Fidic User Guide Final (Romania) PDF

Romania
Ministry of Public Finance

Managing Authority for Infrastructure
Transposition of the FIDIC Clauses of
Contract in the Romanian Language
Employer User Guide for Particular Conditions of Contract
April 2007
Funded by the European Union

Phare 2004/016-772.05.01.02
Member of COWI Consortium

Romania
Ministry of Public Finance
Managing Authority for Infrastructure
Transposition of the FIDIC Clauses of
Contract in the Romanian Language
April 2007
DISCLAIMER:
The content of this report is the sole responsibility of the Framework Contractor and can in
no way be taken to reflect the views of the European Union.
Report no. Employer User Guide for Particular Conditions of Contract

Issue no. A
Date of issue 25.04.2007
Prepared LHM
Checked Andreea Toma/Alexis Gressier
Approved Lars H. Møller
.
Romania, Transposition of the FIDIC Clauses of Contract in the Romanian Language 1
Table of Contents
1 Introduction and Background 4

1.1 Introduction 4
1.2 Application of the FIDIC Conditions of Contract 4
1.3 Romanian Legislation 5
1.4 Standard Tender Documents 6
1.5 Acknowledgements 7
2 Basic Rules for Works Contracts 8

2.1 Procurement Rules 8
2.2 Tender Procedure and Conditions of Contract 8
2.3 Procurement Rules after Contract Signature 8
2.4 Particular Conditions 9
2.5 Contract Management 9
3 The FIDIC 1999 Documents 10

3.1 The FIDIC 1999 Documents 10
3.2 Choice between the FIDIC Documents 11
4 The FIDIC Red Book 14

4.1 Introduction 14
4.2 FIDIC Guidance 14
4.3 Particular Conditions Clause-by-Clause Guidance 20
4.4 Dispute Adjudication Agreement 61
4.5 Guidance for Appendix to Tender 63
5 The FIDIC Yellow Book 64

5.1 Introduction 64
5.3 Particular Conditions Clause-by-Clause Guidance 70
5.4 Dispute Adjudication Agreement 111
5.5 Guidance for Appendix to Tender 112
6 The FIDIC Green Book 113

6.1 Introduction 113
6.3 Clause-by-Clause Guidance 116
6.4 Guidance for the Appendix to Tender 127
bfc2-071_fidic user guide_250407_final.DOC .

7 Templates for Guarantees 129
8 Templates for Contractual Issues 131
Table of Appendices
Appendix A - PC's for the FIDIC Red Book
Appendix B - PC's for the FIDIC Yellow Book
Appendix C - PC's for the FIDIC Green Book
Appendix D - Templates for Guarantees
Appendix E - Templates for Contractual Issues
Appendix F - DAB Agreements

Abbreviations
ANRMAP National Authority for Regulating and Monitoring Public Procurement
ARIC Romanian Association of Consulting Engineers
BCEOM French consulting company
CFCU Central Finance and Contracts Unit
CN ADNR SA National Company for Motorways and National Roads
CONS Conditions of Contract for Construction
COWI Danish consulting company
CV Curriculum Vitae
DAB Dispute Adjudication Board
EC European Commission
EPC Engineering, Procurement, Construction
EPCT Conditions of Contract for EPC/Turnkey Projects
ERDF European Regional Development Fund
EU European Union
EUR Euro
FIDIC Fédération International des Ingénieurs-Conseils
GD Government Decision
GEO Government Emergency Ordinance
GO Government Ordinance
ICC International Chamber of Commerce
ISC State Inspectorate in Construction
ISPA Instrument for Structural Policies for Pre-Accession
MA Infra Managing Authority for Infrastructure, MPF
MEI Ministry of European Integration
MPF Ministry of Public Finance
MTCT Ministry of Transport, Construction and Tourism
OGR Official Gazette of Romania
P&DB Conditions of Contract for Design-Build
RBA Romanian Bank Association
RCC Romanian Chamber of Commerce
RON Romanian Leu
TOR Terms of Reference
UNCITRAL United Nations Commission on International Trade Law
VAT Value added tax

1 Introduction and Background
1.1 Introduction
This Employer User Guide for Particular Conditions of Contract is prepared by
BCEOM, a member of the COWI Consortium, under the EuropeAid Benefici-
ary Framework Contract - Lot 2 - Transport and Infrastructure.
The Guide was prepared in response to the Terms of Reference under Letter of
Contract No. Rosu-13-ter dated 21st June 2006, signed by the CFCU on 13th
June 2006 and by the COWI Consortium on 12th July 2006.
In November 2006, the Contract was proposed modified by eliminating activi-

ties related to the FIDIC silver book from the TOR. This was accepted by MA
Infra and the CFCU, and a contract modification was signed by both parties on
12th January 2007.
1.2 Application of the FIDIC Conditions of Contract

Agreement with FIDIC
An Agreement was signed on 27th June 2006 between the Romanian Ministry
of Public Finance (MPF) and the FIDIC, and became effective upon FIDIC's
signature on 12th July 2006.
In this Agreement, FIDIC granted non-exclusive rights to MPF to translate into

Romanian language and adopt into legislation the following key documents:
• Conditions of Contract for Construction, 1st Edition 1999
• Conditions of Contract for Plant and Design-Build, 1st Edition 1999
• Short Form of Contract, 1st Edition 1999
• Conditions of Contract for EPC/Turnkey Projects, 1st Edition 1999.
According to Clause 4 of the Agreement, the copyright of the translation shall

automatically remain with FIDIC, after the publication of the translations of the
documents in the Official Gazette of Romania (OGR).
Translation
A translation into the Romanian language was carried out - as Task 1 of above
Services Contract - during the period of August to December 2006. The transla-
tion included the General Conditions of Contract for the first 3 of the above 4
FIDIC documents, i.e. the FIDIC red, yellow, and green books.

The approved translations will be issued by the MPF for use on infrastructure
projects in Romania, after the publication in the Official Gazette of Romania.
1.3 Romanian Legislation

Relevant Romanian legislation in force includes the following laws and regula-
tions:
• Legal framework with regard to construction works:
- Law No. 50/1991 on the authorization of construction works, as re-
published in the OGR No. 933 of 13.10.2004 and amended by GEO
No. 122/2004, by Law No. 119/2005, by Law No. 52/2006 and by
Law No. 376/2006 (hereinafter “Law No. 50/1991”).
- Application Norms of Law No. 50/1991, as approved by Order No.
1430/2005 of the Minister of Transport, Construction and Tourism, as
published in the OGR No. 825 of 13.09.2005.
- Law No. 10/1995 on quality of constructions, as published in the OGR
No. 12 of 24.01.1995 and amended by GD No. 498/2001 and by Law
No. 587/2002 (hereinafter “Law No. 10/1995”).
- Regulation on the reception of construction works and of installations
related thereto, as approved by GD No. 273/1994, as published in the
OGR No. 193 of 28.07.1994 and amended by GD No. 940/2006 (here-
inafter “GD No. 273/1994”).
- Methodology for the issuance by the I.S.C. of the approval as regards
technical and economic documentations related to the investments fi-
nanced from public funds, as approved by Order of the I.S.C. No.
74/2007, as published in the OGR No. 101 of 09.02.2007.
• Legal framework with regard to public procurement:
- GEO No. 34/2006 on granting of public procurement, concession of
public works and concession of services agreements, as published in
the OGR No. 418 of 15.05.2006, approved and amended by Law No.
337/2006 (hereinafter “GEO No. 34/2006”).
- Application Norms on the granting of public procurement pursuant to
GEO No. 34/2006 as approved by GD No. 925/2006, as published in
the OGR No. 625 of 20.07.2006 and amended by GD No. 1056/2006
and No. 1337/2006 (hereinafter “GD No. 925/2006”).
- Guide for the award of public procurement contracts pursuant to GEO
No. 34/2006, as approved by Order of the President of the ANRMAP
No. 155/2006, as published in the OGR No. 894bis of 02.11.2006
(hereinafter the “Procurement Guide”).
- Regulation for surveillance of the awarding of public procurement
contracts, as approved by Order of the President of the ANRMAP No.
26/2007, as published in the OGR No. 102 of 09.02.2007.

• Legal framework with regard to public finance:

- Law No. 500/2002 on public finances, as published in the OGR No.
597 of 13.08.2002 and amended by Law No. 314/2003, Law No.
96/2006 and GD No. 1865/2006 (hereinafter “Law No. 500/2002”).
- GD No. 264/2003 on setting out actions and expense categories, crite-
ria, procedures and limits regarding advance payments from public
funds, as republished in OGR No. 109din 05.02.2004 and amended by
GD Nos. 525/2004, 712/2004, 1451/2004, 728/2006 (hereinafter “GD
No. 264/2003”).
- GO No. 79/2003 regarding the control and recovery of community
funds and relevant co-financing funds used in an improper manner, as
published in the OGR No. 622 of 30.08.2003, approved with amend-
ments by Law No. 529/2003 and amended by GO Nos. 94/2004,
53/2005 and 12/2007 (hereinafter “GO No. 79/2003”).
- Application Norms of GO No. 79/2003, as approved by GD No.
1510/2003, as published in the OGR No. 914 of 20.12.2003 and
amended by GD Nos. 2396/2004 and 1358/2006.
• Relevant provisions of the Civil Code, Commercial Code, Fiscal Code
(Law No. 571/2003 approving the Fiscal Code, as published in the OGR
No. 927 of 23.12.2003, as amended) and of the Fiscal Norms (GD No.
44/2004 approving the methodological norms of implementation of the
Fiscal Code, as published in the OGR No. 112 of 06.02.2004, as amended).
1.4 Standard Tender Documents

Structure of Standard Tender Document
A standard tender document for works contracts shall include the following
documents:
• Volume 1: Instructions to Tenderers
- Letter of Invitation
- Instructions to Tenderers
- Letter of Tender and Appendix to Tender
- Forms for Tender Guarantees
- Questionnaire
- Glossary
- Evaluation Grid
• Volume 2: Conditions of Contract
- Letter of Tender, including Appendix to Tender
- Form of Contract Agreement
- General Conditions of Contract
- Particular Conditions of Contract
- Forms for Guarantees
• Volume 3: Technical Specifications
• Volume 4: Bill of Quantities
• Volume 5: Design Documents and Drawing.

General Conditions of Contract

The General Conditions of Contract shall be those prepared as Task 1 of the
Services Contract undertaken by BCEOM, on behalf of the COWI Consortium,
and approved by the MPF in January 2007 for the following FIDIC documents:
• Conditions of Contract for Construction, 1st Edition 1999
• Conditions of Contract for Plant and Design-Build, 1st Edition 1999
• Short Form of Contract, 1st Edition 1999.
The General Conditions of Contract will in due course be published in the Offi-
cial Gazette of Romania for use on infrastructure projects in Romania.
Templates
This Employer User Guide for Particular Conditions of Contract provides guid-
ance for Romanian employers for the preparation of particular conditions of
contract and for the Appendix to Tender.
The Guide provides:
• Clause-by-clause guidance for particular conditions of contract
• Templates for guarantees
• Templates for selected contractual documents.
The remaining parts of the standard tender documents shall not be covered by
this Employer User Guide on Particular Conditions of Contract.
1.5 Acknowledgements
The Consultants acknowledge the comprehensive assistance provided by the
Coordination Committee as well as the Working Group and the counterparts set
up by the MA Infra of the MPF.
The draft mandatory and additional particular conditions were discussed in de-
tail with the MA Infra counterparts and the Working Group, and later presented
for the Coordination Committee. A one-day workshop with all the stakeholders
took place on 6th December 2006 in Bucharest.

2 Basic Rules for Works Contracts
2.1 Procurement Rules

In Romania, the procurement rules are defined by the GEO No. 34/2006, as fur-
ther approved and modified by Law No. 337/2006. In addition, detailed rules
are laid down in the Implementing Norms of the said ordinance, published un-
der GD No. 925/2006.
The above mentioned GEO No. 34/2006 transposes into Romanian legislation
the relevant provisions of the European Directive No. 18/2004/CE defining the
overall procurement rules and procedures for the entire European Union.
2.2 Tender Procedure and Conditions of Contract

As such, tender procedure and conditions of contract are different processes and
do not really interfere. It is preferable to avoid introducing references to the
conditions of contract within the instructions to tenderers, as, in the best case,
they just repeat the provisions of the draft conditions of contract attached to the
tender dossier and in the worst case, they are in conflict with those.
Furthermore, the tender dossier and the Contractor’s proposal have no value
after the signature of the Contract, unless they are explicitly incorporated as
part of the Contract documents. It is therefore recommended to seriously con-
sider which documents should form part of the Contract.
It should also be noted that a particular tender procedure ends after the signa-
ture of the related contract (or after the cancellation of the procedure). There-
fore, in case a contract is terminated, it is not legally possible to revert to the
second ranked tenderer of the original procedure.
Finally, it should be understood that tender procedures do not replace adequate

and efficient contract management. The criteria used in the tender should be
proportional to the requirements of the project, without setting unreasonable
constraints. The wish of a Contracting Authority to have a “good contractor”
should not result into distortion of competition or artificial requirements.
2.3 Procurement Rules after Contract Signature

Even if the tender procedure ends after contract signature, some rules referring
to procurement shall be observed during the entire life of the contract.

