The Impact of Legislative Changes Caused by the Outbreak of the COVID-19 Pandemic on the Functioning of Contracts in Economic Turnover

The COVID-19 pandemic not only significantly reduced the activity of entrepreneurs, but also largely crowded out their functioning in business. The existing condition magnified by legislative changes has become a determinant of changes also at the level of contracts entered into by entrepreneurs. The purpose of the following paper is to present the changes in the rules of contract formation. The first part of the article deals with modifications in contracts concluded within the framework of public procurement in connection with the impact of circumstances defined by COVID-19 on the proper execution of a contract. This is followed by amendments to financing and M&A (Mergers and Acquisitions) contracts with regard to the introduction of clauses in them: material adverse effect, material adverse change and hardship. These clauses significantly emphasise the negotiating role of business-to-business contracts at the level of breach of a contract, evasion of performance of the transaction as well as define the limits of the event contained in the contract in terms of the executing party’s liability.