1 bölgesel rekabet edebilirlik operasyonel programının uygulanması için kurumsal kapasitenin...
TRANSCRIPT
1
Bölgesel Rekabet Edebilirlik Operasyonel Programı’nın Uygulanması için Kurumsal Kapasitenin Oluşturulmasına Yönelik Teknik Yardım
Technical Assistance on Institutional Building for the Implementation of RCOP in Turkey
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDICConditions of Contracts Training
12 – 14 April 2011
2
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Agenda - 1
Day # 1
Introduction Objective of the Training & Expectations of the participants FIDIC (What and Why?) FIDIC Publications FIDIC Conditions of Contracts for Works Contracts FIDIC Contracts Comparison Matrix 2 exercises
3
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Agenda - 2 Day # 2
Parties of a Works Contract under FIDIC Contents of a Works Tender Dossier Introduction to Particular Conditions Appendix to Tender Clauses of the Conditions of Contract related to Volume 3 Clauses of the Conditions of Contract related to Volume 5 2 exercises
4
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Agenda - 3
Day # 3 Before Contract Signature Before the Commencement of Works First 28 days Project Management Tools under FIDIC Conditions Financial Management Tools Limits of Engineer’s Authority in EU-funded Projects Exercise Evaluations
5
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Agenda
Session # 1
Day # 1, Morning
IntroductionObjectives of the TrainingWhat is FIDIC?Why FIDIC?FIDIC Publications
6
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Introduction – 1
• Trainer:– Kerem Sadıklar– Civil Engineer & MBA– > 15 years of experience including EU & UNDP– [email protected]
• Participants:– 25 of FCD + TID of RCP – CIC– Knowledge & experience level?
7
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Introduction – 2
Objective of the Training:
By the end of the course, the trainees should;
– have a solid understanding of types of FIDIC Contracts– know contents of a Works Contract– know where to find what– be able to identify the external expertise they need – be able to draft an «Appendix to Tender»– be able to identify the important clauses of an PC
8
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Introduction – 3
Therefore the training
will cover FIDIC’s institutional structure and bookshop FIDIC contract types and major differences Identification of the most appropriate contract type Issues/clauses which need special attention during tendering.
will be interactive; please be participative will use exercises will involve team work
9
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Introduction – 4
Please always remember;
Management of FIDIC contracts is a broad and complicated area,
FIDIC experiences improve by execution,
Studying, Implementation and Continues Monitoring are the keys to success.
10
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
What is FIDIC? - 1 Fédération Internationale des Ingénieurs-Conseils
International Federation of Consulting Engineers
Uluslar arası Müşavir ve Mühendisler Federasyonu
Established in Switzerland in 1913, HQs is in Genève
First contract is printed in 1957
FIDIC represents Engineers and Consultants from various countries. E&C Associations from 75 countries are FIDIC members
Under this umbrella 30.000 firms and 1.000.000 professionals are represented
11
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
What is FIDIC? - 2
TürkMMMB - Türk Müşavir Mühendis ve Mimarlar Birliği
ATCEA – Association of Turkish Consulting Engineers and Architects
Established in 1980
ATCEA has 200 members
ATCEA is a member of FIDIC since 1987
Sells and distributes its own publications as well as FIDIC’s
www.tmmmb.org.tr
12
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
What is FIDIC? - 3
Some of the International Institutions using FIDIC;
World Bank (WB) European Bank of Restructuring and Development (EBRD) European Investment Bank (EIB) European Commission (EC) KfW Bankengruppe (KfW) Islamic Development Bank (IDB) African Development Bankası (ADB) Asian Development Bank (ADB)
13
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Why FIDIC? – 1
FIDIC Conditions of Contracts
cover almost all the major issues that needs to be addressed under a contract
have a consistent and easy to follow structure
distribute the risks fairly amongst parties
designed by a third party (Consultant) but not an Employer; therefore conditions are more objective and fair
can be adopted easily for many type of investments projects
14
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Why FIDIC? – 2
FIDIC has committees formed of international members to improve its publications.
