A foreign supplier with a long-term distribution agreement in Ukraine watches its local counterparty stop all deliveries. The counterparty cites force majeure. The supplier disagrees. Both parties face the same question: what does Ukrainian contract law actually require, and who bears the risk of business disruption? Getting this wrong – on either side of the dispute – means forfeiting contractual rights that cannot easily be recovered once a Ukrainian court has ruled.
Force majeure and hardship in Ukraine are governed by separate doctrines within Ukrainian civil and commercial legislation. Force majeure excuses a party from liability for non-performance when an extraordinary, unavoidable event makes performance impossible. Hardship permits a court to modify or terminate a contract when circumstances have changed so fundamentally that the original bargain no longer reflects the parties' reasonable expectations. Both doctrines have been tested intensively by Ukrainian courts since 2022, and the gap between the statutory text and actual court practice is significant.
This analysis examines the doctrinal foundations of each concept, traces the competing lines of court interpretation. Identifies the strategic risks that international businesses face in Ukrainian disputes. Additionally, sets out the cross-border considerations most relevant to CIS-region clients.
Doctrinal foundations: two distinct legal concepts
Ukrainian civil legislation distinguishes clearly between force majeure and hardship, though both respond to the same underlying commercial reality – disruption severe enough to undermine contract performance. Understanding the distinction is essential before any litigation or negotiation strategy is constructed.
Force majeure in Ukrainian law is defined as an extraordinary event that a party could not foresee or prevent. Three cumulative conditions must be satisfied. The event must be extraordinary – outside the normal range of risks a business assumes when contracting. It must be unavoidable – no reasonable precaution could have prevented it. And it must have caused the specific non-performance claimed. All three elements are required. Ukrainian commercial courts reject force majeure defences that satisfy only one or two of the conditions.
The causal link requirement is frequently underestimated. A party cannot simply point to a disruptive event and claim relief. It must demonstrate that the event directly prevented the specific performance obligation at issue. Courts have rejected force majeure claims where a party could have performed through an alternative route, supplier, or method – even if that alternative was more expensive or less convenient. Practitioners in Ukraine note that this causal analysis has become more rigorous since 2022, as courts grew wary of opportunistic force majeure invocations by parties seeking to escape commercially unfavourable contracts.
Hardship operates under a different doctrinal logic. Under Ukrainian civil legislation, a party may seek judicial modification or termination of a contract when the circumstances on which the parties relied have changed significantly and cannot be attributed to that party's risk. The party invoking hardship must show that performance has become so burdensome that it would be manifestly unjust to hold it to the original terms. This is a high threshold. Ukrainian courts do not treat a general deterioration in business conditions as hardship. The change in circumstances must be specific, substantial, and unforeseen at the time of contracting.
The practical difference between the two doctrines matters enormously for litigation strategy. Force majeure, if established, suspends or excuses liability. Hardship, by contrast, leads to a court order – either modifying the contract terms or terminating the contract prospectively. A party facing an impossible performance will typically pursue force majeure. A party that can still perform but at a fundamentally altered cost structure may find hardship the more appropriate instrument. Choosing the wrong doctrine at the outset of civil procedure can result in a dismissed statement of claim and months of lost litigation time.
The certification mechanism and its limits
Ukrainian commercial practice has developed a formal certification mechanism for force majeure. The Torgovelno-promyslova palata Ukrainy (Ukrainian Chamber of Commerce and Industry, or CCI) issues official force majeure certificates. These certificates are widely recognised in commercial disputes and serve as the primary evidentiary instrument when a party invokes force majeure under a domestic contract.
The certification process involves submitting an application to the CCI with supporting documentation. The CCI reviews the circumstances and, if satisfied, issues a certificate confirming that the specified event qualifies as force majeure for the relevant period and territory. The process typically takes several weeks, though wartime conditions have affected timelines. The certificate does not operate automatically – it must be presented to the counterparty within the notice period specified in the contract, or within a reasonable time if no contractual deadline exists.
Many international businesses treat the CCI certificate as a definitive shield. This assumption is mistaken and has caused significant litigation losses. Ukrainian commercial courts consistently hold that the certificate is evidence, not proof. Courts assess it alongside the contractual terms, the specific performance obligation, the causal link between the certified event and the non-performance, and whether the invoking party took reasonable steps to mitigate. A party that obtained a certificate but failed to notify its counterparty promptly. Alternatively. That continued performing under related contracts while claiming force majeure under the one in dispute, is likely to face a sceptical judicial inquiry.
