Fidic Conditions of Contr 21032012113710

Bölgesel Rekabet Edebilirlik Operasyonel Programı’nın Uygulanması için
Kurumsal Kapasitenin Oluşturulmasına Yönelik Teknik Yardım
Technical Assistance on Institutional Building for the Implementation of RCOP

in Turkey
This project is co-financed by the European
Union and the Republic of Turkey
FIDIC
Conditions of Contracts Training
12 – 14 April 2011
FIDIC Training 12-14 April 2011 1

Agenda - 1
 Day # 1
 Introduction
 Objective of the Training & Expectations of the participants
 FIDIC (What and Why?)
 FIDIC Publications
 FIDIC Conditions of Contracts for Works Contracts
 FIDIC Contracts Comparison Matrix
 2 exercises

Agenda - 2
 Day # 2
 Parties of a Works Contract under FIDIC

 Contents of a Works Tender Dossier
 Introduction to Particular Conditions
 Appendix to Tender
 Clauses of the Conditions of Contract related to Volume 3
 2 exercises

Agenda - 3
 Day # 3
Before Contract Signature

Before the Commencement of Works


 First 28 days
 Project Management Tools under FIDIC Conditions
 Financial Management Tools
 Limits of Engineer’s Authority in EU-funded Projects
 Exercise
 Evaluations

Agenda
Session # 1
Day # 1, Morning
 Introduction
 Objectives of the Training
 What is FIDIC?
 Why FIDIC?
 FIDIC Publications

Introduction – 1
• Trainer:
– Kerem Sadıklar
– Civil Engineer & MBA
– > 15 years of experience including EU & UNDP
– kerem.sadiklar@grontmij.com.tr
• Participants:
– 25 of FCD + TID of RCP – CIC
– Knowledge & experience level?

Introduction – 2
Objective of the Training:
 By the end of the course, the trainees should;
– have a solid understanding of types of FIDIC Contracts

– know contents of a Works Contract
– know where to find what
– be able to identify the external expertise they need
– be able to draft an «Appendix to Tender»
– be able to identify the important clauses of an PC

Introduction – 3
 Therefore the training
 will cover
 FIDIC’s institutional structure and bookshop
 FIDIC contract types and major differences
 Identification of the most appropriate contract type
 Issues/clauses which need special attention during tendering.
 will be interactive; please be participative

 will use exercises
 will involve team work

Introduction – 4
Please always remember;
 Management of FIDIC
contracts is a broad and
complicated area,
 FIDIC experiences improve by

execution,
 Studying, Implementation
and Continues Monitoring
are the keys to success.

What is FIDIC? - 1
 Fédération Internationale des Ingénieurs-Conseils
International Federation of Consulting Engineers
Uluslar arası Müşavir ve Mühendisler Federasyonu
 Established in Switzerland in 1913, HQs is in Genève
 First contract is printed in 1957
 FIDIC represents Engineers and Consultants from various countries. E&C

Associations from 75 countries are FIDIC members
 Under this umbrella 30.000 firms and 1.000.000 professionals are represented

Union and the Republic of Turkey What is FIDIC? - 2
 TürkMMMB - Türk Müşavir Mühendis ve Mimarlar Birliği
ATCEA – Association of Turkish Consulting Engineers and Architects
 Established in 1980
 ATCEA has 200 members
 ATCEA is a member of FIDIC since 1987
 Sells and distributes its own publications as well as FIDIC’s
 www.tmmmb.org.tr

What is FIDIC? - 3
Some of the International Institutions using FIDIC;
 World Bank (WB)

 European Bank of Restructuring and Development (EBRD)
 European Investment Bank (EIB)
 European Commission (EC)
 KfW Bankengruppe (KfW)
 Islamic Development Bank (IDB)
 African Development Bankası (ADB)
 Asian Development Bank (ADB)

Why FIDIC? – 1
FIDIC Conditions of Contracts
 cover almost all the major issues that needs to be addressed under a contract
 have a consistent and easy to follow structure
 distribute the risks fairly amongst parties
 designed by a third party (Consultant) but not an Employer; therefore conditions

are more objective and fair
 can be adopted easily for many type of investments projects

Why FIDIC? – 2
 FIDIC has committees formed of international members to improve its

publications.
 Committees do continuous monitoring to improve and/or revise the existing

publications (contract types, guidelines, etc.) and to introduce new books.
 Very well known by international Contractors and Consultants, therefore

creates confidence and encourages tenderers.

