Few provisions in construction contracts generate as much controversy as force majeure — the clause that allocates risk when circumstances beyond any party’s control bring a project to its knees. Under the FIDIC 1999 suite, Clause 19 addressed “Force Majeure” in familiar, if imprecise, terms. The FIDIC 2017 editions deliberately rebranded the entire mechanism as “Exceptional Events” under Clause 18, a change that is more than cosmetic. The 2017 amendments introduce tighter procedural requirements, recalibrate the entitlement to additional time and money, and redefine what qualifies as a triggering event. For contractors, employers, and engineers working on international projects today, understanding the differences between these two regimes is not a matter of academic interest — it is a matter of contractual survival.
The COVID-19 pandemic thrust force majeure clauses into the spotlight across every industry, and construction was no exception. Projects were suspended, supply chains collapsed, labour became unavailable, and governments imposed restrictions that made it physically impossible to continue works. Parties who had never looked closely at Clause 19 or Clause 18 suddenly found themselves poring over every word. What they discovered — sometimes to their cost — was that force majeure relief under FIDIC is neither automatic nor broadly framed. It is procedurally demanding, substantively limited, and subject to interpretation disputes that can be as expensive as the underlying disruption itself.
This article examines the force majeure / exceptional events regime under both the 1999 and 2017 FIDIC Red and Yellow Books, identifies the key substantive and procedural differences, and provides practical guidance for each of the main project parties. Whether you are negotiating a new FIDIC contract, managing a live claim, or advising a client facing a crisis, the analysis below provides the framework you need.
Defining the Event: What Qualifies as Force Majeure or an Exceptional Event?
Under the FIDIC 1999 Red Book, Sub-Clause 19.1 defines Force Majeure as an event or circumstance which is beyond a party’s control, which such party could not reasonably have provided against before entering into the Contract, which having arisen, such party could not reasonably have avoided or overcome, and which is not substantially attributable to the other party. Importantly, the 1999 definition is followed by a non-exhaustive list of specific examples: war, hostilities, invasion, acts of foreign enemies, rebellion, terrorism, riot, natural catastrophes such as earthquakes and floods, and similar events.
The FIDIC 2017 Red Book (Sub-Clause 18.1) adopts the same four-limb definitional test but makes several refinements worth noting. First, the 2017 edition uses the label “Exceptional Event” throughout, which signals a deliberate move away from the French legal concept of force majeure and towards a more neutral, internationally applicable formulation. Second, the 2017 list of qualifying events is restructured and slightly expanded, with explicit reference to “pandemic or epidemic” as a category — a provision that would have been enormously significant had it been in force in 2020. Third, the 2017 edition places greater emphasis on the foreseeability analysis: a party will not qualify for relief if a reasonable and experienced contractor (or employer) in that specific project location and sector would have anticipated the event at the time of tender. This contextual foreseeability standard is more demanding than might initially appear.
The Foreseeability Threshold in Practice
The foreseeability requirement is where many force majeure claims founder. In regions with known political instability, a contractor that fails to price in the risk of civil unrest may struggle to argue that hostilities were unforeseeable. In earthquake-prone zones, a seismic event of moderate magnitude may not satisfy the test, even if it causes substantial damage. In the context of the 2017 edition, the standard is calibrated to an “experienced contractor” in the specific geographic and sectoral context of the works. This means that FIDIC 2017 force majeure analyses are inherently fact-intensive and jurisdiction-specific, and claims advisors must engage closely with local risk profiles at the time the contract was entered into.
Notice Requirements: The Procedural Gateway to Relief
Both the 1999 and 2017 editions require the party claiming relief to give notice after the occurrence of the force majeure or exceptional event. This notice requirement is a hard procedural gateway — failure to comply can extinguish an otherwise valid entitlement.
Under FIDIC 1999 Sub-Clause 19.2, the affected party must give notice to the other party within 14 days of when the party became aware (or should have become aware) of the relevant event. The notice must describe the event, its effects on performance, and the relief claimed. This 14-day window is strict, and while courts in some jurisdictions have shown flexibility in assessing whether late notice caused prejudice, many arbitral tribunals have applied the time-bar provision rigorously.
The FIDIC 2017 edition (Sub-Clause 18.2) retains the 14-day notice window but imports the overarching claims procedure framework from Sub-Clause 20.2 — the same “contemporary records” and “fully detailed claim” architecture that governs all contractor claims under the 2017 suite. This is a significant structural change. Under FIDIC 2017, a force majeure or exceptional events notice is treated as a Contractor’s Claim notice (or Employer’s Claim notice, as applicable), which means it must be followed within 84 days by a fully particularised claim document setting out the contractual basis, factual narrative, and quantification of additional time and cost. The integration of the claims machinery into the exceptional events regime makes the 2017 procedure considerably more burdensome — and more legally precise — than its 1999 predecessor.