A further complication arises in cross-border contracts governed by foreign law. Many international supply and services agreements contain governing law clauses selecting English, German, or Swiss law. In those cases, the CCI certificate has no binding legal status under the applicable law. The force majeure analysis must be conducted under the chosen law's doctrine, which may impose different conditions – particularly regarding foreseeability and the allocation of risk between sophisticated commercial parties. Law firms advising on cross-border disputes must address both the Ukrainian evidentiary dimension and the foreign law doctrine simultaneously.
To explore the strategic options available to international parties in Ukrainian commercial disputes, see our dedicated page on corporate disputes in Ukraine.
Competing court interpretations since 2022
The scale of business disruption since February 2022 generated an exceptional volume of force majeure and hardship litigation in Ukrainian commercial courts. This volume has produced a body of court practice that is neither uniform nor fully settled. Two competing interpretive lines are visible in the decisions of Ukrainian commercial courts.
The first line takes a relatively permissive approach. Courts in this line hold that the declaration of martial law in Ukraine constitutes an extraordinary circumstance for purposes of force majeure analysis. They accept that parties operating in affected regions could not reasonably be expected to perform, and they give substantial weight to CCI certificates. This approach reflects a pragmatic recognition that the disruption to Ukrainian commercial life since 2022 is genuinely extraordinary by any standard.
The second line is more demanding. Courts in this line insist on rigorous proof of each element – including the causal link between the specific event and the specific non-performance. They have dismissed force majeure defences where the contract itself allocated the relevant risk to the invoking party. There. The party had continued operating in other respects while claiming impossibility. Alternatively. There, the certificate covered a region or period that did not precisely match the performance obligation at issue. This line treats force majeure as an exception that must be strictly construed, not a general wartime reprieve.
The Verkhovny Sud (Supreme Court of Ukraine) has not issued a single consolidated position that resolves this divergence. Its decisions on force majeure tend to be fact-specific, making it difficult to extract general principles with confidence. Practitioners who have appeared before the cassation tier note that the Supreme Court applies the causal link requirement strictly. However. It has also shown willingness to uphold force majeure defences where the factual record is thorough and the CCI certificate is supported by independent evidence.
The hardship doctrine has seen less litigation volume, partly because the evidentiary and doctrinal burden is higher. Courts have generally required parties invoking hardship to demonstrate a specific, measurable shift in the economic equilibrium of the contract – not merely a general increase in costs or difficulty. Claims based solely on currency depreciation, rising input prices, or general wartime uncertainty have rarely succeeded. Hardship claims that succeeded typically involved a specific government order, regulatory change, or physical destruction that eliminated the commercial rationale of the contract entirely.
For parties considering international arbitration as an alternative to domestic court proceedings, our analysis of litigation and arbitration in Ukraine sets out the procedural options in detail.
The gap between statute and practice: what international clients miss
The statutory text of Ukrainian civil and commercial legislation on force majeure and hardship is relatively concise. In practice, the gap between the statutory rules and how courts apply them is substantial. International clients accustomed to the precision of English commercial law or the doctrinal rigour of German civil law often underestimate this gap.
The first gap concerns notice obligations. Many Ukrainian contracts contain force majeure notice clauses requiring the affected party to notify its counterparty within a specified period – often between three and fifteen days of the triggering event. A party that fails to give timely notice may lose the benefit of the force majeure defence entirely, regardless of whether the underlying event was genuine. Ukrainian courts have enforced notice requirements strictly, even where the delay in notification was itself attributable to wartime disruption. The lesson is that procedural compliance cannot be deferred even in genuinely extraordinary circumstances.
The second gap concerns the duty to mitigate. Ukrainian civil legislation imposes a general duty on contracting parties to take reasonable steps to reduce their losses. Courts have applied this duty in the force majeure context: a party that had reasonable mitigation options available. sourcing from an alternative supplier. Using a different delivery route. Alternatively, adjusting its performance schedule. but declined to pursue them may find its force majeure defence partially or wholly rejected. This is not always stated explicitly in the statutory text, but it is a consistent feature of court practice.
The third gap concerns the interaction between force majeure clauses in the contract and the statutory default rules. Many international contracts contain bespoke force majeure definitions that are narrower or broader than the statutory standard. Ukrainian courts generally give priority to the contractual definition where it exists and is clearly drafted. However, courts have refused to apply contractual force majeure clauses that purport to cover events that Ukrainian law would characterise as ordinary commercial risk rather than extraordinary events. A party that drafted its force majeure clause to cover currency fluctuation or supply chain disruption without qualifying language may find that a Ukrainian court disregards the clause as contrary to public policy.
