Monday, February 23, 2009

Doing Business in Oman: Frequently Asked Questions

Q: In the current economic climate, some companies are having difficulty fulfilling their contractual obligations. Can a company that defaults on its obligations use the global economic crisis as a basis for declaring force majeure?
A: The answer depends on the language of the applicable contract and the jurisdiction, but in general the economic crisis is not considered an appropriate basis for declaring force majeure. Unless the agreement between the parties explicitly states otherwise, Omani courts are unlikely to excuse a company from performing its obligations based on a force majeure declaration due to the economic meltdown.