The giant diamond company Debswana has invoked the Force Majeure clause under the contract with all its contractors in the country and asked them to clear the site. The diamond giant attributed the Force Marjeure to the COVID-19 pandemic, the resultant public health and financial results, and the declaration of the State of Emergency by President Dr. Mokgweetsi Masisi on 31 March as well as the regulations promulgated in consequence of the pandemic and the emerging global financial crisis, which it is said has affected Debswana acutely.
In a letter dated 1st April 2020 co-authored by Mokwadi Koloka a Senior Commercial Manager and Ignatius Nfana who is a Lead Supply Chain the company warned all Contractors with active contracts with it that operations at the various Debswana facilities or locations will have to be either "shutdown or severely curtailed”.
The letter is titled “GENERAL ANNOUNCEMENT: POSSIBLE FORCE MAJEURE NOTICE”, and was directed Contractors to (“the Contract”) entered into Debswana Diamond Company (Pty) Limited (“Debswana”). As the largest private employer in Botswana, Debswana said it has an obligation to its workforce, its contractors and their sub-contractors and the nation as a whole to "endeavour to ensure that there are no further infections in Botswana" and, or to prevent or limit the spread of infections in Botswana.’’
Given the above, the letter said operations at the various Debswana facilities or locations will have to be either shutdown or severely curtailed. Debswana held that COVID-19 and the extreme social distancing announced by Masisi are without doubt an "exceptional event or circumstance" which accords with the definition of an event of Force Majeure.
In Law Force Majeure refers to unforeseeable circumstances that prevent someone from fulfilling a contract. Debswana told contractors that Senior Contracts Administrator, Debswana Contracts Managers on Site and any other persons responsible for administering "Your Contract will engage you in due course" regarding the ramifications of this event on the "specific contract you have entered into with Debswana" .
“You are further, notified to leave site (*as applicable) by end of business on Thursday 02 April 2020”.
The Contractor shall liaise with the Engineer or Project Manager to ensure that the process of leaving the site is smooth, including that of your subcontractors. "You are to use your best efforts to comply immediately with any reasonable instructions included in this notice and any instruction issued by the Engineer or Project Manager regarding adherence to safety protocols, protection of life and any materials, plant and the works".
On a good note Debswana states that its decision does not affect Contractors not based on site. Contractors providing essential services will be required to leave skeletal staff behind for Care & Maintenance (numbers to be agreed with Debswana).