Pandemics, public-private partnerships (PPPs), and force majeure | COVID-19 expectations and implications

Abstract

The novel coronavirus (COVID-19) pandemic is placing unprecedented stress on public-private partnerships (PPPs), creating the real possibility of widespread project failures. The disruption and potential collapse of multiple PPP projects will likely trigger force majeure contractual provisions, but the applicability and efficacy of these generic catch-all clauses remain in question. This critical note therefore discusses the implications of force majeure contractual conditions on PPPs in the COVID-19 epoch. We first define the concept of force majeure as it pertains to pandemics. Next, we review a select number of international policies for such events, outlining their key features and glaring shortcomings. Then, we use Novia Scotia's Highway 104 Twinning Project as an illustrative case example of improved force majeure risk management. Finally, after reflecting on the three ironies of construction crisis management, we outline the need for swift trust in PPPs during this current pandemic and conclude by calling for a comprehensive revision of force majeure contract provisions.

Household water insecurity will complicate the ongoing COVID-19 response: Evidence from 29 sites in 23 low- and middle-income countries

“…These partnerships may have the physical and social infrastructure to immediately improve water access for many vulnerable communities. But the pandemic has created financial stress for PPPs across industries globally and threatens widespread project failure from logistical disruption and new budget constraints, including the loss of revenue from regional lockdowns ( Baxter and Casady, 2020 ; Casady and Baxter, 2020 ). PPP engagement requires caution, as goals and accountability are not always well-aligned between partners, and profit imperatives can clash with equity and other priorities.…”

Modeling working shifts in construction projects using an agent-based approach to minimize the spread of COVID-19

“…Impacts outside of the construction field have been focused on understanding the applicability of the force majeure clause in the current pandemic context (e.g. [ 16 , 25 , 26 ]. [ 26 ], discussed the impact that COVID-19 has had on the Nigerian construction industry [ 26 ].…”

“…suggested that given the highly disruptive events COVID-19 has placed on the Nigerian construction industry (e.g., by slowing down completion of projects due to social distancing practices), force majeure contractual clauses should be reviewed among the parties involved so to minimize the challenges that COVID-19 has placed on construction contracts. Similarly [ 16 ], explore the force majeure clause in the context of public-private partnerships (PPP). Casady and Baxter argued that given the important role that infrastructure projects will play in the economic recovery of nations and the stress that COVID-19 is placing on force majeure clauses, it is important that these clauses are reviewed in a comprehensive manner to minimize their impacts on construction projects.…”

“…As the spread of COVID-19 has continued worldwide, research studies have started to report challenges that workers may face while performing their jobs during the pandemic context (e.g., [ 14 , 15 ]. Of note, a few studies have focused on the challenges that COVID-19 may have on construction workers in the current pandemic context [ 3 , 11 , 16 ]. For instance [ 11 ], proposed a model to study how the spread of COVID-19 among construction workers may impact the construction workforce’s planning during a project.…”

Significance of Strategic Outsourcing in IT Project Management

“…Rather, it formally defines the protocols that would take over usual operations during times of crisis. There have been considerations that the COVID-19 Outbreak could constitute a Force Majeure event [22]. IT projects are no exceptions and may need such provisions to ensure that businesses can engage in mutually supportive relationships.…”