In particular, modifications to the original contract incorporating additional

work (including additional quantities) and resulting into an increase of the Ac-
cepted Contract Amount are considered as “negotiated procedure without prior
publication of a contract notice” and are legally possible only in one of the
situations described in Article 122 of GEO No. 34/2006.
2.4 Particular Conditions

The FIDIC Conditions of Contract define a careful balance between the rights
and obligations of both parties, the Employer and the Contractor. This balance
is one of the elements that made those conditions of contract successful and
widely used around the world.
It is therefore recommended that Employers, when drafting particular condi-

tions of contract, maintain this balance and refrain from modifying those provi-
sions that are seen as favouring the Contractor (such as Sub-Clause 2.4), keep-
ing only provisions that favour the Employer.
2.5 Contract Management

The FIDIC Conditions of Contract are favouring a modern type of contract
management, with the following aspects:
• The relationship between the Parties should be oriented towards the execu-
tion of the works in a satisfactory manner where conciliation and agree-
ment are to be found rather than “aggressive” attitudes
• It is felt as absolutely necessary for an adequate progress of the works that
a similarly adequate cash flow be maintained
• Claims should be notified and treated in due time. The Parties should
avoid, with the assistance of the Engineer, to transform claims into dis-
putes but should endeavour to find fair solutions in a reasonable time.

3 The FIDIC 1999 Documents
3.1 The FIDIC 1999 Documents

As stated in the Foreword of the documents, the Fédération Internationale des
Ingénieurs-Conseils (FIDIC) published - in 1999 - the First Editions of four (4)
new standard forms of contract:
• CONS - Conditions of Contract for Construction, which are recom-
mended for building or engineering works designed by the Employer or by
his representative, the Engineer. Under the usual arrangements for this type of
contract, the Contractor constructs the works in accordance with a design
provided by the Employer. However, the works may include some elements of
Contractor-designed civil, mechanical, electrical and/or construction
works.
• P&DB - Conditions of Contract for Plant and Design-Build, which are
recommended for the provision of electrical and/or mechanical plant, and for
the design and execution of building or engineering works. Under the usual
arrangements for this type of contract, the Contractor designs and provides,
in accordance with the Employer's requirements, plant and/or other works;
which may include any combination of civil, mechanical, electrical and/or
construction works.
• EPCT - Conditions of Contract for EPC/Turnkey Projects, which may
be suitable for the provision on a turnkey basis of a process or power plant,
of a factory or similar facility, or of an infrastructure project or other type of
development, where (i) a higher degree of certainty of final price and time
is required, and (ii) the Contractor takes total responsibility for the design and
execution of the project, with little involvement of the Employer. Under the
usual arrangements for turnkey projects, the Contractor carries out all the
Engineering, Procurement and Construction (EPC): providing a fully-
equipped facility, ready for operation (at the "turn of the key").
• Short Form of Contract, which is recommended for building or engineer-
ing works of relatively small capital value. Depending on the type of work
and the circumstances, this form may also be suitable for contracts of
greater value, particularly for relatively simple or repetitive work or work
of short duration. Under the usual arrangements for this type of contract,
the Contractor constructs the works in accordance with a design provided by
the Employer or by his representative (if any), but this form may also be suit-
able for a contract which includes, or wholly comprises, Contractor-designed
civil, mechanical, electrical and/or construction works.

The Forms of Contract are recommended by FIDIC for general use, where the
tenders are invited on an international basis. Modifications may be required in
some jurisdictions, particularly if the Conditions are to be used on domestic
contracts. FIDIC considers the official and authentic texts to be the versions in
the English language.
3.2 Choice between the FIDIC Documents

The FIDIC Conditions of Contract are prepared as a "matching set" with each
topic covered in similarly worded provisions in each of the books. The selec-
tion of the appropriate book is critical to the success of the Project.
General guidance is provided in the FIDIC Contracts Guide - issued in 2000 -

as summarised below.
Relatively small value contract, short construction time or involving simple

or repetitive work
If the price for the contract is relatively small (say under EUR 500,000) or the
construction time is short (say less than 6 months), or the work involved is rela-
tively simple or repetitive (dredging work might be a good example), then con-
sider using the Short Form of Contract, irrespective of whether the design is
provided by the Employer or the Contractor, and of whether the project in-
volves construction, electrical, mechanical, or other engineering work.
Larger or more complex projects
1. Is the Employer (or the Engineer) going to do most of the design?

- As in traditional projects (e.g., infrastructure, buildings, hydropower,
etc.), the Employer did nearly all the design (perhaps not construction
details, reinforcement, etc.)
- The Engineer administered the Contract, monitored the construction
work and certified payment
- The Employer was kept fully informed, could make variations, etc.
- With payment according to bills of quantities or lump sums for ap-
proved work done.
If this is what is wanted - choose the FIDIC Red Book (CONS).
2. Is the Contractor going to do most of the design?

- As in traditional projects (e.g., electrical and mechanical works, in-
cluding erection on site), the Contractor did the majority of the design
(e.g., the detail design of the plant or equipment), so that the plant met
the outline or performance specification prepared by the Employer,
and in design-build and turnkey-type projects, the Contractor also did
the majority of the design (not only of plant projects, but also of various
infrastructure and other types of projects), and the project was re-
quired to fulfill an outline or performance specification prepared by the
Employer

- The Engineer (or Employer's representative) administered the Contract,

monitored the manufacture and erection on site or construction work
and certified payment
- With payment according to achieved milestones generally on a lump
sum basis.
If this is what is wanted - choose the FIDIC yellow book (P&DB).
3. Is it a privately Financed (or Public/Private Financed) Project, of the

Build-Operate-Transfer or similar type, where the Concessionaire takes
the total responsibility for the financing, construction and operation of the
Project?
- Then the Concessionaire (the "Employer") probably requires to have a
contract with the construction Contractor, i.e., an EPC (Engineering,
Procurement, Construction) Contract, where the Contractor takes total
responsibility for the design and construction of the infrastructure or
other facility, and where there is a higher degree of certainty that the
agreed contract price and time will not be exceeded
- The Employer does not wish to be involved in the day-to-day progress
of the work, provided the end result meets the performance criteria he
has specified
- The parties concerned (e.g., sponsors, lenders and the Employer) are
willing to see the Contractor paid more for the construction of the Pro-
ject in return for the Contractor bearing the extra risks associated with
enhanced certainty of final price and time.
If this is what is wanted - choose the FIDIC silver book (EPCT).
4. Is it a Process Plant or a Power Plant (or a factory or similar) where the

Employer (who provides the finance) wishes to implement the Project on a
Fixed-Price Turnkey Basis?
- Then the Employer wishes the Contractor to take total responsibility
for the design and construction of the process or power facility and hand
it over ready to operate "at the turn of a key"
- The Employer wishes a higher degree of certainty that the agreed con-
tract price and time will not be exceeded
- The Employer wishes the Project to be organised on a strictly two
party approach, i.e., without an "Engineer" being involved
has specified
- The Employer is willing to pay more for construction of his Project
(than would be the case if P&DB were used) in return for the Contrac-
tor bearing the extra risks associated with enhanced certainty of final
price and time.

5. Is it an Infrastructure Project (e.g., road, rail link, bridge, water or sewage

treatment plant, transmission line, even dam or hydropower plant) or simi-
lar where the Employer (who provides the finance) wishes to implement the
Project on a Fixed-Price Turnkey Basis?
for design and construction
- The Employer wishes a higher degree of certainty that the agreed con-
tract price and time will not be exceeded (except that, if underground
works in uncertain or difficult ground conditions are likely, the risk of
unforeseen ground conditions should be borne by the Employer and
P&DB 4.12 would be appropriate)
party approach, i.e. without an "Engineer" being involved
has specified
- The Employer is willing to pay more for the construction of his Pro-
ject (than would be the case if P&DB were used) in return for the
Contractor bearing the extra risks associated with enhanced certainty of
final price and time.
6. Is it a Building Project where the Employer wishes to have his building(s)

constructed on a Fixed-Price Turnkey Basis generally complete with all
furniture, fittings and equipment?
for design and construction
- The Employer wishes a high degree of certainty that the agreed con-
tract price and time will not be exceeded
party approach, i.e. without an Employer's Engineer being involved
of the construction work, provided the end result meets the perform-
ance criteria he has specified
- The Employer is willing to pay more for the construction of his Pro-
ject (than would be the case if P&DB were used) in return for the
Contractor bearing the extra risks associated with enhanced certainty of
final price and time.
If this is what is wanted - choose the FIDIC silver book (EPCT). In the
case of a building, or of a building development project, the Employer or
his architect may have done some or most of the design, but (with suitable
modification regarding design responsibility) EPCT may be used.
7. Is it a reconstruction or refurbishment or other type of Project?

Check the above questions, as applicable, and make your choice accord-
ingly.

4 The FIDIC Red Book
4.1 Introduction
This chapter provides guidance for the preparation of the Particular Conditions
of Contract and the Appendix to Tender for Works Contracts using the FIDIC
Conditions of Contract for Construction, 1st Edition 1999, i.e. the FIDIC Red
Book.
The FIDIC General Conditions of Contract were translated into Romanian lan-
guage in August to November 2006, and was submitted to the MPF in Decem-
ber 2006.
Mandatory and additional particular conditions of contract for the FIDIC Red
Book, necessary as to harmonise the contract provisions with the current Ro-
manian legislation, were prepared in October 2006 to January 2007, and was
submitted to the MPF in January 2007.
The Romanian language version of the General Conditions of Contract and the
proposed mandatory and additional particular conditions will, after approval by
the MPF, be published in the Official Gazette of Romania for use on infrastruc-
ture projects in Romania.
This Guide comprises guidance and proposals for the proposed mandatory and
additional particular conditions of contract.
4.2 FIDIC Guidance

In the preparation of the General Conditions of Contract for Construction, it
was recognized that, while there are many sub-clauses which will be generally
applicable, there are some sub-clauses which must necessarily vary to take ac-
count of the circumstances relevant to the particular contract. The sub-clauses
which were considered to be applicable to many (but not all) contracts have
been included in the General Conditions, in order to facilitate their incorporation
into each contract.
The General Conditions and the Particular Conditions will together comprise the
Conditions of Contract governing the rights and obligations of the parties. It will
be necessary to prepare the Particular Conditions for each individual contract,
and to take account of those sub-clauses in the General Conditions which men-
tion the Particular Conditions.

For this publication, the General Conditions of Contract were prepared on the
following basis:
• Interim and final payments will be determined by measurement, applying
the rates and prices in a Bill of Quantities
• If the wording in the General Conditions necessitates further data, then
(unless it is so descriptive that it would have to be detailed in the Specification)
the sub-clause makes reference to this data being contained in the Appendix to
Tender, the data either being prescribed by the Employer or being inserted
by the Tenderer
• Where a sub-clause in the General Conditions deals with a matter on which
different contract terms are likely to be applicable for different contracts, the
principles applied in writing the sub-clause were:
a) Users would find it more convenient if any provisions which they did
not wish to apply could simply be deleted or not invoked, than if addi-
tional text had to be written (in the Particular Conditions) because the
General Conditions did not cover their requirements; or
b) In other cases, where the application of (a) was thought to be inappro-
priate, the sub-clause contains the provisions which were considered
applicable to most contracts.
For example, Sub-Clause 14.2 [Advance Payment] is included for convenience

only, not because of any FIDIC policy in respect of advance payments. This
Sub-Clause becomes inapplicable (even if it is not deleted) if it is disregarded by
not specifying the amount of the advance. It should therefore be noted that some
of the provisions contained in the General Conditions may not be appropriate
for an apparently-typical contract.
Further information on these aspects, example wording for other arrangements,

and other explanatory material and example wording to assist in the preparation
of the Particular Conditions and the other tender documents, are included within
the Guidance for the Preparation of the Particular Conditions. Before incorpo-
rating any example wording, it must be checked to ensure that it is wholly suit-
able for the particular circumstances; if not, it must be amended.
Where example wording is amended, and in all cases where other amendments or
additions are made, care must be taken to ensure that no ambiguity is created,
either with the General Conditions or between the clauses in the Particular
Conditions. It is essential that all these drafting tasks, and the entire preparation
of the tender documents, are entrusted to personnel with the relevant expertise,
including the contractual, technical and procurement aspects.
This publication concludes with example forms for the Letter of Tender, the Ap-
pendix to Tender (providing a check-list of the sub-clauses which refer to it), the
Contract Agreement, and alternatives for the Dispute Adjudication Agreement.
This Dispute Adjudication Agreement provides text for the agreement between
the Employer, the Contractor and the person appointed to act either as sole ad-
judicator or as a member of a three-person dispute adjudication board; and in-
corporates (by reference) the terms in the Appendix to the General Conditions.