FIDIC Publications - 1
 Types of Contracts;
 Client/Consultant Model Services Agreement (White Book)
 Joint Venture Agreements
 Sub Contracting Agreements
 Various Types of Conditions for Works Contracts

Union and the Republic of Turkey FIDIC Publications - 2
Other Publications;
 Business Integrity
 Risk Management
 Quality Management
 Environment Management
 Sustainability Guide
 FIDIC Contracts Guide to the Construction, Plant and Design-Build and

EPC/Turnkey Contracts

Exercise # 1
 Please go to web site www.fidic.org
 list the types of publications available.
Note: Based on the availability of internet in the training center, this exercise
may be done as a joint activity.

Agenda
Session # 2
Day # 1, Afternoon
 Types of FIDIC Conditions of Contracts for

Works
 Exercise # 2
 Comparison Matrix

FIDIC Publications – 3;
Conditions of Contracts for Works
 Conditions of Contract for Construction for Building and Engineering Works Designed by
the Employer; 1999 Edition – RED BOOK
 Conditions of Contract for Plant and Design-Build for Electrical and Mechanical Plant,
and for Building and Engineering, Designed by the Contractor; 1999 Edition – YELLOW
BOOK
 Conditions of Contract for EPC Turn-key Projects (First Edition, 1999) - SILVER BOOK
EPC Turn-key : Engineering – Procurement – Construction
 Short Form of Contract 1st Ed (1999 Green Book) – GREEN BOOK

 Conditions of Contract for Construction (Multilateral Development Bank
Harmonised Ed. Version 3: June 2010). For Building and Engineering Works
designed by the Employer. Harmonised RED BOOK
 Conditions of Contract for Design, Build and Operate Projects (1st Ed, 2008) -
GOLD BOOK
FIDIC has adopted the scenario, with a 20- year operation period, and has opted for a single
contract awarded to a single contracting entity (which will almost certainly be a consortium or joint
venture) to optimise the coordination of innovation, quality and performance, rather than award
separate contracts for design-build and for operation. The contractor has no responsibility for
either financing the project or for its ultimate commercial success. The document, as written, is
not suitable for contracts which are not based on the traditional Design-Build-Operate sequence,
or where the Operation Period differs significantly from the 20 years adopted.

RED BOOK – 1
 Design and Engineering (incl. BoQs) is done by Employer or

Employer’s Representative.
 Tenderers fill in their unit prices into the existing BoQs.
 Final amount is not fixed, payments are done based on the real
amounts executed. (Exceptions are available eg: lump-sum
conracts).

RED BOOK - 2
 Employer carries the risk for contract amount increases.
 The better the design, the flawless the project implementation.
 Tender evaluations are relatively simpler.

YELLOW BOOK - 1
 Employer prepares only the «Employer’s Requirements».
 Employer Requirements includes only; Draft layout, Operational

Parameters, Technical Specifications and Financial Proposal Format
(Schedule of Prices).
 Tenderers submit their technical proposals together with their financial

proposals. Technical proposals cover at minimum methodology, basic
design and drawings, bill of and similar supporting documents.

YELLOW BOOK - 2
 Generally lump-sum price contracts are used.
 Price increase and other risks are distributed amongst both parties.
 Tender evaluation process is more complicated and requires technical expertise.

SILVER BOOK - 1
 Two-party contracts (No Engineer)
 Employer defines design parameters, quality measures and functional requirements.
 Tenderers submit comprehensive technical proposals supported with designs.
 Lump-sum contracts are used and all risk lies with the Contractor.


SILVER BOOK - 2
 More suitable for projects like; refinery, petrochemical facilities, power plants.
 Implemented if the employer foresees high risk for the supply and assembly of
mechanical and electrical components.
 Tender evaluations are very complicated and requires continuous negotiations.
 Not suitable for public and EU-funded projects in Turkey.

GREEN BOOK
 For low contract values (< 500,000 USD)
 Simple but repetitive works
 Short term assignments
 Usually Employer takes over the design responsibility.

Exercise # 2
Please fill in the given table based on
your best assumptions.

