The government has permitted contractors to use ‘Force Majeure’ due to the evolving situation in West Asia, recognizing “war” as a valid trigger under procurement rules. Contractors impacted by disruptions in West Asia can now seek relief as the Ministry of Finance treats the prevailing conditions as a war-like event for contractual purposes.
Contracts with completion deadlines on or after February 28, 2026, affected by West Asia disruptions, may receive an extension of at least two months and up to four months without penalties or extra costs. The memorandum states that suppliers will not face sanctions for delays caused by events covered in the Force Majeure clause, despite punitive provisions in the contract.
The government emphasized that delays due to Force Majeure must be evaluated case by case, with entities required to adjust delivery or completion timelines without imposing liquidated damages. However, contractors can only invoke Force Majeure if they were not in default as of February 27, 2026, and if disruptions are directly related to the West Asia situation.
If Force Majeure conditions persist beyond 90 days, contracts can be terminated by either party without financial consequences. The ministry clarified that all contractual obligations will resume once the specified period ends. These measures align with the provisions in various procurement manuals, defining Force Majeure as unforeseeable events beyond human control, including war, strikes, riots, and natural disasters.