In addition, FIDIC has published a contracts guide to the use of its Conditions
of Contract for Construction, for Plant and Design-Build, and for EPC/Turnkey
Projects.
In order to clarify the sequence of Contract activities, reference may be made to

the charts on the next two pages and to the Sub-Clauses listed below (some
Sub-Clause numbers are also stated in the charts). The charts are illustrative and
must not be taken into consideration in the interpretation of the Conditions of
Contract.
1.1.3.1 & 13.7 Base Date

1.1.3.2 & 8.1 Commencement Date
1.1.6.6 & 4.2 Performance Security
1.1.4.7 & 14.3 Interim Payment Certificate
1.1.3.3 & 8.2 Time for Completion (as extended under 8.4)
1.1.3.4 & 9.1 Tests on Completion
1.1.3.5 & 10.1 Taking-Over Certificate
1.1.3.7 & 11.1 Defects Notification Period (as extended under 11.3)
1.1.3.8 & 11.9 Performance Certificate
1.1.4.4 & 14.13 Final Payment Certificate
Figure 4-1 Sequence of Principal Events

Figure 4-2 Sequence of Payment Events
Figure 4-3 Sequence of Dispute Events
4.2.1 Introduction
The Conditions of Contract for Construction - the FIDIC Red Book - have been
prepared by FIDIC and are recommended for general use for the purpose of the
construction (excluding most design) of building or engineering works where
tenders are invited on an international basis.
Modifications to the Conditions are required to be fully adapted to the current

Romanian legislation.
Under the usual arrangements for this type of contract, the Contractor con-
structs the works in accordance with design details provided by the Employer
or his representative, the Engineer. Although these Conditions allow for the
possibility that the Contractor may be required to design parts of the permanent

works, they are not intended for use where most of the works are designed by
the Contractor. For these Works, it would be more appropriate to utilise
FIDIC's Conditions of Contract for Plant and Design-Build or Conditions of
Contract for EPC/Turnkey Projects.
The guidance hereafter is intended to assist writers of Particular Conditions by

giving options for various sub-clauses where appropriate. Before incorporating
any example wording, it must be checked to ensure that it is wholly suitable for
the particular circumstances. Unless it is considered suitable, example wording
should be amended before use.
In the preparation of the Conditions of Contract to be included in the tender

documents for a contract, the following text can be used:
“The Conditions of Contract comprise the "General Conditions", which form
part of the "Conditions of Contract for Construction" First Edition 1999 pub-
lished by the Fédération Internationale des Ingénieurs-Conseils (FIDIC), and
the following "Particular Conditions", which include amendments and addi-
tions to such General Conditions.”
Where example wording is amended, and in all cases where other amendments
or additions are made, care must be taken to ensure that no ambiguity is cre-
ated, either with the General Conditions or between the clauses in the Particular
Conditions.
There are no sub-clauses in the General Conditions which require data to be

included in the Particular Conditions. The General Conditions refer to any nec-
essary data being contained in the Appendix to Tender or (for technical matters)
in the Specification.
4.2.2 Preparation of Tender Documents

The tender documents should be prepared by suitably qualified engineers who
are familiar with the technical aspects of the required works, and a review by
suitably qualified lawyers may be advisable.
The tender documents issued to tenderers will consist of the Conditions of Con-
tract, the Specification, the Drawings, and the Letter of Tender and Schedules
for completion by the Tenderer.
For this type of contract, where works are valued by measurement, the Bill of
Quantities will usually be the most important Schedule. A Daywork Schedule
may also be necessary, to cover minor works to be evaluated at cost.
In addition, each of the Tenderers should receive the data referred to in Sub-
Clause 4.10, and the Instructions to Tenderers to advise them of any special
matters which the Employer wishes them to take into account when pricing the
Bill of Quantities but which are not to form part of the Contract.
When the Employer accepts the Letter of Tender, the Contract includes these
completed Schedules.

The Specification
The Specification may include the matters referred to in some or all of the fol-
lowing sub-clauses:
- 1.8 Requirements for Contractor's Documents
- 1.13 Permissions being obtained by the Employer
- 2.1 Phased possession of foundations, structures, plant or means of access
- 4.1 Contractor's designs
- 4.6 Other contractors (and others) on the Site
- 4.7 Setting-out points, lines and levels of reference
- 4.14 Third parties
- 4.18 Environmental constraints
- 4.19 Electricity, water, gas and other services available on the Site
- 4.20 Employer's Equipment and free-issue material
- 5.1 Nominated Subcontractors
- 6.6 Facilities for Personnel
- 7.2 Samples
- 7.4 Testing during manufacture and/or construction
- 9.1 Tests on Completion
- 13.5 Provisional Sums.
The Appendix to Tender

Many sub-clauses in the General Conditions make reference to data being con-
tained in the Appendix to Tender, providing a convenient location for the data
which is usually required. The example form in Appendix D2 provides a check-
list of the data required; but there is no indication, either in the General Condi-
tions or in the example Appendix to Tender, that this data is either prescribed
by the Employer or inserted by the Tenderer. The Employer should prepare the
Appendix to Tender, based on this example form, with the elements completed
to the extent of his requirements.
The Employer may require other data from Tenderers, and include a question-
naire in the Schedules.
The Instructions to Tenderers

The Instructions to Tenderers may need to specify any constraints on the com-
pletion of the Appendix to Tender and/or Schedules, and/or specify the extent
of other information which each Tenderer is to include with his Tender. If each
Tenderer is to produce a parent company guarantee and/or a tender security,
these requirements (which apply prior to the Contract becoming effective)
should be included in the Instructions to Tenderers: example forms are annexed
to this document as Annexes D.1.
The Instructions to Tenderers may include matters referred to in some or all of

the following Sub-Clauses:

- 4.3 Contractor's Representative (name and curriculum vitae)

- 4.9 Quality Assurance system
- 9.1 Tests on Completion
- 18 Insurances
- 20 Resolution of disputes.
4.3 Particular Conditions Clause-by-Clause Guidance

This section includes guidance for the preparation of the particular conditions
of contract for the FIDIC Red Book, with a clause-by-clause review.
4.3.1 Clause 1 - General Provisions

Sub-Clause 1.1 - Definitions
It will be necessary to amend some of the definitions, due to Romanian legisla-
tion in force, the requirements of the Romanian procurement legislation and for
clarification of the general conditions.
The following definitions should be modified:

• In Sub-Clause 1.1.1.1 the definition of Contract shall reflect the deletion of
Letter of Acceptance. Under Romanian public procurement regulations,
the Contract is formed by the execution of the Contract Agreement after
lapse of a mandatory minimum time period from the communication of the
letter of award by the Employer to the Contractor (Article 205 of GEO No.
34/2006, and Article 94 of GD No. 925/2006). The amendment of such
definition is set out in the mandatory particular conditions in Appendix A1.
• In Sub-Clause 1.1.1.3 the definition of the Letter of Acceptance shall be
deleted.
• In Sub-Clause 1.1.3.1 the definition of the "Base Date" may be changed to
reflect a particular calendar date.
• In new Sub-Clause 1.1.3.10 a definition of the "Taking-Over Minutes on
Completion of Works" shall be included to reflect the process of taking-
over of works by a commission to be appointed by the Employer in accor-
dance with Romanian regulations (Article 15 of GD No. 273/1994). Such
definition is set out in the mandatory particular conditions in Appendix A1.
• In new Sub-Clause 1.1.3.11 a definition of the "Final Taking-Over Min-
utes" shall be included to reflect the process of final taking-over of works
by a commission to be appointed by the Employer in accordance with Ro-
manian regulations (Article 36 of GD No. 273/1994). Such definition is set
out in the mandatory particular conditions in Appendix A1.
• In Sub-Clause 1.1.4.1 the definition of the "Accepted Contract Amount"
shall be modified in order to reflect the deletion of the Letter of Accep-
tance.
• In Sub-Clause 1.1.4.6 the "Foreign Currency" should be indicated.

• In Sub-Clause 1.1.4.8 "Local Currency" should be defined as RON (Ro-

manian Leu).
• New Sub-Clause 1.1.4.13 should be inserted to define the expression
"Unit Price" as follows:
“Unit Price is the price of a unit quantity in the Bill of Quantities exclud-
ing VAT.”
• In Sub-Clause 1.1.6.2 "Country" should be defined as Romania.
• In Sub-Clause 1.1.6.5 “Applicable Laws” should be defined as all Roma-
nian legislation, laws, ordinances, decisions, orders and other laws and
regulations and by-laws of any legally constituted public authority having
the force of law in Romania.
• In Sub-Clause 1.1.6.7 "Site" it has to be mentioned that the Contractor’s
site installation would in many cases not be part of the Site as defined un-
der the Contract.
Sub-Clause 1.2 - Interpretation

If the references to "profit" are to be more precisely specified, Sub-Clause 1.2
may be varied. Such provision is recommended so as to provide a clear refer-
ence during implementation, in particular when evaluating claims, such as:
“In these Conditions, provisions including the expression “Cost plus reason-
able profit” require this profit to be one-twentieth (5%) of the respective Cost.”
Sub-Clause 1.3 - Communications

Attention is drawn on the importance of the requirements of the first sentence
of the last paragraph that, although applicable in many sub-clauses, are not re-
peated in the General Conditions. Non-compliance might have serious conse-
quences.
Sub-Clause 1.4 - Law and Language

No need for particular conditions related to this sub-clause.
Sub-Clause 1.5 - Priority of Documents

An order of precedence is usually necessary, in case a conflict is subsequently
found among the contract documents In Sub-Clause 1.5, the order of prece-
dence shall reflect the deletion of the Letter of Acceptance (Article 94(2) of GD
No. 925/2006), as well as the fact that, if during the performance of the Con-
tract, certain elements of the Contractor’s technical offer turn out to be non-
compliant with the requirements in the Specifications, the latter shall prevail.
(Article 95(2) of GD No. 925/2006). A proposed amendment is included in the
mandatory particular conditions in Appendix A1.
It is recommendable to integrate as part of the Contract (as documents listed

under letter (h) of the present sub-clause, significant components of the Con-
tractor’s proposal (key personnel, key equipment, method of works, outline of
quality assurance, traffic management and/or environmental management
plans), so as to ensure some enforceability to this proposal. Even if the Contract
clearly specifies the priority of documents, consistence of these with the tender
documents should be checked and corrections, if needed, should be introduced
prior to the Contract signature. Furthermore, in case a Contractor’s programme

is included in the Contract documents, it might be recommendable to state that

any reference to calendar dates is indicative only, especially if the Contract sig-
nature or the Commencement Date occur with delays against initial time sched-
ules
Sub-Clause 1.6 - Contract Agreement

The first sentence of Sub-Clause 1.6 shall be deleted, in order to reflect the de-
letion of Letter of Acceptance.
The form of Contract Agreement should be included in the tender documents as

an annex to the Particular Conditions. An example form is included at the con-
tractual templates in Appendix D2.
Sub-Clause 1.7 - Assignment

If the Contract is concluded pursuant to a public procurement procedure, the
assignment of the whole or any part thereof by the Contractor (even with the
prior agreement of the Employer) is a sensitive issue, as it may be considered a
means of escaping the mandatory legal provisions on public procurement of
works. The template for works contracts set out in Form 5 attached to the Pro-
curement Guide allows the assignment of the works contract by the Contractor
with the prior agreement of the Employer, provided that the Contractor remains
liable towards the Employer for the performance of any obligations under the
works contract.
Sub-Clause 1.8 - Care and Supply of Documents

Sub-Clause 1.9 - Delayed Drawings or Instructions

Sub-Clause 1.10 - Employer's Use of Contractor's Documents

Sub-Clause 1.11 - Contractor's Use of Employer's Documents

Sub-Clause 1.12 - Confidential Details

Sub-Clause 1.13 - Compliance with Laws

The Employers should specify, when relevant, the particular regulations to be
complied with by the Contractor. This should be done under the format:
“Applicable Laws of particular relevance for the Contract include, but are not
limited to: Law No. xxx”
It is recommended to precise the scope of paragraph (b), for example with:

Except for the building permit to be provided by the Employer, authorisa-
tions and/or permits required from relevant national/local authorities shall
be obtained by the Contractor, at his own expenses. Such permits include
inter alia permits for site erection, traffic diversions, route permits, resi-

dence and work permits, permits for radio communication, permits to relo-
cate public utilities, etc.
Within 21 days of the signature of the Contract Agreement, the Contractor

shall submit to the Engineer the detailed planning of the Works, together
with a list of all necessary permits with the time needed for obtaining those
permits in order to properly carry-out the Works in compliance with the
programme prepared and updated under Sub-Clause 8.3 [Programme].
Sub-Clause 1.14 - Joint and Several Liability