This project is co-financed by the European Comparison Matrix - 1
Parameters RED YELLOW SILVER GREEN
Employer or
Design Employer Contractor Employer Contractor
Engineer approves
Only Contractor’s or rejects before Only Contractor’s
Design Approval Design (If any) executions N.a. Design (If any
Unit Price / Lump-

Financial Proposal Unit Price Lump-sum Price Lump-sum Price sum Price
Payment Calendar Measured

Measured Payment / Payment quantities or
Payment Schedules quantities percentages percentages Percentages
No. Employer
representative may
Engineer Yes Yes Generally No assign if needed.
Comparison Matrix - 2
Parameters RED YELLOW SILVER GREEN
Tests during Significant number Relatively less and

Construction of tests simpler Generally no tests Limited or no tests
Very detailed and Very detailed and

Relatively less and complicated complicated
Tests at completion simpler performance tests performance tests. Limited or no tests
Employer carries Contractor carries

Risk Distribution the design risks Distributed the risks Varies

Agenda
Session # 3
Day # 2, Morning
 Parties of a Works Contract under FIDIC
 Contents of a Works Tender Dossier
 Introduction to Particular Conditions
 Exercise # 3

Parties of a Contract - 1
3 parties under a typical FIDIC Contract :
 The Employer
 The Contractor
 The Engineer (Supervisor)

Union and the Republic of Turkey Parties of a Contract - 2
Relations in a EU-funded Project
 Employer – Contractor
FIDIC Conditions of Contract
 Employer – Engineer
Service Contract
EU/PRAG General Conditions
 Engineer – Contractor
Engineer supervises the
construction and manages the
project with limited authority.

Employer
 Defines the requirements and specifications
 Provides the construction site
 Provides the financial resources (usually)
 Provides the necessary conditions to the Contractor for the execution of works
 Some of these tasks are shared by OPs and ERs (not party to the contract) in EU-
funded projects.

Contractor:
 Responsible from executing the works
 Provides the necessary securities and guarantees
 Held responsible from his and/or his sub contractors actions
 Responsible from the quality of the executed works as well as the security of the
construction site
 Prepares the interim payment reports
 May use sub contractors as allowed in the conditions of the contract

Union and the Republic of Turkey Parties of a Contract - 5
Engineer:
 Assigned by the Employer to represent the Employer
 Name, contact information and authorities of an Engineer are stated in relevant parts
of the Works Contract
 After consulting with the Employer and the Contractor, should propose fair and
objective solutions for claims.
 Checks the quality of the appropriateness of the workmanship and the materials used
 Approves the payment certificates of the Contractor

Contents of a Works TD - 1
A Works tender dossier comprises of 5 Volumes;
 Volume 1: Instructions to Tenderers - PRAG rules apply. Terminology should

be adopted in line with FIDIC.
 Volume 2: Conditions of Contract – FIDIC
 Volume 3: Technical Specifications / Employer’s Requirements
 Volume 4: Financial Offer Format, Schedule of Prices
 Volume 5: Drawings

 Volume 1:
 Instructions to Tenderers (ITT)
 Tender Form and Annexes (Appendix to Tender)
 Tender Guarantee Format
 Forms
 Glossary of Terms
 Evaluation Grid

 Volume 2:
 Draft Contract
 General Conditions of Contract (RED / YELLOW BOOK))

Based on the nature and design responsibility.
 Particular Conditions of Contract
 Security Samples (Pre-finance, Performance & Retention)

Contents of a Works TD – 4
Particular Conditions – 1
FIDIC General Conditions of Contracts (RED or YELLOW) for any type of project
anywhere in the world.
Contract will be customized by using the particular conditions of contract.
 Particular conditions prevail the General Conditions.
 Particular Conditions changes / replaces / revises / deletes the Clauses of the

General Conditions.

 Clauses in Particular Conditions should not be conflicting with the

clauses of the General Conditions.
 FIDIC Guidelines may be used while drafting Particular Conditions.
 Particular Conditions should be in line with the local law and law of the
contract.
 Any revisions / additions / omissions done by the Particular Conditions

should be based on rational reasoning.

 Very complex PCs may harm the completeness and structure of a works
Contract.
 PCs should be drafted by a team of experts who have relevant works and contract
management experience.
 PCs should be assessed / evaluated by local lawyers.
 Appendix to Tender may be used as control tool.
 Clause 1.5 of PCs; «Priority of Documents» is important and should be re-

addressed for every project.

