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Bahrain situation could affect force majeure rules

Legal expert Charles Braithwaite muses on the implications of cancelling a grand prix due to political unrest amid F1's global expansion.
The decision to cancel next month's Bahrain Grand Prix following the outbreak of political protests in the island kingdom may have been a prudent one for many reasons but, with the number of races being sanctioned in potentially volatile areas, could result in contracts being more closely scrutinised.

While no-one would doubt that it would have been wrong on both human and political levels to have staged an F1 event amid the chaos that erupted in Manama last week, claiming force majeure as the reason for the cancellation of the 13 March event could cause a few headaches for race organisers, participants and governing bodies alike in future.

Defined in the dictionary as 'an irresistible force or unforeseeable course of events excusing from fulfilment of contract', the term has been used on numerous occasions in motorsport - notably by teams finding themselves unable to field the requisite number of cars, or appear at all, in races and, in the last case similar to Bahrain, when the 1995 Pacific GP was cancelled due to an earthquake - but could see its exclusions rewritten should the current wave of unrest continue to spread across Africa, the Middle East and into other potentially volatile areas being targeted for a position on the F1 schedule.

“Obviously, the safety of participants and spectators has to come first, but the recent situation in Bahrain and the cancellation of GP2 Asia's second round throws open an interesting discussion about the use of force majeure in sporting event contracts,” Charles Braithwaite, a partner with leading motorsport law firm Collyer Bristow, confirmed.

“With a swathe of civil unrest currently sweeping northern Africa and the Middle East, it will be interesting to see whether the force majeure clause is rewritten for future years. While the situation in Bahrain could not have been foreseen when the original F1 contracts were signed, it may be that future contracts have to take into account more closely the civil and political situation in the country in which the event is being hosted.

“A force majeure clause is included in most commercial contracts in one form or another. The clause essentially frees a party from liability or obligation when an extraordinary event or circumstance beyond their control prevents performance of the contract – often taken to mean natural disaster or war but, depending how the clause is drafted, potentially also covering things such as infrastructure failures, government sanctions, riots and industrial disputes. The clause usually gives the parties a right to terminate the contract should a force majeure event occur or should it continue for a certain period of time.

“So, GP2 Asia's second round has been cancelled under force majeure because no one could have foreseen, at the time of signing contracts, that civil unrest would make it unsafe to host the event. With the F1 season set to open in Bahrain in just a couple of weeks, a number of people would have been looking at the force majeure clause in their contracts to see whether it covered their interests.

"The race organisers would have been looking to see whether they could invoke the clause to avoid liability should they need to cancel the race. Participants would have been looking to see whether they could invoke the clause to avoid liability should they decide it was too risky to attend or participate.

"It will not be an easy decision. Teams have already spent money on shipping equipment to Bahrain, sponsors have signed contracts on the back of the season timetable and drivers are expecting to undertake a certain number of races over the coming months.”

It remains to be seen whether, like the Aida event in 1995, the Bahrain Grand Prix can be rescheduled later in the season. The Pacific GP eventually took place in October, but the busy 2011 calendar may mitigate against Bahrain re-appearing in the current campaign, even if its current situation can be resolved.


Thanks to our colleagues at Collyer Bristow. For more information, click on the following link: Motorsport Law



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John - Unregistered

February 23, 2011 12:40 PM

It also kind of highlights the concerns, raised many times in the past, about where the races are being held anyway. There are many places around the world that have been know to be "dangerous" for years, such as the middle east, North Africa, etc. Yet F1 contracts are being signed bringing the sport ever closer to these areas, seemingly for the income they generate rather than the good of the sport and fans. So, has the policy of chasing the dollar finally bitten back?

Alan D - Unregistered

February 24, 2011 11:01 AM

John: "There are many places around the world that have been know to be "dangerous" for years, such as the middle east, North Africa, etc." I understand what you are saying, and it is view shared by many, but sweeping together a lot of countries into one big group of Middle East etc and then calling them dangerous or unstable is probably a cosy westernised viewpoint and hot helpful. You can't label a country as dangerous just because it happens to be in the middle east. And remember, full blown riots happen in our civilised cities in the west too. Bahrain is a well developed country and has been working hard at social reform, including giving women the right to vote and appointing women to cabinet positions as an act of positive discrimination.



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