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Will Force Majeure be #1?

July 2, 2020

It is time for IACCM’s extensively cited survey, the Most Negotiated Terms – the only worldwide study that tells us what business negotiators actually spend their time negotiating!

Those familiar with this annual study, now in its 20th year, will know that the pace of change has been relatively slow and only occasionally dramatic. The year of its launch, 2001, was one such dramatic year, when the events of 9/11 caused Force Majeure provisions to surge to prominence.

Certainly, over the years, there have been shifts in the table of top terms and also new entrants, often due to regulation or as a result of some major event. But the top spot has almost always been claimed by our old friend, Limitation of Liability. There has been occasional excitement when its close rival, Indemnities, has narrowed the gap …..

Will this year be different?

COVID-19 has had a massive impact on so many aspects of our lives – and contracts are no exception. There is extensive discussion over what terms will change, which provisions become more important, whether the tone and tenor of negotiations themselves will alter, perhaps becoming more collaborative. Scanning the legal press it would be easy to conclude that Force Majeure may once again be a candidate for top spot – but is that really the case?

Force Majeure clauses certainly made headlines when the pandemic started to hit in earnest. There were dozens of articles and webinars discussing its applicability and what constituted a well-written provision. Many law firms appear to remain focused on those questions, yet for business people, it may be rather less relevant. Force Majeure is in many ways symbolic of the more adversarial school of contracts and negotiations. For business executives, the issues are much more about how customers and suppliers work together to minimize risk and disruption.

So where will Force Majeure feature this year? What other terms may have risen up the list and to what extent are attitudes to negotiation itself undergoing material change? How do the answers vary across industries, or geographies? The IACCM Most Negotiated Terms survey will provide answers to these questions and more.

This year, we are especially excited to be partnering with leading contract management software provider, Icertis. The insights provided by their Artificial Intelligence tool will enable us to not only understand the relative positioning of the negotiated terms, but also a sense of what elements of a term are receiving the greatest focus. Equipped with this information, negotiators will be in a much better position to set their own priorities for contract review and negotiation planning and training.

Initial results will be issued to participants by the end of July. If you want to be among the first to know, visit TopNegotiatedTerms to complete the survey!

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