Dutch court finds “force majeure” argument inadmissible
The reimposition of Iran sanctions by the US does not enable EU companies to terminate contracts with Iranian businesses, a 2020 ruling suggests.
In the case Payesh Gostaran Pishro Ltd. v. Pipe Survey International C.V., the dispute revolved around a contract between the Iranian company Payesh Gostaran Pishro (PGP) and the Dutch company Pipe Survey International for pipeline inspection services in Iran. The contract was signed in 2017, but following the reinstatement of U.S. secondary sanctions against Iran in May 2018, Pipe Survey suspended its contractual obligations, citing force majeure due to the risk of sanctions.
The Court of Rotterdam ruled on 1 April 2020 that Pipe Survey could not claim force majeure solely due to the imposition of U.S. sanctions. The court reasoned that under the EU Blocking Statute, which prevents European companies from complying with extraterritorial U.S. sanctions, U.S. secondary sanctions did not legally prevent Pipe Survey from performing its contractual obligations. Therefore, the court found that the business risks associated with U.S. sanctions were not sufficient to excuse the company from fulfilling the contract.
Overview of Payesh Gostaran Pishro
Payesh Gostaran Pishro Ltd was founded on March 15, 2011, by Hamidreza Askari Jonoush, Mehrshad Zebardast, Alireza Soufizadeh, and Ehsan Hedayatnia with an initial capital of 100,000 toman. The company’s website features photos and brief resumes of each founder.
The initial articles of incorporation focused on technical inspection, supervision, and execution of civil engineering projects, including roads, buildings, and landscaping. The company also engaged in urban furniture installation, traffic equipment projects, and beautification initiatives. Additionally, it was involved in the procurement, sale, import, and export of goods and represented domestic and foreign companies.
In October 2023, PGP expanded its scope of activities to include comprehensive technical inspections across industries like oil, gas, petrochemical, automotive, and construction, according to the Rooznameh Rasmi business gazette. The company also provides training, personnel services, and inspections for imported and exported goods, as well as risk-based and safety inspections. Additionally, it engages in advanced inspection techniques, asset management, and offshore industry projects, aiming to cover a wide range of industrial and technical needs.
The company appears to have gone under the radar of Iranian media, although it lists major Oil & Gas firms like PGPIC (sanctioned), National Iranian Oil Engineering and Construction Company (a subsidiary of the state oil company NIOC), Pars Oil and Gas Co., and various other NIOC subsidiaries among its clients on its website. The English version of its website lists Ghadir Investment, a conglomerate linked to the Armed Forces, among its clients.
There is no mention of a case against a Dutch company, Pipe Survey, being sued by an Iranian firm, PGP, over breach of contract in any Iranian sources.
In Iran, an active company with high-profile clients would typically feature regularly in business news stories.
The company website lists its foreign branches as Canada, Brazil, Argentina, the UK, France, Romania, the Netherlands, Turkey, Ukraine, Georgia, Armenia, Russia, China, India, the UAE, South Korea, Malaysia and Kazakhstan. It also says any of these branches can be contacted via a single, generic email address.
The company has a video on Aparat that consists only of stock photos.