Coronavirus Is Force Majeure In Ukraine. How Is It Work In Ukraine?

Quarantine due to the spread of coronavirus has become an unpredictable reality for businesses in a time of constraint.

Does Ukraine consider quarantine the Covid-19 a force majeure?

- Yes, it admits. At the state level, amendments were made to part two of Article 14-1 of the Law of Ukraine “On Chambers of Commerce and Industry in Ukraine” (Verkhovna Rada of Ukraine (VRU), 1998, No. 13, Art. 52).

Can a business be automatically released from liability for quarantining in a case of force majeure?

- In accordance with international practice, force majeure, including quarantine, like coronavirus force majeure does not automatically discharge the liability. You need to understand how a particular circumstance, including quarantine, limits certain obligations.

Does quarantine justify the inability to pay under lease agreements due to the listing of force majeure?

- At the legislative level, the absence of money is not considered a force majeure, so the inability to pay cannot be attributed to force majeure unless there is evidence of technical limitations on payment.

- Attention! The Chamber of Commerce may consider statements of force majeure in the event that it is not possible to use the premises in connection with restrictions or prohibitions imposed on the government by entities in the relevant fields.

Is it possible to settle issues without penalty and be released from liability without obtaining a force majeure certificate?

-  Yes, it is possible - if the parties will amend the contract peacefully. We recommend that you apply the procedure for settling the parties to the contract by concluding appropriate amendments to the contract for the transfer of obligations, which in turn will automatically eliminate the breach of contractual obligations and will not require certification of force majeure (force majeure circumstances) - Chamber of Commerce of Ukraine or its authorized regional Chamber of Commerce and obtaining the relevant certificate of force majeure (circumstances not compelling the power), which is the basis for exemption from liability for failure (improper performance) of obligations for Ukraine.

Also, if the relevant legal acts provide for an exemption from liability or failure to charge sanction/penalties in the relevant area of activity, this will be considered as a norm of direct action that does not require further confirmation.

Can it be recognized as a force majeure suspension of the company in connection with the refusal of workers to go to work in the conditions of quarantine?

- No, in the absence of an order at the state level that obliges an enterprise to suspend its activities, including through mass layoffs, such a circumstance cannot be certified as force majeure.

-  Please note that due to the introduced quarantine, no normative legal act on the territory of Ukraine provides for the possibility of refusing to go to work without obtaining a leave of absence, sick leave, obtaining the consent of the management to work on a remote schedule without harming the work.

This shall be taken into account using International  Contracts with Ukrainian partners.

 

Support of contracts and transactions