Steel Building Force Majeure: Notice, Risk Allocation & Suspension

A steel factory shell braced against a gale, idle port cranes beyond—scenario where a force majeure clause decides who absorbs the six-week delay.

A port strike delays your steel container shipment by six weeks. A regional lockdown halts site erection. A war closes the Suez Canal. Your schedule slips—but who eats the delay cost? This risk allocation clause defines which events excuse performance, how notice must be given, and whether time or money is extended when a qualifying event hits.

This steel building force majeure risk allocation guide walks through the legal definition, the FIDIC framework, the qualifying-event list, the notice and evidence procedure, and how time, cost, and insurance are split when a qualifying event hits. Our liquidated damages article covers fixed-per-day delay penalties. Force majeure is different—it is when neither party is at fault but performance is impossible.

What Is Force Majeure in Steel Building Contracts?

Force majeure (from the French "superior force") is an event outside a party's reasonable control that is unforeseeable, unavoidable, and insurmountable. When it strikes, performance is partially or wholly excused, and neither party is in breach. It is not a get-out clause for commercial inconvenience—it is a narrow legal carve-out reserved for events that genuinely stop work. This is the core principle behind every steel building force majeure risk allocation clause.

FIDIC framework. The FIDIC Red Book (1999 and 2017 editions), Clause 19, defines force majeure broadly: war, hostilities, invasion, terrorism, riot, strike not confined to the contractor's own workforce, epidemics, and natural catastrophes of exceptional magnitude. Under PRC Civil Code Article 590, force majeure similarly excuses partial or full liability, provided the affected party gives timely notice and evidence. Both frameworks require the affected party to mitigate.

Force majeure is not the same as:

• Hardship / changed economics. When input costs rise beyond expectation but performance is still possible, that is a commercial renegotiation, not force majeure.
• Change in law. A new regulation that raises cost is typically handled by an adjustment clause, not an excuse.
• Subcontractor failure. The contractor chose the subcontractor; subcontractor default is the contractor's problem.

Our liquidated damages article steel building liquidated damages delay claims covers the per-day penalty that force majeure pauses. Contract mechanics are in steel building contract review; scope changes in steel building change order management.

Table 1 — Force Majeure vs Liquidated Damages vs Change Order

Aspect	Force Majeure	Liquidated Damages	Change Order
Fault	Neither party at fault	Contractor at fault	Scope change (owner-directed)
Effect on schedule	Extension of Time (EOT)	Delay penalty accrues	Time adjusted per new scope
Effect on cost	Each side bears own loss (usually)	Contractor pays per-day penalty	Owner pays for added scope
Notice window	14 days (FIDIC)	As contract states	Before work starts
Typical trigger	War, pandemic, port closure	Late delivery, late erection	Owner adds crane, mezzanine
Insurance role	CAR covers physical damage	None	None

Qualifying Events: What Counts and What Doesn't

Not every delay qualifies. The following events are typically listed as qualifying force majeure events in steel building contracts, and they form the heart of any steel building force majeure risk allocation schedule:

• Natural disasters: earthquakes, floods, hurricanes, typhoons, blizzards, landslides, tsunamis.
• Armed conflict: war, invasion, terrorism, insurgency, martial law.
• Public health: declared pandemics, government-mandated lockdowns, quarantines.
• Supply chain extremes: national port closures, long-duration national strikes, canal blockages (Suez, Panama).
• Government action: export bans, import bans, new environmental shutdowns.

Events that do NOT qualify:

• Raw material price spikes—commercial risk.
• Subcontractor default—the contractor's selection.
• Labor disputes confined to the contractor's own yard—management risk.
• Currency exchange swings—financial risk, covered by price adjustment clauses.
• Routine weather—contracts assume normal weather; only extreme events trigger.

Steel-specific exposures. Cross-border steel projects have three unique FM exposures: (1) ocean freight disruption (war-risk premiums, port congestion); (2) sudden export bans or tariff changes in the steel-supplying country; and (3) site-side natural disaster damaging already-erected steel. Each of these deserves its own line in the risk register, because the trigger, the notice channel, and the insurance response are all different. A port closure is a shipping-line declaration; an export ban is a government gazette; a site earthquake is a site inspection report plus a CAR claim. Mixing them into a single vague "delay events" clause is how disputes get started six months later when the port actually closes. Post-event assessment is covered in steel building post disaster assessment; flood and fire damage are covered in steel building flood damage assessment repair and steel building fire damage assessment repair.

