(Yicai Global) Feb. 17 -- A Chinese government certification body has thus far issued 1,615 certificates attesting that the novel coronavirus epidemic is a force majeure event disabling domestic companies from executing their contracts, with the value of these abortive deals totaling almost CNY110 billion (USD16 billion) as of Feb. 14 and the highest amount involved in a single transaction being over CNY23 billion.

The certifier, the China Council for the Promotion of International Trade, is a national foreign trade and investment promotion agency under the country's cabinet the State Council, has started to confirm facts relevant to force majeure claims and issue corresponding verifications in response to applications submitted to its authentication platform -- rzccpit.com -- to help companies cope with the epidemic's adverse impacts and to offer more convenient services following its outbreak, explained Yan Yun, the deputy director of the CCPIT's center for commercial certification, CCTV News reported yesterday.

Force majeure clauses in contracts shield parties unable to discharge their duties because of acts of God, war, insurrection, natural disasters and the like from liability for this inability, but they require a proven factual basis. The term in French roughly translates as 'with greater force.' Formed in 1952, the certifier, the China Council for the Promotion of International Trade, is a national foreign trade and investment promotion agency under the country's cabinet the State Council.

The organization's online certification platform instituted on Jan. 26 is now available in 26 Chinese provinces and the cities of Beijing, Tianjin, Shanghai and Chongqing, which are directly under China's central government.

These authentications form an important evidentiary base for absolving parties of liability for breach of contract, and those whose fulfillment is prevented can petition for complete or partial exemption for non-execution, partial performance or delayed fulfillment of contracts on the strength of these documents.

Forbearing Firms

Some companies have won their counterparts' understanding and recognition, and have been able to keep their purchase orders coming in after showing them these certificates, and their opposite numbers have in some cases also agreed to defer delivery deadlines, according to feedback the CCPIT has obtained from those firms to which it has issued documents.

The council's certificates are recognized by more than 200 national or regional governments, customs, chambers of commerce and companies around the world, and they enjoy great credibility overseas, said Yan Yun, deputy director of the body's commercial certification center.

The CCPIT issues a factual proof of force majeure to establish the presence of the disabling events claimed upon request by petitioners. After a certificate issues, parties affected by unforeseeable circumstances beyond their control may be partially or entirely exempted from liability.

The council, which formed in 1952, promotes foreign commerce, international cooperation and economic and trade negotiations, and provides legal and intellectual property services to companies, according to its website. The CCPIT does not disclose the identity of applicants for its certifications.

Editor: Ben Armour