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FIDIC Contract & Agreement forms
Kaj Möller (SWE).
• FIDIC Executive Committee Member (2011-2015);
• Liaison with FIDIC Contracts Committee; and
• Head of Export, Sweco Group. www.swecogroup.com– Scandinavian based engineering consultant firm;
– Total turnover of app 1 BEUR;
– Export assignments in 80 countries (East Europe, Central-, South- and
Southeast-Asia, Africa, South- and Central America) annually; and
– Applying all FIDIC contracts and agreement forms in our external
contracting and operations, upstream and downstream.
Why does FIDIC invest in standard forms for
Contract and Agreements?
• Create a first-class globally recognized contract standard for
industries investing in engineering, construction and related
operations;
• Promote the role of the Engineer and its importance in
balancing party´s risk exposure in construction investments.
• Secure integrity, transparence and accuracy in Clients
projects.
• Represent a continuous QA chain, from Basic Project
Considerations through Programming, Procurement,
Construction, Completion to Operations and Maintenance;
FIDIC Contract & Agreement forms
FIDIC Contract & Agreement forms
Best 2014 reading recommendation:
FIDIC Procurement Procedures Guide, 2011.
How does FIDIC do this?
FIDIC produces contract forms that we think are:
.
FIDIC Contract & Agreement forms
• COMPLETE, FLEXIBLE• Range covers most needs.
• Readily adaptable to fit
requirements.
• Choice of form can then
match projects
characteristics.
• RECOGNISED• Positive FIDIC image.
• World-wide acceptance
• Tested for more than 50 years
• CLEAR, COHERENT• Essential clauses.
• Detailed definitions.
• Consistent structure.
• Harmonized.
• FAIR, EQUITABLE• Risk allocated to the party
best placed to control it, bear
it, and deal with it.
• THIRD PARTY• Drafted by consulting
engineers who design and
manage projects.
How does FIDIC do this?
.
FIDIC Contract & Agreement forms
Modell agreements for
professionals services:• Client/Consultant
• Joint Venture
• Sub-Consultant
• Representative
Forms of contract for works:• Construction and Sub-
Contractor
• Construction (MDB)
• Plant, Design & Build
• Turn Key
• Dredging
Forms of contract for works
and operations:• Design, Build & Operate
(DBO)
How does FIDIC do this?
.
FIDIC Contract & Agreement forms
Contract Guides
and Policy Papers.Conferences, Work-shops
and Training.Close contact with key -
users and partners to fine-
tune and improve quality.
On the drawing board by the CC:
• Task Group 4A – Update of Joint Venture Model Agreement and Sub-
Consultant Model Agreement;
• Task Group 4B – Update of Client / Consultant Model Agreement (White
Book);
• Task Group 6 – Update of 1999 Rainbow Suite (Red, Yellow and Silver
book);
• Task Group 7 – Update of Dredgers Contract;
• Task Group 9 – New Yellow Book / Silver Book Sub-contract Forms
• Task Group 10 – New Tunnelling/Underground Contract;
• Task Group 11 – New Operate, Design & Build (ODB) Form of Contract;
• Task Group 12 – New Contract & Agreement - Glossary of Terms;
FIDIC Contract & Agreement forms
Which trends do we see 1(2):• Undoubtedly, fair and balanced contracts generate healthy
project completions. But there is mixed understanding of
the potential by the Clients. Experienced
financiers/employers vis-à-vis “New moneys”;
• With less and less time for implementation (from
investment decision to Investment pay-off) the need for the
Independent Engineer is greater than ever;
• The trend for a Turn Key or Design & Build delivery method
is still gaining popularity. More push for “Choice of Delivery
Method = project characteristics” is still needed;
• More assignments serving the Contractor rather than the
Employer.
FIDIC Contract & Agreement forms
Which trends do we see 2 (2):
• Employers wants stronger focus on “Fit for its
purpose” and thus operations liability contract (e.g.
DBO) are more and more preferred, not only to off
load their balance sheet;
• Over-tweaking of FIDIC based contracts, where the
intention of the forms are lost. Yet, still claimed to be
FIDIC contracts;
• A need for more forms available in multiple
languages;
• Health & Safety, Sustainability, Information
Management (e.g. BIM) and Integrity are areas of
interest which are given more and more contractual
attention by the Employers;
FIDIC Contract & Agreement forms
Plantagon Green House – Urban Agriculture
FIDIC Contract & Agreement forms
• A Build-only delivery method is not suitable when: • the total project time is limited; or
• contractors works experience is crucial in design stage to achieve the final result.
• A Design & Build delivery method is not suitable when:• Early cost-estimate accuracy is crucial; or
• Employer wants detailed influence the design;
• An EPC delivery method is not suitable when:• If it is a ”first time ever” project with crucial local permits,
approvals, codes and standards needed;
• There are significant unknown risks, e.g unknown underground conditions, in the project; or
• If the Employer intends to supervise closely or control the Contractor's work, or to review most of the construction drawings; or
• If the Employers is not willing to pay extra for the transfer of risks.
Basic programming considerations
Should FIDIC respond to these trends, and
if so, how? 1 (2):
• Is the set of Agreement & Contract forms by FIDIC
matching the needs of the future? What new forms of
contracts could be needed? Are any forms foreseen to
become obsolete soon?;
• What is the future role of the Independent Engineer in
Turn Key and/or Design & Build contracts? Are there any
alternatives?
• Health & Safety, Sustainability, Information Management
(e.g. BIM) is a selection of new areas of interest which are
given more and more attention by the Employers. How
deep into these areas should FIDIC contract and
agreement forms reach?
• What document formats should be used in the future.
Paper copies, encrypted pdf, format for Tablets /
handhelds?
FIDIC Contract & Agreement forms
Should we respond to these trends, and if
so, how? 2 (2):
• How about “Golden Clauses” of FIDIC General
Conditions? Clauses not the be changed in order to be a
FIDIC based contract? Introduction of a FIDIC Contract
Authentication ID?
• How should FIDIC charge for its forms? With the current
business model FIDIC are selling some ten thousands
copyright protected General Conditions / year. Yet, no one
knows how many millions of contract, based on FIDIC
forms, that are signed world-wide every year, without
FIDIC receiving any revenue.
FIDIC Contract & Agreement forms
FIDIC CERTIFIED CONTRACT
AUTHENTIFICATION ID. XYZ