Introduction
On 31 March 2026, the Government Gazette Extraordinary published Legal Notice No. 29 of 2026, in which the Right Honourable Prime Minister, Ntsokoane Samuel Matekane, acting under section 3(1) of the Disaster Management Act, 1997, declared a state of disaster on the Foot and Mouth Disease (FMD) outbreak in Lesotho. The declaration takes effect from the date of publication and runs until 27 March 2027. A full year of legally recognised national emergency.
While much of the public discussion has, understandably, focused on the agricultural and veterinary dimensions of the outbreak, the declaration has profound implications that extend well beyond cattle posts and dip tanks. It will reshape, for the next twelve months, the legal and commercial landscape in which Basotho businesses operate. Supply chains will be interrupted, cross-border trade with the Republic of South Africa will be disrupted, and contracts that were perfectly performable in February 2026 may become commercially or legally impossible to honour by mid-year.
This article examines the declaration from a legal and commercial-law perspective, with particular focus on the doctrine of breach of contract, the defence of supervening impossibility, and the strategic steps that businesses should take now, before defaults occur, to protect themselves.
The outbreak in context
The FMD outbreak was first identified on 18 February 2026 at a cattle post in Mahlasela, Botha-Bothe District, on Lesotho’s northern border with South Africa’s Free State Province. Of the seventeen cattle initially sampled by the Ministry of Agriculture, Food Security and Nutrition, six tested positive for FMD antibodies, and further samples were sent to the World Organisation for Animal Health’s reference laboratory in Botswana for virus typing.
The Lesotho outbreak does not exist in isolation. It coincides with, and is almost certainly linked to, a far larger FMD crisis in South Africa. In February 2026, the South African government declared FMD a national disaster after outbreaks were recorded in eight of nine provinces, with KwaZulu-Natal, Gauteng, the Free State and the North West being the worst affected. Because Lesotho is geographically encircled by South Africa and depends almost entirely on its larger neighbour for the import and transit of goods (including livestock, animal products and inputs to the wool and mohair industry), what happens at South African dip tanks inevitably reverberates through Maseru’s commercial corridors.
The declaration under Lesotho’s Disaster Management Act gives the State the legal architecture to impose movement controls, intensify quarantines, restrict markets, mandate vaccination and biosecurity measures, and mobilise resources accordingly. These are necessary public-health interventions. They are also, by their very nature, commercially disruptive.
The economic shock: who feels it, and how
The most immediate and visible casualties of the declaration are obvious: cattle farmers, sheep and goat owners, abattoirs, butcheries, leather producers, and the wool and mohair growers’ associations whose shearing seasons depend on regulated, FMD-free livestock movement. Reports already indicate that wool and mohair growers in Berea have had to absorb the cost of personal protective equipment that they had expected to be supplied under the disaster framework, increasing the financial burden on a sector that is, for many rural Basotho households, the principal source of cash income.
But the economic shock will not stop at the farm gate. The ripple effect will be felt by:
- Logistics and transport operators who carry livestock and animal products across the South African border, where stricter quarantine, sanitation and documentation requirements will increase costs and lengthen turnaround times.
- Retailers and wholesalers of meat, dairy and animal-derived goods, who may face supply shortages, price volatility, and increased compliance costs.
- Manufacturers and exporters in the leather, textile and food-processing sectors whose input supply chains depend on stable livestock markets.
- Hospitality and tourism operators, many of whom procure locally produced meat and dairy under fixed-price supply agreements.
- Financial institutions and insurers, who will face elevated credit risk on agricultural loans and a wave of claims under business interruption and livestock policies.
For each of these participants, the declaration is not just a public-health event. It is a contract event.
The contractual fault line: when performance becomes impossible
This is where the commercial-law analysis begins. The declaration of a state of disaster, together with the movement restrictions, quarantines and import/export controls that flow from it, will, in many cases, prevent businesses from delivering goods, performing services or receiving consideration as their contracts require.
Consider a Maseru-based meat processor that has a long-term supply contract with a supermarket chain to deliver a fixed tonnage of beef per month. If movement of cattle from affected districts is restricted, or if the abattoir’s source farms are placed under quarantine, the processor may simply be unable to perform. Or consider a leather goods exporter whose South African buyer cancels orders because Lesotho-origin hides are now subject to import restrictions across the border. Or a wool grower who has pre-sold the season’s clip but cannot shear because biosecurity requirements have not been met. In each scenario, the same legal question arises: is the non-performing party in breach of contract, and what are the consequences?
