Can a Force Majeure Clause Excuse Non-Performance Under Korean Law?

Short Answer

Potentially, yes. A force majeure clause may excuse, suspend, or delay contractual performance under Korean law, depending on the wording of the contract and the facts of the case.

However, force majeure is not automatically recognized simply because an unexpected event occurred. The affected party generally needs to show that the event was outside its control, not reasonably foreseeable, not reasonably avoidable, and actually prevented or seriously affected performance.

In practice, disputes often focus on causation, foreseeability, available alternatives, notice requirements, mitigation efforts, and evidence.

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What Is Force Majeure?

Force majeure generally refers to extraordinary events beyond a party’s reasonable control that prevent or substantially interfere with contractual performance.

Depending on the contract, force majeure events may include:

• Natural disasters
• War or armed conflict
• Government actions
• Export or import restrictions
• Pandemics
• Labor strikes
• Transportation disruptions
• Severe supply chain interruptions

However, increased costs, market changes, ordinary supplier delays, or general business difficulty do not automatically qualify as force majeure.

The contract wording and the actual effect on performance are critical.

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Key Issues When Invoking Force Majeure

Issue 1: Does the Contract Define Force Majeure?

The first question is what the contract actually says.

Some contracts list specific force majeure events. Others use broad language such as “events beyond a party’s reasonable control.”

The parties should consider whether the clause covers:

• Government restrictions
• Export or import bans
• Shortages of raw materials
• Supplier failures
• Transportation shutdowns
• Cyber incidents
• Pandemics or public health measures
• War, sanctions, or trade restrictions

It also matters whether the list is exhaustive or merely illustrative.

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Issue 2: Did the Event Actually Prevent Performance?

The existence of an external event is usually not enough.

The affected party must usually show that the event actually caused the failure to perform.

For example, the parties may dispute whether:

• Alternative suppliers were available
• Alternative shipping routes existed
• Partial performance remained possible
• Production could have continued at another facility
• The delay was caused by the event or by ordinary operational problems
• The event made performance impossible or merely more expensive

This causation issue is often central in force majeure disputes.

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Issue 3: Was the Event Foreseeable or Avoidable?

A party may have difficulty relying on force majeure if the risk was already known or reasonably foreseeable when the contract was signed.

For example, a war, strike, pandemic restriction, or supply shortage may not support a force majeure argument if it was already ongoing or reasonably predictable at the time of contracting.

The affected party may also need to show that the disruption could not reasonably be avoided or overcome through ordinary commercial measures.

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Issue 4: Were Notice Requirements Followed?

Many force majeure clauses require the affected party to give prompt written notice.

The clause may specify:

• When notice must be given
• How notice must be delivered
• What information must be included
• What supporting documents must be provided
• How often updates must be given

Failure to comply with notice requirements may weaken the force majeure claim, even if the underlying event was serious.

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Issue 5: Did the Party Mitigate the Impact?

The affected party should usually take reasonable steps to reduce the impact of the event.

This may include:

• Seeking alternative suppliers
• Using alternative transportation
• Allocating available inventory
• Attempting partial performance
• Adjusting production schedules
• Keeping the other party informed

A party that simply stops performing without exploring reasonable alternatives may face difficulty relying on force majeure.

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Issue 6: What Is the Legal Effect of Force Majeure?

A force majeure clause should clearly state what happens if the event applies.

Possible effects include:

• Temporary suspension of obligations
• Extension of delivery deadlines
• Excuse from liability for delay
• Allocation of additional costs
• Right to terminate if the event continues for a specified period
• Obligation to resume performance after the event ends

Without clear effect provisions, the parties may disagree over whether force majeure excuses performance entirely, only delays performance, or merely reduces damages exposure.

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What If the Contract Has No Force Majeure Clause?

If the contract has no force majeure clause, the affected party may still argue under general Korean law that it should not be liable because the non-performance occurred without its fault.

However, this argument is usually fact-intensive and may be difficult to prove.

The affected party should be prepared to show that the event was outside its control, unforeseeable, unavoidable, and the actual cause of non-performance.

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Common Force Majeure Disputes

Cross-border contract disputes commonly involve questions such as:

• Does increased cost qualify as force majeure?
• Does supplier failure excuse the seller’s delay?
• Does a government restriction make performance impossible?
• Was the event already foreseeable when the contract was signed?
• Were alternative suppliers or shipping routes available?
• Was notice given in time?
• Can the contract be terminated after prolonged disruption?

These disputes often depend more on evidence and contract wording than on the mere existence of the external event.

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Practical Drafting Tips

Foreign companies contracting with Korean businesses should consider whether the force majeure clause clearly addresses:

• Covered events
• Whether the list is exhaustive or illustrative
• Notice requirements
• Required supporting documents
• Mitigation obligations
• Partial performance
• Extension of deadlines
• Allocation of additional costs
• Termination rights after prolonged force majeure
• Resumption of performance
• Evidence required to support the claim

A carefully drafted clause can reduce uncertainty when unexpected events disrupt an international transaction.

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Conclusion

A force majeure event does not automatically excuse non-performance under Korean law.

The outcome usually depends on the wording of the contract, the nature of the event, whether performance was actually prevented, whether the event was foreseeable or avoidable, whether notice was properly given, and whether the affected party took reasonable mitigation steps.

For foreign companies doing business in Korea, a force majeure clause should be drafted not only to list events, but also to explain how the parties must respond when those events occur.

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