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In early 2025, a quietly significant legal decision emerged from the International Chamber of Commerce (ICC) in Switzerland. It didn’t make many front pages. No photo ops. No fanfare. But it spoke volumes—about law, power, and the surprisingly stubborn resilience of commercial contracts.
The basics are simple enough: ČEZ, the Czech Republic’s state-backed energy company, had a long-term gas supply deal with Gazprom Export, a major Russian energy firm. Then came 2022, and with it, the Russian invasion of Ukraine—a geopolitical earthquake that also shook pipelines, contracts, and supply chains across Europe.
Gazprom stopped delivering gas. ČEZ took them to arbitration. And—somewhat remarkably—ČEZ won. The ICC tribunal awarded them around $42 million in damages (Reuters, 2025).
Now, you might think: in the midst of war and sanctions, surely everyone understood that obligations were going to fall apart. But the tribunal didn’t see it that way. And therein lies the real story.
Contracts Under Siege
When the bombs started falling and sanctions mounted, contracts—those meticulously negotiated, clause-laden bundles of commercial intent—were suddenly put to the test. Especially in the energy sector, where the infrastructure is rigid, supply chains are long, and delivery isn’t just about moving product—it’s about trust, timing, and, increasingly, politics.
For ČEZ, the issue wasn’t just the gas—it was accountability. The company had a deal. Gazprom didn’t deliver. And the reasons, though dramatic, weren’t—legally speaking—enough.
The Russian firm cited force majeure, a familiar legal doctrine that can, in certain conditions, excuse a party from performance when something truly disruptive happens: a war, an earthquake, a government act. Something that makes the deal unworkable—not just inconvenient, but actually impossible.
But as the ICC tribunal saw it, Gazprom’s defense didn’t hold up.
What Does “Force Majeure” Really Mean?
It’s one of those legal terms that feels simple but turns thorny fast. Most commercial contracts include some variation of a force majeure clause. In theory, it provides an out—an acknowledgment that, sometimes, life intervenes. But invoking it successfully is another matter.
Generally, courts and tribunals look for four things:
1. The Event Falls Within the Clause
The disruption must be clearly included in the contract. War, embargoes, acts of government—these are standard.
2. Performance Is Objectively Prevented
The threshold isn’t whether it became difficult—it must be legally or physically impossible.
3. The Affected Party Acted Diligently
You need to show that you tried. You looked for alternatives. You didn’t just stand still.
4. Timely and Proper Notice Was Given
You need to alert the counterparty quickly and clearly, explaining what happened and what you’re doing about it.
In Gazprom’s case, the tribunal found several shortcomings. War may have been a valid force majeure event, but the causal link to Gazprom’s failure to deliver was “too indirect” (ICC Reporter, 2025). They also couldn’t demonstrate they’d seriously tried to minimize the impact—or even followed the notice requirements in the contract.
The Politics Beneath the Contract
There’s an elephant in the room: Gazprom is not a typical commercial entity. It’s deeply entangled with the Russian state. So any arbitration involving it drips with politics.
But one of the tribunal’s more interesting moves was to treat Gazprom as a commercial actor—not a political proxy. They applied the rules of contract, not diplomacy (Global Arbitration Review, 2025).
And that matters. Because when tribunals start blurring that line, the legal framework risks becoming unmoored from reality. This decision reaffirms a delicate balance: yes, context matters—but a contract is still a contract.
Jurisdiction: No Russian Detour
In 2024, ČEZ made a smart legal maneuver: it secured a ruling preventing Gazprom from taking the case to Russian courts (Reuters, 2024). That move protected the case from potential political interference and affirmed the ICC’s role as the appropriate venue.
This is about more than just procedure. It’s about trust in arbitration. Neutrality is arbitration’s currency. And in this case, it held.
Beyond the Award: Precedent in the Making
The $42 million award is significant. But it’s the precedent, not the payout, that has people watching:
- War alone doesn’t excuse performance. There must be a clear, direct disruption—and no viable alternatives.
- Political influence doesn’t shield commercial actors. Even state-backed companies must honor their agreements.
- Good faith counts. Effort, transparency, and timing all matter when invoking force majeure.
This sends a signal across the energy sector: even amid conflict, contracts remain enforceable—if not by courts, then by arbitral bodies.
Looking Ahead: Clauses, Courts, and Consequences
This case won’t be the last of its kind. As energy security continues to collide with geopolitics, companies will need to:
- Revisit and tighten force majeure language,
- Define obligations clearly, including what “impossibility” actually means,
- Build in robust notice procedures, and
- Consider where and how disputes will be resolved if things fall apart.
In other words: plan for disruption—legally, not just logistically.
Crisis Isn’t Carte Blanche
This wasn’t just a regional utility staring down a superpower. It was a reminder that contracts don’t dissolve in crisis—they’re tested by it.
Sure, the world is messy. Wars erupt. Markets shift. Governments impose sanctions. But unless those events render performance truly impossible—and unless you act transparently and in good faith—you’re still on the hook.
The takeaway? Crisis doesn’t silence contracts. It amplifies them. And when contracts can’t speak, tribunals do.
References
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Global Arbitration Review (2025) ‘Czech energy group declares win against Gazprom’, 26 February. Available at (Accessed: 3 March 2025).
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ICC Reporter (2025) ‘ICC tribunal awards CEZ damages over Russian gas shortfall’, International Arbitration Monitor, March. Available at (Accessed: 3 March 2025).
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Reuters (2025) ‘ČEZ wins arbitration against Gazprom’, Reuters, 26 February. Available at (Accessed: 3 March 2025).
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Reuters (2024) ‘ICC tribunal bans Gazprom from bringing gas dispute to Russian court’, Reuters, 24 May. Available at (Accessed: 3 March 2025).
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Wikipedia (2025) 2022–2023 Russia–European Union gas dispute. Available at (Accessed: 3 March 2025).