Description

Construction Contract: Conditions of Contract for Construction
FOR BUILDING AND ENGINEERING WORKS DESIGNED BY THE EMPLOYER
MDB Harmonised Edition, June 2010 Version

Amended Version published June 2010
Amended Version published March 2006, see March 2006  Version
(First Version published May 2005)

FOR USE UNDER LICENCE ON PROJECTS FUNDED BY PARTICIPATING MULTILATERAL DEVELOPMENT BANKS (MDB)
 
FOR PROJECTS THAT ARE NOT PARTICIPATING MDB FINANCED, THE CONSTRUCTION CONTRACT, 1ST EDITION 1999, MUST BE USED.

General Conditions
Particular Conditions
Forms of Tender, Contract Agreement Dispute Adjudication Agreement

Conditions of Contract for Construction, which are recommended for building and engineering works designed by the Employer or by his representative, the Engineer. Under the usual arrangements for this type of contract, the Contractor constructs the works in accordance with a design provided by the Employer. However, the works may include some elements of Contractor-designed civil, mechanical, electrical and/or construction works.
 

Complete Contract, June 2010 Version:
General Conditions, Forms, Index,

Complete Contract, June 2010 Version:
General Conditions, Forms, Index, etc. Add to Order
For Amended Version published March 2006, see March 2006  Version
 
 
ACKNOWLEDGEMENTS TO THE FIRST EDITION, 1999
 
Fédération Internationale des Ingénieurs-Conseils (FIDIC) extends special thanks to the following members of its Update Task Group: Christopher Wade (Group Leader), SWECO-VBB, Sweden; Peter L Booen (Principal Drafter), GIBB Ltd, UK; Hermann Bayerlein, Fichtner, Germany; Christopher R Seppala (Legal Adviser), White & Case, France; and José F Speziale, IATASA, Argentina.
 
The preparation was carried out under the general direction of the FIDIC Contracts Committee comprising John B Bowcock, Consulting Engineer, UK (Chairman); Michael Mortimer-Hawkins, SwedPower, Sweden; Axel-Volkmar Jaeger, Schmidt Reuter Partner, Germany; and Hiroyuki Endo, Pacific Consultants, Japan.
 
Various drafts were reviewed by the following persons or organisations: Mushtaq Ahmad, NESPAK, Pakistan; Peter Batty, Post Buckley International, USA; Manfred Breege, Lahmeyer International, Germany; Pablo Bueno, TYPSA, Spain; Nael G Bunni, Consulting Engineer, Ireland; Ian Fraser, Beca Carter Hollings & Ferner, New Zealand; Roy Goode, Oxford University, UK; Dan W Graham, Bristows Cooke & Carpmael, UK; Mark Griffiths, Griffiths & Armour, UK; Geoffrey F Hawker, Consulting Engineer, UK; Hesse & Steinberger, VDMA, Germany; Poul E Hvilsted, Elsamprojekt, Denmark; Gordon L Jaynes, Whitman Breed Abbott & Morgan, UK; Tonny Jensen (Chairman of FIDIC Quality Management Committee), COWI, Denmark; Philip Loots & Associates, South Africa; Neil McCole, Merz and McLellan, UK; K B (Tony) Norris, Consulting Engineer, UK; Eric Petersen, CEGELEC, France; Matthew Needham-Laing, Victoria Russell & Paul J Taylor, Berrymans Lace Mawer, UK; David R Wightman & Gerlando Butera, Nabarro Nathanson, UK; the Association of Japanese Consulting Engineers; European International Contractors; Organisme de Liaison Industries Métalliques Européennes ("ORGALIME"); the International Association of Dredging Contractors; the International Bar Association; the Asian Development Bank; and the World Bank.
 
FIDIC wishes to record its appreciation of the time and effort devoted by all the above.
 
The ultimate decision on the form and content of the document rests with FIDIC.
 
INTRODUCTION
A number of the Multilateral Development Banks (MDBs) have for many years adopted the FIDIC Conditions of Contract for Construction as part of the Standard Bidding Documents which the MDBs require their borrowers or aid recipients to follow. In using the FIDIC Conditions it has been the regular practice of the MDBs to introduce additional Clauses in the Conditions of Particular Application (or “Particular Conditions”) in order to amend provisions contained in the FIDIC General Conditions. These additional clauses in many cases have standard wording which has to be repeated whenever procurement documents are being prepared for a new project. Furthermore, the provisions in bid documents, including the additional clauses contained in the Particular Conditions, varied between the MDBs, and this created inefficiencies and uncertainties amongst the users of the documents, and increased the possibilities for disputes.
 
These problems were recognised by the Heads of Procurement (HOPs) of the MDBs as significant, as were the benefits of standardisation. In response, the HOPs resolved to harmonise their bid documents on an international basis, by making use of the FIDIC General Conditions. For this purpose, the HOPs further resolved that there should be a modified form of the FIDIC Conditions of Contract for Construction, 1st Edition 1999, in which the General Conditions would contain the standard wording which previously has been incorporated by MDBs in the Particular Conditions.
 
FIDIC also recognised the major benefits to the users of the contracts of harmonisation and the inclusion in the General Conditions of the main common changes required by Particular Conditions in MDB contracts. Accordingly, the Federation was pleased to work with the HOPs to produce this MDB Harmonised Edition of the 1999 Conditions for MDB financed contracts.
 
