This article was displayed on the ChosunBiz RM Report site at 2:54 p.m. on Mar. 13, 2026.
This is part of the official letter that Hanwha Solutions, a petrochemical company, sent to clients on the 10th. With the possibility of disrupted passage through the Strait of Hormuz growing due to the war among the United States, Israel, and Iran—through which about 25% of global seaborne crude oil shipments pass—the company notified them that raw material procurement and product transportation could face problems. Other domestic corporations such as LG Chem and Lotte Chemical also informed clients of the potential occurrence of force majeure.
◇Corporations flood law firms with requests, asking whether force majeure applies
As signs point to a protracted Middle East crisis, legal inquiries from domestic corporations are also surging. Corporations with raw material import and maritime transport contracts are seeking to confirm whether they can invoke force majeure to avoid liability if they cannot fulfill their contractual obligations.
Force majeure is a legal concept applied when contract performance becomes impossible due to reasons beyond the parties' control, such as war or natural disasters. If recognized, liability for damages arising from nonperformance may be exempted.
According to legal sources on the 13th, major domestic law firms have formed Middle East response teams and are handling corporations' requests for advice. Inquiries are coming not only from corporations importing raw materials from the Middle East but also from those that have contracts with them, asking about legal liability for performance issues and delays in transportation.
In particular, there are many requests to review contracts related to export-import and transportation. They are asking to confirm whether this Iran situation constitutes a force majeure event as defined in the contracts.
Force majeure is not explicitly defined in our law. However, the Supreme Court has held through precedents that for force majeure to be recognized, the event must have occurred outside the parties' sphere of control, and even if the parties exercised ordinary means, they could not have foreseen or prevented it.
The mere presence of a force majeure clause in a contract does not automatically exempt liability. Even if the risk level of a particular sea area has risen, force majeure may not be recognized if passage through the route is not completely impossible. The same applies when there are alternative transport routes or substitute supply means. For shipping companies, the key issue is proving that no alternative route exists.
Whether "war" or "maritime blockade" is specified as a force majeure event in the contract is also an important criterion. The standard contract for the sale of goods published by the Korea Commercial Arbitration Board (KCAB) lists government regulation, natural disasters, war, maritime blockade, revolution, rebellion, strikes, and epidemics as force majeure events. If one proves that such situations were unforeseeable at the time of contracting and difficult to avoid or resolve, one can claim exemption from liability for nonperformance.
Even if war is not expressly listed as a force majeure event, application is not entirely precluded. If the contract includes "acts of government" or "enforcement of law by government," war may be interpreted as a government act.
Shin Dong-chan, an attorney who heads the international sanctions team at YulChon, said, "Contracts typically include a catch-all clause to encompass events similar to those specified in the force majeure clause," and added, "Expert review is needed to determine whether the clause can apply in each contract."
◇Rate and insurance premium increases alone are hard to recognize
In many cases, force majeure is hard to recognize based solely on higher insurance premiums and freight rates. It is difficult to claim exemption from performance merely because vessel insurance premiums or maritime freight rates have risen sharply due to the Middle East crisis. In actual international arbitration cases and precedents, it is rare for mere economic disadvantage to excuse performance.
There are exceptions. Park Yoon-jung, a foreign attorney at BAE, KIM & LEE LLC, said, "If an insurer refuses to provide hull or vessel insurance and it becomes genuinely impossible to secure coverage, transportation itself may become impossible," adding, "In that case, it could be recognized as force majeure." In fact, some insurers are reportedly refusing to provide insurance for ships operating near the Strait of Hormuz.
Not only the force majeure conditions but also the declaration procedure is important. One must notify the counterparty, in the manner stipulated in the contract, that transportation has become difficult due to a strait blockade and the like. Most contracts specify concrete notice methods such as email, mail, or direct notice. Attorney Shin Dong-chan said, "Even if local conditions are widely reported in foreign media, failure to notify in the manner set out in the contract may make it difficult to have force majeure recognized."
Meanwhile, the government also moved to support corporations. The Ministry of Justice on the 11th distributed a report on "corporations' force majeure response strategies" and said it plans to provide legal support to small and midsize corporations through the overseas advancement corporations international legal support team.
Law firms are responding actively as well. BAE, KIM & LEE LLC has begun advising corporations, centered on international arbitration experts, and Shin & Kim LLC is responding through its trade and industry policy center, which includes senior foreign attorney Kim Se-jin and adviser Yoon Kang-hyun, a former ambassador to Iran. Lee & Ko formed a "Middle East task force (TF)" with experts in defense industry, corporate advisory, overseas construction, insurance, and maritime fields. YulChon plans to hold an emergency seminar on the 18th on corporate response measures to the Middle East crisis.