- 4 hours ago
Ketegangan Asia Barat semakin memuncak apabila Iran menutup Selat Hormuz kepada kapal tanpa kebenaran, sekali gus melumpuhkan laluan tenaga global yang membawa hampir 20% bekalan minyak dunia. Harga minyak melonjak melebihi USD110 setong, syarikat perkapalan utama mengisytiharkan force majeure, dan trafik maritim merosot lebih 90% — mencetuskan persoalan undang‑undang besar mengenai liabiliti, risiko kontrak dan kebolehlaksanaan force majeure merentas bidang kuasa antarabangsa.
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00:00The escalating Middle East conflict has now evolved into a full-scale maritime and also legal crisis,
00:07with Iran keeping the Strait of Hormuz effectively closed to all vessels without explicit permission,
00:12a choke point that normally carries around 20% of the world's crude oil supply.
00:18And recent AIS data shows multiple commercial ships, including Costco,
00:23on mega-container vessels being forced into sharp U-turns
00:27after warnings from the IRGC navi as global oil prices surge past $110 a barrel on the news.
00:37And also analysts report that Hormuz traffic has dropped to a near standstill,
00:42with the waterway now functioning as a high-risk militarized zone
00:45that directly threatens global trade flows and also contractual stability.
00:50And at the same time, major shipping lines, including Maersk, Evergreen, MSC and CMA-CGM,
00:57have begun invoking force majeure as services across the Gulf collapse under missile strikes,
01:03port shutdowns and also suspended bookings and soaring war risk insurance premiums.
01:09And also marine tracking data shows that only around 8 vessels per day
01:13are able to pass through the Strait of Hormuz compared to more than 130 on a normal day,
01:19with hundreds more stranded across the Persian Gulf and diverted around Africa at massive operational cost.
01:27And the situation has triggered what industry observers describe as the largest contractual disruption in decades,
01:34raising urgent legal questions about risk allocation, impossibility,
01:38and the enforceability of force majeure across jurisdictions.
01:42And joining us is Head of Legal Policy and Maritime Governance Unit, IIOES, University of Malaya.
01:52Reza, thank you so much for joining us this morning.
01:55First of all, in the event of Strait of Hormuz closure,
01:59can companies basically automatically invoke force majeure,
02:02or must they demonstrate specific, you know, contract level disruption and impossibility?
02:09Okay, thanks, thanks, Sanjeeb, and good morning.
02:14So, ideally, it's not easy to invoke this force majeure.
02:21So, what is actually force majeure?
02:23Force majeure is a Latin, French word, sorry,
02:26is a French word that means superior force or major force
02:32that would allow the parties to actually stop or hold the whole proceedings
02:40or the whole obligations that is required under the contract.
02:45So, ideally, in a situation like what is happening at the Gulf Strait,
02:51the Strait of Hormuz,
02:54whereby most of the ships are now being put on this situation
02:58whether they wanted to invoke the force majeure.
03:01So, ideally, it's not an automatic.
03:04It really depends on the situation
03:06and also the type of performance of the contract or the obligation.
03:12And there's no alternative.
03:14There's no way for them to actually move their ship
03:17from the Gulf, from the area that is affected due to the war.
03:23So, in that event,
03:25then only then they can actually straight away look at the contract,
03:29go back to the clause that might be a saving grace here
03:34because if they do not invoke that particular part,
03:38then either parties may bear a huge, huge risk
03:42of facing millions of damages, lawsuits.
03:47So, this is not something new, Najib.
03:50I think we have gone through this recently.
03:53I think COVID-19 has kind of like impact a lot of businesses,
03:58a lot of trades.
03:59So, this whole force majeure is something that we already learned
04:05in the past few years.
04:08And most companies or contractual companies
04:12oblige to know that force majeure is not an automatic.
04:17It's there, yes, for a reason.
04:19However, it depends on how you actually frame the whole clause
04:26and also the type of obligations that is required.
04:29Yeah.
04:30So, it's not automatic in that aspect.
04:33Reza, help us to understand,
04:34how do legal variations across key jurisdictions,
04:38such as English law versus civil law systems,
04:41basically shape the validity and the success of force majeure
04:44claims in global trade?
04:47So, ideally, I mean, because we look at English law
04:52as our common law system.