Committees do continuous monitoring to improve and/or revise the existing publications (contract types, guidelines, etc.) and to introduce new books.
Very well known by international Contractors and Consultants, therefore creates confidence and encourages tenderers.
15
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications - 1
Types of Contracts;
Client/Consultant Model Services Agreement (White Book)
Joint Venture Agreements
Sub Contracting Agreements
Various Types of Conditions for Works Contracts
16
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications - 2
Other Publications;
Business Integrity
Risk Management
Quality Management
Environment Management
Sustainability Guide
FIDIC Contracts Guide to the Construction, Plant and Design-Build and EPC/Turnkey Contracts
17
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Exercise # 1
Please go to web site www.fidic.org list the types of publications available.
Note: Based on the availability of internet in the training center, this exercise may be done as a joint activity.
18
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Agenda
Session # 2
Day # 1, Afternoon
Types of FIDIC Conditions of Contracts for WorksExercise # 2Comparison Matrix
19
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications – 3; Conditions of Contracts for Works
Conditions of Contract for Construction for Building and Engineering Works Designed by the Employer; 1999 Edition – RED BOOK
Conditions of Contract for Plant and Design-Build for Electrical and Mechanical Plant, and for Building and Engineering, Designed by the Contractor; 1999 Edition – YELLOW BOOK
Conditions of Contract for EPC Turn-key Projects (First Edition, 1999) - SILVER BOOK
EPC Turn-key : Engineering – Procurement – Construction
Short Form of Contract 1st Ed (1999 Green Book) – GREEN BOOK
20
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications – 4; Conditions of Contracts for Works
Conditions of Contract for Construction (Multilateral Development Bank Harmonised Ed. Version 3: June 2010). For Building and Engineering Works designed by the Employer. Harmonised RED BOOK
Conditions of Contract for Design, Build and Operate Projects (1st Ed, 2008) - GOLD BOOK
FIDIC has adopted the scenario, with a 20- year operation period, and has opted for a single contract awarded to a single contracting entity (which will almost certainly be a consortium or joint venture) to optimise the coordination of innovation, quality and performance, rather than award separate contracts for design-build and for operation. The contractor has no responsibility for either financing the project or for its ultimate commercial success. The document, as written, is not suitable for contracts which are not based on the traditional Design-Build-Operate sequence, or where the Operation Period differs significantly from the 20 years adopted.
21
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications – 5; Conditions of Contracts for Works
RED BOOK – 1
Design and Engineering (incl. BoQs) is done by Employer or Employer’s Representative.
Tenderers fill in their unit prices into the existing BoQs.
Final amount is not fixed, payments are done based on the real amounts executed. (Exceptions are available eg: lump-sum conracts).
22
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications – 6; Conditions of Contracts for Works
RED BOOK - 2
Employer carries the risk for contract amount increases.
The better the design, the flawless the project implementation.
Tender evaluations are relatively simpler.
23
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications – 7; Conditions of Contracts for Works
YELLOW BOOK - 1
Employer prepares only the «Employer’s Requirements».
Employer Requirements includes only; Draft layout, Operational Parameters, Technical Specifications and Financial Proposal Format (Schedule of Prices).
Tenderers submit their technical proposals together with their financial proposals. Technical proposals cover at minimum methodology, basic design and drawings, bill of and similar supporting documents.
24
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications – 8; Conditions of Contracts for Works
YELLOW BOOK - 2
Generally lump-sum price contracts are used.
Price increase and other risks are distributed amongst both parties.
Tender evaluation process is more complicated and requires technical expertise.
25
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications – 9; Conditions of Contracts for Works
SILVER BOOK - 1
Two-party contracts (No Engineer)
Employer defines design parameters, quality measures and functional requirements.
Tenderers submit comprehensive technical proposals supported with designs.
Lump-sum contracts are used and all risk lies with the Contractor.
26
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications – 10; Conditions of Contracts for Works
SILVER BOOK - 2
More suitable for projects like; refinery, petrochemical facilities, power plants.
