CYIL vol. 15 (2024)

BÁRA MIKA 1. Introduction

The negative effect of unforeseen changes in external circumstances to a contract is a major risk inherent to any long-term contractual relationship. 2 Recently, several unprecedented disruptions occurred, 3 and the Czech economy, with more than 70 % of its gross domestic product linked to export, 4 is highly exposed to their influence. In this paper, two such effects will be considered, vis major and hardship. Term vis major will not be used and understood in this paper as a reference to any specific civil law doctrine (e.g., force majeure in French law) but rather as a type of occurrence, an event that makes the performance of a contract objectively impossible. 5 The hardship will be understood as a situation where the performance is possible but has become excessively onerous (or the counter-performance severely diminished in value) 6 to the extent that undermines the basic economy of the contract. While the end effect is different, the triggering event for both vis major and hardship is not attributable to the contract parties. It is an event that could not have been reasonably foreseen during the contract negotiation process and the aggrieved party did not have an obligation to prevent or overcome it. 7 Considered on a case-by-case basis, the same facts may constitute a vis major for one contract performance and hardship for another. As to the thresholds, requirements, and outcomes, there are several variations with countless minor deviations in how domestic doctrines deal with the impossibility or excessively onerous performance. 8 Since this text will ultimately consider the Czech exporter’s point of view, Czech private law and the CISG 9 will be analyzed in the first part of this paper, as the regulations most relevant for the Czech exporter. The second half of the paper will present an empirical study of the subject based on qualitative interviews with selected Czech exporters describing their recent experiences with vis major and hardship. 2 SCHWENZER, I. (2008) ‘Force majeure and hardship in international sales contracts’, Victoria University of Wellington Law Review , 39(4), p. 709, doi:10.26686/vuwlr.v39i4.5487. 3 Disruptors to international trade relevant to the CEE area between 2020 and 2023 include Covid-19 pandemic, the Russian war against Ukraine, steeply rising prices of energy or materials, and disruption of supply chains. 4 See Exportní strategie ČR 2023-2033 [Export strategy of the Czech Republic 2023-2033] (no date) Ministerstvo průmyslu a obchodu. Available at: https://www.mpo.cz/assets/cz/zahranicni-obchod/podpora-exportu/exportni strategie/2023/9/Exportni-strategie-2023-2033.pdf. 5 FIROOZMAND, M.R. and ZAMANI, J. (2017) ‘Force majeure in international contracts: Current trends and how International Arbitration Practice is responding’, Arbitration International , 33(3), p. 396, doi:10.1093/ arbint/aix021. 6 NWAFOR, N. and LLOYD, C. (2019) ‘Re-imagining the doctrines of hardship and exemption/force majeure under the CISG and UNIDROIT principles of international commercial contracts’, Global Journal of Comparative Law , 8(1), p. 54. doi:10.1163/2211906x-00801003. or URIBE, M., (2011) The effect of a change of circumstances on the binding force of contracts: Comparative perspectives . Cambridge: Intersentia Publ., p. 16. 7 SCHWENZER, I. (2008) ‘Force majeure and hardship in international sales contracts’, Victoria University of Wellington Law Review , 39(4), p. 714, doi:10.26686/vuwlr.v39i4.5487. 8 Ibid., p. 711, See also DIMATTEO, L.A. (2015) ‘Contractual excuse under the CISG: Impediment, hardship, and the excuse doctrines’, Pace International Law Review , 27(1), p. 259-260, doi:10.58948/2331-3536.1351. 9 In this text, abbreviation “CISG” means United Nations Convention on Contracts for the International Sale of Goods adopted in Vienna on 11 April 1980 (CISG).

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