Scenario: a storm tears the workshop roof off and floods the entire leased plot for nearly two months; the park developer still invoices full sub-lease rent and management fees, citing “the contract has no relief clause”. The force majeure clause is the least-read part of a lease at signing and the most needed when things go wrong. This article sets out how to draft it for industrial land leases under the Civil Code 91/2015/QH13 and the State’s own land-rent relief mechanism.
The legal base: Articles 156, 351 and 420 of the Civil Code
Article 156 of the Civil Code 91/2015/QH13 defines force majeure as an event that occurs objectively, could not have been foreseen, and cannot be overcome despite all necessary measures within one’s capacity. The consequence, at clause 2 of Article 351: a party in breach is exempt from liability if the breach results from force majeure, unless otherwise agreed. Alongside, Article 420 governs fundamental change of circumstances: where objective change makes contract performance seriously unbalanced, the affected party may demand renegotiation and, failing agreement, ask the court to terminate or amend the contract. These three provisions form the default frame — but a 30–50-year land lease should not be left to defaults, because litigating “is it force majeure” always costs more time than a clause that already lists events and consequences.
The standard force majeure clause structure for land leases
Layer one, definition and list: open with the Article 156 definition, then illustrate with land-specific risks — storms, floods, earthquakes, fire not caused by either party, epidemics and state-ordered lockdowns, requisition or use-restriction decisions for defence and security, and wide-area infrastructure failures beyond the developer’s control. Layer two, procedure: the affected party must notify in writing within 7–15 days with evidence (authority documents, disaster confirmations, photos, status records) and bears a duty to mitigate. Layer three, financial effects: no penalties or late-payment interest during the event; sub-lease rent and fixed fees reduced in proportion to the unusable area, or suspended if the whole plot is unusable; the lease term extended by the interruption period if the parties wish. Layer four, the exit threshold: if the event runs continuously beyond the agreed threshold (practice: 90–180 days), either party may terminate, with settlement of the used portion, refund of prepayments and deposit, and a machinery-removal window. Layer five, clear exclusions: market price movements, one party’s financial difficulty and ordinary policy change are not force majeure — preventing abuse of the clause.
Leverage from the State’s mechanism, and the epidemic note
A strong negotiation argument for the sub-lessee: the State itself shares this risk with the developer. Decree 103/2024/ND-CP provides that where a land user must suspend operations to remedy consequences of natural disaster, fire or force majeure, its land rent is reduced by 50% for the suspension period. If the developer receives that relief at the State layer but passes nothing down to the sub-lease layer, it profits twice from the same event. Putting this mechanism on the negotiation table usually works better than academic argument over Article 156. On epidemics: after the 2020–2021 experience, new land leases should carry a dedicated clause for public-health events and administrative operation restrictions (park lockdowns, distancing orders), fixing fee relief by restriction level in advance — rather than leaving the parties to fight over whether it is force majeure or changed circumstances, two doctrines with entirely different legal consequences (exemption versus renegotiation).
Frequently Asked Questions
What must a force majeure clause in a land lease contain?
A complete force majeure clause built on Article 156 of the Civil Code 91/2015/QH13 has five components: a definition (objective, unforeseeable, insurmountable despite all necessary measures); an illustrative event list (natural disaster, fire, epidemic, war, administrative decisions rendering the land unusable); a notice duty within a fixed period with proof (authority confirmations of the disaster/event); legal effects (immunity from damages/penalties during the event, suspension of corresponding obligations, rent treated on the principle that unusable land is not paid for, or is reduced proportionally); and a termination threshold (if the event lasts beyond an agreed number of days, either party may terminate, with deposit refund and settlement of the used portion).
Do epidemics and prolonged lockdowns count as force majeure in industrial land leases?
They can be force majeure or a fundamental change of circumstances, depending on drafting and facts. Under Article 156 of the Civil Code 91/2015/QH13, a force majeure event must be objective, unforeseeable and insurmountable — wide-area lockdowns during epidemics have been accepted as force majeure in many Vietnamese dispute outcomes. But for long-term land leases, epidemic impact often lands in the ‘fundamental change of circumstances’ zone of Article 420 (performance becomes extremely difficult, seriously unbalanced) — whose consequence is renegotiation rather than full exemption. A dedicated clause for epidemics and administrative operation restrictions is the safest route.
How are land rent and park fees treated when force majeure strikes?
Follow the three-layer structure common in sub-leases: State layer — where land cannot be used due to disaster, fire or force majeure, land and tax law provides corresponding rent relief (Decree 103/2024/ND-CP grants a 50% land-rent reduction for the period of forced suspension to remedy disaster, fire or force majeure consequences); developer layer — the sub-lease should pass that mechanism down: sub-lease rent is reduced or suspended in proportion to the unusable area and period; service layer — output-based fees (wastewater, power) fall naturally with usage. Without such a clause, the sub-lessee is left negotiating from the Civil Code’s general basis, in a far weaker position.
How long must force majeure last before the land lease can be terminated?
The law sets no universal figure — the threshold is contractual, with drafting practice commonly at 90–180 continuous days or a cumulative count per period. The clause must also settle the exit consequences: refund of prepaid rent for unused time, deposit return (less set-off for real damage), site handover/demolition duties and a machinery-removal window. Without an agreed threshold and consequences, the party wanting out must invoke Article 420 of the Civil Code (fundamental change of circumstances) and persuade a court or tribunal — a long road with an uncertain outcome.
