Engineering And Construction Contract Specifications

[CVE449]

FIDIC CONTRACTS

Dr. Ahmed Elyamany

Objectives

� By the end of this lecture, you will:

1. Define FIDIC Contracts

2. CONDITIONS OF CONTRACT

3. FEATURES AND ADVANTAGES

4. TENDERING PROCEDURES

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4. TENDERING PROCEDURES

Dr. Ahmed Elyamany

What is FIDIC ?

� An international federation of consulting engineers, founded in 1913 with its headquarters located in Lausanne, Switzerland, whose objective is to promote the common interests of the member associations and disseminate information to its members for the development of consulting industry.

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What does FIDIC do?

� Arrange seminars and conferences and prepare standard documents, in the furtherance of its goals.

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FIDIC CONTRACTS

� Conditions of Contract for Construction (Red Book)

� Conditions of Contract for Plant and Design-Build (Yellow Book)

� Conditions of Contract for EPC/Turnkey Projects(Silver Book)

� Short Form of Contract ( Green Book)� Short Form of Contract ( Green Book)

� CLIENT/CONSULTANT MODEL SERVICES AGREEMENT

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The New Red Book

� For Construction of major building or engineering projects in general

� Employer’s Responsibility for Design

� Unit Price Contract/Remeasurement (monthly payment)

� Administration of Contract by Engineer� Administration of Contract by Engineer

� Pro-contractor in terms of risk allocation

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The New Yellow Book

� For provision of mechanical and electrical plant, and for design and execution of building or engineering projects

� Contractor’s Responsibility for Design(design extent?)

� Lump-sum, with adjustments (stage/milestone or monthly payment)

� Administration of Contract by Engineer

� Pro-contractor in terms of risk allocation

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The Silver Book

� For provision on a turnkey basis of a process or power plant, etc.

� Contractor’s Total Responsibility for Design

� Normally fixed Lump-sum, with few adjustments (stage/milestone or monthly payment)

� Administration of Contract by Employer’s Representative

� Pro-employer in terms of risk allocation

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The Green Book

� For Building or Engineering Works of Small Capital Value or containing mostly simple or repetitive work

� Contractor’s or Employer’s Responsibility for Design

� Lump-sum, with adjustments (monthly payment)

� Administration of Contract by Employer’s Representative � Administration of Contract by Employer’s Representative

� Pro-contractor in terms of risk allocation

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published 1999CONDITIONS OF CONTRACT

Guide

published 2001

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STRAIGHTFORWARD

PROJECT ?EMPLOYER DESIGN ?

CONTRACTOR DESIGN

fixed price - lump sum

no

no

yesyes

WHICH BOOK TO USE?

plant and/or high

unforeseen risks

fixed price - lump sum

little employer involvement

no major unforeseen risks no

DISCUSS IN DETAIL

Employer ’s requirements

with the Contractor, and

negotiate a modified

FIDIC contract

no yesyes

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FEATURES AND ADVANTAGES

� BALANCED

� Fair apportioning of risks, rights and obligations between the parties

� WELL TRIED

� Long case history for earlier contracts

� ACCEPTEDACCEPTED

� Known and recognized; in wide use for international contracts

� SUPPORTED

� Recommended or required by development banks,

� EFFECTIVE

� Clear and complete conditions; time limits; provisions for attribution

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Key points: CONSTRUCTION

� Employer designs

� Engineer, working for the Employer

� Bill of Quantities� Bill of Quantities

� Payments based upon measurements

� Certification of payments by Engineer

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Key points: PLANT & DESIGN-BUILD

� Contractor designs

� Engineer, working for the Employer

� Lump sum pricing� Lump sum pricing

� Payments according to progress

� Certification of payments by Engineer

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Key points: EPC/TURNKEY PROJECTS

� Contractor designs and takes full responsibility

� Employer may appoint a Representative

� Fixed price, to cover risks taken on by Contractor� Fixed price, to cover risks taken on by Contractor

� Payments according to progress

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Key points: SHORT FORM

� Simple projects

� Design by either party

� Employer may appoint a Representative� Employer may appoint a Representative

� Valuation as appropriate; to be agreed

� Payments according to value of Works executed and Materials and Plant delivered to site

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Key points: CLIENT/CONSULTANT

� Agreed Scope of Services: Appendix A (the agreed scope of services)

� Normal, Additional and Exceptional Services

� Normal Services priced as agreed

� Additional and Exceptional Services at rates agreed

� Payment schedule as agreed

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USE OF FIDIC CONTRACTS

� Match contract and project

� Decide the form of contract early

� Appoint Dispute Arbitration Board early� Appoint Dispute Arbitration Board early

� preparation of the contract should be done by professionals

� Do not touch the General Conditions

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PRINCIPLES OF PROCUREMENT

� Effectiveness

� Economy

� Efficiency

� Accountability

� Transparency / confidentiality� Transparency / confidentiality

� Strong competition

� Publicity, wide participation

� Fair and equal conditions

� Standard procedures

� Standard documentation

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PROCUREMENT CATEGORIES

� Goods

� Works

VersusVersus

� Consultant services

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TENDERING PROCEDURES

� Development bank / public procurement procedures

� Open tendering / International Competitive Bidding

� Local tendering / National Competitive Bidding� Local tendering / National Competitive Bidding

� Restricted tendering / Limited Bidding

� Two stage tendering

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SELECTION PROCEDURES/CRITERIA

� Criteria defined and published in advance

� Economically most advantageous offer

� Quality based selection for intellectual services� Quality based selection for intellectual services

� Quality and cost based selection

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PROCUREMENT STEPS

� Preparation

� Publication

� Pre-qualification / short-listing

� Invitation

� (Submission)� (Submission)

� Evaluation

� Award, contracting

� Supervision, contract administration

� Lessons learned

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PREPARATION OF PROCUREMENT

� Determination of needs and objectives

� Determination of constraints

� Identification of parties

� Planning, budgeting, financing

� Contract type

� Selection procedure� Selection procedure

� Requirements / Specifications / Bills of Quantities / Terms of Reference

� Pre-qualification and evaluation criteria

� Particular conditions

� Tender documents

� Publicity

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CONTRACT ADMINISTRATION

� Supervision

� Implementation of rule

� Quality and quantity

� Invoice verification

� Payments� Payments

� Extensions, variation orders, modifications

� Termination

� Disputes and their resolution

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RISKS IN PROCUREMENT

� Wrong goods, works, services

� Bad value for money

� Fraud� Fraud

� Corruption

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Questions?Questions?

Contact:

Dr. Ahmed Elyamany

0109-4100-824

a2hyamany@yahoo.com

http://drahmedelyamany.weebly.com

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