The fourth gap is procedural. Filing a statement of claim in Ukrainian commercial courts requires adherence to specific civil procedure rules. During wartime, some courts have operated under modified procedures, with hearings conducted remotely or with reduced timelines. An interim injunction – for example, to freeze a counterparty's assets pending judgment enforcement – is available in Ukrainian commercial procedure but requires a well-prepared application demonstrating urgency and the risk of irreparable harm. Many foreign parties underestimate the evidentiary threshold for interim relief and file insufficiently supported applications, resulting in rejection and delays of several months before a further attempt can be made.
A comparative perspective is instructive here. A client familiar with Russian civil law doctrine will find Ukrainian force majeure broadly similar in structure. However. Diverging in court practice. particularly regarding the role of the CCI certificate and the strictness of the causal link requirement. Our comparative analysis of force majeure and hardship in Russia identifies the key distinctions for CIS-region practitioners.
Cross-border implications for CIS clients
Ukrainian force majeure and hardship disputes rarely involve only Ukrainian law. CIS-region clients – particularly those with operations spanning Ukraine, Kazakhstan, Georgia, or other post-Soviet jurisdictions – face a layered set of cross-border complications that domestic Ukrainian counsel may not fully address.
The first complication involves governing law. Where a contract between a Ukrainian party and a CIS counterparty selects the law of a third jurisdiction. commonly English law or Swiss law. the Ukrainian force majeure certification mechanism is legally irrelevant to the substantive analysis. The force majeure or frustration doctrine of the chosen law applies. English law, for example, takes a markedly narrower approach to frustration than Ukrainian law takes to force majeure. A Ukrainian party that obtained a CCI certificate and notified its foreign counterparty in accordance with Ukrainian procedure may find that none of this assists it under the applicable English law analysis.
The second complication involves dispute resolution forums. Many CIS-region contracts with Ukrainian parties contain arbitration clauses selecting Stockholm, Vienna, or Paris as the seat, with ICC or other institutional rules. In those cases, the dispute will be determined by an international arbitral tribunal. The tribunal will apply the chosen law and will treat Ukrainian law. including any statutory force majeure provisions. only to the extent that it is relevant under conflict of laws principles or where the parties have expressly incorporated Ukrainian law concepts.
The third complication is judgment enforcement. A party that obtains a favourable Ukrainian court judgment may face significant obstacles when seeking to enforce it against a CIS counterparty's assets held outside Ukraine. Bilateral treaties on judicial cooperation between Ukraine and certain CIS states provide a basis for recognition, but enforcement proceedings in the destination jurisdiction require separate court filings and carry their own procedural requirements. Enforcement is rarely automatic and can take a year or more in jurisdictions where the local courts scrutinise the Ukrainian judgment on public policy grounds.
The fourth complication concerns sanctions. Several CIS-region businesses have counterparties or beneficial owners subject to international sanctions regimes. A force majeure or hardship dispute that involves a sanctioned party – or assets held by such a party – creates additional layers of legal exposure. Legal counsel advising on these disputes must assess sanctions compliance obligations alongside the underlying contract law analysis. Failing to do so before filing a statement of claim or commencing arbitration can result in regulatory consequences entirely separate from the commercial dispute.
For businesses with multiple contracts affected by wartime disruption in Ukraine, a portfolio approach to force majeure analysis is often more cost-effective than contract-by-contract litigation. Grouping affected contracts by governing law, forum, and counterparty type allows counsel to identify which disputes are suited to negotiated settlement, which warrant court filings, and which are better resolved through arbitration. This triage exercise should precede any procedural steps and should inform the overall litigation budget.
Strategic recommendations and forward outlook
Businesses facing force majeure or hardship issues in Ukraine should treat the matter as a litigation risk management exercise from the outset. Several strategic priorities emerge from the analysis above.
First, audit the contract before claiming or contesting force majeure. The contractual force majeure definition, the notice period, and the governing law clause determine the applicable legal standard. Many disputes arise because one party assumed the statutory default applied when the contract had modified it. This audit should be completed before any notification is sent.
Second, assemble the evidentiary record before filing. A statement of claim in a Ukrainian commercial court that rests solely on a CCI certificate and a general assertion of impossibility will face serious resistance. The evidentiary record should include contemporaneous communications, operational records, third-party evidence of the disrupting event, and documentation of mitigation efforts. Constructing this record retroactively – after the counterparty has already filed its own pleadings – is significantly harder.