For a major contract, detailed requirements for the joint venture may need to be
specified. For example, it may be desirable for each member to produce a par-
ent company guarantee. An example form is annexed to this document in the
templates of guarantees in Appendix D1.
These requirements, which apply prior to the Contract becoming effective,

should be included in the Instructions to Tenderers.
The Employer will wish the leader of the joint venture to be appointed at an
early stage, providing a single point of contact thereafter, and will not wish to
be involved in a dispute between the members of a joint venture. The Employer
should scrutinise the joint venture agreement carefully, and it may have to be
approved by the project's financing institutions.
New Sub-Clause 1.15 - Details to be Confidential

If confidentiality is required, an additional sub-clause may be added. The word-
ing of such Sub-Clause could be as follows:
“The Contractor shall treat the details of the Contract Agreement as private
and confidential, except to the extent necessary to carry out his obligations
there under or to comply with applicable Laws. The Contractor shall not pub-
lish, permit to be published, or disclose any particulars of the Works in any
trade or technical paper or elsewhere without the prior written agreement of
the Employer.”
4.3.2 Clause 2 - The Employer

Sub-Clause 2.1 - Right of Access to the Site
If right of access cannot be granted, both early and thereafter exclusively, de-
tails should be given. Employers shall be particularly careful in relation with
this sub-clause, as non-compliance with their obligations under the present sub-
clause is a substantial failure and may lead to Termination by the Contractor
under Sub-Clause 16.2.
In case right of access is to be granted by stages, it could be desirable to define

Sections (in the Appendix to Tender) and define in this sub-clause the time for
provision of right of access for each Section.
In case right of access and possession is not to be granted exclusively, this

should be clearly stated, with all particulars.

In case right of access and possession will be granted only for limited sections
and/or for limited duration (such as in the case of rail rehabilitation works), the
Employer should state this and define the procedure that will be applied as well
as the main constraint/parameters.
The Site does not include additional working areas that the Contractor might
require, as defined under Sub-Clause 4.23. However, in the particular case of
temporary diversions specifically required by the Employer (for example in the
case of bridge works), the required land should be made available by the same
Employer.
It is also recommendable to specify what possession of Site implies as regards

operation and maintenance of facilities on Site and as regards traffic.
Sub-Clause 2.2 - Permits, Licences or Approvals

With reference to paragraph (a), it is good practice to include in the tender and
then contract documents, and particularly in the Specifications, all relevant in-
formation. References to laws and standards should be included for formal rea-
sons, but the contract documents should be, as much as possible, self-sufficient,
so as to facilitate access to the market.
Sub-Clause 2.3 - Employer's Personnel

These provisions should be reflected in the Employer's contracts with any other
contractors on the Site.
The work to be carried out by these other contractors should be described in the
tender documents, and aspects such as co-ordination and safety may need to be
specified.
Sub-Clause 2.4 - Employer's Financial Arrangements

It is possible, for example for long term contracts, to introduce a more precise
definition of what will be considered as reasonable evidence. However, it is
recommended not to delete this Sub-Clause entirely, as contractors would be
concerned by such cancellation. The anticipation of a risk in this regard would
then reflect on the prices.
It has to be noted that this Sub-Clause plays its role mainly when large costs
overruns are occurring (including due to Contractor’s claims), as Employers are
generally expected to have secured funding corresponding to the Accepted
Contract Amount before the signature of the contract.
Sub-Clause 2.5 - Employer's Claims

It has to be underlined that under Sub-Clause 14.7, the Employer is not allowed
to make deductions from the amounts certified by the Engineer (the mandatory
particular conditions allow however arithmetical mistakes to be corrected).
Therefore, the procedure defined in the present Sub-Clause has to be used in
case the Employer disagrees with an amount certified or wishes to apply vari-
ous penalties (such as delay damages).

4.3.3 Clause 3 - The Engineer

Sub-Clause 3.1 - Engineer's Duties and Authority
Any requirements for Employer's approval should be set out in the Particular
Conditions.
This list should be extended or reduced as necessary. If the obligation to obtain

the approval of the Employer only applies beyond certain limits, financial or
otherwise, the example wording should be varied.
It is clear that the Engineer has the role defined in very general terms in Article
21 paragraph d) of Law No. 10/1995. However, the Conditions of Contract
provide for several additional duties and authority.
Employers might wish to limit the authority of the Engineer, in order to main-
tain control on some of the main features. Such limitations should (i) be spe-
cifically detailed in the Particular Conditions and (ii) truly correspond to those
mentioned in the Engineer’s contract.
In addition to those limitations included in the mandatory particular conditions

(Appendix A1) and deriving from the applicable Romanian legislation, Em-
ployers might want to add, for example:
a) Sub-Clause 4.4: Specific approval of the Employer is required before
issuing consent for any Sub-Contractor; (alternatively, this obligation
could be limited to major Sub-Contractors, that is those providing
more than x% of the Accepted Contract Amount)
b) Sub-Clause 8.4 and/or Sub-Clause 13.1: Specific approval of the Em-
ployer is required before instructing or approving any extension of the
Time for Completion
c) Sub-Clause 13.1: Specific approval of the Employer is required before
instructing or approving the omission of any work.
Attention of the Employers is drawn on the fact that such prior approval trans-
fer responsibility from the Engineer to the Employer.
It is also recommendable to add the following precisions, or similar:

“Notwithstanding the obligation, as set out above, to obtain approval, if, in the
opinion of the Engineer, an emergency occurs affecting the safety of life or of
the Works or of adjoining property, he may, without relieving the Contractor of
any of his duties and responsibilities under the Contract, instruct the Contrac-
tor to execute all such work or to do all such things as may, in the opinion of
the Engineer, be necessary to abate or reduce the risk. The Contractor shall
forthwith comply with any such instruction of the Engineer. The Engineer shall
determine an addition to the Contract Price, in respect of such instruction, in
accordance with Sub-Clause 13.1 and shall notify the Contractor accordingly,
with a copy to the Employer.”
Sub-Clause 3.2 - Delegation by the Engineer


Sub-Clause 3.3 - Instructions of the Engineer

Attention is drawn on the following provision of this Sub-Clause:
“The Contractor shall only take instructions from the Engineer, or from an as-
sistant to whom the appropriate authority has been delegated under this
Clause.”
Therefore, under the Contract, the designer or other entities are not to issue in-
structions directly to the Contractor.
Sub-Clause 3.4 - Replacement of the Engineer

Sub-Clause 3.5 - Determinations

Attention is drawn on two issues:
- As per Sub-Clause 1.3, determinations should not be unreasonably
withheld or delayed. In general, claims should be dealt with in a
timely manner. Employers might consider introducing a time limit for
issuing determinations.
- Determinations enter into force immediately.
In practice, the Engineer could issue an interim determination before issuing a

final one, in order to avoid delays, while waiting for additional supporting par-
ticulars.
New Sub-Clause 3.6 - Management Meetings

It is recommendable to introduce reference to management meetings, for exam-
ple with the following:
“The Engineer or the Contractor’s Representative may require the other to at-
tend a management meeting in order to review the arrangements for future
work. Such meetings shall take place on a monthly basis. The Engineer shall
record the business of management meetings and supply copies of the record to
those attending the meeting and to the Employer, within two working days from
the meeting. In the record, responsibilities for any actions to be taken shall be
in accordance with the Contract.
The agenda for such meetings shall cover a review of progress attained, a re-
view of schedules and plants for future activities, the status of staffing, engi-
neering, safety, equipment, material supply, payments, current and anticipated
difficulties, interface with other Contractors, claims for extras, and other perti-
nent topics. Time and place of these meetings shall be mutually agreed taking
into consideration the subject to be discussed.”
4.3.4 Clause 4 - The Contractor

Sub-Clause 4.1 - Contractor's General Obligations
Occasionally, there may be an item of Temporary Works for which the Con-
tractor will not be fully responsible. For example, the Contract may specify
temporary arrangements for river diversion which have been designed by the
Engineer. In these cases, the Sub-Clause may require amendment, taking ac-

count of the type of this item of Temporary Works, and of the extent of the
Employer's responsibility.
It has to be understood that the Contractor might be required to design part of

the Works even under the conditions of contract for construction. However, if
the Contractor is to design a very significant part of the works, Employers
should consider using the conditions of contract for plant and design-build.
In case the Contractor is required to provide design of part of the Works, this
should be clearly stated, normally in the Specifications. It is important to state
the extent of such design work and whether it is relating to full design of a spe-
cific part (including Temporary Works, relocation or protection of utilities, etc)
or to an increased level of detail (for example production of working drawings
for the Permanent Works). In both cases, Employers should specify:
- Whether and to what extent the Engineer’s consent on the name and
qualifications of the designer (individuals, sub-contractor, etc) and de-
sign checkers shall be obtained. This might also include definition of
possible conflict of interest (with the Employer’s Personnel, including
the Engineer’s personnel)
- Whether, to what extent and in which time period and according to
which sequence, design shall be submitted by the Contractor and ap-
proved or reviewed by the Engineer and / or the Employer. Attention
is drawn to cases where the Employer’s Technical-Economic Commit-
tee’s approval would be required
- Whether and to what extent authorisations and permits are required
and which Party is responsible to obtain them.
It is also recommendable to specify that any design produced by the Contractor

shall be coordinated with existing designs produced by the Employer.
In case the Contractor is to fully design a part of the Works, Employers might
consider integrating additional provisions, similar to those of Clause 5 of the
conditions of contract for plant and design-build, providing a better definition
of the design procedure.
In case the Contractor is to provide refined design (working drawings), it is

recommendable to state the following:
“The design by the Contractor shall form a coherent technical project together
with the Specifications and Drawings provided by the Employer in the Con-
tract. In case the Contractor’s design proposes substantial changes to the Em-
ployer’s design (including but not limited to changes of technical solutions),
such proposal shall be deemed to have been made by the Contractor under
Sub-Clause 13.2 [Value Engineering].”
It is also recommended to state that:

“Any approval or consent, as well as any review, under this Sub-Clause or oth-
erwise, shall not relieve the Contractor from any obligation or responsibility.”

Sub-Clause 4.2 - Performance Security

Sub-Clause 4.2 needs to be amended in order to comply with Romanian public
procurement regulations on the submission and release of the Performance Se-
curity (Articles 87(b) and 92(4) of GD No. 925/2006). The proposed amend-
ments are included in the mandatory particular conditions in Appendix A1.
In order to avoid the risk of termination in case of failure by the Contractor to

submit the Performance Guarantee, it is recommended to request submission of
the Performance Security at the signature of the Contract Agreement.
The value of the Performance Security is normally based on the Accepted Con-
tract Amount. As per the provisions of Article 89 paragraph (2) of GD No.
925/2006, it cannot exceed 10% of the Contract Price VAT excluded. For large
projects with possibly important cost-overruns, it is recommendable to add the
following text at the end of this Sub-Clause.
“Whenever the Engineer determines that the Contract Price exceeds the Ac-
cepted Contract Amount or the Contract Price previously determined for the
purposes of this Sub-Clause, by more than ten (10%) percent, the Contractor,
at the Engineer’s written request, shall promptly increase the value of the Per-
formance Security by an equal percentage.”
To avoid difficulties in case of Joint Ventures, it is recommended to include:
“The Performance Security of a joint venture or consortium shall specify the

name of the joint venture or consortium.”
The acceptable form(s) of Performance Security should be included in the ten-

der documents, annexed to the Particular Conditions. Example forms are an-
nexed to this document in the templates of guarantees in Appendix D1.
They incorporate the Uniform Rules published by the International Chamber of

Commerce (the "ICC"), which is based at 38 Cours Albert 1er, 75008 Paris,
France), which also publishes guides to these Uniform Rules.
In case the Employer is not prepared to accept another form of security than the
one annexed to the Particular Conditions, it should amend the second sentence
of the second paragraph of Sub-Clause 4.2 as follows:
“The Performance Security shall be issued by an entity and from within a coun-
try (or other jurisdiction) approved by the Employer, and shall be in the form
annexed to the Particular Conditions.”
Sub-Clause 4.3 - Contractor's Representative