Practical Consequence: Build the Paper Trail Immediately
The single most important practical takeaway from the 2017 procedural changes is that parties must establish a documentary record from day one of an exceptional event. Photographs, site diaries, contemporaneous correspondence, weather station data, governmental notices, and expert assessments should all be compiled and preserved as the event unfolds. Attempting to reconstruct this record months later, in the context of a dispute, is both difficult and unconvincing to arbitral tribunals.
Entitlement to Additional Time: What Relief Is Available?
Force majeure relief under FIDIC is time-based in the first instance. Both the 1999 and 2017 editions provide that a party affected by a force majeure or exceptional event is entitled to an extension of time if completion of the Works is delayed. This extension is granted under Sub-Clause 19.4 (1999) and Sub-Clause 18.4 (2017), and it applies to both the Contractor (for the Time for Completion) and the Employer (for obligations that may be delayed by the same event).
The causation standard requires the party to demonstrate that the exceptional event actually delayed performance of the works. A force majeure event that strikes a part of the world entirely remote from the project site may still affect the project indirectly — through supply chain disruptions, material shortages, or import restrictions. Under both editions, such indirect effects can in principle found a claim, but the causal connection must be established with specificity. Blanket assertions that “COVID affected our project” are insufficient without evidence of how the event specifically delayed critical-path activities.
The 2017 Concurrent Delay Issue
The FIDIC 2017 edition, consistent with its approach throughout the claims provisions, is more explicit about concurrent delay. Where an exceptional event occurs concurrently with a contractor-caused delay, the apportionment of time relief becomes contested. The 2017 drafting does not resolve concurrent delay definitively — it remains a matter for the Engineer’s determination under Sub-Clause 3.7 or, failing agreement, for the DAAB and arbitration. Parties should note that the law of the governing jurisdiction will often supply the applicable rule for concurrent delay analysis, which means the position can vary considerably between common law and civil law systems.
Entitlement to Additional Cost: The Critical Asymmetry
This is where the FIDIC force majeure regime diverges sharply from party expectations and, frequently, from the provisions of bespoke contracts. Under both the 1999 and 2017 editions, the right to recover additional cost from a force majeure or exceptional event is significantly more restricted than the right to time.
Under FIDIC 1999 Sub-Clause 19.4, the Contractor is entitled to additional Cost (and, if applicable, reasonable profit) only if the force majeure event falls within the specific categories listed in Sub-Clause 19.1(i) to (iv) — that is, war, hostilities, invasion, terrorism, rebellion, riot, contamination from radioactivity, or acts of Employer’s personnel. For events such as natural catastrophes (earthquakes, floods, storms), the Contractor is entitled only to an extension of time with no additional cost recovery. The Employer bears the consequence of his own risks, and the Contractor bears the cost of all other qualifying events.
The FIDIC 2017 edition (Sub-Clause 18.4) preserves this asymmetric structure. Cost recovery for exceptional events is limited to those events that are categorised as Employer’s Risks under Sub-Clause 17.2 — essentially political violence, war, and nuclear/chemical contamination. For natural events and pandemics, the Contractor absorbs the cost of the delay (which typically means prolongation costs, standing costs, and escalated materials costs) without recovery from the Employer, even though neither party is at fault. This allocation reflects the FIDIC drafters’ view that natural catastrophe risk, in the absence of project-specific insurance requirements, lies with the party best positioned to price and insure it — typically the Contractor in a Red or Yellow Book contract.
Why This Matters for Contract Negotiations
The cost allocation asymmetry is one of the most commonly misunderstood features of FIDIC force majeure provisions, and it is frequently renegotiated during tender and contract execution. Contractors in jurisdictions with high natural disaster exposure — seismically active regions, areas prone to tropical storms or flooding, or territories with histories of pandemic or epidemic disease — should seek to negotiate enhanced cost recovery provisions, or at minimum, to ensure that project-specific insurance arrangements respond to the unrecovered cost exposure.
Prolonged Exceptional Events and Termination Rights
Both editions address the scenario where a force majeure or exceptional event continues for an extended period, making it impossible or commercially pointless to resume performance. These are the “prolonged exceptional event” provisions, and they give rise to termination rights that sit outside the standard default-based termination framework.
Under FIDIC 1999 Sub-Clause 19.6, if the execution of substantially all the Works in Progress is prevented for a continuous period of 84 days, or for multiple periods totalling more than 140 days, either party may give notice to the other terminating the Contract. The termination is without fault and triggers the payment provisions in Sub-Clause 19.7: the Contractor is entitled to be paid for all work executed, for plant and materials ordered (provided these are delivered or in transit), and for any other costs reasonably incurred in connection with the Works.
