Contract under pressure: force majeure and hardship explained

A blocked shipping route, rising oil prices, or transport costs that suddenly skyrocket: these are no longer exceptions, but a reality that directly impacts your contracts. Two key concepts are central in this context: force majeure and hardship (imprévision). Stefanie Claeys and Larissa Blondeel explain what this means in practice: what is the difference between the two, and what should you pay attention to today when drafting your contracts and general terms and conditions?

The difference between force majeure and hardship

Force majeure and hardship are closely related concepts, yet they differ significantly in their legal scope. Both stem from unforeseen circumstances, but their outcomes are fundamentally different.

• Force majeure refers to a situation in which one of the parties is unable to perform its obligations. Think of a product that must be imported but is no longer available due to external circumstances. In such cases, the contract is suspended or terminated.
• Hardship (imprévision) arises when performance is still possible, but has become excessively burdensome or unfair. This does not end the contract but leads to its renegotiation.

Hardship explained: the impact of Book 5 of the Civil Code on your contracts

With the introduction of Book 5 of the Civil Code, the legislator has refined the law of obligations.

One of the most significant developments is the explicit recognition of the hardship doctrine in Article 5.74. For the first time, the law expressly acknowledges that a contract may become unbalanced due to circumstances that could not have been foreseen at the time it was concluded.

In practical terms, a party may request a renegotiation of the contract when five conditions are met:

1. performance has become excessively onerous
2. the circumstances were unforeseeable
3. the situation is not attributable to that party
4. the risk was not contractually assumed
5. the possibility of renegotiation has not been excluded

In other words, the contract remains enforceable, but its balance has been disrupted.

As Larissa Blondeel notes:
“Contracts are no longer assessed solely on what was agreed at the outset, but also in light of how reality evolves afterwards. In fast-moving markets, that is far from a luxury.”

Force majeure and hardship: termination or adjustment?

In practice, these concepts are often confused, even though they produce opposite effects. One puts an end to the contract, the other compels renegotiation. The distinction starts with a simple question: can the contract still be performed?

If the answer is no, force majeure comes into play. Performance has become objectively impossible due to an external, unforeseeable and non-attributable event. The debtor is then released from its obligations, and the contract is suspended or terminated, in principle without compensation.

If performance remains possible, but under conditions that disrupt the contractual balance, the situation falls within the realm of hardship. The obligations remain, but the context has fundamentally changed. The law then expects the parties to renegotiate in order to restore balance.

As Stefanie Claeys explains:
“The distinction may seem subtle, but in practice it is decisive. Force majeure releases you from your obligations. Hardship binds you to them, while opening the door to renegotiation.”

When the situation stalls: a practical example

Imagine you are a real estate developer and conclude a contract with a contractor for the construction of a residential project, based on the energy and transport costs at that time.

A few months later, a conflict in the Middle East escalates and the Strait of Hormuz is blocked. Fuel prices surge, transport costs rise sharply, and expenses increase significantly. The works can continue, but at a cost that completely disrupts the contractual balance.

This is not force majeure, as performance remains possible. It is hardship: the contract shifts from workable to excessively burdensome.

The situation differs if delivery becomes impossible. If prefabricated concrete elements can no longer reach the site due to a complete blockade, the contractor cannot perform its obligations. In that case, force majeure applies and the contract is suspended or terminated.

Not every contract breaks under pressure. Sometimes reality forces adjustment — and that is precisely where hardship comes into play.

What should you do when the balance shifts? Three practical levers

When a contract comes under pressure, it is not only about reacting, but about regaining control.

1. Qualify correctly: force majeure or hardship?
The first step is legal, but essential. This qualification determines your room to manoeuvre.

2. Renegotiate proactively and strategically
In cases of hardship, renegotiation is not optional. Take the initiative and return to the table, preferably with the support of a mediator, to find a workable solution without bringing the project to a halt.

3. Anticipate and structure: steer through your contracts and general terms and conditions
A contract under pressure often exposes its weak points. As hardship rules are supplementary, you can define how they apply in your agreements.

This requires nuance. You may include, limit or exclude renegotiation, but overly strict exclusions may be challenged in B2B relationships if they create imbalance.

In practice, it is advisable to include balanced clauses on price revision, risk allocation and changes in circumstances. This helps avoid renewed disputes with every disruption and ensures greater control, even in an international context.

Would you like to update your contracts and general terms and conditions in time?
The lawyers at NOMA provide clear, pragmatic advice to help you avoid critical contractual situations and stay one step ahead. Get in touch.

In June, NOMA is hosting a live seminar on general terms and conditions, tailored to entrepreneurs. Leave your details to stay informed.