The starting point: breach of contract
Under Lesotho’s common law, which, like South Africa’s, is rooted in Roman-Dutch principles, a party that fails to perform a contractual obligation when performance is due is, prima facie, in breach. The innocent party may, depending on the nature of the breach and the terms of the contract, be entitled to:
- claim specific performance;
- cancel the contract and claim restitution; and/or
- claim damages to be placed in the position they would have been in had the contract been performed.
A breach therefore exposes the defaulting party to potentially significant financial liability, including consequential and reputational damage. For many Basotho SMEs operating on tight margins, a single major breach claim could be existential.
The escape valves: force majeure and supervening impossibility
The law, however, recognises that not every failure to perform is the fault of the defaulter. There are two principal mechanisms by which a party may be excused: a contractual force majeure clause, or, in the absence of one, the common-law doctrine of supervening impossibility of performance (often referred to by its Roman-Dutch label, vis maior or casus fortuitus).
Force majeure clauses
A force majeure clause is a contractual provision that allocates the risk of specified extraordinary events between the parties. Well-drafted clauses typically:
- enumerate qualifying events (e.g., war, natural disasters, epidemics, government action, declarations of disaster or emergency);
- require notice to the counterparty within a defined period;
- provide for suspension of obligations during the event;
- allow either or both parties to terminate the contract if the event continues beyond a stipulated period; and
- regulate the consequences for partial performance and pre-paid amounts.
If a contract contains a force majeure clause whose wording captures the FMD outbreak or the resulting governmental measures, and most modern, post-COVID supply contracts do, the parties’ rights and obligations during the disaster period will be governed by that clause. The first question every business should ask itself this week is therefore a simple one: do my key contracts contain force majeure clauses, and what do they say?
Supervening impossibility (the common-law fallback)
Where a contract is silent, the common-law doctrine of supervening impossibility applies. The doctrine extinguishes the obligation to perform, and, correspondingly, the right to receive performance, where, after conclusion of the contract, performance becomes objectively impossible as a result of an unforeseeable and unavoidable event that is not the fault of either party.
The requirements are strict. A party invoking supervening impossibility must show that:
- The event was unforeseeable at the time of contracting. Contracts concluded before the FMD declaration may meet this requirement; contracts concluded after 31 March 2026, when the disaster was already declared and publicly known, will struggle to do so. This is a critical date-of-contract issue.
- The event was unavoidable. The party could not, by reasonable steps, have prevented or worked around the impossibility.
- The event is not the fault of either party. Negligent biosecurity practices, for example, would compromise the defence.
- Performance is objectively impossible. not merely difficult, more expensive, or commercially inconvenient. This is the highest hurdle.
The objectivity requirement deserves particular emphasis. South African and Lesotho courts have repeatedly held that performance must be objectively impossible, not merely burdensome or economically onerous. A supplier who can still deliver but at a much higher cost will generally not succeed with the defence. A supplier whose entire source herd has been condemned, or whose goods cannot lawfully cross a quarantined border, very likely will.
It is also important to appreciate what supervening impossibility does not do. It does not, of itself, entitle the affected party to damages, compensation or an extension of time. It simply discharges the obligation. Any partial performance already rendered may need to be unwound through the law of unjustified enrichment. For this reason, parties almost always prefer to negotiate a contractual force majeure regime rather than rely on the bare common-law doctrine.
Applying the doctrines to FMD scenarios
How do these principles apply to typical FMD scenarios?
Scenario 1 — A national livestock movement ban. Where the State, acting under the disaster declaration, prohibits the movement of cattle from affected districts, a supplier whose herd is in such a district will generally have a strong case for supervening impossibility (or, where applicable, force majeure). Performance is not merely difficult; it is unlawful, and the defence of objective impossibility is satisfied where performance has become illegal.
Scenario 2 — Cross-border export restrictions. Where South African import authorities prohibit the entry of Lesotho-origin animal products, a Lesotho exporter whose contract requires delivery in South Africa will generally also have a strong case. Again, performance has been rendered legally impossible through no fault of the exporter.
Scenario 3 — Increased compliance costs. Where a supplier can still perform, but at significantly higher cost (for example, because of new biosecurity, PPE or testing requirements), the common-law doctrine will likely not assist. Increased cost is not impossibility. The supplier’s only protection in that case is a well-drafted hardship or change-in-law clause or a willingness on the counterparty’s part to renegotiate.
Scenario 4 — Loss of demand. Where a buyer’s commercial appetite has fallen because of the outbreak (for example, a restaurant chain that no longer wants the volume of beef it ordered), neither force majeure nor supervening impossibility will ordinarily help. Performance by the buyer, payment of the price, remains entirely possible. Loss of commercial appetite is a market risk, not a legal impossibility.
These distinctions matter enormously. The same outbreak can excuse one party’s obligations completely while leaving the other party fully bound.