Implemented if the employer foresees high risk for the supply and assembly of mechanical and electrical components.
Tender evaluations are very complicated and requires continuous negotiations.
Not suitable for public and EU-funded projects in Turkey.
27
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
FIDIC Publications – 11; Conditions of Contracts for Works
GREEN BOOK
For low contract values (< 500,000 USD)
Simple but repetitive works
Short term assignments
Usually Employer takes over the design responsibility.
28
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Exercise # 2
Please fill in the given table based on your best assumptions.
29
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Parameters RED YELLOW SILVER GREEN
Design Employer Contractor EmployerEmployer or Contractor
Design ApprovalOnly Contractor’s Design (If any)
Engineer approves or rejects before executions N.a.
Only Contractor’s Design (If any
Financial Proposal Unit Price Lump-sum Price Lump-sum PriceUnit Price / Lump-sum Price
Payment SchedulesMeasured quantities
Payment percentages
Payment Calendar / Payment percentages
Measured quantities or Percentages
Engineer Yes Yes Generally No
No. Employer representative may assign if needed.
Comparison Matrix - 1
30
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Comparison Matrix - 2
Parameters RED YELLOW SILVER GREEN
Tests during Construction
Significant number of tests
Relatively less and simpler Generally no tests Limited or no tests
Tests at completionRelatively less and simpler
Very detailed and complicated performance tests
Very detailed and complicated performance tests. Limited or no tests
Risk DistributionEmployer carries the design risks Distributed
Contractor carries the risks Varies
31
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Agenda
Session # 3
Day # 2, Morning
Parties of a Works Contract under FIDIC
Contents of a Works Tender Dossier
Introduction to Particular Conditions
Exercise # 3
32
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Parties of a Contract - 1
3 parties under a typical FIDIC Contract :
The Employer
The Contractor
The Engineer (Supervisor)
33
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Parties of a Contract - 2
Relations in a EU-funded Project
Employer – Contractor
FIDIC Conditions of Contract
Employer – Engineer
Service Contract
EU/PRAG General Conditions
Engineer – Contractor
Engineer supervises the construction and manages the project with limited authority.
34
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Parties of a Contract - 3
Employer
Defines the requirements and specifications
Provides the construction site
Provides the financial resources (usually)
Provides the necessary conditions to the Contractor for the execution of works
Some of these tasks are shared by OPs and ERs (not party to the contract) in EU- funded projects.
35
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Parties of a Contract - 4
Contractor:
Responsible from executing the works
Provides the necessary securities and guarantees
Held responsible from his and/or his sub contractors actions
Responsible from the quality of the executed works as well as the security of the construction site
Prepares the interim payment reports
May use sub contractors as allowed in the conditions of the contract
36
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Parties of a Contract - 5
Engineer:
Assigned by the Employer to represent the Employer
Name, contact information and authorities of an Engineer are stated in relevant parts of the Works Contract
After consulting with the Employer and the Contractor, should propose fair and objective solutions for claims.
Checks the quality of the appropriateness of the workmanship and the materials used
Approves the payment certificates of the Contractor
37
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Contents of a Works TD - 1
A Works tender dossier comprises of 5 Volumes;
Volume 1: Instructions to Tenderers - PRAG rules apply. Terminology should be adopted in line with FIDIC.
Volume 2: Conditions of Contract – FIDIC
Volume 3: Technical Specifications / Employer’s Requirements
Volume 4: Financial Offer Format, Schedule of Prices
Volume 5: Drawings
38
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Contents of a Works TD - 2 Volume 1:
Instructions to Tenderers (ITT)
Tender Form and Annexes (Appendix to Tender)
Tender Guarantee Format
Forms
Glossary of Terms
Evaluation Grid
39
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Contents of a Works TD - 3
Volume 2:
Draft Contract
General Conditions of Contract (RED / YELLOW BOOK))
Based on the nature and design responsibility.
