Managing the daily challenges of in-house life - DLA Piper WIN

In-House Counsel Day – Priorities for 2012

Recent developments in project procurement law

Presented by David Nancarrow

Wednesday 28 March 2012

WIN: What in-house lawyers need

Knowledge, support and networking for the in-house lawyer community

www.dlapiperwin.com

---

Overview

• Procurement process

• Tendering contracts

• Different models

• Emerging procurement models in WA

• Questions?

---

You must have a project delivery plan

Objectives

Strategy

Options

Plan

---

Procurement Process

• Engineers, managers and lawyers

• Time and resources

• Exposure to the market

---

Key Procurement Issues

• Time

• Owner resources

• Risk allocation

• Market capacity and willingness to accept risk

• Tested technology

• Source of funding

• Owner’s history and future

• Lowest price vs price certainty

---

Tendering Contracts

• Key elements

•Conditions of tender

•Information for tenderers

•Returnable schedules – the bid

• Critical conditions

• Managing the tender process

• Must be consistent with the project delivery plan

---

Different Models

• Understanding the options

• Timing and market will affect available options

---

Getting behind the acronyms

• PPP

• EPCM

• PMC

• EPC

• D&C

• ECI

• ETI

---

Substance not Appearance

• Titles are meaningless

• Key contractual terms are not

Common misconceptions

• It is very rarely “either/or”

• A payment mechanism is not a contract type

---

Barriers to Successful Project Outcomes

• Uncertainty

• Scope

• Requirements

• Culture of Defensiveness

• Claims engineering

• Blame allocation

• Risk Management

• Transferral of risks and resulting dispute management

• Loss of Innovation

• Important stakeholders i.e. specialist subcontractors not consulted at

an early stage

• Lack of Incentives to Perform

• Only negative performance incentives: liquidated damages

• Unclear objectives or KPIs

---

The New Models

• It doesn’t have to be the same as last time

• Must be selected for your project

• Developing and creating relationships

---

Emerging models in WA

• EPC

• Relationship contracting

• ETI

• ECI

• Alliance

---

Questions?

•Questions?