Placement of agreements for the period of the coronavirus pandemic. Force major.

What steps is the business supposed to undertake when going through the tough times occasioned by the virus-incurred pandemic

At present when a global pandemic is the issue at hand, a good deal of the businesses are most likely to have a bumpy going accounted for by cancelled meetings, equally cancelled placements of agreements, all the more so by reason of cancelled clauses in agreements that are already operating. Numerous industries such as tour operators, event making, manufacturing, trade, etc. suffer directly or indirectly affected by the pandemic.

Given the propagation of the infection, the impact on the economics has already gone global. Inevitably, Bulgaria is hit just as well. Many Bulgarian companies stay in deals with partners from abroad which on their part have already been suffering the economic downsides following the constraints forced as measures to fight COVID-19.

In this publication, we will make an effort, though claiming no exhaustiveness, at tracking down what issues the business may run into at present, and how it can possibly avoid the negatives.

Force major

Typically, when confronted by epidemic viral infection propagation and other occurrences of large scale impact, many dealers find themselves unable to perform or complete plenty of arrangements undertaken before such occurrence. Many businesses end up in the challenge of figuring no way round a troublesome contractual provision, or even dismissing it. What could be one thing they may have recourse to, and what remedies are they supposed to claim?
Says the Bulgarian legislation (art. 306 of the Company Act) "The party liable under a business deal shall not be responsible for its non-performance when caused by a force major. " Paragraph 2 of the said article goes on to say, “Force major is any unforeseen or unpreventable occurrence of emergency nature which happens following the placement of the agreement.” A force major clause has been arranged for in many other legislations round the world, and the rules under it may vary.
The effect of such circumstances does not imply that the parties have to simply rescind from the agreement. Subsequent obligatory actions shall have to be undertaken. As such, The Bulgarian Industrial Association  has already undertaken an initiative to protect dealers issuing certificates attesting to the effect of such circumstances. This is with the view of the dealer-protective measures undertaken globally. Admittedly, you should be free to claim this regulation irrespective of whether you have or have not placed a specific force major clause in your agreement. A mandatory provision shall be, however, that you do not happen to be in delay or in failure to acquit your obligations which per se will make you a defaulting party under the agreement. Remember that the dealer has to inform the other contracting party within a reasonably short period about the occurrence of such circumstances.

Approval and execution of agreements

For the course of the proclaimed epidemic, many of the business partners may end up unable or unwilling to meet in person and negotiate further on those issues, or to proceed with executing that agreement. In this event, the companies may always turn into online communication mode making use of the means readily at hand, such as Google Hangouts, Viber, Zoom, Skype and the like, so they may not cease their communications.
The digital signature of papers is not a typical practice in Bulgaria. In such extraordinary circumstances, however, many dealers may take advantage of the good sides to the remote signature so as to keep the smooth go and consummation of their commercial processes. It may be that some of you are well aware of the mobile app developed by the Bulgarian startup EvroTrust, which provides for a remote signature of papers. All of the above, naturally, being legally arranged for in clause 2 article 25 of Regulations 910/2014 of the EU which vests the electronic signature with an equal legal effect as has the manual.


The statements made in this publication come by the admission of Respect Consult team, engaging no one with the assumptions. Given that every case is per se one-of-a-kind, it has to be studied on its own. If you find yourself in a trouble as the above, or if interested to find out more, do not hesitate to contact us via email: office@respectconsult.com alternatively, on our lines: +359 32 666 990 to receive customized advice.