Force Majeure in the UAE: Lessons from the Iran–Israel Escalation

Why this topic ‘ Iran Israel Escalation’ matters now

Geopolitical tensions resurfaced in the Middle East following the 2025 escalation between Iran and Israel. In response, commercial flights were suspended, maritime routes faced disruptions, and many UAE-based businesses swiftly activated contingency measures.

In this context, many clients and commercial actors are asking whether these developments could justify invoking force majeure under UAE law. This article explores the concept of force majeure in the UAE, its application in light of recent events, and the practical steps businesses should consider.

Understanding Force Majeure in UAE Law

Force majeure is recognized in the UAE Civil Transactions Law, Federal Law No. 5 of 1985 (as amended). Article 273 addresses situations where an unforeseen and uncontrollable event renders contractual performance impossible. If the entire obligation becomes impossible, the contract is considered automatically terminated. If only part of the obligation becomes impossible, that part may be extinguished, and the other party may be given the option to terminate the entire agreement.

Article 287 provides that a party is not liable for damages if the harm arose from a foreign cause beyond its control, provided there was no fault or negligence.

For a successful invocation of force majeure under UAE law, the affected party must demonstrate that the event was unforeseeable at the time of contracting, that it was outside their control, and that it made performance truly impossible—not merely more burdensome or commercially unviable.

The Impact of the Iran–Israel Escalation on UAE Businesses

The conflict has had immediate implications in the UAE. Several major airlines, including Emirates and Etihad, have suspended or rerouted flights due to heightened regional risk. Maritime shipping through the Strait of Hormuz slowed considerably (until its halt) as insurers raised premiums and shipping companies reassessed risk exposure. Many Gulf-based multinationals activated their crisis response protocols and reviewed their supplier obligations and delivery timelines.

Supply chains were strained, particularly in construction, retail, and logistics. In such a scenario, force majeure may appear as a logical legal mechanism to mitigate liability. However, whether it can be successfully invoked depends on the structure of the underlying contract, the timing and nature of the disruption, and whether contractual performance has truly become impossible.

Application of Force Majeure Provisions in UAE Contracts

In the UAE, force majeure clauses may either be expressly written into the contract or implied through the application of the Civil Code. An express clause typically defines the specific events considered to constitute force majeure, such as war, civil unrest, government actions, or acts of God. If no such clause exists, UAE law still provides a framework under Articles 273 and 287.

Courts and arbitral tribunals in the UAE will examine several elements before accepting a force majeure defense. These include whether the event was genuinely unforeseeable and exceptional, whether there is a direct and documented causal link between the event and the inability to perform the contract, and whether the affected party attempted to mitigate the consequences or explore alternatives to fulfill its obligations. Timely and adequate notice to the counterparty is also essential.

Industry Examples in the Current Context

In the aviation and travel sector, cancelled flights and restrictions on airspace may allow airlines to invoke force majeure when unable to perform scheduled services. However, airlines remain bound by regulatory and contractual duties regarding refunds and rerouting options.

Shipping and logistics operators affected by the conflict—particularly those using the Strait of Hormuz—may find some relief under charterparty agreements that include war-risk or force majeure provisions. Nonetheless, tribunals or courts will expect the carrier to show that re-routing or other alternatives were unavailable.

In the construction and real estate sectors, developers or contractors may face delays in receiving key materials or completing works. While this could give rise to a force majeure claim, the party must establish that such delays were not only beyond their control but also rendered completion impossible under the original timeline, despite reasonable mitigation efforts.

Employers may also face complications, particularly if staff members are stranded overseas or unable to report to work due to closures or restrictions. Under UAE labour law, employers may make temporary adjustments such as remote working or agreed salary reductions, provided there is proper justification and the employee’s consent.

Legal and Commercial Response: What Steps to Take

Parties affected by the consequences of regional instability should first review the wording of their contracts to determine whether force majeure is defined and what notification requirements are triggered. Even where disruption is anticipated but has not yet rendered performance impossible, early written notice to the other party is strongly advised.

It is equally important to collect and retain evidence of the disruption. This includes official communications such as flight suspension notices, governmental advisories, or supplier emails that clearly demonstrate the impossibility of performance. Businesses should also take reasonable steps to mitigate harm, including exploring alternative routes, suppliers, or means of performance. Failure to mitigate can weaken or defeat a force majeure claim.

Legal advice should be sought, particularly where contracts are governed by foreign law or subject to institutional arbitration. In many cases, performance can be adjusted or suspended temporarily without full termination of the contract, especially when there is goodwill and cooperation between the parties.

Force Majeure and Dispute Resolution under Iran Israel Escalation

If a dispute arises and proceeds to arbitration or litigation, tribunals will consider whether the force majeure event meets the relevant legal standards. The party invoking the clause will be expected to show a direct causal link between the event and its non-performance, proof that notice was timely given, and evidence of mitigation efforts.

In cases governed by DIFC or ADGM law, English common law principles may apply. These frameworks are often more restrictive than UAE Civil Code provisions and may require a more literal and narrowly construed interpretation of what qualifies as force majeure.

Conclusion to Force Majeure under Iran Israel Escalation

The Iran–Israel escalation has renewed awareness of the vulnerability of global and regional business to conflict-related disruption. While force majeure provides a valuable tool for managing risk, its success as a legal defense depends on several factors: the contract language, the nature and timing of the disruption, the efforts made to mitigate harm, and the documentation maintained by the affected party.

Force majeure should not be treated as a blanket excuse. Rather, it is a nuanced legal doctrine that, when properly invoked, can protect a party from liability during truly exceptional times.

At Rubert & Partners, we assist clients in assessing the viability of force majeure claims, issuing compliant notices, and navigating disputes stemming from regional instability and cross-border challenges. For businesses affected by recent developments or those seeking to proactively manage legal risk, we welcome you to contact our team for tailored advice and strategic support.

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