FIDIC Contracts (1999 editions) Guide MDB Construction Contract supplement draft (2006)

FIDIC Contracts Guide Supplement: MDB Harmonised Construction Contract (2006). Guide to the March 2006 release of the MDB Harmonised Construction Contract.

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The FIDIC Contracts Guide Supplement, MDB Construction Contract
March 2006 release;
Guide to the Multilateral Development Bank Harmonised Conditions of Contract for Construction ACKNOWLEDGEMENTS FOREWORD CONTENTS Prepared by the FIDIC Secretariat under the guidance of the FIDIC Contracts Committee
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Introduction
The use of standard conditions of contract for all civil Works ensures comprehensiveness of coverage, an improved balance of rights or obligations between Employer and Contractor, general acceptability of their provisions, and savings in time and cost for bid preparation and review, leading to more economic prices. The International Bank for Reconstruction and Development (IBRD) and other Multilateral Development Banks (MDBs) started releasing in May 2005 Standard Bidding Documents for the procurement of works that conformed, “to the extent possible without contravening their procurement guidelines”, to the model provided by the Master Procurement Document for Procurement of Works & User’s Guide harmonised among the various MDBs and approved by the Heads of Procurement of the MDBs and International Financial Institutions (IFIs) in October 2004. The Master Bidding Documents reflect “best practices” by these institutions. These Standard Bidding Documents for the procurement of works are to be used for the procurement of admeasurement (unit price or rate) type of works through International Competitive Bidding (ICB) in projects that are financed in whole or in part by an MDB. These bidding documents are not suitable for lump sum contracts without substantial changes to the method of payment and price adjustment, and to the Bill of Quantities, Schedules and so forth. The MDB harmonised Master Procurement Document for Procurement of Works & User’s Guide incorporates General Conditions of a harmonised edition of contract conditions which text has been agreed by the International Federation of Consulting Engineers (FIDIC) and various MDBs for its inclusion in the Master Procurement Documents for Procurement of Works & User’s Guide. The harmonisation of the General Conditions has made unnecessary the great number of deviations to the General Conditions of Contract (FIDIC’s “Conditions of Contract for Construction”), introduced in, for example, the World Bank’s SBD for the procurement of works through Particular Conditions of Contract to account for all non-applicable general conditions. Given that the harmonised General Conditions are based extensively on the “Conditions of Contract for Construction”, 1st Edition, published by FIDIC in 1999, and FIDIC being the sole copyright owner of the publication, the MDBs subscribed to a license agreement with FIDIC that authorizes the use of the harmonised edition of such conditions of contract by the MDBs when preparing bidding documents in accordance with their various SBD for the procurement of works. By virtue of a license agreement subscribed between Participating Banks and FIDIC, a Bank’s Borrowers and their implementing agencies are authorized to reproduce the MDB Harmonised Edition of FIDIC’s General Conditions of Contract for the exclusive purpose of preparing bidding documents. Therefore, Borrowers and their implementing agencies must abstain from making any use of the Harmonised Edition of FIDIC’s General Conditions of Contract, distinct from the use indicated in the license agreement with the Banks. The harmonised Master Procurement Document for Procurement of Works & User’s Guide also contains Particular Conditions, now consisting of two Parts: Part A, comprising the Contract Data and Part B, Specific Provisions, containing clauses specific to each contract. There is also a section containing Sample Forms. The MDB Harmonised Edition of the FIDIC Conditions of Contract for Construction, referred to as the “MDB Harmonised Construction Contract”, comprising General Conditions, Particular Conditions and Sample Forms taken from the MDB harmonised Master Procurement Document for Procurement of Works & User’s Guide is published by FIDIC in accordance with the terms of the license agreement between FIDIC and the MDBs. The present Supplement to the FIDIC Contracts Guide provides information and guidance for preparing contracts using the MDB Harmonised Construction Contract. The information and guidance is taken from the 1st Edition 1999 of the FIDIC Conditions of Contract for Construction (the “Construction Contract, 1st Edition 1999” and from elements of the MDB harmonised Master Procurement Document for Procurement of Works & User's Guide that were published in the World Bank Standard Bidding Document for Works & Users Guide, May 2006. Included are: - a table of the changes to the Construction Contract General Conditions; - a list of words and phrases that have been replaced in the Construction Contract General Conditions; - an index of the MDB Harmonised Construction Contract General Conditions; - a side-by-side comparison of the General Conditions of the Construction Contract, MDB Harmonised Edition, with those of the Construction Contract, 1st Edition 1999; - Notes for the Preparation of Particular Conditions. The Supplement to the FIDIC Contracts Guide was first published in May 2005 to accompany the publication of the MDB Harmonised Construction Contract. A second version of the contract was released in March 2006, and the present guide was updated to reflect the changes. The Supplement to the FIDIC Contracts Guide was prepared by the FIDIC Secretariat under the guidance of the FIDIC Executive Committee and the FIDIC Contracts Committee which comprises Christopher Wade (Chairman), Nael Bunni, Axel-Volkmar Jaeger, Philip Jenkinson, and Michael Mortimer-Hawkins together with John B Bowcock as Special Adviser and Christopher R Seppala as Legal Adviser. FIDIC wishes to record its appreciation of the time and effort devoted by all the above.
Contents
INTRODUCTION - Introduction to the Supplement - Introduction to the Conditions of Contract for Construction, MDB Harmonised Edition - Summary of the License Agreement - Foreword 1 - Notes on the Preparation of Conditions of Contract - Notes on the Preparation of Tender Documentation GENERAL CONDITIONS: Changes Changes to the Construction Contract 1st Edition 1999 - Notes to the MDB Harmonised General Conditions - Words and Phrases replaced in the General Conditions GENERAL CONDITIONS: Comparison Clauses - Index of Sub-Clauses 3.2 Clause 1 Defined Words Clauses 1 - 20 Comparison PARTICULAR CONDITIONS - Notes on the Preparation of Particular Conditions 4.1

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