 249 (as noted above this Civil Code will soon be replaced by Federal Law No. 25 of 2025 in particular Article 224 of Federal Law No. 25 of 2025). addresses exceptional circumstances (hardship), allowing courts to reduce or modify obligations where performance becomes excessively burdensome.^[4]

This framework reflects a structured legal approach:

• Impossibility leads to termination
• Hardship leads to judicial adjustment

UAE courts apply these provisions strictly, requiring clear evidence that the event directly caused the impossibility of performance.

Frustration of contracts: Frustration differs from force majeure, as it applies when performance becomes radically different from what was originally agreed, rather than impossible. It is a narrow doctrine requiring a high threshold, typically invoked when an external factor beyond the parties’ control undermines the contract’s purpose. In the UAE, Article 249 of the Civil Code (to be replaced by Article 224 of Federal Law No. 25 of 2025) addresses exceptional circumstances or hardship. When performance becomes excessively onerous due to unforeseeable events, courts may adjust obligations rather than terminate the contract. This is particularly relevant in real estate and lease agreements, where economic or market changes may make obligations burdensome without making them impossible.

Force Majeure in ADGM and DIFC

Within the UAE’s financial free zones, the application of force majeure differs significantly from the onshore legal framework.

In the Abu Dhabi Global Market (ADGM), Contracts are governed by English common law, so force majeure is not automatically recognized unless expressly included in the contract. Relief may only be sought under the doctrine of frustration, which applies when performance becomes radically impossible or fundamentally different from what was agreed. Minor inconvenience or financial difficulty is insufficient.

In contrast, the Dubai International Financial Centre (DIFC), Parties may rely on contractual force majeure clauses or invoke Article 82 of the DIFC Contract Law (Law No. 6 of 2004). Article 82 excuses non-performance caused by an impediment beyond the party’s control, which is unforeseeable and unavoidable, provided timely notice is given. Payment obligations are generally not excused unless expressly stated.^[5]

Current Scenario: Iran-US Conflict

The ongoing Iran-US conflict has significantly impacted the Middle East, particularly the Gulf region. One of the most critical consequences has been the disruption of trade routes such as the Strait of Hormuz, through which a substantial portion of global oil supply passes.

The conflict has resulted in:

1. Restrictions and risks in maritime shipping
2. Airspace closures affecting logistics and aviation
3. Attacks on infrastructure and energy facilities

These developments have led several Gulf countries to invoke force majeure in relation to oil and gas exports and other contractual obligations. The situation demonstrates how force majeure is increasingly used not only in private contracts but also in large-scale commercial and state-level transactions. Companies operating in the UAE have experienced both operational and legal challenges due to the ongoing conflict. From an operational perspective, businesses have faced:

1. Supply chain disruptions due to restricted shipping routes
2. Delays in construction and infrastructure projects
3. Increased transportation and insurance costs

1. Economically, sectors such as tourism, aviation, and retail have been affected by reduced activity and uncertainty. Businesses have reported slower growth, reduced consumer demand, and rising operational expenses.  From a legal perspective, invoking force majeure has proven challenging. UAE courts require strict proof of impossibility, and claims based solely on financial loss or inconvenience are generally rejected. This has led to:

1. Increased contractual disputes
2. Greater reliance on renegotiation and arbitration
3. A shift toward more detailed and carefully drafted force majeure clauses

Companies are now proactively including explicit references to war, geopolitical risks, and supply disruptions. They focus on strengthening notice and mitigation provisions. They diversify supply chains to reduce dependency on high-risk routes^[6]

Application in Real Estate and Lease Agreements

In UAE real estate and lease contracts, force majeure allows parties to:

1. Suspend obligations temporarily if performance is delayed.
2. Terminate the contract if performance becomes impossible.
3. Renegotiate terms if the situation makes obligations too difficult.

Courts and contracts look at the specific wording of the force majeure clause to decide the remedy.

Conclusion

Force majeure continues to play a vital role in modern contract law, particularly in times of geopolitical instability. Under UAE law, the doctrine is clearly defined and strictly applied, ensuring that relief is granted only in cases of genuine impossibility. The ongoing Iran-US conflict highlights the evolving relevance of force majeure in both legal and economic contexts. For companies in the UAE and the broader Gulf region, it underscores the importance of precise contractual drafting, proactive risk management, and adaptability in an uncertain global environment.

References

[1] Federal Decree-Law No. 25 of 2025 (UAE Civil Transactions Law, effective June 2026).

[2] UAE Civil Transactions Law, Federal Law No. 5 of 1985, art. 273.

[3] UAE Civil Transactions Law, art. 287.

[4] UAE Civil Transactions Law, art. 249.

[5] DIFC Contract Law (Law No. 6 of 2004), Art. 82; DIFC Courts Judgment CFI‑092/2024.

[6] Reuters, “Coalition discusses securing Strait of Hormuz amid Iran tensions,” 2 April 2026. Reuters, “Shipping disruptions rise as Hormuz tensions escalate,” March 2026

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