Risks for businesses operating in armed conflict zones: An evolving battleground
International Arbitration Trends in 2026
In brief
The global landscape of armed conflict is the most complex and crowded since the Second World War. These include international armed conflicts (e.g. the war in Ukraine), non-international armed conflicts (e.g. civil wars in Myanmar and Sudan), and situations that may not be straightforward to categorize (such as “drug wars” and terrorist insurgencies). Across the globe, geopolitical fragmentation and hybrid threats — combining cyberattacks with kinetic warfare — are redefining the operating environment for multinational businesses.
Companies now face increased exposure to sanctions, operational disruptions and other legal and reputational risks. As a result, we expect a surge in conflict-related commercial and investor-state arbitration, litigation and public international law disputes.
To manage these risks, businesses should integrate conflict analysis into due diligence, strengthen contractual and investment protections, establish robust documentation systems, monitor legal developments and anticipate disputes across multiple fora.
The scope of risk for corporates operating in conflict zones is expanding, with companies facing increased litigation exposure across multiple jurisdictions, while also contending with accountability at the international law level, demanding robust due diligence and governance to mitigate legal and reputational risks.
Alexandra van der Meulen
Partner
In detail
International arbitration trends in 2026
In detail
Many businesses today are deeply embedded in conflict-affected economies. Energy and extractives, logistics, tech, construction and industrial firms often provide goods and services that sustain local markets. In addition, tech and defense companies frequently supply equipment to state actors, creating risks that such equipment may ultimately be used in ways that breach international law.
At the same time, companies looking to enter post-conflict environments, such as Syria or, eventually, Ukraine, face heightened compliance and security risks arising from changing sanctions frameworks, governance uncertainty and residual instability that may amplify operational and legal exposure.
In a world where conflict is, unfortunately, a new constant, businesses need to hard wire conflict analysis into their decision-making – preparation will ensure resilience.
Joshua Kelly
Partner
Practical takeaways
Operating in armed conflict zones is no longer a niche concern; it is a mainstream business risk. To manage this risk, companies will increasingly need to consider whether the following actions are advisable given the conditions they are facing:
- Adopt comprehensive due diligence strategies: Integrate conflict analysis into due diligence and implement rigorous assessment and cross-border risk mapping systems.
- Secure optimal protection under contracts and treaties: Strengthen contractual protections, assess investment protection frameworks and consider restructuring to avail protections.
- Keep abreast of developments and maintain records: Establish systems for continuous documentation to strengthen their position to seek reparation or defend claims and actively monitor legal developments in key jurisdictions.
- Prepare for cross-border disputes and consider the most relevant dispute resolution fora: Anticipate multi-fora disputes spanning litigation in the countries involved in armed conflicts and other jurisdictions, commercial arbitration, investor-state arbitration and public international law litigation.
Our international arbitration and public international law specialists are ideally placed to assist clients proactively manage these multidimensional disputes. Please contact us to learn more.
