Reed Smith Client Alerts

The health crisis caused by the Covid-19 pandemic has had an immediate impact on companies’ contractual relationships, raising concerns about both the continuation of ongoing contractual relationships and the consequences of performance difficulties. In this uncertain economic landscape, unprecedented derogatory legal regimes have been adopted in order to adjust the application of certain rules during the current crisis.

Authors: Daniel Kadar Stéphanie Abdesselam

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Many questions will also be raised at the end of the legal “health emergency” period declared by the French government. What contractual management approach should be adopted now that we can measure the impact of the health crisis on contractual relations?

The document prepared by our team lists a few points of interest, as the current period is offering opportunities in that respect.

Table of contents

Focus 1: Contractual implications due to the “legally protected” period in France

  • What is the purpose of the emergency measures adopted in France during the Covid-19 period?
  • What are the exceptions granted by these emergency provisions concerning the performance of the contract?
  • Are these measures extraterritorial and can they apply to international contracts?

Focus 2: Managing contractual performance difficulties due to the current health crisis

  • What are the legal mechanisms for a provider, distributor or supplier facing performance difficulties?
  • What remedies are available to a company facing the non-performance of its co-contractor?

Focus 3: Life after the legally protected period: opportunities for taking into account the impacts of the health crisis in contractual provisions

  • How to address contractual risks related to the health crisis in contract negotiations?
  • How to address risks of a possible future pandemic or a return of Covid-19?

Focus 4: Opportunities for supply diversification

  • Opportunities for diversifying suppliers in times of crisis or substituting a defaulting supplier without incurring liability?
  • Does a drop in orders create a risk of liability based on sudden termination of established business relationships?
Client Alert 2020-394