Clause 2 outlines key Employer obligations, including access rights, assistance with permits, and financial arrangements. Additional obligations include payment (Sub-Clause 14.7) and taking over the Works (Sub-Clause 10.1). Employer claims require notice and compliance with Sub-Clause 2.5.
The 1999 FIDIC forms of contract contain a number of
Clause 16 addresses suspension and termination by the Contractor, including rights to suspend work, grounds for termination, cessation of work, and payment on termination. It specifies notice periods, conditions for immediate termination, and entitlements following termination.
FIDIC 1999 is a re-measurement contract, with the Employer bearing the risk of quantity variations. Clause 12 covers measurement, evaluation of rates, and valuation of omissions. It lacks a standard measurement method, which has been criticized.
Clause 9 covers Tests on Completion, requiring the Contractor to give notice when ready to carry out Tests on Completion, addressing delays by either party, retesting after failure, and handling failures to meet contract requirements after retesting.
Clause 4 of the FIDIC Red Book 1999 consolidates various Contractor obligations, covering 24 topics. It includes general duties and references other significant obligations scattered throughout the Contract, such as communications, assignment, document care, compliance with laws, and time for completion.
Clause 10 covers the Taking-Over of Works, Sections, or parts. It includes conditions for Taking-Over, deemed Taking-Over due to Employer's use or interference, and breach of contract if the Engineer fails to issue the Taking-Over Certificate.
Clause 20 covers claims, disputes, and arbitration. It includes procedures for Contractor claims, appointing a Dispute Adjudication Board (DAB), handling disputes, amicable settlement, arbitration under ICC rules, and actions when a DAB decision is not complied with or absent.
Contractors who fail to issue FIDIC 1999 Clause 20.1 notices on time risk losing claims. A DIFC Court of Appeal ruling reinterprets the 28-day notice period, challenging the Obrascon case and tightening requirements for timely contractor notifications under FIDIC contracts.
Clause 17 covers risk and responsibility, indemnities, liability limitations, and intellectual property rights. The Contractor bears risk during execution and defect remedy periods, with risk transferring to the Employer upon issuing the Taking-Over Certificate. Risk allocation depends on governing law.
Clause 8 covers the start of works, time for completion, delays, extensions, and suspension of works. It includes provisions for commencement, completion, progress, delay damages, and suspension, with updates from the 4th Edition Red Book.
Clause 6 covers Staff and Labour, requiring the Contractor to comply with local laws, pay fair wages, provide accommodation, ensure health and safety, and maintain proper records. It also restricts recruitment from the Employer’s personnel and mandates qualified supervision.
Clause 14 covers payment aspects, including interim and final certificates, advance payments, retention monies, and the cessation of the Employer’s liability. It outlines the process for monthly payment applications, final settlement, and the Contractor's rights if payments are delayed.
Clause 3 outlines the Engineer's duties and obligations, including acting for the Employer, delegating authority (but not Determinations), issuing instructions, and handling Variations. It also covers Engineer replacement and making fair Determinations after consulting both Parties.
Clause 19 covers Force Majeure and release from performance, with broader definitions than typical laws. It prescribes detailed insurance requirements, reducing flexibility. The Contractor bears most obligations, necessitating careful amendments and professional advice to avoid misunderstandings and ensure proper incorporation into contracts.
Clause 15 covers Termination by the Employer, including notices to correct, grounds for termination, valuation at termination, payment after termination, and the Employer's entitlement to terminate at will with 28 days' notice.
In this article Corbett & Co. Director Andrew Tweeddale addresses whether sub-clause 20.5 is a condition precedent to the commencement of an arbitration or whether it is an obligation, the breach of which will not affect the jurisdiction of the arbitral tribunal to resolve the dispute.
Clause 5 defines a "nominated Sub-Contractor" and allows the Contractor to object on reasonable grounds. If the Employer insists on employing the Sub-Contractor, it must indemnify the Contractor. Payments to the Sub-Contractor are certified by the Engineer.