If the Representative is known at the time of submission of the Tender, the Ten-
derer may propose the Representative. The Tenderer may wish to propose al-
ternatives, especially if the contract award seems likely to be delayed. If the
ruling language is not the same as the language for day to day communications
(under Sub-Clause 1.4), or if for any other reason it is necessary to stipulate
that the Contractor's Representative shall be fluent in a particular language, a
modification of the clause may be made in the particular conditions. A recom-

mendation is attached in the recommended particular conditions in Appendix

A2.
The role of the Contractor’s Representative should be highlighted. Not only his
nomination, but also his revocation has to receive the prior consent of the Engi-
neer.
In order to ensure that a properly nominated Contractor’s Representative is

available at all times, it is possible to specify (under Sub-Clause 14.3) that
Statements have to be signed by the Contractor’s Representative so as to be
taken into consideration.
It is also recommendable to make reference to the key qualifications required at

the time of the Tender.
Sub-Clause 4.4 - Subcontractors

The wording in the General Conditions includes the conditions which will usu-
ally be applicable.
However, under Romanian public procurement regulations, if parts of the

Works are to be performed by Subcontractors, at the signature of the Contract
Agreement, the Contractor must provide the Employer with the relevant sub-
contracts, which must comply with the terms of the Tender and shall constitute
Schedules to the Contract (Article 96(1) of GD No. 925/2006). Moreover, the
Contractor may not replace any of the Subcontractors designated in the Tender
without the prior consent of the Engineer (Article 96(2) of GD No. 925/2006).
Please also note that, according to the same Article 96(2) of GD No. 925/2006,
replacement of Subcontractors nominated in the Tender must not lead to modi-
fication of the initial technical or financial offer of the Contractor.
The proposed modification is included in the mandatory particular conditions in

Appendix A1.
On a case-by-case basis, Employers might want to define a maximum limit of

sub-contracting (for example 50% of the value of the Works). In such case, this
amount should be clearly stated, typically in the Appendix to Tender.
Replace the first sentence of Sub-Clause 4.4 with:
“The Contractor shall not subcontract a larger value of the Works than the
maximum specified in the Appendix to Tender.”
Subject to the mandatory provisions of the Romanian public procurement regu-

lations, the Engineer’s prior consent for subcontractors might lead to excessive
administration. It is therefore possible to limit such requirement, as follows:
At the end of point (b), add the following:
“Such prior consent shall not be required if the value of the subcontract is less
than one percent (1%) of the Contract Price.”

Furthermore, it is recommendable, for transparency reasons, to detail on which

criteria consent will be given. Such criteria might include:
- Personal situation (no bankruptcy or similar proceedings, no final sen-
tence for professional misconduct, fulfilled obligations as per payment
of taxes and social contributions)
- Sound financial position
- Experience in similar projects (for the type of works intended to be
performed by the proposed Subcontractor), etc.
Sub-Clause 4.5 - Assignment of Benefit of Subcontract

Sub-Clause 4.6 - Co-operation

In case several contractors are working simultaneously on or near the Site, it is
highly desirable that the Specifications describe the resulting constraints and
procedures for co-ordination.
Sub-Clause 4.7 - Setting Out

Sub-Clause 4.8 - Safety Procedures

If the Contractor is sharing occupation of the Site with others, it may not be
appropriate for him to provide some of the listed items. In these circumstances,
the Employer's obligations should be specified.
The requirements of paragraph (d) of the present Sub-Clause might need to be

reviewed in particular cases: it might not be appropriate to ensure fencing and
lighting of a road section, for example.
It is recommended to include at the end of this Sub-Clause provisions referring

to Traffic Management Plans and similar, when relevant.
“Within 28 days of the signature of the Contract Agreement, the Contractor

shall submit to the Engineer a detailed traffic management plan.
The traffic management plan shall indicate what measures will be implemented
to manage the traffic while Works are underway. Such plan shall describe, in
the form of a sketch accompanied by narrative details, the sequence of signs,
deviations, lighting, fence, etc, to be applied to each section of road with differ-
ent cross profile characteristics (2, 3 or 4 lanes), so that road users and ripar-
ian be protected. The traffic management plan shall be approved by the Engi-
neer before the start of the Works on any part of the Site.”
Approval by the Engineer will be granted only further to the approval by the
Road Police and by the Employer’s specialised services.
In case of default on the part of the Contractor in maintaining or implementing

such traffic management plan, as approved by the Engineer, on any part of the
Site, the Employer shall be entitled, subject to Sub-Clause 2.5, to payment by

the Contractor of the Cost of remedy measures or any higher amount depending
on actual damages.
Sub-Clause 4.9 - Quality Assurance

The wording in the General Conditions imposes the requirement of a quality
assurance system in accordance with details specified in the Contract.
In case a description or an outline of the quality assurance system was submit-

ted as part of the Tender, this Sub-Clause should establish a link with the
documents provided.
Sub-Clause 4.10 - Site Data

Under this Sub-Clause, Employers are required to make available all necessary
relevant data on sub-surface and hydrological conditions, usually as part of the
tender documents.
Sub-Clause 4.11 - Sufficiency of the Accepted Contract Amount

Sub-Clause 4.12 - Unforeseeable Physical Conditions

In the case of major sub-surface works, the allocation of the risk of sub-surface
conditions is an aspect which should be considered when tender documents are
being prepared. If this risk is to be shared between the parties, Sub-Clause 4.12
may be amended by deleting sub-paragraph (b) of Sub-Clause 4.12 and substi-
tuting by:
“(b) Payment for any such Cost, per cent ( %) of which shall be in-
cluded in the Contract Price (the balance percent of the Cost shall be
borne by the Contractor).”
Sub-Clause 4.13 - Right of Way and Facilities

Sub-Clause 4.14 - Avoidance of Interference

Sub-Clause 4.15 - Access Route

This Sub-Clause has to be put in relation with Sub-Clause 2.1 and Sub-Clause
4.13. It is therefore assumed that an access route exists (but its suitability for
transport is not guaranteed by the Employer) and that the Contractor is entitled
to use it (even if this might imply some costs).
Sub-Clause 4.16 - Transport of Goods

Sub-Clause 4.17 - Contractor's Equipment

If the Contractor is not to provide all the Contractor's Equipment necessary to
complete the Works, the Employer's obligations should be specified: see Sub-
Clause 4.20. If vesting of Contractor's Equipment is required, further para-
graphs may be added, subject to their being consistent with applicable laws.

This Sub-Clause refers only to Equipment brought on Site. It might be advis-

able to extend it to Equipment brought to the Contractor’s site installation, if
this is not located on the Site.
Furthermore, it is recommendable to refer to the equipment proposed by the

Contractor as part of its tender:
“The Contractor shall use for the execution of the Works Equipment of not
lower quality and capacity than the Equipment proposed in the Tender and
listed in Schedule xx to the Contract.”
Sub-Clause 4.18 - Protection of the Environment

For Works to be executed in particularly environmentally sensible areas, Em-
ployers might want to include in this Sub-Clause a provision for indemnifica-
tion in case of default. For instance:
“In case of default on the part of the Contractor in meeting the requirements of
the present Sub-Clause, the Employer shall be entitled, subject to Sub-Clause
2.5, to payment by the Contractor of the Cost of remedy measures or any
higher amount depending on actual damages.”
Sub-Clause 4.19 - Electricity, Water and Gas

If services are to be available for the Contractor to use, the Specification should
give details, including locations and prices.
Sub-Clause 4.20 - Employer's equipment and Free-Issue Material

For this Sub-Clause to apply, the Specification should describe each item which
the Employer will provide and/or operate and should specify all necessary de-
tails. With some types of facilities, further provisions may be necessary, in or-
der to clarify aspects such as liability and insurance.
In case Employers intend to use this Sub-Clause, for use of Employer’s Equip-
ment or of free issue materials, they should be very careful so as to ensure fair
and transparent conditions of competition. The exact conditions and prices for
Equipment should be detailed and disclosed to all tenderers, while detailed in-
formation regarding the quality and quantity of free issue materials, as well as
the time and place where they will be made available should be defined. It is
advisable to have those materials surveyed as part of the tender, so as to define
their condition and suitability for use.
In case the condition of free issue materials is not known before the execution
of the Works (for example when some materials are to be re-used), Employers
should ensure that all tenderers base their prices on the same assumptions and
that the mechanism for incorporation of such materials does not distort compe-
tition.
Sub-Clause 4.21 - Progress Reports

The progress report is one of the main supporting documents to be submitted
together with the Statements. The level of detail to be provided as part of the
progress reports might be adapted to the projects requirements.

The requirement to provide 6 copies might also be adapted.
Sub-Clause 4.22 - Security of the Site

appropriate for him to be responsible for its security. In these circumstances,
The provisions of the present Sub-Clause should be adapted from one project to
another in function of the configuration of the Site.
For example, in the case of a road rehabilitation project, it is recommendable to

precise that:
“For the purposes of this Sub-Clause, the road users and riparian shall not be
considered as unauthorised persons in the normal use of the road and access to
riparian properties. Such use and access shall be regulated as part of the Con-
tractor’s traffic management plan.”
Sub-Clause 4.23 - Contractor's Operations on Site

Sub-Clause 4.24 - Fossils

New Sub-Clause 4.25 Works Diary

It is recommendable to add a new Sub-Clause [Works Diary] (or integrate these
provisions with the ones of Sub-Clause 4.21 [Progress Reports] with subse-
quent description in the Specifications):
“The Contractor shall draw up a works diary for contemporary records, in a
format agreed by the Engineer. The works diary shall be held on Site and the
Contractor’s Representative shall daily record the following information (as a
minimum):
1. Atmospheric conditions, the work breaks due to adverse meteorological
conditions, the working hours, the number and the qualification of the per-
sonnel working on Site, the supplied materials, the materials incorporated
into the works, the equipment out of order, the tests completed, the sent
samples, the unforeseen events, as well as verbal orders given to the Con-
tractor.
2. Attachments with detailed data on all elements which are checked on Site
and used for the calculation of the payments to the Contractor, such as
completed Works, actual quantities, supplies accepted for incorporation
into the Works. These attachments are part of the works diaries, but can be
signed, if need be, as separate documents.
3. List of any obstructions and other difficulties encountered by the Contrac-
tor in the execution of the Works, during the reported period.
At the Engineer’s request, the Contractor has to provide all necessary informa-
tion for the daily completion of the works diary and attachments.

The information provided is noted in the works diary and attachments, signed
by the Contractor’s Representative and countersigned by the Engineer or his
representative. The Contractor shall be responsible to ensure that adequate
back-up of this information is provided.
In case of disagreement on a subject noted in the works diary or attachments,

the Contractor has to inform in writing the Engineer about his remarks within
14 days from the date when the notice has been recorded in the works diary or
attachments”.
New Sub-Clause 4.26 - As-Built Drawings

In order to ensure full compliance with the requirements of Law No. 10/1995, it
is advisable to introduce provisions similar with those of the conditions of con-
tract for plant and design-build (Sub-Clause 5.6).
Furthermore, the Contractor might be required to provide inputs to the Con-

struction Book. Such inputs should be clearly defined.
4.3.5 Clause 5 - Nominated Sub-Contractors

In most cases under Sub-Clause 4.4, the Contractor selects Subcontractors, sub-
ject to any constraints specified in the Contract. Clause 5 provides for the par-
ticular situation whereby the Employer may select a Subcontractor, although
the Contractor remains responsible for any act or default of Subcontractors, ac-
cording to Sub-Clause 4.4.
The sub-paragraphs of Sub-Clause 5.2 indicate some of the problems which

may have to be overcome.
If a nominated Subcontractor is to be required, full details should be included in

the tender documents. If the Employer anticipates that a Subcontractor is to be
instructed under Clause 13 but is not to be a nominated Subcontractor, Clause 5
should be amended, describing the particular circumstances.
The attention of Employers is drawn on the fact that Nominated Subcontractors

shall be nominated further to a selection procedure in full accordance with the
relevant procurement legislation. Before using this Clause, Employers might
also consider the conclusion of a separate contract.
Sub-Clause 5.1 - Definition of "nominated Subcontractor"

Sub-Clause 5.2 - Objection to Nomination

Sub-Clause 5.3 - Payments to nominated Subcontractors

Sub-Clause 5.4 - Evidence of Payments


4.3.6 Clause 6 - Staff and Labour

Sub-Clause 6.1 - Engagement of Staff and Labour
It is advisable to link key personnel to be employed with the requirements of
the tender documents, for instance:
“The Contractor shall employ key personnel as proposed in the Tender and
listed in Schedule xx to the Contract. Any replacement personnel shall be at
least of equivalent qualification and experience.”
Sub-Clause 6.2 - Rates of Wages and Conditions of Labour

Sub-Clause 6.3 - Persons in the Service of Employer

Sub-Clause 6.4 - Labour Laws

According to the Procurement Guide, the Employer must clearly indicate in the
tender documents the mandatory rules regarding labour conditions and labour
safety which must be complied with throughout the performance of the Con-
tract. Such obligation is deemed to be complied with if the tender documents
indicate the relevant institutions wherefrom detailed information as regards the
above mentioned regulations can be obtained.
The Employer should require Tenderers to indicate in the Tender the fact that
obligations related to labour conditions and labour safety were taken into con-
sideration in the preparation of the Tender.
Sub-Clause 6.5 - Working Hours

