What is the impact of the COVID-19 measures on your license agreements, software development agreements, R&D agreements and more generally commercial agreements?
The Belgian federal government has officially adopted stricter containment measures as from today, 18 March 2020, 12:00 am.
As a consequence, you may have to fully or partly suspend your activities and may no longer require the services of your suppliers.
You may also find yourself in a situation where you are not able to fulfil your obligations, eg fail to deliver timely or comply with milestones because of a reduced staff, act swiftly upon becoming aware of an infringement because the judicial system operates on a limited basis, etc.
Before taking any hasty decisions, you should carefully check your contract and verify the applicable rules:
Force Majeure
ie an insurmontable obstable preventing the performance of an obligation, to the exclusion of events which only make it more difficult or costly to perform, which the debtor is not accountable for).
- Where a party is prevented from delivering or doing what he/she was bound to, or did what had been forbidden as a result of an event of force majeure, there is no breach of contract (article 1148 of the Belgian Civil Code).
- This may lead to various consequences for the contract as a whole, which will depend on the nature of the contract: the contract may be fully or partly cancelled or suspended or may remain in force.
Hardship
(ie unforeseeable circumstances fundamentally disturbing the contractual equilibrium)
- The so-called imprevisieleer / théorie de l’imprévision is generally not accepted in Belgium.
- As long as the performance in kind of an obligation is possible, it must be assumed regardless of the cost to the debtor.
Freedom of contract
- These are not mandatory rules. This means that you may have specified, restricted or extended the events of force majeure and the consequences thereof in your contract.
Knowing your legal position will help you approach your commercial partner and find a sustainable solution for all parties during this crisis.
Our team in Brussels is fully operational and ready to assist you with these issues. Send us your contract and we will let you know what you may and may not do.
Send us the latest version of the contract(s) to Marie Keup. We will provide you a fixed fee based on your needs and a timeline within 24 hours.
In the meantime, stay home and stay safe!
