Conflict Zones and Commercial Contracts: What the Tigray Crisis Teaches GCs About Force Majeure and Political Risk Clauses

Why Mekelle Matters to Contract Lawyers Far Beyond Africa

When Ethiopian federal police re-entered Mekelle following the withdrawal of Tigray People's Liberation Front forces, the immediate headlines focused on humanitarian conditions and public order. For general counsel and law firms advising clients with African operations, however, the development raises a more technical question: what happens to commercial contracts when a region transitions from rebel control back to recognised governmental authority, and who bears the legal risk during that interval?

The Tigray situation is not unique. From Sudan to Myanmar to parts of the Sahel, periods of contested authority followed by a partial restoration of central government control are becoming a recurring feature of the commercial landscape. Contracts drafted without close attention to this full cycle, covering not just the eruption of conflict but its messy resolution, leave parties exposed to costly disputes about whether obligations remain suspended, have been frustrated entirely, or have quietly revived.

The Force Majeure Gap: Outbreak Versus Resolution

Most force majeure clauses in international commercial contracts address the onset of a triggering event: war, civil unrest, government action, or acts of a declared enemy. Far fewer clauses address what happens when that event partially resolves. Does the suspension of obligations lift automatically when federal police re-enter a regional capital? Does a party that suspended performance under a force majeure notice need to serve a separate notice of revival? These questions are rarely answered in the contract itself.

The enforceability of a force majeure clause also depends heavily on the governing law. Under English law, force majeure is entirely a creature of contract; there is no statutory fallback, so every gap in drafting becomes a litigation risk. Ethiopian contract law, rooted in the 1960 Civil Code and influenced by civil law traditions, treats impossibility of performance more broadly, but applying that standard during a transitional period, when authority is contested rather than absent, is genuinely uncertain territory.

Political Risk Clauses and the Transitional Authority Problem

A transitional administration, the type now being established in Mekelle, creates a category of counterparty risk that sits awkwardly between standard political risk definitions. Most political risk insurance policies and stabilisation clauses in investment contracts refer to actions of "the government" or "a recognised authority." A transitional body may not satisfy either definition, leaving investors and their lenders in a grey zone.

GCs advising clients with assets, offtake agreements, or supply arrangements in the Tigray region, or in any comparable post-conflict environment, should audit their contracts against three specific questions. First, does the force majeure clause cover not just the conflict event but the transition period? Second, is there a mechanism for notice and re-commencement of obligations when conditions improve? Third, does the governing law treat partial restoration of order as sufficient to end the force majeure period, or does full normalisation have to be demonstrated?

Jurisdiction Selection and the Enforceability Question

Contracts with Ethiopian counterparties are subject to the jurisdiction of Ethiopian courts unless the parties have validly selected a foreign seat for arbitration. The Permanent Court of Arbitration and various ICC panels have handled Ethiopian disputes, but recognition and enforcement of awards in Ethiopia remains dependent on domestic court cooperation, which can be complicated in post-conflict conditions.

For new contracts in the region, GCs should consider requiring arbitration seated in a neutral jurisdiction with a strong UNCITRAL or New York Convention track record, incorporating a governing law with clear force majeure rules, and adding a specific clause addressing the status of obligations during transitional governance periods. These are not exotic drafting requirements; they are standard practice for contracts in fragile-state environments and should be treated as baseline protections rather than premium additions.

What GCs Should Update in Their Contract Templates Now

The Tigray situation is a timely prompt to review template language across any contract portfolio touching politically sensitive jurisdictions. Specifically, legal teams should consider four updates.

First, expand the force majeure definition to include "transitional authority periods" and "contested governmental control" as distinct triggering conditions. Second, add a re-commencement mechanism that requires affirmative notice from both parties before suspended obligations revive. Third, include a material adverse change clause that explicitly addresses deterioration and improvement in the political environment as separate trigger points. Fourth, ensure that any stabilisation or political risk clause references both "de jure" and "de facto" governmental authority, so that a transitional body's actions are captured within the definition.

Adira's contract review capability can identify clauses that address conflict risk only partially, flagging language that covers outbreak but not resolution, or that references governmental authority without defining it for transitional contexts. For multinationals with large portfolios across Sub-Saharan Africa or other fragile-state regions, that kind of systematic gap analysis is considerably more efficient than reviewing each contract manually ahead of a potential trigger event.

The Broader Pattern for Global Legal Teams

The return of federal authority to Mekelle is, one hopes, a step toward durable peace in northern Ethiopia. For legal professionals, it is also a reminder that conflict risk in commercial contracts is not a binary condition. Contracts that treat force majeure as an on-off switch, rather than as a continuum from stability through conflict to transitional recovery, will continue to generate disputes as political volatility persists across multiple regions simultaneously. Drafting for the full cycle, not just the dramatic opening event, is the professional standard that global practice now demands.