Priority of Documents
 the contract,
 the Tender Form with its appendix,
 the Particular Conditions,
 the General Conditions,
 the Technical Specifications,
 the design documentation (drawings),
 the bill of quantities (after arithmetical
corrections)/breakdown,
 any other documents forming part of the contract

Clauses which must be revised / added during the preparation of a PCs
 Clause 1.3 Communication

Should be revised in line with all the communication tools allowed for the specific
project
 Clause 1.4 Law and Language

If different languages will be used under certain circumstances this should be defined
here
 Clause 1.5 Priority of Documents

Amendments and additions can be made here. Please be extremely careful, and do
not change unless you have to.

Union and the Republic of Turkey Particular Conditions – 2
 Clause 1.6 Contract Agreement

Contract Agreement will also be referred as «Letter of Acceptance»
 Clause 2.1 Right of Access to Site

If there are conditions (time constraints or other) related to this issue, this clause should
be drafted accordingly.
 Clause 3.1 Engineer’s Duty and Authority

The limits of Engineer’s authority should be clearly defined here. This article is
extremely important for EU funded projects where the authority of the Engineer is
limited. This article should be in line with the ToR fo the Engineer’s service contract.
 Clause 4.1 Contractor’s General Obligations

If the Contractor has additional obligations, these should be clearly defined here.

This project is co-financed by the European Particular Conditions – 3
 Clause 4.8 Safety Procedures

If there are any additional procedures to be implemented because of EU or local laws
they should be defined here
 Clause 4.19 Electricity, Water and Gas

This articled defines where and how the Contractor will obtain the necessary
infrastructure.
 Clause 4.21 Progress Reports

If additional reports other than the ones defined in General Conditions are requested,
these should be defined here.
 Clause 7 / Sub Clause 7.9 «Rules of Origin».

This sub clause should be added in EU funded projects. Please remember this is only
for permanent works.

 Clause 8.2 – Time for Completion

If there are different milestones for completion and/or taking over parts of the
works these should be defined here.
 Clause 12.1 – Works to be Measured

Only RED BOOK
If measurements are to be done by records and/or reports, the details should
be defined here.

Exercise # 3
Please identify the Clauses which are different in RED
and YELLOW FIDIC Books.

Union and the Republic of Turkey Particular Conditions - 5
 Different Clauses in FIDIC Books:
RED Book YELLOW Book GREEN Book
Clause 3 Engineer Engineer Employer’s

Administartion
Clause 5 Nominated Sub Design Design

Contractors
Clause 12 Measurement Tests for Tests for

and Evaluation Completion Completion

Agenda
Session # 4
Day # 2, Afternoon
 Appendix to Tender
 Exercise # 4

Appendix to Tender – 1
 Appendix to Tender is prepared as a summary table.
 Includes Financial and Administrative / Contractual Information
 Administrative / Contractual Information
 Contact Details of Parties
 Contract Duration
 Law and Language of the Contract
 Disputes and Arbitration

Financial Information:
 Security Amounts
 Delay Penalties
 Pre-Finance Payments
 Retention Deductions
 Minimum Interim Payments
 Insurance Amounts

 It includes summary of the information originating from the Particular and

General Conditions of Contract.
 A different AtT should be prepared for each tender. May be used as a tool to
check the completeness and consistency of the particular and general
conditions.
 Numeric values or specific information should be indicated in Appendix to

Tender to avoid confusion and mistakes between different values.
 Appendix to tender should be used to complement the Particular and General

Conditions, not to amend or revise them.

This project is co-financed by the European Volume 3 - 1
 Technical Specifications / Employer Requirements
 RED Book: Technical Specifications

 Material quality
 Material properties
 Workmanship quality
 Assembly conditions
 Locations, etc. are defined in detailed.
 YELLOW Book: Employer Requirements

 Performance criteria is defined for the works which will be
designed by the Contractor.

This project is co-financed by the European Volume 3 - 2
RED Book; Technical Specifications
 Every detail (material & workmanship) that can not be shown on drawings should
be clearly defined here.
 Definitions should be clear and net.

«shall», «will», «must» to be used,
«may» «may be» not to be used
 Location Forms (Room Lists) should be included.
The more detailed and clear the specifications, the more flawless the project
implementation.

Volume 3 - 3
YELLOW Book; Employer Requirements
 Employer’s Requirements should define the scope and the objective of

the project.
 The requirements, parameters, functions, scope and the quality of the

completed works should be defined.
 All the existing information, relevant technical & administrative

regulations and standards should be listed to enable the Contractor to
do a proper design.

