ame seminars seminar on fidic and edf 1 PDF
Preview ame seminars seminar on fidic and edf 1
AME SEMINARS SEMINAR ON FIDIC AND EDF 1 – 2 MARCH 2012, INTERCONTINENTAL HOTEL, NAIROBI Welcome and Introduction Day 1 09:00 Speaker: SIMON DELVES In association with AME SEMINARS SEMINAR ON FIDIC AND EDF 1 – 2 MARCH 2012, INTERCONTINENTAL HOTEL, NAIROBI Key Note Address – Keso Msita Day 1 09:10 Speaker: KESO MSITA In association with GENERAL COMMENTS • Commend the organisers of this seminar • It is an honour and privilege on my part being required to give introductory remarks at the commencement of the seminar • Intend to give some perspectives with respect to the use of FIDIC contracts 1-2 March 2012 www.ameseminar.com Simon Delves 3 GENERAL COMMENTS • FIDIC conditions of contracts are the mostly used standard conditions internationally • They are equally mostly used for major infrastructure projects within the region • The ever growing interest on their use in our region is partly an outcome of the demand by multilateral funding agencies and also lack of such comprehensive conditions of contracts in many jurisdictions 1-2 March 2012 www.ameseminar.com Simon Delves 4 FEATURES WITH RESPECT TO PROJECT IMPLEMENTATION • The quality of pretender information upon which tender/contract documents are prepared has not been encouraging • Thus, poor tender/contract documents are encountered which reflect as poorly prepared projects • These result into variations, additional works , and claims and disputes 1-2 March 2012 www.ameseminar.com Simon Delves 5 FEATURES WITH RESPECT TO PROJECT IMPLEMENTATION • A number of employers are not familiar with FIDIC contracts • Not all contractors are familiar with FIDIC contracts • In the region, we are witnessing an influx of contractors who are not familiar with FIDIC contract management features and procedures; and indeed some employers also have the same weaknesses 1-2 March 2012 www.ameseminar.com Simon Delves 6 ROLE OF THE ENGINEER NOT WELL UNDERSTOOD • FIDIC’S traditional approach has been to give authority to an independent and skilled third party called the engineer, in order to ensure projects are well managed and for holding a fair balance between the parties • Unfortunately, employers expect the engineer to solely work as their agent. The situation is partly an outcome of the requirement for approval from the employer prior to giving decisions on contractual matters 1-2 March 2012 www.ameseminar.com Simon Delves 7 SOME ISSUES OF CONCERN • Wrong amendments made to standard forms, that mutilates the envisaged interdependence of provisions and severely tempers with the envisaged risk sharing policy • In one Design and Build case, involving six contracts, major employer’s risks were shifted to contractors; a number of credible contractor’s did not tender as a result. Almost all projects encountered problems • In certain situations amendments are not done in spite of the situation demanding so. Example is that of an un amended arbitration clause in a contract between a government agency and a local contractor that required disputes to be referred to the International Chamber of Commerce in Paris 1-2 March 2012 www.ameseminar.com Simon Delves 8 SOME ISSUES OF CONCERN • The definition of ‘cost’ is not understood and its implication with respect risk sharing policy • That it excludes profit on matters which are beyond the control of both parties • Where profit is payable, that is explicitly provided for and it will be an outcome of a default the employer 1-2 March 2012 www.ameseminar.com Simon Delves 9 SOME ISSUES OF CONCERN • Price fluctuation clause is wrongly applied • Wrong indices are equally used • As a result, employer’s find themselves have to pay more than they should 1-2 March 2012 www.ameseminar.com Simon Delves 10
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