Force Majeure

Glossary

Banking

Force Majeure

Force majeure is a standard clause in borrowing documentation that releases borrowers from liability for natural catastrophes and for events over which it has no control. The clause comes into effect when these events prevent it from carrying out its obligations under its borrowing documentation. Examples of events that trigger the force majeure clause include natural disasters (hurricanes, tornadoes, tsunamis, floods, earthquakes, avalanches, volcanic eruptions); and political and geopolitical events (military coups, wars, government expropriation or the imposition of capital controls).

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