Contracts typically use Incoterms (like FOB, CIF, or DDP) to define responsibilities for transport, risk, and customs duties (including tariffs).
If the contract uses FOB (Free on Board) or similar, the buyer (Chinese airline) is usually responsible for import duties and tariffs.
If its DDP (Delivered Duty Paid), Boeing would bear the cost of any tariffs.
Force Majeure and Trade Barriers
Some contracts include Force Majeure clauses that cover governmental actions, including sudden imposition of tariffs or trade restrictions.
However, invoking this clause requires proving the impact was truly unforeseeable and beyond the partys control.
Change in Law / Hardship Clauses
Advanced contracts may include change-in-law provisions that trigger renegotiation or price adjustments if tariffs are imposed after signing.
This allows flexibility if the cost structure changes significantly due to government actions.
Price Adjustment Clauses
Some contracts have price escalation or adjustment mechanisms tied to duties or taxes.
Boeing might specify that if a tariff is imposed, the price is adjusted or the buyer must absorb the cost.
Termination or Suspension Rights
In more contentious situations, the buyer may have a right to suspend acceptance or terminate the contract if delivery becomes commercially unreasonable due to tariffs.