Volume 3 - 4
Clauses of the Conditions of Contract related to Volume 3 - 1
 1.9 Errors in the Employer’s Requirements

Extension of Time – Contract Amount Increase
 1.13 Compliance with Laws

(planning vs. construction permits)
 4.1 Contractor’s General Obligations

Additional security or visibility measures
 4.6 Co-operation
If other contractors share the site

Volume 3 - 5
 4.7 Setting Out (correct positioning, leveling etc.)
 4.14 Avoidance of Interference (interference with third parties)
 4.18 Protection of Environment
 4.19 Electricity, Water and Gas 8avaliable infrastructure)
 4.20 Employer’s Equipment and Free-Issue Material
 5.1 General Design Obligations (yellow)/ Nominated Sub Contractors (Red)

Volume 3 - 6
 5.2 Contractor’s Documents (Yellow Book)
 5.4 Technical Standards and Regulations
 5.5 Training
 5.6 As-built Documents
 6.6 Facilities for Staff and Labor

Facilities for the Employer and Engineer on site
 7.2 Samples (material approvals)

Volume 3 - 7
 7.3 Inspection (Manufacturer Tests)
 9.1 Contractor’s Obligations (Tests on Completion)
 9.4 Failure to Pass Tests on Completion
 12.1 Tests after Completion (Yellow Book)
 12.4 Failure to Pass Tests after Completion (Yellow Book)

Volume 5
Clauses of the Conditions of Contract related to Volume 5:
 RED and YELLOW Books

1.8 Care and Supply of Documents
 RED Book
1.9 Delayed Drawings and Instructions
 YELLOW Book
1.9 Errors in the Employer’s Requirements

Exercise # 4
Please fill in the missing parts of the attached Appendix to

Tender in line with the given Particular Conditions of Contract
and the General Conditions of a RED FIDIC Book

Agenda
Session # 5
Day # 3, Morning
 Before Contract Signature

 Before the Commencement of Works
 First 28 days
 Project Management Tools under FIDIC Conditions
 Exercise # 5

Before Contract Signature - 1
 Employer gives award notice to the Awardee.
 Contract Negotiations are done (if necessary).
 Priority of documents are re-arranged if necessary due to contract

negotiations or clarifications during tender period.
 Contract is signed by the Employer (and endorsed by EUD).
 Contractor submits the required documents (e.g. performance guarantee) to

the Employer together with the signed Contract.

Before the Construction Works Commerce - 1
Upon the signature of the Contract certain procedures need to completed before the Contractor can
commence the works;
 18.2 Submission of All Risk Insurance
 20.2 Identification of DAB (Dispute Adjucation Board) member(s). – Sometimes identification is

done on «Ad hoc» bases.
 3.1 If not already in the Contract, the Employers informs the Contractor about the details of the
Engineer.
 Communication lines and rules are established.
 1.8 & 1.9 Supply of Drawings and Instructions

(RED Book) Drawings should be an integral part of the Contract and should be provided based
on a well structured calendar

 3.2 The limits of the authority of the Engineer and its staff should be defined
The authority of the Engineer is limited in projects funded by EU.
 Please remember that the phrase Engineer refers to the Consultant Firm,
not the Consultant’s Team Leader.

 The personnel of the Employer, the Contractor and the Engineer to be

deployed on the project site is identified. (4.3 Contractor’s Representative)
 The limits of authority of each personnel is identified and a line of

communication is drafted based on this. It is recommended that the line of
communication is signed by all parties.
For example: the Team Leader of the Engineer approves the Contractors
Interim Payments, but does not have the authority to negotiate
amendments on the Consultancy Contract.

 Clause 2.1 Right of Access to Site

 Employer should give the right to access and possession of the site to the
Contractor after the Contract Signature.
 Employer should complete his responsibilities and should give the
possession of the site free of problems.
 Delays in this task may cause extensions in the contract duration and
increases in the contract price.
 1.13 Contractor should complete all the necessary local procedures and obtain
the necessary permits to start construction works.
 Clause 8.1 Unless otherwise stated in PCs the commencement date is within 42
days after the contract signature. Engineer shall give the notice not less than 7
days before the Commencement Date.

First 28 Days
 Clause 4.4 Necessary permissions and procedures are completed for the
Sub Contractors.
 Clause 4.1 Contractor’s General Obligations.