If the Employer does not wish to specify working hours in the Appendix to
Tender, or to restrict them to the times specified by the Tenderer (in order to
plan the Engineer's supervision, for example), this Sub-Clause may be deleted.
In some cases, requests of the Contractor to work outside the normal working
hours will have an impact on the activity of and required inputs from the Engi-
neer. This can be limited with:
“The personnel of the Contractor will not be allowed to perform the Works in
more than one shift, except for those activities requiring continuous presence
on Site, such as traffic management.”
Sub-Clause 6.6 - Facilities for Staff and Labour

If the Employer will make some accommodation available, his obligations to
do so should be specified.
Sub-Clause 6.7 - Health and Safety

Additional health and safety requirements might be necessary depending on the
type of works and related risks: railway, chemicals, etc.
Sub-Clause 6.8 - Contractor's Superintendence

Add the following text at the end of Sub-Clause 6.8:

“A reasonable proportion of the Contractor’s superintending staff shall have a

working knowledge of Romanian language. Otherwise the Contractor shall
have a sufficient number of competent interpreters available on Site during all
working hours.”
Add the following paragraphs at the end of Sub-Clause 6.8:
“(a) Foreign Staff and Labour

The Contractor may import any personnel who are necessary for the execution
of the Works. The Contractor must ensure that these personnel are provided
with the required residence visas and work permits. The Contractor shall be re-
sponsible for the return to the place where they were recruited or to their domi-
cile of imported Contractor’s Personnel. In the event of the death in the Country
of any of these personnel or members of their families, the Contractor shall
similarly be responsible for making the appropriate arrangements for their re-
turn or burial.
(b) Alcoholic Liquor or Drugs

The Contractor shall not, import, sell, give, barter or otherwise dispose of any
alcoholic liquor or drugs, or permit or allow importation, sale, gift, barter or
disposal by Contractor’s Personnel.
(c) Arms and Ammunition

The Contractor shall not give, barter or otherwise dispose to any person, any
arms or ammunition of any kind, or allow Contractor’s Personnel to do so.
(d) Illegal Payments

Any commission, advantage, gift, gratuity, reward or bribe given, promised or
offered by or on behalf of the Contractor or his agent or servant or any other
person on his or their behalf or on behalf of any of them in relation to the ob-
taining or to the execution of this or any other Contract with the Employer
shall, in addition to any criminal liability which may be thereby incurred, sub-
ject the Contractor at the Employer's option to the cancellation of this and of
all other contracts which he may have entered into with the Employer and also
the payment of any loss or damage resulting from such cancellation. Any
amount paid shall be deducted from the Contractor's payment due.”
Sub-Clause 6.9 - Contractor's Personnel

Sub-Clause 6.10 - Records of Contractor's Personnel and Equipment

Sub-Clause 6.11 - Disorderly Conduct

4.3.7 Clause 7 - Plant Materials and Workmanship

Sub-Clause 7.1 - Manner of Execution
It is recalled that Materials are things to be supplied or form part of the Perma-
nent Works. The prohibition of “Hazardous Materials” does not exclude haz-
ardous processes (covered under Sub-Clause 4.8).

Sub-Clause 7.2 - Samples

Sub-Clause 7.3 - Inspection

In case the Contractor shall cover the costs of testing by the Employer’s Per-
sonnel (including testing equipment, etc), this should be made clear in the
Specifications.
Sub-Clause 7.4 - Testing

Sub-Clause 7.5 - Rejection

Sub-Clause 7.6 - Remedial Work

Sub-Clause 7.7 - Ownership of Plant and Materials

Sub-Clause 7.8 - Royalties

It is advisable to specify that:
“The Contractor shall also be liable for all payments or compensation, if any,
levied in relation to the dumping of part or all of such materials, waste piles,
debris and hazardous waste.”
New Sub-Clause 7.9 - Technical Standards and Regulations

It is advisable to precise (as per the provisions of Sub-Clause 5.4 of the condi-
tions of contract for plant and design-build):
“The design, the Contractor's Documents, the execution and the completed
Works shall comply with the Country's technical standards, building, construc-
tion and environmental Laws, Laws applicable to the product being produced
from the Works, and other standards specified in the Specifications, applicable
to the Works, or defined by the applicable Laws.
All these Laws shall, in respect of the Works and each Section, be those pre-
vailing when the Works or Section are taken over by the Employer under
Clause 10 [Employer's Taking Over]. References in the Contract to published
standards shall be understood to be references to the edition applicable on the
Base Date, unless stated otherwise.
If changed or new applicable standards come into force in the Country after the
Base Date, the Contractor shall give notice to the Engineer and (if appropriate)
submit proposals for compliance. In the event that:
a) the Engineer determines that compliance is required, and
b) the proposals for compliance constitute a variation,

then the Engineer shall initiate a Variation in accordance with Clause 13

[Variations and Adjustments].”
4.3.8 Clause 8 - Commencement, delays and Suspension

Sub-Clause 8.1 - Commencement of Work
In the second sentence of the first paragraph of Sub-Clause 8.1 “Letter of Ac-
ceptance” shall be deleted and substituted with “Contract Agreement”.
Failure of the Employer to provide access to and possession of the Site in due
time might delay the Commencement Date and have serious consequences. It is
highly recommended not to sign any contract before compliance with Sub-
Clause 2.1 and Sub-Clause 8.1 is ensured.
In case Employers know that the Commencement Date for a part of the Works
will be delayed, it is advisable to define this part as a Section (in the Appendix
to Tender) and to define under the present Sub-Clauses different Commence-
ment Dates by Sections.
On the other hand, the last sentence defines strong obligations for the Contrac-
tor. For example, the Contractor should not stop the Works if it is able to work
on part of the Works.
Sub-Clause 8.2 - Time for Completion

It has to be highlighted that, the expiry of the Time for Completion does not
relieve the Contractor from its obligation to perform the Works, nor the Em-
ployer from its obligation to pay (with the possibility of claiming for delay
damages as per Sub-Clause 8.7). In case the Works are not completed during
the Time for Completion, there is no need to amend the Contract in any way, as
the Contract clearly describes how to handle this situation.
If the Works are to be taken-over in stages, these stages should be defined as

Sections, in the Appendix to Tender.
Sub-Clause 8.3 - Programme

It has to be highlighted that the programme is not to be approved by the Engi-
neer and / or the Employer. The programme is primarily a document prepared
by the Contractor, under its full responsibility.
It is advisable to provide a time-limit for the submission of a revised pro-

gramme. Add the following sentences:
“Such revised programme shall be submitted within 21 days from the date of
the Engineer’s notice. Failure to comply with this provision shall entitle the
Employer, subject to Sub-Clause 2.5, to payment of damages by the Contrac-
tor.”
Sub-Clause 8.4 - Extension of Time for Completion


Sub-Clause 8.5 - Delays Caused by Authorities

Sub-Clause 8.6 - Rate of Progress

Employers sometimes complain that there is little control on the performance of
the Contractor before the end of the Time for Completion. It is therefore possi-
ble to include a “milestones system” along the example provided below. Before
using such system, Employers should however ensure that they will themselves
be in a position to meet their obligations under the Contract.
Compliance of the progress of the Works with the Contractor’s programme, as

submitted under the first paragraph of Sub-Clause 8.3 or revised under the third
paragraph of Sub-Clause 8.3, is controlled through a milestones system. This
system includes five milestones for monitoring and evaluation of the progress
of the Works. Milestone 1 is defined hereafter. The four other indicators shall
be agreed by the Contractor and the Engineer within 28 days from the submis-
sion of the Contractor’s work programme. In case no agreement is reached dur-
ing such period, the Engineer will define those four indicators. Such indicators
however shall be defined based on the Contractor’s work programme.
Milestone 1 is defined as the achievement of the following indicators, 28 days

after the Commencement Date:
- All Contractor key personnel are on Site,
- The Contractor work programme under the present Sub-Clause is
submitted,
- (Other items).
In case the Contractor incurs delays in the achievement of a milestone, the Em-
ployer will be entitled, subject to Clause 2.5, to withhold from the Interim Pay-
ment Certificates an amount equal to 0.05% of the Accepted Contract Amount
per day of delay, up to a maximum of 10% of the Accepted Contract Amount.
The amount so withheld shall be paid to the Contractor, if and when the mile-
stone is reached. Any remaining monies so withheld shall be paid upon the is-
sue of the Taking-Over Certificate for the Works.
Whenever a revised programme is being submitted, the milestones have to be

updated in accordance with the provisions above.
Sub-Clause 8.7 - Delay Damages

Under many legal systems, the amount of these pre-defined damages must rep-
resent a reasonable pre-estimate of the Employer's probable loss in the event of
delay. If the Accepted Contract Amount is to be quoted as the sum of figures in
more than one currency, it may be preferable to define these damages (per day)
as the percentage reduction which would be applied to each of these figures. If
the Accepted Contract Amount is expressed in the Local Currency, the dam-
ages per day may either be defined as a percentage or be defined as a figure in
Local Currency: see Sub-Clause 14.15(b).

It is recalled that delay damages cannot be simply deducted by Employers from

Interim Payment Certificates, but the Employer’s Claims procedure defined
under Sub-Clause 2.5 has to be followed.
It is also mentioned that these delay damages are the only damages due for such
default (late completion), except in the event of termination by the Employer.
This tends to restrict the constitution of “black lists” or other similar instru-
ments.
The usual practice is to limit the total amount of delay damages at a maximum
of 15% of the final Contract Price. For contracts where completion of the
Works by a certain date is of paramount importance, it might be envisaged to
(i) introduce a higher amount of delay damages, but also (ii) introduce a bonus
for acceleration.
It should also be noted that Employers might, in duly justified cases, waive
their rights to delay damages, or suspend the actual payment of such damages
by the Contractor until the completion of the Works, for example in case pay-
ment of such damages would create strong pressures on the Contractor’s cash
flow and would jeopardize the actual completion of the Works.
Sub-Clause 8.8 - Suspension of Work

It is highlighted that suspension may be instructed but does not necessarily
have to be instructed. For example, some categories of works should normally
be suspended under certain weather conditions (concreting or asphalt works
during winter time, etc.).
Sub-Clause 8.9 - Consequences of Suspension

Sub-Clause 8.10 - Payment for Plant and Materials in Event of Suspension

Sub-Clause 8.11 - Prolonged Suspension

Sub-Clause 8.12 - Resumption of Work

New Sub-Clause 8.13 - Incentives for Early Completion

Incentives for early completion may be included in the tender documents (al-
though Sub-Clause 13.2 refers to accelerated completion).
4.3.9 Clause 9 - Tests on Completion

Sub-Clause 9.1 - Contractor's Obligations
The Specification should describe the tests which the Contractor is to carry out
before being entitled to a Taking-Over Certificate. If the Works are to be tested
and taken-over in stages, the tests requirements may have to take account of the
effect of some parts of the Works being incomplete.

Sub-Clause 9.2 - Delayed Tests

Sub-Clause 9.3 - Retesting

Sub-Clause 9.4 - Failure to Pass Tests on Completion

4.3.10 Clause 10 - Employer's Taking-Over

Sub-Clause 10.1 - Taking Over of the Works and Sections
This Sub-Clause needs to be amended in order to comply with the Romanian
regulations related to taking-over of Works set out mainly in GD No. 273/1994.
The Employer must nominate a taking-over commission (Article 7 of GD No.
273/1994) which shall issue and sign taking-over minutes upon completion of
Works (Article 15 of GD No. 273/1994). On the other hand, the issuance of the
Taking-Over Certificate is mandatory and therefore may not be presumed.
Such regulations are reflected in the mandatory particular conditions in Appen-

dix A1.
The role of the Engineer in the taking-over commission is not defined. Unless
expressly forbidden by the Law, it might be recommendable that the Engineer
be nominated as representative of the Employer.
It remains for Employers and Engineers to agree on what exactly means “minor
outstanding work and defects which will not substantially affect the use of the
Works or Section for their intended purpose”.