Table 2 — Steel Building Force Majeure Event Classification

Event Type	Examples	Typically Qualifies?	Notice Window
Earthquake / tsunami	Site earthquake, > magnitude 6	Yes	14 days
Hurricane / typhoon	Wind > 33 m/s / 75 mph	Yes, if beyond design	14 days
Flood / river overflow	Major river flood, site inundation	Yes, if unforeseen	14 days
War / armed conflict	Port closure, convoy attack	Yes	14 days
Pandemic / lockdown	National quarantine order	Yes, with government order	14 days
Port strike (national)	Longshoremen national strike	Yes	14 days
Port congestion (routine)	1–2 week backlog	No—commercial risk	n/a
Raw material price rise	Steel +20% in 6 months	No—commercial risk	n/a
Subcontractor default	Sub-builder bankrupt	No—contractor risk	n/a
FX volatility	Currency ±10%	No—financial risk	n/a

Notice Procedure & Evidence

Timing is the single most important mechanical rule. FIDIC Clause 19.3 requires the affected party to give notice within 14 days of becoming aware of the force majeure event. Many national forms use 15 days. Missing the notice window almost always forfeits the right to claim EOT or cost relief—even if the event itself was genuine.

Notice content must include:

• Description of the event.
• Which work packages are affected.
• Expected duration.
• Initial mitigation measures being taken.

Evidence package. Written notice is backed by documentary proof:

• Government orders, port authority statements, customs notifications.
• Photographs/videos of site damage, port congestion, or lockdown barricades.
• Industry certifications: chamber of commerce letters, shipping-line declarations, marine notices.
• Monthly progress updates while the event continues.

Mitigation duty. The affected party must take reasonable steps to reduce loss. A port strike in Shanghai does not excuse routing through Busan if that is feasible; a pandemic lockdown does not excuse doing nothing if fabrication can shift to another yard. Failure to mitigate limits the recoverable loss. Document every alternative evaluated, even the ones rejected, because the engineer or arbitrator will ask later why the chosen route was the only viable one. Keep a running log of phone calls with shipping lines, emails with alternative suppliers, and photographs of queued vessels. This log is what turns a verbal "we tried" into an evidentiary record. Dispute escalation after FM is covered in steel construction dispute resolution; schedule baseline is in steel building project timeline; risk transfer is in steel building insurance.

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Risk Allocation: Time vs Money, Suspension & Termination

When a qualifying event strikes, three questions follow: do I get time, do I get money, and what happens if the event drags on? The answers define the practical shape of steel building force majeure risk allocation in real projects.

Extension of Time (EOT). If the FM event directly delays the critical path, an EOT is granted for the actual impact duration. Liquidated damages do not accrue during that period. If the contractor is also independently delayed (e.g., slow fabrication + port strike), the concurrent delay principle splits impact proportionally.

Cost allocation. Under FIDIC, each party bears its own losses: the contractor eats idle crew and equipment costs; the owner eats rent and revenue delay costs. Physical damage to the works is typically covered by Construction All-Risk (CAR) insurance, not by the other party. War and terrorism may be excluded from CAR—check the policy. Exception: in some war/terrorism clauses, the owner funds certain demobilization and re-mobilization costs.

Suspension vs termination. Short FM events (a few weeks) lead to suspension: work pauses, no termination, and resumes when the event clears. The contractor preserves its resources on site or demobilizes to a standby posture, and the owner keeps the contract in force. Long FM events trigger termination rights. Under FIDIC, if FM continues for 84 consecutive days (or an aggregate 140 days over a period), either party may terminate; under some national forms, the threshold is 180 days. Termination settles for work done, contractor demobilization, and reasonable remobilization costs.

Practical drafting tips for steel contracts:

• List qualifying events explicitly; avoid "and other events" catch-alls that breed disputes.
• Name the ports you ship through, and list fallback ports.
• Confirm CAR covers war risk and pandemic—not always automatic.
• Tie the EOT day-count to critical-path impact, not calendar days.

All-risk cover is covered in steel building construction all risk insurance; shipping terms in incoterms 2020; business continuity in steel building emergency response business continuity.