FIDIC 2017 Sub-Clause 18.5 and 18.6 largely replicate this structure with one important enhancement: the 2017 edition clarifies the method of calculating payment on termination for prolonged exceptional event more explicitly, and cross-references the general payment on termination provisions in Sub-Clause 16.3. The 84-day / 140-day thresholds are retained. Critically, under neither edition does the Contractor receive payment for loss of profit on the unexecuted portion of the Works — again reflecting the FIDIC philosophy that force majeure risk, including financial loss from early termination, is not ordinarily transferable to the Employer.
Mutual Obligations and the Employer’s Perspective
Force majeure provisions are often discussed exclusively from the Contractor’s perspective, but employers face their own obligations and risks under these clauses. Under both editions, the Employer is also subject to the force majeure regime: if an Employer obligation (such as the obligation to give access to the Site, make advance payments, or provide materials under an employer-supplied specification) is affected by an exceptional event, the Employer can invoke the same notice and relief mechanism. This is particularly relevant for public sector employers who may be subject to government-imposed restrictions or requisition orders that affect their own obligations under the Contract.
The Employer also has a direct financial interest in the force majeure outcome through the delay damages mechanism. If the Contractor is granted an extension of time by reason of an exceptional event, the Time for Completion is correspondingly extended, and delay damages cease to accrue for the extended period. An Employer who wishes to contest a force majeure claim therefore has an incentive to challenge both the qualifying nature of the event and the causal connection to delay.
The Engineer’s Role Under FIDIC 2017 Sub-Clause 3.7
Under the FIDIC 2017 edition, exceptional events claims (like all contractor and employer claims) are subject to the Engineer’s Agreement or Determination process in Sub-Clause 3.7. The Engineer has 42 days from receipt of the fully particularised claim to consult with both parties and endeavour to reach agreement. Failing agreement, the Engineer issues a determination, which is binding on both parties unless and until overturned by the DAAB or arbitration.
This process places the Engineer in a quasi-adjudicative role in relation to force majeure claims, which can be technically complex and politically sensitive. The Engineer must assess the foreseeability of the event against the factual matrix at the time of tender, evaluate the causal nexus between the event and the claimed delay, determine whether the affected party took all reasonable steps to minimise the consequences, and quantify the entitlement. These are demanding obligations, and Engineers acting on FIDIC 2017 contracts should ensure they have access to specialist claims advisory support when exercising this function.
Comparing 1999 and 2017: A Summary of Key Differences
The shift from “Force Majeure” to “Exceptional Events” encapsulates several substantive improvements in the 2017 edition. The 2017 edition integrates the exceptional events procedure into the overarching claims mechanism, creating a single, coherent pathway for all time and money claims. The 2017 list of qualifying events is updated and more precisely drafted. The role of the Engineer in determining entitlement is formalised and procedurally bounded. The DAAB provides a faster and more accessible dispute resolution mechanism for contested exceptional events determinations than the 1999 DAB.
However, the fundamental economic bargain — time relief for all qualifying events, cost relief only for politically-driven events — remains unchanged. Parties who expected the 2017 revision to create a more generous cost recovery regime for natural catastrophes and pandemics will be disappointed. The allocation of natural event risk to the Contractor is a deliberate policy choice by the FIDIC drafters, and it remains a significant negotiating point in most major international project contracts.
Conclusion: Navigating Exceptional Events in Practice
Force majeure and exceptional events provisions are among the most complex and consequential in any FIDIC contract. Understanding the differences between the 1999 and 2017 regimes — in terms of definition, procedure, entitlement to time, entitlement to cost, and termination rights — is essential for anyone involved in the administration, management, or dispute resolution of FIDIC-based projects. The practical lessons are consistent across both editions: give notice promptly, document everything contemporaneously, and take all reasonable steps to mitigate the effects of the qualifying event. Failure on any of these fronts can transform a meritorious claim into an unrecoverable loss.
For contractors and employers entering into new FIDIC contracts, the negotiation of the exceptional events clause — particularly the cost recovery provisions and the definition of qualifying events — deserves the same attention as any other commercially critical provision. The COVID-19 experience demonstrated that exceptional events can be global, prolonged, and economically devastating, and that standard FIDIC cost allocation may leave contractors bearing very significant uncompensated losses. Tailored contractual solutions, backed by appropriate insurance, are the most effective risk management tool available.
This article is published for general information purposes and does not constitute legal advice. Construction law is a specialist field and parties to FIDIC contracts should seek professional legal advice in relation to their specific circumstances. CMGuide Pty Ltd provides construction claims, contract management, and contractual advisory services. For more information, visit cmguide.com.au.