Sections, in the Appendix to Tender. Precise geographical definitions are ad-
visable, and the Appendix to Tender should include a table, so as to define the
Time for Completion and delay damages: example of this table is shown in the
Appendix D2.
Sub-Clause 10.2 - Taking-Over of Parts of the Works

The Romanian regulations related to taking-over of parts of the Works (GD No.
273/1994, GD No. 925/2006) are reflected in the mandatory particular condi-
tions in Appendix A1.
Sub-Clause 10.3 - Interference with Tests on Completion

Sub-Clause 10.4 - Surfaces Requiring Reinstatement


4.3.11 Clause 11 - Defects Liability

Sub-Clause 11.1 - Completion of Outstanding Work and Remedying De-
fects
Sub-Clause 11.2 - Costs of Remedying Defects

Sub-Clause 11.3 - Extension of Defects Liability Period

It is recommended to add:
“The Employer shall be entitled subject to Sub-Clause 2.5 to an extension of
the Defects Notification Period for the Works, a Section or a significant part of
the Works, if and to the extent that the Works, a Section, a major item of Plant
or significant part of the Works (as the case may be, and after taking over) can-
not be used for the purposes for which they are intended by reason of a defect
or damage. However, a Defects Notification Period shall not be extended by
more than two years.”
Sub-Clause 11.4 - Failure to Remedy Defects

Sub-Clause 11.5 - Removal of Defective Work

Sub-Clause 11.6 - Further Tests

Sub-Clause 11.7 - Right of Access

Sub-Clause 11.8 - Contractor to Search

Sub-Clause 11.9 - Performance Certificate

This Sub-Clause needs to be amended in order to comply with Romanian regu-
lations related to taking-over of Works set out mainly in GD No. 273/1994.
dix A1.
The issue of the Performance Certificate represents the acceptance of the

Works. It is therefore normal that the final payment and final evaluation of the
Contract Price comes after such acceptance.
Sub-Clause 11.10 - Unfulfilled Obligations

Under Romanian law, the Contractor is liable for the latent defects of the
Works during a 10 year period, whilst his liability for defects affecting the
structure subsists during the lifetime of the Works (Article 29 of Law No.
10/1995). Such statutory periods of liability are acknowledged in the mandatory
particular conditions in Appendix A1.

Sub-Clause 11.11 - Clearance of Site

4.3.12 Clause 12 - Measurement and Evaluation

Sub-Clause 12.1 - Works to be Measured
If any part of the Permanent Works is to be measured according to records of
its construction, details should be specified in the tender documents, including
any records for which the Contractor is to be responsible.
Sub-Clause 12.2 - Method of Measurement

It is recommended to describe the principle of the methods of measurement in
the Preamble of the Bill of Quantities and the details in a “description of price”
for each item of the Bill of Quantities.
For “lump sum” items, it is recommendable to define a schedule of payments.

Furthermore, it should be noted that whenever some item is to be paid (partly or
entirely) when it is achieved “at the satisfaction of the Engineer”, such “satis-
faction” should be properly documented.
Sub-Clause 12.3 - Evaluation

It is advisable to include the following:
- In Sub-Clause 12.3 (a) (i): replace “10%” with “15%”
- In Sub-Clause 12.3 (a) (ii): replace “0.01%” with “0.5%”
- In Sub-Clause 12.3 (a) (iii): replace “1%” with “2%”.
Sub-Clause 12.4 - Omissions

4.3.13 Clause 13 - Variations and Adjustment

Variations can be initiated by any of three ways:
a) The Engineer may instruct the variation under Sub-Clause 13.1, with-
out prior agreement as to feasibility or price;
b) The Contractor may initiate his own proposals under Sub-Clause 13.2,
which are intended to benefit both Parties, or
c) The Engineer may request a proposal under Sub-Clause 13.3, seeking
prior agreement so as to minimise dispute.
Sub-Clause 13.1 - Right to Vary

Several points have to be noted:
- Variations are initiated prior to the taking-over
- Variations are initiated by the Engineer (maybe at the request of the
Employer)
- Variations do not require to be signed or approved by the Contractor
and may be simply instructed. From this point of view, variations do

not have to be treated like an addendum. However, as any instruction,

variations have to be made or confirmed in writing.
- Under the procurement legislation, additional works are to be treated
with considerable care. In particular, the conditions of Article 122(i)
of GEO No. 34/2006 have to be met.
The last sentence of this Sub-Clause is of importance and introduces the princi-
ple of “non-retroactivity”.
Sub-Clause 13.2 - Value Engineering

“The Contractor shall be fully responsible for any proposal made under this
Sub-Clause, including for the period required for its review and approval. The
Contractor shall not be entitled to any extension of time, Cost or profit related
to such period of review and approval.”
Sub-Clause 13.3 - Variation Procedure

Sub-Clause 13.4 - Payment in Applicable Currencies

Sub-Clause 13.5 - Provisional Sums

It is recommended to modify point (b) (ii):
“A sum for overhead charges and profit, calculated as a percentage of these

actual amounts by applying the relevant percentage specified in the Appendix
to Tender.” Typically, a percentage of 5% is being used.
A new paragraph needs to be added at the end of this Sub-Clause reflecting the
obligation for the Contractor to comply with Romanian public procurement
regulations when purchasing Plant, Materials or services other than from a
nominated Subcontractor. The relevant wording is included in the mandatory
particular conditions in Appendix A1.
Sub-Clause 13.6 - Daywork

Sub-Clause 13.7 - Adjustment for Changes in Legislation

The possibility of such adjustments is foreseen in Article 97 paragraph (3) letter
(a) of GD No. 925/2006.
Sub-Clause 13.8 - Adjustment for Changes in Cost

These provisions for adjustments may be required if it would be unreasonable
for the Contractor to bear the risk of escalating costs due to inflation.
The possibility and principles of such adjustments are foreseen in Article 97 of

GD No. 925/2006. For any contract of duration of more than 12 months, it is
strongly recommended to include a price adjustment formula. Such formula

should be based on relevant indices published by authorised bodies, typically

by the National Institute of Statistics.
If the contract is intended to be at fixed rates, it is sufficient not to fill in any

“table of adjustment data”. However, in order to remove any ambiguity, it
might be preferable to clearly state that:
“The Tender and subsequently the Contract Amount shall have been based on
the Contractor’s projections for inflation over the implementation period. Thus
the Contract Price shall not be subject to any adjustment due to inflation, rise
or fall in the cost of labour, materials or any other matters affecting the execu-
tion of the Contract. Cases provided by Clause 13.7 are not subject to this re-
striction.”
It should be noted that the proposed formula applies only for works performed
after the changes occurred (so it applies for what “remains to be executed” in
accordance with provisions of GD No. 925/2006). Actually the multiplier is
calculated for the works performed during month n.
4.3.14 Clause 14 - Contract price and Payment

Sub-Clause 14.1 - The Contract Price
When writing the Particular Conditions, consideration should be given to the
amount and timing of payment(s) to the Contractor. A positive cash flow is
clearly of benefit to the Contractor, and tenderers will take account of the in-
terim payment procedures when preparing their tenders.
Additional Sub-Clauses may be required to cover any exceptions to the options

set out in Sub- Clause 14.1, and any other matters relating to payment.
Cost-plus contracts, under which the actual Costs are determined and paid, are
unusual and only used when (for reasons of urgency or otherwise) the Em-
ployer is willing to accept the risks involved. If the Contractor is to be paid ac-
tual Costs, Clause 12 should be replaced by provisions describing the method
of determining the Costs and Contract Price. As a result, the provisions in the
General Conditions which entitle the Contractor to payment of additional Costs
will generally be of no effect.
Sub-Clause 14.1(a) would not apply if payment is to be made on a lump sum

basis.
Lump sum contracts may be suitable if the tender documents include details
which are sufficiently complete for construction and for Variations to be
unlikely. From the information supplied in the tender documents, the Contrac-
tor can prepare any other details necessary, and construct the Works, without
having to refer back to the Engineer for clarification or further information.
Further design by the Contractor (under sub-paragraphs (a) to (d) of Sub-Clause

4.1) is not precluded. However, these Conditions would be inappropriate if sig-
nificant design input by the Contractor is required. In those cases, FIDIC's other

forms may be more appropriate: see FIDIC's Conditions of Contract for Plant
and Design-Build or Conditions of Contract for EPC/Turnkey Projects.
For a lump sum contract, the tender documents should include a schedule of
payments (see Sub-Clause 14.4), and any drawings required for construction
may be specified as being Contractor's Documents. The Specification should
describe the procedures under which the Contractor submits these Documents
for the Engineer to approve.
If Sub-Clause 14.1(b) is not to apply, additional Sub-Clause(s) should be

added.
Sub-Clause 14.2 - Advance Payment

benefits of advance payment(s). Unless this Sub-Clause is not to apply, the total
advance payment (and the number of instalments if more than one) must be
specified in the Appendix to Tender.
This Sub-Clause needs be amended in order to reflect mandatory Romanian

regulations in respect of advance payments from the public funds (Law No.
500/2002 and GD No. 264/2003). Such amendments are included in the manda-
tory particular conditions in Appendix A1.
The acceptable form(s) of guarantee should be included in the tender docu-

ments, annexed to the Particular Conditions: an example form is annexed in
Appendix D1.
Sub-Clause 14.3 - Application for Interim Payment Certificate

It might be useful to better define which supporting documents would be re-
quired, in addition to the documents and information contained in the Contrac-
tor’s progress report.
In order to ensure that a duly appointed Contractor’s Representative will be

present at all time, it is possible to add the following sentence at the end of this
Sub-Clause:
“Any Statement under this Sub-Clause shall be signed by the Contractor’s Rep-
resentative duly appointed in accordance with Sub-Clause 4.3. In case a State-
ment is not signed by the duly appointed Contractor’s Representative, such
Statement shall be void and ineffective.”
Sub-Clause 14.4 - Schedule of Payments

In most cases, this Sub-Clause would apply only for the conditions of contract
for plant and design-build, and the Schedule would actually make reference to
actual progress. It is important to define such progress by reference to non-
ambiguous milestones. Situations in which payments depend on a rate of
achievement estimated by the Engineer without proper substantiation should be
avoided. It is therefore recommended to elaborate a Schedule that takes into
account the main steps of the Contract and the main “objects” in the design and
execution. Some objects might also be divided into sub-phases. In some cases,

tenderers would have to price each object. It is however preferable that the
“weight” of each sub-phase be defined in the tender documents.
Sub-Clause 14.5 - Plant and Materials intended for the Works

It is recalled that under Sub-Clause 7.7, Plant and Materials delivered to the
Site become the property of the Employer. It should be noted that the Site has a
precise definition and this does not necessarily include Contractor’s compound
and other installations.
Sub-Clause 14.6 - Issue of Interim Payment Certificates

The legal constraints deriving from the use of public funds for the financing of
the Contract (Law No. 500/2002) and affecting the issuance of Interim Payment
Certificates by the Engineer are reflected in the mandatory particular conditions
in Appendix A1.
Furthermore, several aspects need to be highlighted:

- The Engineer is bound by the time limit of 28 days for issue of an In-
terim Payment Certificate (failure to issue a Certificate in 56 days is a
reason for Termination by the Contractor under Sub-Clause 16.2),
- The Engineer is due to substantiate its determination, through the pro-
vision of supporting particulars,
- The Contractor is to be notified of the value of the Interim Payment
Certificate,
- The Engineer shall give notice to the Contractor in case the value of a
Certificate would be less than the minimum value stated in the Ap-
pendix to Tender.
- Interim Payment Certificates are, by definition, interim. They do not
imply acceptance of any work and might be modified afterwards. Al-
though modifications regarding works already certified should remain
the exception, such works are considered as finally approved only at
the issue of the Performance Certificate.
Sub-Clause 14.7 - Payment

This Sub-Clause needs to be amended in order to reflect the deletion of Letter
of Acceptance, as well as the fact that issuance of an invoice by the Contractor
for each Interim Payment Certificate is mandatory under Romanian regulations.
Such amendments are included in the mandatory particular conditions in Ap-
pendix A1.
It has to be noted that the Employer is not entitled to modify any Payment Cer-
tificate, but in case of arithmetical mistakes. Any other claim of the Employer
has to be made in accordance with the procedure defined in Sub-Clause 2.5. It
also has to be noted that, in case the Employer considers that an undue payment
has been made, he can also include in his claim the related financing costs. The
scope of those provisions is to ensure that an adequate flow of cash is main-
tained.

Sub-Clause 14.8 - Delayed Payment

When payments are made in Euro (or EUR), it is useful to indicate that the cen-
tral bank of the Country is the European Central Bank, for example:
The financing charges for amount/s receivable not paid on the due date shall be
the interest rate applied by the European Central Bank to its principal refi-
nancing operations, as published in the C series of the Official Journal of the
European Communities, in force on the first calendar day of the month in
which the due date falls, increased by three and a half percentage points.
Sub-Clause 14.9 - Payment of Retention Money

In case the Employer agrees not to retain monies but to obtain a corresponding
bank guarantee, add the following paragraphs at the end of Sub-Clause 14.9:
“The Contractor may request the payment of retention money against the sub-
mission to the Employer of a bank guarantee. In such case, the Engineer shall
certify and the Employer shall make payment to the Contractor of the amounts
related to Retention Money, after he obtains such guarantee, in a form and pro-
vided by an entity approved by the Employer, in amounts and currencies equal
to the payments to be made. The Contractor may gradually increase the amount
of the bank guarantee, in accordance with the estimates submitted under Sub-
Clause 14.4 [Schedule of Payments]. The amount of the bank guarantee shall
however be equal to the limit of Retention Money stated in the Appendix to
Tender when the total of all certified interim payments (excluding the advance
payment and deductions and repayments of retention) exceeds seventy per cent
(70%) of the Accepted Contract Amount less Provisional Sums.
The Contractor shall ensure that the guarantee is valid and enforceable until
the Contractor has executed and completed the Works and remedied any de-
fects, as specified for the Performance Security in Sub-Clause 4.2. The release
of the guarantee shall be in lieu of the release of the second half of the Reten-
tion Money under the second paragraph of Sub-Clause 14.9, while the Contrac-
tor shall be entitled, when the Taking-Over Certificate has been issued for the
Works, to a reduction of the amount of the bank guarantee corresponding with
the first half of the Retention Money."