 Security of the site and works
 EU Visibility Rules are secured
 Clause 6 Staff and Labour

 Sub Clause 6.4 (Local Labour Laws)
 Sub Clause 6.5 (Working hours)
 Sub Clause 6.7 (Health and safety)
 Contractor should take all the necessary precautions to avoid accidents
and should assign a safety representative.

Project Management Tools – 1
 Notices
 Instructions
 Reports
 Records
 Certificates


 Clause 1.3 Communication
 The rules stated in this clause should be followed.

 Payment certificates, approvals, certifications and similar requests
should be processed within the durations stated in the Contract.
 A copy of the notices should be shared by the Engineer.
 Clause 1.9 Delayed Drawings and Instructions
 Delays which will cause claims should be avoided as much as possible.

Project Management Tools - 3
Clause 3.3 Instructions of the Engineer
 Engineer should issue instructions in line with its Authority.
 Instructions can only be issued by the Engineer or its representative.
 RED Book includes verbal instructions by written confirmations.

Reports
Clause 4.21 Progress Reports
 Unless otherwise stated, the Contractor should issue progress reports in

certain intervals. Usually as attachments to the interim payment certificates.
 Reports compare the physical and financial realization with the planned and
propose programmes for the remaining duration.
 Reports should be supported by pictures and test results.
 Reports should include information about the production, delivery and

assembly schedules of the permanent works.

This project is co-financed by the European Project Management Tools – 5
Reports
 Clause 6.10 Records of Contractor’s Personnel and Equipment

 Contractor should keep daily site records. The records should include site activities as
well as weather conditions.
 Such information should be summarized in the progress reports.
 Clause 2.5 ve 20.1 Claims

 Progress reports should list the Claims of both Parties.
 The contractor should give notice in 28 days after he became aware of the event or the
circumstances. And shall submit a detailed claim in 42 days.
 Engineer shall respond within 42 days after receiving a claim.
 Clause 14 - Contract Price and Payment

 Progress reports should include sufficient level of information about cash flows in order
to allow the Employer to make proper planning.


Certificates
 Clause 10 – Employer’s Taking Over
 Contractor may apply for Taking Over Certificate 14 days before the works
are completed (Notice).
 Engineer within 28 days after receiving the application (a) issues the
certificate or (2) rejects the application.
 Clause 11 – Defects Liability
 Upon the full satisfaction of Contractor’s duties and responsibilities and within
28 days after the expiry of the Defects Notification Period; Engineer issues
the Final Acceptance Certificate.

Exercise # 5
Please calculate the maximum number of contract duration
for the Project using the attached Annex to Tender.

Agenda
Session # 6
Day # 3, Afternoon
 Financial Management Tools

 Limits of Engineer’s Authority in EU-funded Projects
 Evaluations

Financial Management Tools- 1
 Clause 12 Measurement and Evaluation (RED Book)
 Clause 13 Variations and Adjustments
 Clause 14 Contract Price and Payment

Financial Management Tools – 2

 Clause 12 Measurement and Evaluation
 Only valid for RED Book Contracts.
 YELLOW Book has «Tests After Completion».
 Measurements are done by the Engineer in presence of the Contractor. In certain circumstances
records are used instead of measurements.
 Payments are usually based on net measurements.
 Clause 12.3 defines the procedures for defining new rates.
 Clause 12.4 defines the compensations payments to be done to the Contractor for omissions.

Financial Management Tools – 3

 YELLOW Book; Payment Conditions
 Usually lump-sum contracts.
 Sub items are defined for interim payments. Payments are based on completion
ratios (percentages).
 Sub items should be arranged carefully in order not to harm the Contractor’s cash
flow. Unfair or unreasonable payment conditions are always reflected to the
prices.
 14.4 Schedule of Payments and Volume 4 should be in line with each other.

Financial Management Tools - 4
 Clause 13 Variations and Adjustments
 13.1 Engineer can instruct a variation
 13.2 Value Engineering
 13.3 Variation Procedure
 13.8 Adjustments for Changes in Cost: Calculates price increases based cost
(material, workmanship, energy etc.) increases. Not implemented in EU
funded projects.

 Clause 14 Contract Price and Payment
 14.1 Contract Price
 14.2 Advance Payment
 14.3 Interim Payment Certificates / Sub Clause 4.21 Progress Reports
 14.4 Schedule of Payments
 14.7 & 14.8 Payment / Delayed Payment

 Advance payment and deductions should be in line with the nature of the
works.
 Payment conditions should not put the Employer under risk, but at the
same time should not harm the cash flow of the Contractor.
 In EU funded projects, Beneficiaries are requested to approve the

interim payments «Read & Approved».
 Procedures for Contract Price variations should be clearly defined. And

relevant clauses should be drafted accordingly.
 Payment terms and durations should be calculated after considering the

necessary approval procedures.