Particular Conditions of Contract
Security Samples (Pre-finance, Performance & Retention)
40
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Contents of a Works TD – 4
Particular Conditions – 1
FIDIC General Conditions of Contracts (RED or YELLOW) for any type of project anywhere in the world.
Contract will be customized by using the particular conditions of contract.
Particular conditions prevail the General Conditions.
Particular Conditions changes / replaces / revises / deletes the Clauses of the General Conditions.
41
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Contents of a Works TD – 5
Particular Conditions – 2
Clauses in Particular Conditions should not be conflicting with the clauses of the General Conditions.
FIDIC Guidelines may be used while drafting Particular Conditions.
Particular Conditions should be in line with the local law and law of the contract.
Any revisions / additions / omissions done by the Particular Conditions should be based on rational reasoning.
42
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Contents of a Works TD – 6
Particular Conditions – 3
Very complex PCs may harm the completeness and structure of a works Contract.
PCs should be drafted by a team of experts who have relevant works and contract management experience.
PCs should be assessed / evaluated by local lawyers.
Appendix to Tender may be used as control tool.
Clause 1.5 of PCs; «Priority of Documents» is important and should be re-addressed for every project.
43
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Contents of a Works TD – 7
Priority of Documents
the contract, the Tender Form with its appendix, the Particular Conditions, the General Conditions, the Technical Specifications, the design documentation (drawings), the bill of quantities (after arithmetical
corrections)/breakdown, any other documents forming part of the contract
44
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Particular Conditions – 1
Clauses which must be revised / added during the preparation of a PCs
Clause 1.3 Communication
Should be revised in line with all the communication tools allowed for the specific project
Clause 1.4 Law and Language
If different languages will be used under certain circumstances this should be defined here
Clause 1.5 Priority of Documents
Amendments and additions can be made here. Please be extremely careful, and do not change unless you have to.
45
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Particular Conditions – 2
Clause 1.6 Contract Agreement
Contract Agreement will also be referred as «Letter of Acceptance»
Clause 2.1 Right of Access to Site
If there are conditions (time constraints or other) related to this issue, this clause should be drafted accordingly.
Clause 3.1 Engineer’s Duty and Authority
The limits of Engineer’s authority should be clearly defined here. This article is extremely important for EU funded projects where the authority of the Engineer is limited. This article should be in line with the ToR fo the Engineer’s service contract.
Clause 4.1 Contractor’s General Obligations
If the Contractor has additional obligations, these should be clearly defined here.
46
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Particular Conditions – 3
Clause 4.8 Safety Procedures
If there are any additional procedures to be implemented because of EU or local laws they should be defined here
Clause 4.19 Electricity, Water and Gas
This articled defines where and how the Contractor will obtain the necessary infrastructure.
Clause 4.21 Progress Reports
If additional reports other than the ones defined in General Conditions are requested, these should be defined here.
Clause 7 / Sub Clause 7.9 «Rules of Origin».
This sub clause should be added in EU funded projects. Please remember this is only for permanent works.
47
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Particular Conditions – 4
Clause 8.2 – Time for Completion
If there are different milestones for completion and/or taking over parts of the works these should be defined here.
Clause 12.1 – Works to be Measured
Only RED BOOK
If measurements are to be done by records and/or reports, the details should be defined here.
48
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Exercise # 3
Please identify the Clauses which are different in RED and YELLOW FIDIC Books.
49
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Particular Conditions - 5 Different Clauses in FIDIC Books:
RED Book YELLOW Book GREEN Book
Clause 3 Engineer Engineer Employer’s Administartion
Clause 5 Nominated Sub Contractors
Design Design
Clause 12 Measurement and Evaluation
Tests for Completion
Tests for Completion
50
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Agenda
Session # 4
Day # 2, Afternoon
Appendix to TenderClauses of the Conditions of Contract related to Volume 3 Clauses of the Conditions of Contract related to Volume 5Exercise # 4
51
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Appendix to Tender – 1
Appendix to Tender is prepared as a summary table.