It is believed that the modified, or harmonised document, will simplify use of the FIDIC Conditions of Contract not only for the MDBs and their borrowers, but also for others involved with project procurement, such as consulting engineers, contractors and contract specialists working on MDB financed projects.
 
Use of the harmonised conditions should significantly reduce the number of additions and amendments to be included in the Particular Conditions. Nevertheless, most projects will have special requirements which will necessitate some specific changes.
 
This harmonised document therefore contains provision for Particular Conditions, as has become the practice in other FIDIC documents. This MDB Harmonised Edition also includes sample forms for Contract Data (Particular Conditions - Part A), Securities, Bonds, Guarantees and Dispute Board agreements.
 
In general, this harmonised document follows earlier FIDIC risk sharing principles for the types of contract for which they were prepared. In most cases, the amendments which have been made to produce the MDB Harmonised Edition of the FIDIC General Conditions for Construction are those arising from the requirements of the MDBs, except for some minor changes of an editorial nature.
 
However, in the case of the dispute provisions contained in Clauses 20.2 to 20.8 and in the associated Appendix, the opportunity has been taken to make other  amendments which FIDIC considers an improvement on earlier wording in the Construction Contract, 1st Edition 1999.
 
The insurance provisions given in Clause 18 of the document remain unchanged from the 1st Edition 1999, although some commentators have suggested an alternative approach to dealing with this specialised topic. In particular, Employers may wish to consider arranging for a dedicated single policy for the project which would cover all necessary insurances.
 
The advantage of such an approach is that it would avoid gaps or other misunderstandings in the insurances provided, including possible duplication of cover. If an Employer decides to arrange a single insurance policy, then a copy of that policy should be made available to tenderers during the tender period. FIDIC recommends that Employers should obtain, at an early stage of project procurement, expert advice on insurance matters.
 
The MDBs listed in the section “Participating Banks” have participated in the preparation of the MDB Harmonised Edition. It is understood that all of them will adopt this edition of the FIDIC document in their Standard Bidding Documents.
 
A first version of the General Conditions was released to Participating Banks in May 2005, followed by an amended second version in March 2006 and this third amended version in June 2010.
 
Drafts of these three versions of the MDB Harmonised Edition were circulated for comment to interested parties, prior to their finalisation. All of the comments received were considered by FIDIC and some have been incorporated. Other comments will be reviewed again when in due course FIDIC produces a second edition of its Construction Contract.
 
The contribution of the FIDIC Contracts Committee to the preparation of this Harmonised Edition is acknowledged. The Contracts Committee for the first two versions comprised Christopher Wade (Chairman), Nael Bunni, Axel-Volkmar Jaegar, Philip Jenkinson and Michael Mortimer-Hawkins together with John B Bowcock as Special Advisor and Christopher R Seppala as Legal Adviser. It is noted that all were also involved, together with others, in the preparation of the 1999 Edition of the Conditions of Contract for Construction (refer to Acknowledgements in that document). For this 2010 version the Contracts Committee comprised Philip Jenkinson (Chairman), Christoph Theune and Zoltán Záhonyi, with Axel-Volkmar Jaegar, Michael Mortimer-Hawkins, Christopher R Seppala and Christopher Wade as Special Advisers, and Geoff French as the Executive Committee member responsible for the Contracts Committee.
 
FIDIC wishes to record it appreciation of the time and effort devoted by all of the above.
 
 
PARTICIPATING BANKS
The Participating Banks listed below have participated in the preparation of the Multilateral Development Bank (MDB) Harmonised Edition of the FIDIC Conditions of Contract for Construction. It is understood that all of them will adopt this edition of the FIDIC document in their Standard Bidding Documents. The MDB Harmonised Edition is for use on projects financed in whole or in part by a Participating Bank.
African Development Bank
Asian Development Bank
Black Sea Trade and Development Bank
Caribbean Development Bank
Council of Europe Development Bank
European Bank for Reconstruction and Development
Inter-American Development Bank
International Bank for Reconstruction and Development (The World Bank) 
 

Contents

• GENERAL CONDITIONS
• DEFINITIONS LISTED ALPHABETICALLY
• GENERAL PROVISIONS 
• THE EMPLOYER
• THE ENGINEER
• THE CONTRACTOR 
• NOMINATED SUBCONTRACTORS
• STAFF AND LABOUR
• Engagement of Staff and Labour
• PLANT, MATERIALS AND WORKMANSHIP
• COMMENCEMENT, DELAYS AND SUSPENSION
• TESTS ON COMPLETION
• EMPLOYER’S TAKING OVER 
  DEFECTS LIABILITY
• MEASUREMENT AND EVALUATION
• VARIATIONS AND ADJUSTMENTS
• CONTRACT PRICE AND PAYMENT
• DEFAULT OF CONTRACTOR
• DEFAULT OF EMPLOYER
• RISK AND RESPONSIBILITY 
• INSURANCE
• FORCE MAJEURE 
• CLAIMS, DISPUTES AND ARBITRATION
• GENERAL CONDITIONS OF DISPUTE
• ADJUDICATION AGREEMENT
• ANNEX: PROCEDURAL RULES
• INDEX OF SUB-CLAUSES
• PARTICULAR CONDITIONS
• PART A - CONTRACT DATA
• PART B - SPECIFIC PROVISIONS
• SAMPLE FORMS
• FORMS OF SECURITIES