In a bubble by the sea

Abstract

As a result of the COVID-19 pandemic, Macau has been largely isolated from the outside world for more than two years. Despite an effective control of the virus within borders, this situation has led to a considerable strain on residents and businesses. So far, a mixture of informal adjustments and governmental incentives have prevented an influx of contractual default cases to the courts. However, as restrictive measures remain in place, more residents and business are likely to face difficulties. In this context, striking the right balance between the principle of pacta sunt servanda and contractual justice is of paramount importance, especially in long-term contractual relationships, such as rentals, which are more vulnerable to changes of circumstances over time. This chapter analyses the exceptions to pacta sunt servanda in Macau law, with a special focus on the mechanism of termination or modification based on change of circumstances and its applicability to long term contractual relationships in the context of the COVID-19 pandemic.