Includes Financial and Administrative / Contractual Information
Administrative / Contractual Information
Contact Details of Parties
Contract Duration
Law and Language of the Contract
Disputes and Arbitration
52
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Appendix to Tender – 2
Financial Information:
Security Amounts
Delay Penalties
Pre-Finance Payments
Retention Deductions
Minimum Interim Payments
Insurance Amounts
53
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Appendix to Tender – 3
It includes summary of the information originating from the Particular and General Conditions of Contract.
A different AtT should be prepared for each tender. May be used as a tool to check the completeness and consistency of the particular and general conditions.
Numeric values or specific information should be indicated in Appendix to Tender to avoid confusion and mistakes between different values.
Appendix to tender should be used to complement the Particular and General Conditions, not to amend or revise them.
54
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Volume 3 - 1
Technical Specifications / Employer Requirements
RED Book: Technical Specifications Material quality Material properties Workmanship quality Assembly conditions Locations, etc. are defined in detailed.
YELLOW Book: Employer Requirements Performance criteria is defined for the works which will be
designed by the Contractor.
55
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Volume 3 - 2
RED Book; Technical Specifications
Every detail (material & workmanship) that can not be shown on drawings should be clearly defined here.
Definitions should be clear and net.
«shall», «will», «must» to be used,
«may» «may be» not to be used
Location Forms (Room Lists) should be included.
The more detailed and clear the specifications, the more flawless the project implementation.
56
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Volume 3 - 3
YELLOW Book; Employer Requirements
Employer’s Requirements should define the scope and the objective of the project.
The requirements, parameters, functions, scope and the quality of the completed works should be defined.
All the existing information, relevant technical & administrative regulations and standards should be listed to enable the Contractor to do a proper design.
57
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Volume 3 - 4
Clauses of the Conditions of Contract related to Volume 3 - 1
1.9 Errors in the Employer’s Requirements
Extension of Time – Contract Amount Increase
1.13 Compliance with Laws
(planning vs. construction permits)
4.1 Contractor’s General Obligations
Additional security or visibility measures
4.6 Co-operation
If other contractors share the site
58
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Volume 3 - 5
Clauses of the Conditions of Contract related to Volume 3 - 2
4.7 Setting Out (correct positioning, leveling etc.)
4.14 Avoidance of Interference (interference with third parties)
4.18 Protection of Environment
4.19 Electricity, Water and Gas 8avaliable infrastructure)
4.20 Employer’s Equipment and Free-Issue Material
5.1 General Design Obligations (yellow)/ Nominated Sub Contractors (Red)
59
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Volume 3 - 6
Clauses of the Conditions of Contract related to Volume 3 - 3
5.2 Contractor’s Documents (Yellow Book)
5.4 Technical Standards and Regulations
5.5 Training
5.6 As-built Documents
6.6 Facilities for Staff and Labor
Facilities for the Employer and Engineer on site
7.2 Samples (material approvals)
60
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Volume 3 - 7
Clauses of the Conditions of Contract related to Volume 3 - 4
7.3 Inspection (Manufacturer Tests)
9.1 Contractor’s Obligations (Tests on Completion)
9.4 Failure to Pass Tests on Completion
12.1 Tests after Completion (Yellow Book)
12.4 Failure to Pass Tests after Completion (Yellow Book)
61
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Volume 5
Clauses of the Conditions of Contract related to Volume 5:
RED and YELLOW Books
1.8 Care and Supply of Documents
RED Book
1.9 Delayed Drawings and Instructions
YELLOW Book
1.9 Errors in the Employer’s Requirements
62
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Exercise # 4
Please fill in the missing parts of the attached Appendix to
Tender in line with the given Particular Conditions of Contract
and the General Conditions of a RED FIDIC Book
63
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Agenda
Session # 5
Day # 3, Morning
Before Contract SignatureBefore the Commencement of WorksFirst 28 daysProject Management Tools under FIDIC Conditions Exercise # 5
64
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Before Contract Signature - 1
Employer gives award notice to the Awardee.
Contract Negotiations are done (if necessary).
Priority of documents are re-arranged if necessary due to contract negotiations or clarifications during tender period.
