A typical dispute does not begin with a legal breach, but with an invoice
In many international supply relationships, conflicts do not escalate because one party 'does not want to', but because theysuddenly can no longer operate under the same conditions: Transport costs rise, new import duties come into effect, raw materials become scarce, approvals take time, or payments get stuck in bank checks. What initially appears operationally as 'project stress' quickly becomes a legal core issue:Who bears which risk – and what consequences does a disruption actually have?
Especially in 2026, it becomes clear that classic contractual routines (short framework contract + order + Incoterms abbreviation) are reaching their limits. This is because the biggest cost and failure drivers often lieoutsidethe actual goods: regulatory interventions, export control risks, changes to sanctions lists, volatile tariff policies. The US perspective is explicitly described as dynamic in current analyses: companies must also expect movement in tariffs, increasing export control restrictions, and intensified enforcement in 2026 – with consequences for supply chains, investment strategy, compliance, and contract design.
Problem area 1: 'Incoterms regulated' – and yet it is unclear who pays
Many contracts include an Incoterms abbreviation (e.g. FCA, DAP, DDP) – and both parties are convinced that this solves the cost and risk puzzle. In fact, Incoterms do a lot: they are intended as a framework to choose the appropriate delivery clause and to assign obligations more clearly.
In practice, however, the very questions that are crucial in disputes often remain open:
Which costsare considered 'transport costs' – and which are 'regulatory costs' (e.g. additional proof, inspection, or certification obligations)?
Does an agreed clause apply even if the risk materialises not during transport, but in thecustoms or compliance process?What happens if the operational model (container traffic, consolidation, cross-docking) does not fit the chosen Incoterms scenario?
The problem is less about the framework – but rather the assumption that it replaces a clear
contractual risk matrix.Incoterms allocate obligations along a delivery point; however, they do not automatically answer how new duties, 'surprise costs', or data/proof obligations should be distributed.Typical conflict:
Procurement calculates with a delivery price 'including everything'. However, the contract only regulates the delivery location – not the question of whether additional costs (e.g. due to new import requirements) may be passed on. In a dispute, a calculation question then becomes a legal question:Price risk or obligation risk?Problem area 2: Which law applies – and why this often only becomes apparent in disputes.
Problem area 2: Which law applies – and why this often only becomes apparent in a dispute
Another classic: The contract contains technical, delivery, and payment rules, butno clear choice of law– or a choice of law that is practically 'overlaid by the CISG'. Particularly in sales contracts between companies from contracting states, the UN Sales Law (CISG) is often at play, without anyone having actively planned for it.
The CISG provides, for example, in Art. 79 for an exemption from liability if a party proves that the non-performance is due to ahindrance beyond its control, which could not reasonably have been taken into account at the time of the contract conclusion and which could not be avoided or overcome.
What is often underestimated in practice: Such rules do not concern 'any details', but the central point of contention when deliveries fail or costs explode. At the same time, 'exempt' does not automatically mean 'everything is resolved': Often it is aboutdamages, not about whether the contract continues, is adjusted, or can be terminated – and how strict the evidential requirements are.
Problem area 3: Force Majeure is not Hardship – and this is where many cases lie
Many companies have force majeure clauses. These typically apply when performance becomes objectively impossible (e.g. due to embargo, destroyed production facility, governmental prohibition). However, numerous disruptions in 2026 are not 'impossibility', buteconomic derailment: It becomes deliverable, but under conditions that fundamentally upset the contract.
This is where the concept ofHardshipIn the UNIDROIT Principles, hardship is described as a situation in which events fundamentally change the balance of the contract – for example, because the costs of performance increase massively or the value of the counter-performance decreases.
As a typical consequence, a mechanism forre-negotiationis considered: The disadvantaged party can demand re-negotiations; the contract is not automatically "wiped away", but it is about adjustment logic.