Practical and strategic considerations for businesses
The state of disaster is in force until 27 March 2027. That gives every business in Lesotho, and every counterparty trading with a Lesotho business, almost a full year of exposure. Sensible commercial-law practice in this environment requires the following steps.
1. Audit existing contracts now.
Identify every material supply, distribution, lease, financing and service contract. Locate and read the force majeure, hardship, change-in-law, material adverse change, termination and notice clauses. Map each contract against the FMD scenarios likely to affect it. The point is not to find reasons to default; it is to understand exposure before it crystallises.
2. Give proper, timely notice.
Most force majeure clauses contain strict notice requirements, typically a defined period within which the affected party must notify the counterparty in writing, describing the event, its impact on performance, the steps being taken to mitigate, and the expected duration. Failure to give notice in the manner and within the time required can and often does, defeat an otherwise valid force majeure defence. Where there is doubt about whether notice is required, give it anyway.
3. Mitigate, and document the mitigation.
Both force majeure and supervening impossibility require that the affected party take reasonable steps to mitigate. Source alternative suppliers. Explore alternative routes. Engage proactively with veterinary and disaster-management authorities. And, critically, keep contemporaneous written records of every step taken. When a dispute later arises, the difference between success and failure often lies in the paper trail.
4. Renegotiate before defaulting.
A renegotiated contract is almost always a better commercial outcome than a litigated one, even where the legal defence is strong. Many counterparties, faced with a credible force majeure claim and the prospect of protracted litigation, will agree to extensions, partial performance, price adjustments or rolling deliveries. Approach these conversations early, in good faith, and in writing.
5. Update standard-form contracts going forward.
For all contracts concluded after 31 March 2026, the FMD outbreak is no longer unforeseeable. Suppliers and buyers alike should expressly address it in their standard terms, defining FMD and related governmental measures as force majeure events, allocating the resulting risks (and costs) clearly, and providing for hardship-style price adjustment where full impossibility is not reached. Silence in a new contract is no longer a neutral position; it is a risk allocation by default, and usually not a favourable one.
6. Review insurance cover.
Business interruption, livestock, marine and trade-credit policies frequently contain disease and quarantine exclusions, but the precise wording varies. Brokers and insurers should be engaged early to confirm what is and is not covered, and to consider top-up cover where it is available and economically sensible.
7. Engage with the Disaster Management Authority.
The Disaster Management Act framework contemplates coordination between the State and affected stakeholders. Industry associations, particularly in the wool, mohair, meat, dairy, leather and logistics sectors, should engage actively with the Authority and the Ministry of Agriculture, both to shape the implementing measures and to ensure that affected businesses can access whatever support, exemptions and resources the disaster framework makes available.
A broader observation: the regulatory dimension
Beyond contracts, the declaration carries regulatory implications that businesses should not overlook. The Disaster Management Act empowers the State to impose binding measures during the disaster period, measures that may include movement restrictions, market closures, mandatory inspections, and compulsory biosecurity protocols. Non-compliance with such measures may attract administrative penalties, criminal liability, or both, quite independently of any contractual exposure.
There is also a competition-law dimension. Suppliers experiencing capacity constraints will be tempted to coordinate on price or allocation; this is dangerous territory and should not be entered into without competition-law advice. There is a labour-law dimension: businesses that cannot operate at full capacity will need to manage employee obligations carefully, with reference to the Labour Code and any short-time or temporary lay-off arrangements. And there is a tax dimension: businesses experiencing severe disruption should explore whether deferral or relief arrangements are available through the Lesotho Revenue Authority.
Conclusion
Legal Notice No. 29 of 2026 is, on its face, a short instrument: a single page invoking section 3(1) of the Disaster Management Act, 1997, and declaring a state of disaster until 27 March 2027. But its commercial and legal consequences will be felt across virtually every sector of the Lesotho economy for the next twelve months and, in all likelihood, beyond.
For the legal community, the declaration is a reminder that public-health emergencies are simultaneously private-law events. Every quarantine order is, somewhere, a missed delivery date. Every cross-border restriction is a contract that needs to be re-examined. And every business that fails to act now, to audit its contracts, give proper notice, mitigate diligently, document its steps, and renegotiate where it can, risks turning a defensible disruption into an indefensible breach.
The FMD outbreak is, fundamentally, a veterinary problem. But the cost of getting the legal response wrong will be measured not in cattle, but in claims, judgments and lost businesses. Basotho enterprises, and those who advise them, would do well to begin that work today.
This article is intended for general information only and does not constitute legal advice. Businesses affected by the FMD outbreak should obtain advice on their specific circumstances.