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Liquidated damages or contractual penalty

  • United Kingdom
  • Construction and engineering - Articles

06-01-2015

In this article we look at liquidated damages and contractual penalties under Swiss law. Liquidated damages provisions are used widely on international EPC contracts but different legal systems view how those provisions should be interpreted differently. For example, in English law, also widely used on EPC contracts, liquidated damages cannot be a penalty. This article explains that penalty clauses are permissible under Swiss law and how Swiss law treats penalties and liquidated damages provisions differently - with the Swiss civil code system being quite different to the English common law approach. This article will be of interest to those who are considering entering into (or are already party to) construction/engineering contracts (or commercial contracts with liquidated damages provisions) under Swiss law. Please click here to read the article.

Simon Oats, Product Group Head

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