Section 8 of the Civil and Commercial Code (the CCC) provides the statutory definition of FM which denotes any event the happening or pernicious result of which could not be prevented even though a person against whom it happened or threatened to happen were to take such appropriate care as might be expected from him in his situation and in such condition. In short, FM refers to an event that no one under the same situation can prevent from occurring, and once occurred, no one can prevent its harmful result, even though reasonable care has been applied. If the event or its consequence can be reasonably prevented with a reasonable care/effort, it shall not be regarded as FM.

As the statutory definition of FM is not a mandatory law, contracting parties are free to define their own FM and relevant consequences under the contract. Otherwise, the statutory FM will apply if contracting parties have not agreed an FM clause in their contract.

Parties may agree to define their own FM and consequence under the contract, as the statutory FM definition is not a mandatory law.

Under the CCC, there is no specific formality to invoke the FM, but it is recommended that the party seeking to invoke the FM formally serves the FM notice to the other party as soon as the FM has occurred and caused impact on the ability to perform the contract.

If parties have agreed an FM clause, the steps will depend on the terms of the contract.

Under the CCC, this includes the obligation to exercise reasonable care expected from the person in the same circumstance to prevent the harmful result, or if it is impossible to prevent, the duty to mitigate is extended to limit a greater loss/damage.

If parties have agreed an FM clause, mitigation obligations will depend on the terms of the contract.

Section 8 of the CCC does not provide legal consequences upon the occurrence of FM. To determine whether a debtor is discharged from his or her obligation as a result of the FM, the question is whether or not the performance of obligations is impossible:

• If the performance of obligations becomes impossible without the debtor's fault, the debtor is discharged from his obligation (section 219 of the CCC)
• If the performance of obligations becomes impossible in consequence of a circumstance for which the debtor is responsible, the debtor will be liable for compensation for the non-performance.

Thai law has statutory provisions comparable to the common law doctrine of impossibility and frustration of purpose, i.e. the impossibility of performance of obligations, which would release a contracting party (or both parties) from the obligations under the contract (sections 218 and 219 of the CCC).

Moreover, the parties may also agree on some clauses, such as Change of Law, Material Adverse Effect, or Hardship clause, to govern their contractual rights and liabilities as a result of some event which may not fall under the statutory FM.