Contract is signed by the Employer (and endorsed by EUD).
Contractor submits the required documents (e.g. performance guarantee) to the Employer together with the signed Contract.
65
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Before the Construction Works Commerce - 1
Upon the signature of the Contract certain procedures need to completed before the Contractor can commence the works;
18.2 Submission of All Risk Insurance
20.2 Identification of DAB (Dispute Adjucation Board) member(s). – Sometimes identification is done on «Ad hoc» bases.
3.1 If not already in the Contract, the Employers informs the Contractor about the details of the Engineer.
Communication lines and rules are established.
1.8 & 1.9 Supply of Drawings and Instructions
(RED Book) Drawings should be an integral part of the Contract and should be provided based on a well structured calendar
66
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Before the Construction Works Commerce - 2
3.2 The limits of the authority of the Engineer and its staff should be defined
The authority of the Engineer is limited in projects funded by EU.
Please remember that the phrase Engineer refers to the Consultant Firm, not the Consultant’s Team Leader.
67
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Before the Construction Works Commerce - 3
The personnel of the Employer, the Contractor and the Engineer to be deployed on the project site is identified. (4.3 Contractor’s Representative)
The limits of authority of each personnel is identified and a line of communication is drafted based on this. It is recommended that the line of communication is signed by all parties.
For example: the Team Leader of the Engineer approves the Contractors Interim Payments, but does not have the authority to negotiate amendments on the Consultancy Contract.
68
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Before the Construction Works Commerce - 4
Clause 2.1 Right of Access to Site Employer should give the right to access and possession of the site to the
Contractor after the Contract Signature. Employer should complete his responsibilities and should give the
possession of the site free of problems. Delays in this task may cause extensions in the contract duration and
increases in the contract price.
1.13 Contractor should complete all the necessary local procedures and obtain the necessary permits to start construction works.
Clause 8.1 Unless otherwise stated in PCs the commencement date is within 42 days after the contract signature. Engineer shall give the notice not less than 7 days before the Commencement Date.
69
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
First 28 Days Clause 4.4 Necessary permissions and procedures are completed for the
Sub Contractors.
Clause 4.1 Contractor’s General Obligations. Security of the site and works EU Visibility Rules are secured
Clause 6 Staff and Labour Sub Clause 6.4 (Local Labour Laws) Sub Clause 6.5 (Working hours) Sub Clause 6.7 (Health and safety) Contractor should take all the necessary precautions to avoid accidents
and should assign a safety representative.
70
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Project Management Tools – 1
Notices
Instructions
Reports
Records
Certificates
71
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Project Management Tools – 2
Clause 1.3 Communication
The rules stated in this clause should be followed. Payment certificates, approvals, certifications and similar requests
should be processed within the durations stated in the Contract. A copy of the notices should be shared by the Engineer.
Clause 1.9 Delayed Drawings and Instructions
Delays which will cause claims should be avoided as much as possible.
72
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Project Management Tools - 3
Clause 3.3 Instructions of the Engineer
Engineer should issue instructions in line with its Authority.
Instructions can only be issued by the Engineer or its representative.
RED Book includes verbal instructions by written confirmations.
73
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Project Management Tools – 4Reports
Clause 4.21 Progress Reports
Unless otherwise stated, the Contractor should issue progress reports in certain intervals. Usually as attachments to the interim payment certificates.
Reports compare the physical and financial realization with the planned and propose programmes for the remaining duration.
Reports should be supported by pictures and test results.
Reports should include information about the production, delivery and assembly schedules of the permanent works.
74
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Project Management Tools – 5Reports
Clause 6.10 Records of Contractor’s Personnel and Equipment Contractor should keep daily site records. The records should include site activities as
well as weather conditions. Such information should be summarized in the progress reports.
Clause 2.5 ve 20.1 Claims Progress reports should list the Claims of both Parties. The contractor should give notice in 28 days after he became aware of the event or the
circumstances. And shall submit a detailed claim in 42 days. Engineer shall respond within 42 days after receiving a claim.