04:54So, Malaysia is a common law system.
04:56So, we look at English law as our main, major guidance
05:03in terms of that.
05:05And English law, hundreds of years have come up with this whole
05:10shipping and maritime areas that covers the whole world
05:15of shipping industry.
05:17And this is something that governs the whole shipping law.
05:22And under English law, this force majeure depends heavily
05:27on the extract wording of the contract.
05:31Again, because English law equals to common law
05:36is not in a statutory form like what we have in Malaysia.
05:40We have, for example, in Malaysia, we have Contracts Act 1950.
05:45So, in English law, there is no legal provision
05:49under the statutory protection given.
05:52So, there is no statutory provision automatic given
05:55to each parties under English law.
05:57So, it really depends on how they frame the contract.
06:02They frame the words of the contract.
06:04So, we apply the English common law.
06:07So, that's why when we actually look at the law itself,
06:13it really depends on how the contract is formed,
06:17the wording of the contract,
06:18and how it refers to protect the parties,
06:24whichever that's going to be affected
06:26during this impact of this war.
06:30And compare that with a civil law system,
06:32for example, the US,
06:35they will actually pretty much have a legal principles
06:39that govern under the legal principle of civil law.
06:42For example, I can give you one is good faith.
06:45So, good faith, you can actually claim that saying that,
06:50okay, this is due to the parties' main intention,
06:54good intention that it is not their control.
06:58It is beyond their control.
06:59So, they can claim whatever that is actually given
07:03by the court,
07:05but it also requires how the law is allowed
07:10in that jurisdiction, for example, in the US.
07:13So, in English law perspective,
07:16it's very clear it is actually based on the contract.
07:19So, the court will interpret the contract
07:22as how it is framed to protect the parties.
07:25But here, the thing is, the world is very broad.
07:29Everyone is dealing with everyone around the world.
07:33So, English law now has become very much a basis
07:37for everyone to use compared to civil law
07:39in given due respect to civil law.
07:44And, Reza, could disruptions at a single choke point
07:47like, you know, straight-of-hormose
07:48trigger a chain reaction of contractual breaches
07:52across sectors?
07:53And how far can liability realistically extend?
07:58Yeah, that is a very good question, actually.
08:01So, right now, we are facing a huge chain of breach
08:06or breaches, I would say, in that aspect
08:10from one to the other and to the other.
08:13So, one use of that choke point
08:16now has triggered a whole global massive disruption.
08:21And now, most, I would say, court of laws
08:26will face the highest numbers of demands
08:31or claims because of due to shipping delays.
08:35I think, you know, most of the ships are delayed.
08:38And when they delay, then they will refer to the clause.
08:42What are the clause that they will look at
08:43whether there is any due delay in payment?
08:48And then whether there is now a lot of fuel shortages.
08:50So, of course, they will have to suffer
08:56from that particular part as well, the damages.
08:59And supply interruptions, now people are delaying
09:02in obtaining the supplies.
09:04And therefore, they also have to suffer
09:06based on whatever that is stated under the contract.
09:09Maybe one day, how much that they have to suffer
09:12that really depends on the way they frame the contract as well.
09:16And as well, at the end, the supply chain
09:18to the buyer or to the receiver or the consumer
09:21means, you know, delivery obligations are late.
09:26So, in that aspect, liability will go to the other party,
09:30to the other party.
09:31And of course, it will go down to the consumer.
09:35Liability will fall on the consumer.
09:38But of course, this is something that is legally foreseeable,
09:42that if one disruption would lead to another.
09:47And this really, really shows that one particular trade
09:50would definitely have an impact to all the countries
09:56in the whole world.
09:57So, I mean, we have not recovered from COVID-19,
10:00to be honest, from the impact of economy
10:03and also the supply chain of trades.
10:06We are recovering, but it's still in our, you know,
10:11kind of like we just had that.
10:13And now we are facing this.
10:16So, it's, yeah, it's definitely a chain reaction
10:19of events here.
10:21Reza, help us to understand to what extent
10:24have global contracts underestimated geopolitical
10:27choke point risks?
10:28And will this, you know, force a structural rethink
10:31in how risk is located?
