Civil Engineering Project Management (4th Edition)
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4.3 Conditions published by the International<br />
Federation of Consulting Engineers (FIDIC)<br />
FIDIC ‘Red Book’ Conditions, <strong>4th</strong> <strong>Edition</strong><br />
The FIDIC ‘Red Book’ Conditions, <strong>4th</strong> <strong>Edition</strong> are intended to apply to civil<br />
engineering work worldwide. They take the same form as the ICE conditions,<br />
but with some variations and simplifications to allow for work outside the<br />
UK. Additions can be made to cover local needs and different procedures for<br />
payment including payment in different currencies. The <strong>4th</strong> edition – substantially<br />
revising the 3rd – incorporated changes resulting from consultations<br />
within the international construction industry and with major<br />
international lending agencies. These conditions were accepted by the major<br />
lending agencies who recommend or require their use together with additional<br />
clauses and amendments proposed by the agencies.<br />
An important requirement in FIDIC4 is that the engineer is specifically<br />
required to consult with both the employer and the contractor before making<br />
a decision on a contractor’s claim for additional payment or extension of the<br />
contract period. Another provision of importance is contained in Clause 52(3)<br />
which allows for adjustments to payment with respect to the contractor’s<br />
overheads if the value of extra works ordered exceeds 15 per cent of the tendered<br />
sum excluding dayworks and provisional items.<br />
1999 New forms<br />
Contract conditions used for civil engineering work 45<br />
In 1999 FIDIC published four new forms. The first is a Contract for Construction<br />
to replace the Red Book. Much of the text and the concepts have remained<br />
but the whole is re-organized into what was considered a more logical<br />
sequence of clauses. The role of the independent engineer is retained who again<br />
has to consult with both parties to try to reach agreement on claims and the<br />
like, but if this is not possible, to ‘make a fair determination in accordance<br />
with the Contract, taking due regard of all relevant circumstances’. The engineer’s<br />
duty to make final decisions on disputed matters is replaced, however,<br />
by use of a Dispute Adjudication Board (DAB) selected by the parties.<br />
A second form is for Plant and Design-Build which allows for the contractor<br />
to undertake design in accordance with the Employer’s requirements set out<br />
in the contract. As the title suggests this is intended both for plant supply<br />
and installation and for use where much of the civil works may also be<br />
designed by the contractor. This contract again uses an independent engineer<br />
to monitor design and construction against the requirements and has the DAB<br />
to decide disputes.<br />
Additionally FIDIC produced in 1999 a radically different form for engineer,<br />
procure and construct (EPC)/Turnkey <strong>Project</strong>s. Under this form the contractor