Clause 14 - Contract Price and Payment Progress reports should include sufficient level of information about cash flows in order
to allow the Employer to make proper planning.
75
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Project Management Tools – 6Certificates
Clause 10 – Employer’s Taking Over
Contractor may apply for Taking Over Certificate 14 days before the works are completed (Notice).
Engineer within 28 days after receiving the application (a) issues the certificate or (2) rejects the application.
Clause 11 – Defects Liability
Upon the full satisfaction of Contractor’s duties and responsibilities and within 28 days after the expiry of the Defects Notification Period; Engineer issues the Final Acceptance Certificate.
76
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Exercise # 5Please calculate the maximum number of contract duration
for the Project using the attached Annex to Tender.
77
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Agenda
Session # 6
Day # 3, Afternoon
Financial Management ToolsLimits of Engineer’s Authority in EU-funded ProjectsEvaluations
78
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Financial Management Tools- 1
Clause 12 Measurement and Evaluation (RED Book)
Clause 13 Variations and Adjustments
Clause 14 Contract Price and Payment
79
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Financial Management Tools – 2 Clause 12 Measurement and Evaluation
Only valid for RED Book Contracts.
YELLOW Book has «Tests After Completion».
Measurements are done by the Engineer in presence of the Contractor. In certain circumstances records are used instead of measurements.
Payments are usually based on net measurements.
Clause 12.3 defines the procedures for defining new rates.
Clause 12.4 defines the compensations payments to be done to the Contractor for omissions.
80
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Financial Management Tools – 3
YELLOW Book; Payment Conditions
Usually lump-sum contracts.
Sub items are defined for interim payments. Payments are based on completion ratios (percentages).
Sub items should be arranged carefully in order not to harm the Contractor’s cash flow. Unfair or unreasonable payment conditions are always reflected to the prices.
14.4 Schedule of Payments and Volume 4 should be in line with each other.
81
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Financial Management Tools - 4
Clause 13 Variations and Adjustments
13.1 Engineer can instruct a variation
13.2 Value Engineering
13.3 Variation Procedure
13.8 Adjustments for Changes in Cost: Calculates price increases based cost (material, workmanship, energy etc.) increases. Not implemented in EU funded projects.
82
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Financial Management Tools - 5
Clause 14 Contract Price and Payment
14.1 Contract Price
14.2 Advance Payment
14.3 Interim Payment Certificates / Sub Clause 4.21 Progress Reports
14.4 Schedule of Payments
14.7 & 14.8 Payment / Delayed Payment
83
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Financial Management Tools - 6
Advance payment and deductions should be in line with the nature of the works.
Payment conditions should not put the Employer under risk, but at the same time should not harm the cash flow of the Contractor.
In EU funded projects, Beneficiaries are requested to approve the interim payments «Read & Approved».
Procedures for Contract Price variations should be clearly defined. And relevant clauses should be drafted accordingly.
Payment terms and durations should be calculated after considering the necessary approval procedures.
84
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Limits of Engineer’s Authority in EU Funded Projects - 1
The Consultant (Engineer) shall obtain the specific approval of the CFCU (Contracting Authority) and the Beneficiary before taking action on matters affecting contract price and duration including but not limited to the following articles of the FIDIC Red Book:
Sub-Clause 3.5: Agreeing or determining any matter, which will change the Contract Price;
Sub-Clause 4.4: Giving consent to a Subcontractor for a subcontract for which a different subcontractor is named in the Contract;
85
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Limits of Engineer’s Authority in EU Funded Projects - 2
Sub-Clause 8.4: Agreeing or determining an extension of the Time for Completion;
Sub-Clause 8.8: Suspension of work,
Clause 13: Instructing Variations and Adjustments effecting Contract Price or Time for Completion.
Sub-Clause 13.5: Giving instructions for the use of the provisional sums/contingencies;
86
This project is co-financed by the European Union and the Republic of Turkey
FIDIC Training 12-14 April 2011
Thank You / Evaluations