PROF CHITRA WEDDIKKARA CHARTERED ARCHITECT /QUANITY SURVEYOR

PROJECT MANAGER FRICS FAQS FIQS ARAIA

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General Background FIDIC 1999

• Initially foundation in 1913 by three national associations of Europe (France, Belgium, Switzerland)

• Expanded in 1945 to include 40 national associations

• Current membership is 73 national associations

FEDERATION INTERNATIONALE DES INGENIEURS-CONSEILS

International Federation of Consulting Engineers

•Prior to 1957, there were no internationally recognized contract conditions for construction work.

• In 1957 first edition of “Conditions of Contract for Works of Civil Engineering Construction” known as the “Red Book” was published.

Red book based upon British form of contracts, used by Institution of Civil Engineers and reflects British traditions, language and legal system.

FIDIC maintains committees to improve documents and to add further Contract Conditions for other types of construction.

“The Red Book” – Conditions of Contract for Works of Civil Engineering Construction, (Fourth edition 1987) reprinted 1992 (Parts 1&2)

“The White Book” – Clients / Consultant Model Services Agreement (Third edition 1998)

“The Yellow Book” – Conditions of Contract for Electrical and Mechanical Works (Third edition 1987)

“Orange Book” – Conditions of Contract for Design-Build and Turnkey (First edition 1995)

Expansion of types of projects to be covered that reflects changes within the International construction sector

Attempt to standardize formats of main FIDIC contract documents

Introduction of new clauses and update of certain clauses to meet current practice within the construction industry.

Update the role of “The Engineer” and develop use of “Disputes Adjudication Board”

Contract Latest Edition Application

Red Book 1999 Civil work (designed by Employer)

Yellow Book 1999 Plant, Electrical works, Mechanical works (Design-Build)

Silver Book 1999 EPC

Green Book 1999 Minor works

White Book 2006 Consultancy agreement

Blue Book 2006 Dredging work

Gold Book 2007(?) Design-Build-Operate

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• First edition published in 1957 based on ICE Contract in UK

• Mainly used for civil work

• Design by Employer

• Design-Bid-Build

• Existence of the Engineer

• Unit price（BQ）Contract

• Well balanced risk allocation

• Dispute Adjudication Board (DAB) was introduced in 1999 Edition (standby DAB)

Profile

1987Edition

1999Edition

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• Mainly used for Electrical works, Mechanical works and Plant

• Design by Contractor

• Design-Build

• Existence of the Engineer

• Lump sum contract

• Well balanced risk allocation. (but, the Contractor takes design risk and work quaintly risk)

• Dispute Adjudication Board (DAB) was introduced in 1999 Edition (ad hoc DAB)

Profile

1987Edition

1999Edition

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• Mainly used for EPC Contract under BOT Project

• Design by Contractor

• Design-Build

• Engineer is not engaged

• Lump sum contract

• Compared with RedBook, more risk is allocated to the Contractor. For example, no remedy for unforeseeable physical condition

• Dispute Adjudication Board (DAB) was introduced (standby DAB)

Profile

1999 Edition

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• Mainly used for minor works

• Very concise contract with 10 pages

• Engineer is not engaged.

• Dispute Adjudication Board (DAB) was introduced

Profile

1999 Edition

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Published for common use of the nine major MDBs

Based on FIDIC Red Book 1999First Edition ： May 2005Revised Edition ：March 2006

The nine major MDBs• African Development Bank • Asian Development Bank • Black Sea Trade and Development Bank • Caribbean Development Bank • European Bank for Reconstruction and

Development • Inter-American Development Bank • International Bank for Reconstruction and

Development (The World Bank) • Islamic Bank for Development Bank • Nordic Development Fund

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Contract Engineering Design Construction Operation

Red Book

Yellow Book

Silver Book

Green Book

Gold Book

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Acknowledgements Foreword and Charts General Conditions (including Appendix of

General Conditions of Dispute Adjudication Agreement)

Guidance for the Preparation of Particular Conditions (including example forms of guarantees

Forms of letter of Tender, Contract Agreement, and Dispute Adjudication Agreement plus Appendix to Tender.

The same “Update Task Group” was used for the New Red, New Yellow and Silver Books.

A separate Task Group used for the Green Book.

All documents were prepared under the direction of the FIDIC Contracts Committee.

Comments on the basis for General Conditions and advice on preparation of Particular Conditions.

3 charts of Typical Sequence relating to:- Principal events during contract- Payment events (Clause 14)- Dispute events (Clause 20)

Contents: General provisions The Employer The Engineer The Contractor Nominated subcontractors Staff and labour Plant, materials and workmanship Commencement, delays and suspension Tests on completion Defects liability

Contents: Measurement and evaluation Variations and adjustments Contract price and payments Termination by employer Suspension and termination by contractor Risk and responsibility Insurance Force Majeure Claims, disputes and arbitration

The Guidance is to assist writers of the Particular Conditions by giving options for various sub-clauses

Major exercise in cross referencing General Conditions with

- Appendix to Tender- Specifications- Particular Conditions,

And ensuring no contradiction.

Annex A – Parent Company GuaranteeAnnex B – Tender SecurityAnnex C – Performance Security – Demand

Guarantee Annex D – Performance Security – Surety BondAnnex E – Advance Payment GuaranteeAnnex F – Retention Money GuaranteeAnnex G – Payment Guarantee by Employer

Contract Agreement

Dispute Adjudication Agreement ( One-person DAB)

Dispute Adjudication Agreement (Three person DAB)

Employer’s details Contractor’s details (completed after

contract award) Engineer’s details Time for completion of the works Defects notification period Electronic transmission systems Governing law

Ruling language Language for communications Time for access to the site Normal working hours Periods for submissions of insurances Date by which DAB shall be appointed Section completions (optional)

Amount of Performance security Delay damages for the works Maximum amount of delay damages Percentage for adjustments of Provisional

Sums Adjustments for changes in cost Total advance payment (and details for

payment) Percentage of retention

Limit of Retention Money Plant and material en route / to site Minimum amount of Interim Payment

Certificate Currency details Maximum amount of deductibles for

insurance of the Employer’s risks Minimum amount of the third party

insurance

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