Third, assess interim relief options early. An interim injunction in Ukrainian commercial courts is a powerful tool for preserving assets or maintaining the status quo while a dispute proceeds. However, the application must be filed promptly, supported by evidence of urgency, and accompanied by a security deposit in some cases. Delay in seeking interim relief is frequently fatal to the application.
Fourth, consider whether arbitration is the appropriate forum. For high-value disputes or where the counterparty's assets are located outside Ukraine, international arbitration under ICC, LCIA, or Vienna International Arbitral Centre rules may offer a more reliable path to a binding, enforceable award. Arbitration also allows parties to select arbitrators with specific expertise in Ukrainian law and CIS commercial practice.
Fifth, monitor the evolving legislative environment. Ukrainian contract legislation continues to develop in response to wartime conditions. Proposals to extend force majeure relief, modify hardship thresholds, or introduce temporary contract suspension mechanisms have been under discussion. A legislative change can shift the legal analysis of existing disputes materially. Businesses with ongoing Ukrainian contracts should track legislative developments on a rolling basis, not only when a dispute has already arisen.
The forward outlook for Ukrainian force majeure and hardship doctrine is one of continued judicial development. The Supreme Court of Ukraine is likely to issue further guidance as the volume of wartime commercial disputes works its way through the appellate tiers. That guidance may narrow or widen the gap between the permissive and demanding interpretive lines currently visible in lower court practice. International businesses should not assume that a position that was defensible under one line of authority will remain so after a Supreme Court pronouncement.
To explore how these issues interact with your specific contractual position, contact us at info@ferrazwhitmore.com for a preliminary review of your situation in Ukraine.
Frequently asked questions
Q: What is the difference between force majeure and hardship under Ukrainian contract law?
A: Force majeure in Ukraine refers to an extraordinary event that makes performance impossible – excusing a party from liability for non-performance. Hardship, by contrast, addresses situations where performance remains technically possible but has become so burdensome that the economic basis of the contract has fundamentally shifted. Ukrainian civil legislation recognises both concepts, but courts apply them under distinct doctrinal tests and with different legal consequences.
Q: How long does it typically take to resolve a force majeure dispute in Ukrainian courts?
A: Resolution timelines vary considerably depending on the complexity of the matter and the court tier involved. A first-instance commercial court ruling may take several months to over a year from the filing of a statement of claim. Appeals through the appellate and cassation tiers can extend the process further. Parties with arbitration clauses in their contracts may find international arbitration a faster and more predictable alternative to domestic court proceedings during wartime conditions.
Q: Is a certificate from the Ukrainian Chamber of Commerce and Industry sufficient to prove force majeure?
A: A certificate from the Ukrainian Chamber of Commerce and Industry is the standard evidentiary instrument for certifying force majeure in commercial disputes. However, courts do not treat it as conclusive proof in all circumstances. Ukrainian commercial courts have held that the certificate must be assessed alongside other evidence. including the specific contractual terms. The causal link between the event and non-performance. Additionally, whether the party took reasonable steps to mitigate. Relying solely on the certificate without a broader evidentiary record carries significant litigation risk.
About Ferraz & Whitmore
Ferraz & Whitmore is an international law firm based in Lisbon, advising business clients across 46 jurisdictions. Our team combines Portuguese civil law expertise with English common law tradition to deliver cross-border legal solutions in commercial litigation, contract disputes, and force majeure analysis in Ukraine and across the CIS region. We work with international businesses, institutional investors, and in-house legal teams managing contract disruption across multiple legal systems. Our commercial disputes practice has advised on force majeure and hardship matters arising under Ukrainian, English, and other governing law frameworks, including disputes before Ukrainian commercial courts and international arbitral tribunals. The firm's Lisbon base provides direct access to EU regulatory conditions, while our CIS expertise supports clients navigating the distinctive challenges of post-Soviet commercial law environments. Engaging a lawyer in Ukraine with cross-border experience in CIS commercial practice is essential where contract disputes involve multiple jurisdictions, sanctions exposure, or cross-border enforcement. As an international law firm serving clients with operations in Ukraine, Ferraz & Whitmore provides coordinated advice across both the substantive and procedural dimensions of force majeure and hardship disputes. To discuss your contractual position in Ukraine, contact us at info@ferrazwhitmore.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.