Limits of Engineer’s Authority in EU

Funded Projects - 1
 The Consultant (Engineer) shall obtain the specific approval of the CFCU (Contracting
Authority) and the Beneficiary before taking action on matters affecting contract price
and duration including but not limited to the following articles of the FIDIC Red Book:
 Sub-Clause 3.5: Agreeing or determining any matter, which will change the
Contract Price;
 Sub-Clause 4.4: Giving consent to a Subcontractor for a subcontract for which a

different subcontractor is named in the Contract;

Limits of Engineer’s Authority in EU Funded

Projects - 2
 Sub-Clause 8.4: Agreeing or determining an extension of the Time for

Completion;
 Sub-Clause 8.8: Suspension of work,
 Clause 13: Instructing Variations and Adjustments effecting Contract Price

or Time for Completion.
 Sub-Clause 13.5: Giving instructions for the use of the provisional

sums/contingencies;

Thank You / Evaluations

Fidic Conditions of Contr 21032012113710

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Bölgesel Rekabet Edebilirlik Operasyonel Programı’nın Uygulanması için

Kurumsal Kapasitenin Oluşturulmasına Yönelik Teknik Yardım

Technical Assistance on Institutional Building for the Implementation of RCOP

FIDIC Training 12-14 April 2011 1

FIDIC Training 12-14 April 2011 2

 Parties of a Works Contract under FIDIC

FIDIC Training 12-14 April 2011 3

Before the Commencement of Works

FIDIC Training 12-14 April 2011 4

FIDIC Training 12-14 April 2011 5

FIDIC Training 12-14 April 2011 6

Objective of the Training:

 By the end of the course, the trainees should;

– have a solid understanding of types of FIDIC Contracts

FIDIC Training 12-14 April 2011 7

 will be interactive; please be participative

FIDIC Training 12-14 April 2011 8

Please always remember;

 FIDIC experiences improve by

FIDIC Training 12-14 April 2011 9

 Established in Switzerland in 1913, HQs is in Genève

 First contract is printed in 1957

 FIDIC represents Engineers and Consultants from various countries. E&C

FIDIC Training 12-14 April 2011 10

ATCEA – Association of Turkish Consulting Engineers and Architects

 ATCEA has 200 members

 ATCEA is a member of FIDIC since 1987

 Sells and distributes its own publications as well as FIDIC’s

FIDIC Training 12-14 April 2011 11

Some of the International Institutions using FIDIC;

 World Bank (WB)

FIDIC Training 12-14 April 2011 12

 have a consistent and easy to follow structure

 distribute the risks fairly amongst parties

 designed by a third party (Consultant) but not an Employer; therefore conditions

 can be adopted easily for many type of investments projects

FIDIC Training 12-14 April 2011 13

 FIDIC has committees formed of international members to improve its

 Committees do continuous monitoring to improve and/or revise the existing

 Very well known by international Contractors and Consultants, therefore

FIDIC Training 12-14 April 2011 14

 Client/Consultant Model Services Agreement (White Book)

 Joint Venture Agreements

 Sub Contracting Agreements

 Various Types of Conditions for Works Contracts

FIDIC Training 12-14 April 2011 15

 FIDIC Contracts Guide to the Construction, Plant and Design-Build and

FIDIC Training 12-14 April 2011 16

FIDIC Training 12-14 April 2011 17

 Types of FIDIC Conditions of Contracts for

FIDIC Training 12-14 April 2011 18

 Short Form of Contract 1st Ed (1999 Green Book) – GREEN BOOK

FIDIC Training 12-14 April 2011 19

FIDIC Training 12-14 April 2011 20

 Design and Engineering (incl. BoQs) is done by Employer or

 Tenderers fill in their unit prices into the existing BoQs.

FIDIC Training 12-14 April 2011 21

 Employer carries the risk for contract amount increases.

 The better the design, the flawless the project implementation.

 Tender evaluations are relatively simpler.

FIDIC Training 12-14 April 2011 22

 Employer prepares only the «Employer’s Requirements».

 Employer Requirements includes only; Draft layout, Operational

 Tenderers submit their technical proposals together with their financial