10:36So, in terms of looking at the contract
10:41and how this due to the impact of how we can move forward,
10:48I think the right way to understand is that
10:52having an important force measure to protect each party
10:56and obligation in not allowing them to perform,
11:02it's not that they don't want to perform
11:04because of the due circumstances.
11:07And we have seen this in the past,
11:10the wars, the pandemic,
11:12and this is something that we need to learn
11:14and not to brush it aside,
11:19saying that, okay, we cannot actually have this
11:21in the contract because it will, you know,
11:24it will trigger a lot of side effects.
11:27But I think one thing that contractual obligations,
11:32contracts are required is to ensure that both parties
11:35are having that balance of 50-50.
11:38So that in the event of such an event like this,
11:42where performance cannot be performed
11:45because of the trade has been disrupted
11:49because of the war,
11:50or even maybe, you know,
11:52another pandemic touch wood if it happens.
11:55In that event, I think we are prepared
11:58to understand that, okay,
12:00this is what we're going to foresee.
12:02I mean, legal damages or legal obligations
12:07will definitely be around if this happens again,
12:12but at least we are ready.
12:15And in that event,
12:17the companies or maybe trades
12:19and any company's obligation,
12:22they know what they can actually take into account
12:25when they enter into this kind of a contract
12:27because there is a risk
12:28and the risk will be something that they can be bearable
12:32or even foreseeable.
12:34Yeah.
12:35Because you mentioned a little bit about that just now,
12:37but I want to get some clarification.
12:39Could disputes, you know,
12:41arising from this crisis,
12:42basically redefine legal standards
12:45on foreseeability
12:47and also commercial impracticability
12:49in international contracts?
12:52Yeah, definitely.
12:54Definitely it will actually redefine,
12:57I would say because now courts and tribunals
13:01or even arbitration courts
13:04are now reassessing how they can actually maneuver
13:08and also look at the count on foreseeable risk
13:13because they cannot give what you demanded
13:15out of your, you know,
13:18the ballpark figure.
13:19I mean, it is something that courts
13:22and tribunals and arbitration
13:23have to be careful with,
13:25also with the impact of economy,
13:27with the impact from the government,
13:29and how to our people,
13:31especially with the geopolitics
13:34that is very, very unstable
13:35in the next future.
13:37I think it would definitely reshape
13:41and courts and all sort of ADR
13:45or alternative dispute resolution
13:47will have to reassess
13:49how they actually award those damages.
13:53and it's not just easily
13:55if you demand one million ringgit
13:56or one million US dollar,
13:58you will get one million US dollar,
14:00not necessarily.
14:01So it's something that
14:02they have to reassess, yes.
14:04Yeah, Risa, I'm not sure
14:05whether this falls under your expertise,
14:08but I gotta ask this,
14:09do standard marine
14:10and also trade insurance policies
14:12basically actually, you know,
14:14cover disruptions from a hormone closure
14:16or are such events typically excluded
14:19under war or political risk clauses?
14:22Yeah, so in a usual maritime contract,
14:27shipping contract,
14:28they will have certain clause
14:31with regards to the limitation
14:33of what they can cover.
14:35And of course,
14:36this coverage will fall under insurance,
14:39standard marine insurance,
14:41and we have international standards
14:43for that.
14:45But because of this event or war,
14:49I think this whole shipping industry
14:52now has changed
14:53in terms of
14:54they have to be careful
14:56when they draft
14:57their particular insurance
14:58and the coverage
14:59that they actually have taken.
15:02But then again,
15:03it's not something that
15:06it is common
15:08that every day
15:09that it will happen
15:10something like
15:11this war in the Gulf.
15:13but if they know
15:15that the extent
15:17of the risk
15:18of passing through
15:19the Gulf
15:20that is,
15:21you know,
15:22ongoing,
15:22then they might actually
15:23because the word foreseeable,
15:25they foresee
15:26that this happened.
15:27So again,
15:28the insurance policy
15:30is always there
15:31for them to actually
15:32include that
15:33into the contract,
15:34but also,
15:35it really depends on
15:36whether they foresee
15:37that this event
15:38will happen or not.
15:40So yeah,
15:40it really depends
15:42on the type of contract
15:44and also the insurance policy
15:46that they cover
15:47in the contract.
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