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What effect does the corona virus have on deliveries to the USA
H. Roske & Associates LLP, March 23rd, 2020.
Deliveries from the DACH region to the USA are usually based on a contract or general terms and conditions combined with Order & Acceptance. If something unforeseen happens afterwards, the question arises what will happen to the order. There are two obligations, i.e. delivery of goods and payment. There is no precedent for Covid 19, but it is likely that its rapid expansion and the associated consequences will be considered 'unforeseen'.
If the contractual agreement of the parties follows the international standard and applies a common law -- UK or a US state -- then there is usually a force majeure clause combined with a so-called The-Deal-is-The-Deal clause (... "this agreement shall constitute the entire agreement......."). In this case only the force majeure provision applies. If it is applied, the parties are released from their obligations.
If US law is applicable, but there is no force majeure clause, the Uniform Commercial Code (UCC) is available to the parties with the same effect, as a kind of gap filler. This is one of the rare examples where the Americans agreed upon a codified law, as in the old world e.g. the HGB. All 50 states have now ratified the UCC.
Force majeure must be invoked. A written notice to the trading partner is therefore necessary.
If the contractual agreement of the parties follows the international standard and applies a common law -- UK or a US state -- then there is usually a force majeure clause combined with a so-called The-Deal-is-The-Deal clause (... "this agreement shall constitute the entire agreement......."). In this case only the force majeure provision applies. If it is applied, the parties are released from their obligations.
If US law is applicable, but there is no force majeure clause, the Uniform Commercial Code (UCC) is available to the parties with the same effect, as a kind of gap filler. This is one of the rare examples where the Americans agreed upon a codified law, as in the old world e.g. the HGB. All 50 states have now ratified the UCC.
Force majeure must be invoked. A written notice to the trading partner is therefore necessary.