Dubai 
ParisOperational disruption and supply chain risk
Businesses operating across international supply chains often rely on carefully coordinated logistics and delivery arrangements.
Where transportation routes, supplier availability or operational conditions change, contractual performance obligations may be affected.
Commercial contracts frequently include provisions addressing:
- delivery schedules
- performance milestones
- liquidated damages for delay
- obligations to source alternative suppliers
Operational disruption can therefore have contractual implications, particularly where contracts contain strict delivery timelines or time-of-the-essence provisions.
In these circumstances, businesses may wish to consider:
- whether delays may affect contractual performance
- whether force majeure or other contractual protections may apply
- whether contractual variations or extensions may be required
Maintaining clear records of operational developments and mitigation efforts can also assist in managing discussions with counterparties.
Proactive engagement with suppliers, customers and other contractual partners can often help preserve commercial relationships while addressing operational challenges.
CVML regularly advises clients on contractual risk management strategies where supply chain issues affect commercial performance.
If you or your organisation would like to discuss any aspects of this guidance note further, please reach out to your usual CVML contact, or email:
Naji Khairallah, Partner, CVML (n.khairallah@cvml.ae)