Table 3 — Force Majeure Risk Allocation Summary

Item	Contractor Bears	Owner Bears	Insurer (CAR) Bears	Notes
Extension of time	Time loss absorbed	Schedule slip accepted	n/a	LD suspended during EOT
Idle crew / equipment	Yes	No	No	FIDIC own-loss rule
Owner's delay damages	No (LDs paused)	Yes	n/a	No LD accrual
Damage to erected steel	No	No	Yes	Subject to war/pandemic exclusions
Material in transit (war)	Often yes (per Incoterm)	No	Marine cargo	Check war risk clause
Demobilization cost (post-war)	Partly	Often yes	No	FIDIC 19.6 split
Remobilization cost	Partly	Often yes	No	Negotiated at termination
Site re-clearance	Partly	Partly	Often yes	Shared, insurance-led

Conclusion

A steel building force majeure risk allocation clause is not a loophole—it is a narrow, narrowly-defined excuse for events that stop work through nobody's fault. The mechanics are simple: list qualifying events explicitly, give written notice within 14 days with official evidence, mitigate where you can, and accept that time is usually extended while cost is split (each side eats its own losses, with CAR insurance covering physical damage). Missing the notice window forfeils the claim entirely. Get your steel building force majeure risk allocation clause pressure-tested before you sign—send us your contract and we will review it.

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About the Author

Senior Structural Engineer

With over 20 years of hands-on experience in steel structure design and prefabricated building engineering, our in-house senior structural engineer has personally contributed to more than 500 steel building projects—including warehouses, industrial factories, aircraft hangars, agricultural buildings, and commercial structures. The focus is on translating design codes such as AISC 360, ASCE 7, and Eurocode 3 into buildable, cost-effective steel solutions that balance structural performance, fabrication efficiency, and total project cost.

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Case Example

A German importer contracted for a 3,800 m² (40,900 sq ft) prefabricated steel warehouse kit shipped from a Chinese port under CIF Hamburg terms. Eight weeks into fabrication, the Red Sea shipping route was disrupted by a regional conflict, forcing vessels to reroute around the Cape of Good Hope—adding 21 days to transit and triggering a port congestion backlog at Hamburg. The key challenge was determining whether the reroute qualified as force majeure under the FIDIC Red Book Clause 19 framework. The contract explicitly listed "war, armed conflict, or closure of Suez Canal transit" as qualifying events. The contractor issued written notice within the 14-day window with port authority documentation. An Extension of Time of 21 days was granted, liquidated damages were suspended during the delay, and each party bore its own idle costs per the FIDIC own-loss rule. Physical damage to material in transit was covered by marine cargo insurance. For shipping term details, see incoterms 2020.

Frequently Asked Questions

Q1: What events qualify as force majeure in a steel building contract?

Typical qualifying events include natural disasters (earthquakes, floods, hurricanes), armed conflict or terrorism, pandemics with government lockdowns, port closures or national strikes, and government export/import bans. Raw material price increases, subcontractor defaults, and routine weather do not qualify—those are commercial risks.

Q2: How long do I have to notify a force majeure event?

Under FIDIC and most standard forms, notice must be given within 14 days of becoming aware of the event. Some contracts use 15 days. Missing the notice window usually forfeits your right to claim an extension of time or cost relief entirely.

Q3: Does force majeure excuse delay penalties (LDs)?

Yes—when the delay is directly caused by a qualifying force majeure event and notice was timely. The contract grants an Extension of Time (EOT) for the actual duration of impact, and liquidated damages do not accrue during that period. However, concurrent delays (your own delay + force majeure) are split proportionally.

Q4: Who pays for losses during a force majeure event?

Under FIDIC, each party bears its own losses—the contractor eats its own idle costs, the owner eats its own delay costs. However, physical damage to the works is typically covered by the Construction All-Risk (CAR) insurance policy. Check whether war risk and pandemic exclusions apply.

Q5: When can a contract be terminated due to force majeure?

Under FIDIC, if force majeure continues for 84 consecutive days (or an aggregate 140 days), either party may issue a termination notice. Some national forms use 180 days. Termination settles for work completed, contractor demobilization, and reasonable remobilization costs.

Port Strikes, Pandemics, War—Who Eats the Delay?

We draft force majeure clauses that list qualifying events explicitly, set 14-day notice windows, and split time vs cost risk before trouble starts. Review your clause now.

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Reference Links

• FIDIC Red Book Clause 19 (Force Majeure) — international standard form defining qualifying events, 14-day notice, EOT rights, and 84-day termination trigger.
• ICC Force Majeure Clause — model force majeure clause and commentary used in international commercial contracts.