Why this is so critical in international economic law: Whether and how "hardship" is recognised depends heavily onapplicable law, contract design, and litigation strategy.A contract that only recognises "force majeure" can be effectively blind to hardship situations – and then the situation often escalates to termination, delivery stoppage, or damages.
Problem area 4: Sanctions and export controls – "being allowed to deliver" becomes a contractual prerequisite.
Sanctions and export controls often appear as compliance issues. However, in contractual reality, they quickly becomeperformance-determining: Without approval, no delivery; without proof of end-use, no release; without payment approval, no goods dispatch.
Two effects are typical:
Burden of proof and documentation conflicts:Who must prove what in order for delivery to be allowed? Who bears the risk if authorities or banks require additional information?
Chain reactions:A supplier can be blocked even if they are "only" an indirect link – for example, because sub-suppliers, logistics providers, or payment routes are affected.
Current trade analyses emphasise that export control restrictions and enforcement activity may continue to increase in 2026, thereby also affecting contract and supply chain planning.
In practice, a general statement such as "applicable laws must be complied with" is rarely sufficient. What is crucial is whether the contractoperational mechanicsis aware of: information obligations, cooperation obligations, stop/suspension rights, clear triggers, and a handling of cost consequences.
Where it most often grinds in practice
In disputes, the same breaking points can be seen repeatedly:
Unclear triggers:When does a disruption occur that justifies adjustment or suspension?
No proof system:Who must provide which documents, by what deadline, and in what quality?
Missing price mechanism:When external costs rise (tariffs, compliance costs, replacement procurement), there is no "channel" in the contract to properly address this.
Process blindness:Jurisdiction/arbitration is not strategically chosen; evidence preservation, interim legal protection, supply chain documentation are not prepared to be "dispute-proof".
Mismatch of law & reality:One relies on standard clauses, even though the business is a risk-managed long-term relationship.
The result is often paradoxical: both sides actually want to continue working together – but the contract forces them into an all-or-nothing logic (delivering at a loss or risking breach of contract).
Possible solutions – intentionally only outlined
Instead of "more clauses", it is regularly aboutbetter architecture. Typical levers that have proven effective in international supply relationships are:
Risk map in the contract:Not as a 20-page annex, but as a clear assignment:What types of costs/disruptionsare there – andwhobearswhat share?
Hardship mechanics with guardrails:Not a "free pass", but a defined process: triggers, evidence, deadlines, temporary measures, adjustment logic. (Especially since hardship concepts can vary greatly depending on the legal system.)
Sanctions/export control operationalisation:Not just "compliance assurance", but concrete cooperation and information obligations as well as a clear regulation of what happens in the event of blockages.
Incoterms plus:Incoterms as the basic language – supplemented by rules for duties, regulatory requirements, documents, and data quality.
Evidence and documentation design:Whoever documents "cleanly" in a dispute gains time, negotiating power, and often also the better procedural position. (This is less legal theory than operational reality.)
Dispute resolution strategy:Choice of law and forum must fit the risk situation – especially in cases of interruptions, interim measures, and international enforcement.
These points sound abstract – but become very concrete as soon as the first delivery is delayed, customs requests further information, or a bank delays transactions. Then it becomes clear whether a contract resolves conflicts.to cushioncan or whether heaccelerates.
Conclusion
2026 is not the year of 'new contract models', but the year ofstress tests: Contracts must prove themselves in an environment where cost and compliance shocks are no longer exceptions, but calculable risks. Those who design their contract landscape only from the 'normal case perspective' often find in a serious situation that the legal solution does not fail because there are no rules – but because the rulesdo not fit together: choice of law, delivery clause, pricing logic, compliance obligations, evidence and dispute resolution do not interlock.
Especially because many of these questions only become visible when things are already going wrong, an early, structured review of the contract architecture can make the difference: between a manageable adjustment process – and a dispute that permanently damages the delivery relationship.
Note: This post is for general information purposes and does not replace legal advice in individual cases.