Force majeure is the unforeseeable, irresistible and external event that prevents the performance of a contractual obligation. Under Swiss law, this concept is anchored primarily in art. 119 CO, which governs non-culpable impossibility of performance. Unlike other legal systems, Swiss law does not use the expression "force majeure" in the Code of Obligations and adopts an approach based on the concept of objective impossibility. PBM Avocats in Geneva and Lausanne advises clients on drafting appropriate contractual clauses and on strategies to adopt in the event of a disruptive event.
Impossibility of Performance under Art. 119 CO
Art. 119 CO provides that the obligation is extinguished when its performance has become impossible due to circumstances not attributable to the debtor. This provision sets three cumulative conditions for the debtor to be released:
- Impossibility: the performance of the obligation is objectively and absolutely impossible, not merely more difficult or more costly;
- Subsequent nature: the impossibility arose after the conclusion of the contract; if it pre-existed, art. 20 CO (nullity of contract) applies;
- Non-attributability to the debtor: the impossibility does not result from a fault or negligence of the debtor.
When these three conditions are met, the debtor's obligation is extinguished without compensation. But in synallagmatic contracts (with reciprocal obligations), art. 119 para. 2 CO provides a symmetrical rule: if a synallagmatic obligation is extinguished for non-culpable impossibility, the corresponding counter-performance is also extinguished. The creditor who has already paid may therefore recover their performance.
Distinction from Mere Difficulty of Performance
A frequent error is to confuse impossibility (which releases the debtor) with mere difficulty or increased cost (which does not). Under Swiss law:
- If the performance is legally or physically impossible for everyone (destruction of the sold goods, legal prohibition), art. 119 CO applies;
- If the performance is only more expensive or difficult (rise in raw material prices, logistical difficulties), the debtor remains obliged to perform;
- Bankruptcy or insolvency of the debtor is not an impossibility within the meaning of art. 119 CO; the debtor remains liable and engages their responsibility.
Comparison: Art. 119 CO vs Contractual Clause
| Criterion | Art. 119 CO (statutory) | Contractual FM Clause |
|---|---|---|
| Triggering | Absolute objective impossibility | Listed or defined events (more flexible) |
| Effect | Extinction of the obligation | Suspension possible, then termination |
| Notification | No statutory time requirement | Contractual period (e.g. 48 hours) |
| Deposits | Restitution (unjust enrichment) | As per clause (all or pro rata) |
| Legal certainty | Low (judicial assessment) | High (list of events) |
Drafting an Effective Force Majeure Clause
To overcome the uncertainty of art. 119 CO, Swiss contractual practice frequently provides for a force majeure clause. A well-drafted clause generally contains:
- A definition of force majeure (unforeseeable, unavoidable event, outside the reasonable control of the parties);
- A non-exhaustive list of examples: war, terrorism, riot, natural disaster, epidemic, government decision, general strike, embargo;
- An obligation of prompt notification (often 48 to 72 hours) with description of the event and estimate of its duration;
- A regime of suspension of obligations for the duration of the event, with corresponding extension of deadlines;
- A right of termination if the event lasts more than a specified period (often 30 to 90 days);
- Clear rules on the return of performances already provided in the event of termination.
Disruptive Events in Switzerland: Some Practical Situations
Contract breach invoking force majeure is frequent in several sectors:
- Construction: delays due to extreme weather conditions, unforeseeable administrative restrictions, material shortages caused by global crises;
- International trade: embargoes, border closures, maritime transport stoppages;
- Events industry: prohibitions on gatherings, natural disasters making it impossible to hold the event;
- IT contracts: major cyberattacks paralysing the service provider's systems.
In each situation, the central question is whether the event was foreseeable at the time of conclusion of the contract. A contract signed in January 2021, in the midst of the pandemic, cannot invoke the pandemic as an unforeseeable force majeure for obligations contracted at that date.
Frequently Asked Questions about Force Majeure in Swiss Law
Does the COVID-19 pandemic constitute a case of force majeure under Swiss law?
The Federal Supreme Court has not yet definitively ruled on this question. Swiss doctrine is divided. Some consider that the pandemic and the resulting government measures may constitute an unforeseeable event at the time of contracting (for contracts concluded before March 2020), but the impossibility of performance must be absolute to release the debtor. In many cases, performance was not impossible but only more difficult or costly, which is insufficient under art. 119 CO. Contractual force majeure clauses drafted before the pandemic merit case-by-case analysis.
What is the difference between subjective and objective impossibility?
Objective impossibility means that nobody can perform the obligation (the sold goods are destroyed, the law prohibits any delivery). Subjective impossibility means that the specific debtor cannot perform for reasons personal to them (illness, bankruptcy), but another could have done so. Under Swiss law, art. 119 CO only releases the debtor in the case of objective impossibility. Subjective impossibility remains in principle a fault of the debtor that engages their liability.
Can a contractual force majeure clause provide for different effects from art. 119 CO?
Yes, this is one of the practical utilities of force majeure clauses. The parties may stipulate: a list of events that automatically constitute a case of force majeure (epidemic, war, natural disaster, strike, government decision); the obligation for the affected party to notify within a specified period; the suspension of obligations for the duration of the event (rather than extinction); a right of termination if the event lasts more than a certain number of days. These clauses avoid debates on the legal qualification of the event.
What happens to deposits already paid in the event of force majeure?
In the event of non-culpable impossibility extinguishing obligations (art. 119 CO), the contract is dissolved and performances already provided must be returned according to the rules of unjust enrichment (art. 62 CO). Deposits paid must therefore in principle be returned, unless part of the performance has already been partially accomplished, in which case a pro-rated compensation is effected. Restitution may however be complicated if one party is insolvent.
Is hardship (changed circumstances) recognised under Swiss law?
Swiss law does not recognise a general doctrine of changed circumstances (Wegfall der Geschäftsgrundlage) as in German law or economic necessity. In principle, contracts remain valid even if economic conditions have changed radically since their conclusion. However, the Federal Supreme Court has admitted, in a very restrictive and exceptional manner, that extraordinary unforeseeable circumstances may justify a judicial adaptation of the contract or termination. Prudent parties insert price adjustment or hardship clauses in their long-term contracts.