Dmitry Uryakin told Novy Prospect about the situation with the impossibility of fulfilling public contracts due to rising prices on raw materials

Lately the number of requests for legal assistance from companies fulfilling public contracts has drastically increased. The main reason is the fast moving rise in prices on raw materials and components. The most damage it brings to small and medium companies in construction and manufacturing sectors. Contractors identify rise in prices on raw materials as force-majeure circumstances which should lead to renegotiation of financial terms of public contracts. Owners of contracts refuse to renegotiate financial terms because in such cases the law is on their side.

Dmitry Uryakin, Lawyer at Maxima Legal, confirmed Novy Prospect that «contractors should not identify rising prices on raw materials and components as force-majeure circumstances». In his opinion, the judicial practice tends to define rise in prices as a common business risk of a company that voluntarily entered into contractual relationships. The expert also pointed out that big companies also suffer from price increases as well as small and medium ones. «The only difference is that big companies usually have financial reserves while smaller organizations don’t» – said Dmitry.

To read the full article (in Russian) please go to Novy Prospect website >>>