Appendix D1.
Sub-Clause 14.10 - Statement of Completion

Sub-Clause 14.11 - Application for Final Payment Certificate

Sub-Clause 14.12 - Discharge


Sub-Clause 14.13 - Issue of Final Payment Certificate

the Contract (Law No. 500/2002) and affecting the issuance of the Final Pay-
ment Certificate by the Engineer are reflected in the mandatory particular con-
ditions in Appendix A1.
Sub-Clause 14.14 - Cessation of Employer's Liability

Sub-Clause 14.15 - Currencies of Payment

If all payments are to be made in Local Currency, it must be named in the Let-
ter of Tender, and only the first sentence of this Sub-Clause will apply. Alterna-
tively, Sub-Clause 14.15 may then be replaced.
New Sub-Clause 14.16 Repayment

A new Sub-Clause 14.16 may be added:
“The Contractor undertakes to repay to the Employer any amounts paid in ex-
cess of the final amount due within 45 days of receiving a request to do so.
Should the Contractor fail to make repayment within the deadline set by the
Employer, the Employer may increase the amounts due by adding interest:
- At the discount rate applied by the central bank of the country of the
Employer if payments are in the currency of that country;
- At the rate applied by the European Central Bank to its main refinanc-
ing transactions in euro where payments are in euro,
on the first day of the month in which the time-limit expired, plus three and a
half percentage points. The default interest shall be incurred over the time
which elapses between that date of the payment deadline set by the Employer
(exclusive), and the date on which payment is actually made (inclusive). Any
partial payments shall first cover the interest thus established.
Amounts to be repaid to the Employer may be offset against amounts of any

kind due to the Contractor. This shall not affect the Parties’ right to agree on
payment in instalments. Bank charges incurred by the repayment of amounts
due to the Employer shall be borne entirely by the Contractor.”
Financing Arrangements
For major contracts in some markets, there may be a need to secure finance
from entities such as aid agencies, development banks, export credit agencies,
or other international financing institutions. If financing is to be procured from
any of these sources, the Particular Conditions may need to incorporate its spe-
cial requirements. The exact wording will depend on the relevant institution, so
reference will need to be made to them to ascertain their requirements, and to
seek approval of the draft tender documents.
These requirements may include tendering procedures which need to be

adopted in order to render the eventual contract eligible for financing, and/or
special Sub-Clauses which may need to be incorporated into the Particular
Conditions.

The following examples indicate some of the topics which the institution's re-
quirements may cover:
a) Prohibition from discrimination against the shipping companies of any one
country;
b) Ensuring that the Contract is subject to a widely-accepted neutral law;
c) Provision for arbitration under recognised international rules and at a neu-
tral location;
d) Giving the Contractor the right to suspend/terminate in the event of default
under the financing arrangements;
e) Restricting the right to reject Plant;
f) Specifying the payments due in the event of termination;
g) Specifying that the Contract does not become effective until certain condi-
tions precedent have been satisfied, including pre-disbursement conditions
for the financing arrangements; and
h) Obliging the Employer to make payments from his own resources if, for
any reason, the funds under the financing arrangements are insufficient to
meet the payments due to the Contractor, whether due to a default under the
financing arrangements or otherwise.
In addition, the financing institution or bank may wish the Contract to include
references to the financing arrangements, especially if funding from more than
one source is to be arranged to finance different elements of supply. It is not
unusual for the Particular Conditions to include special provisions identifying
different categories of Plant and specifying the documents to be presented to
the relevant financing institution to obtain payment. If the financing institution's
requirements are not met, it may be difficult (or even impossible) to secure
suitable financing for the project, and/or the institution may decline to provide
finance for part or all of the Contract.
However, where the financing is not tied to the export of goods and services
from any particular country but is simply provided by commercial banks lend-
ing to the Employer, those banks may be concerned to ensure that the Contrac-
tor's rights are very restricted. These banks may wish the Contract to exclude
any reference to the financing arrangements, and/or to restrict the Contractor's
rights under Clause 16.
The above arrangements (involving financing institution(s), Employer and Con-

tractor) may be initiated by the Employer; or by the Contractor, before submit-
ting the Tender. Alternatively, the Contractor may be prepared to initiate fi-
nancing arrangements and retain responsibility for them, although he would
probably be unable or unwilling to provide finance from his own resources. His
financing bank's requirements would then affect his attitude in contract negotia-
tions. They might well require the Employer to make interim payments, al-
though a large proportion of the Contract Price might be withheld until the
Works are complete.
This payment arrangement can be achieved either by a high Percentage of Re-

tention; or by a suitably completed schedule of payments (see Sub-Clause

14.4), with the Instructions to Tenderers specifying the criteria with which the
Tenderer should comply. Since the Contractor would then have to arrange his
own financing to cover the shortfall between the payments and his outgoings,
he (and his financing bank) would probably require some form of security,
guaranteeing payment when due.
It may be appropriate for the Employer, when preparing the tender documents,
to anticipate the latter requirement by undertaking to provide a guarantee for
the element of payment which the Contractor is to receive when the Works are
complete. The acceptable form(s) of guarantee should be included in the tender
documents, annexed to the Particular Conditions: an example form is annexed
in Appendix D2.
4.3.15 Clause 15 - Termination by Employer

Sub-Clause 15.1 - Notice to Correct
A notice to correct should mention that it is given under the present Sub-Clause
and state a reasonable time period for remedial. In case this period goes beyond
the Time for Completion, it should be stated that it does not prejudice any right
of the Employer (at least under Sub-Clause 8.7).
Sub-Clause 15.2 - Termination by Employer

This Sub-Clause could be amended in order to provide for a clear IV degree
termination clause (“pact comisoriu de gradul IV”) under Romanian law.
Moreover, the last two sentences of the last paragraph of this Sub-Clause
should be deleted. Items belonging to the Contractor may not be sold by the
Employer, unless the later has an enforceable title allowing him to do so, such
as an enforceable court decision or a security interest over such items (which is
an enforceable title per se).

pendix A1.
It should be noted, in the first place, that termination of the Contract is a failure,
both for the Contractor and for the Employer. In real terms, Employers would
often lose considerable time (including valuation, organisation of a new tender,
etc.) and might support significant additional costs in order to complete the
Works. Therefore, termination under this Sub-Clause should be used as a last
resort. Moreover, the notice period should be used to initiate negotiations and
remedy measures. In such cases, the Employer may postpone the termination
notice, so as to allow such negotiations to develop. “Rushing into termination”
would in any case be a mistake. In particular, the fact that the Contractor is in
one of the situations described in this Sub-Clause as causes for termination
should not be understood as necessarily triggering termination.
Employers might want to bring a clearer definition of the provisions of letter

(b), for example, by defining that a minimum (very low) rate of progress, such
as, say, less than 1% over the last 6 months will be considered as “abandoning”
of the works.

It is possible to insert the following text within the last paragraph after the sec-
ond sentence:
“If the Contractor fails to remove his Equipment and Temporary Works within
21 days after receiving the notice, the Employer will be entitled to use so much
of the Contractor’s Equipment and Temporary Works which have been deemed
to be reserved exclusively for the execution of the Works, under the provisions
of the Contract, as he may consider proper, up to the completion of the respec-
tive Works.”
Sub-Clause 15.3 - Valuation at Date of Termination

It is advisable to define a time limit for the Engineer’s activities under this Sub-
Clause, depending on the complexity of the project (for example, 3 months).
Sub-Clause 15.4 - Payment after Termination

Sub-Clause 15.5 - Employer's Entitlement to Termination

4.3.16 Clause 16 - Suspension and Termination by Contractor

Sub-Clause 16.1 - Contractor's Entitlement to Suspend Work
Sub-Clause 16.2 - Termination by Contractor

See comments under Sub-Clause 15.2. Amendments to this Sub-Clause are in-
cluded in the mandatory particular conditions in Appendix A1.
A Contractor should be aware before giving a notice of termination, that once

the Contract is terminated, it cannot be resumed and in most cases a new tender
procedure would be necessary.
Employers should obviously avoid putting themselves in one of the situations

described.
Sub-Clause 16.3 - Cessation of Work and Removal of Contractor's Equip-

ment
Sub-Clause 16.4 - Payment on Termination

After termination, in accordance with the provisions of Sub-Clause 14.2, the
advance payment shall be repaid immediately by the Contractor (if not, the ad-
vance payment guarantee might be called in by the Employer).
Obviously, payments on termination will usually occur in a difficult situation of

conflict. It might be appropriate to define a time limit for the Contractor to
submit its request.

4.3.17 Clause 17 - Risk and responsibility

Sub-Clause 17.1 - Indemnities
Sub-Clause 17.2 - Contractor's Care of the Works

Sub-Clause 17.3 - Employer's Risks

Employers might want to adapt the definition of risks in accordance with the
specifics of each project. For example, under road or rail rehabilitation projects,
it seems reasonable to exclude damages to the Works caused by the road or rail
traffic from the Contractor’s risks and therefore include those under the Em-
ployer’s risks, such as: add paragraph (i) as follows:
(i) damage to components of the Employer’s property on the Site and dam-
age done to the Works resulting from any accident involving road users
while the public use of the Works is authorised by the Employer, where it
can be demonstrated by the Contractor that the accident cannot be partly
or wholly attributed to any deficiency in the Contractor’s Traffic Man-
agement Plan.
Sub-Clause 17.4 - Consequences of Employer's Risks

Sub-Clause 17.5 - Intellectual and Industrial Property Rights

Sub-Clause 17.6 - Limitation of Liability

An additional paragraph may be added if the total liability of the Contractor is
not to be limited to the Accepted Contract Amount:
“In Sub-Clause 17.6, the sum referred to in the penultimate sentence shall be -
…….".
New Sub-Clause 17.7

If the Contractor is to occupy the Employer's facilities temporarily, an addi-
tional sub-clause may be added:
“The Contractor shall take full responsibility for the care of the items detailed
below, from the respective dates of use or occupation by the Contractor, up to
the respective dates of hand-over or cessation of occupation (where hand-over
or cessation of occupation may take place after the date stated in the Taking-
Over Certificate for the Works):
[Insert details]
If any loss or damage happens to any of the above items while the Contractor is
responsible for their care, arising from any cause whatsoever other than those
for which the Employer is liable, the Contractor shall, at his own cost, rectify
the Loss or damage to the satisfaction of the Engineer.”

4.3.18 Clause 18 - Insurance

Sub-Clause 18.1 - General Requirements for Insurances
This Sub-Clause needs to be modified to reflect the deletion of the Letter of
Acceptance, which is replaced by the Contract Agreement.
The wording in the General Conditions describes the insurances which are to be
arranged by the "insuring Party", who is to be the Contractor unless otherwise
stated in the Particular Conditions. Insurances so provided by the Contractor
are to be consistent with the general terms agreed with the Employer. The In-
structions to Tenderers may therefore require tenderers to provide details of the
proposed terms.
If the Employer is to arrange any of the insurances under this Clause, the tender
documents should include details as an annex to the Particular Conditions (so
that tenderers can estimate what other insurances they wish to have for their
own protection), including the conditions, limits, exceptions and deductibles;
preferably in the form of a copy of each policy. The Employer may find it diffi-
cult to effect the insurances described in the third paragraph of Sub-Clause 18.2
(for Contractor's Equipment, which includes Subcontractor's equipment), be-
cause the Employer may not know the amount or value of these items of
equipment.
Sub-Clause 18.2 - Insurance for Works and Contractor's Equipment

“It shall be the responsibility of the insuring Party to notify the insurance com-
pany of any change in the nature, extent or programme for the execution of the
Works and to ensure adequacy of the insurance coverage at all times during the
period of the Contract.”
Sub-Clause 18.3 - Insurance against Injury to Persons and Damage to

Property
Sub-Clause 18.4 - Insurance for Contractor's Personnel

4.3.19 Clause 19 - Force Majeure

Sub-Clause 19.1 - Definition of Force Majeure
Attention is drawn on the criteria for an event or circumstance to be defined as
Force Majeure and to the exceptional character of such event or circumstance
(much more than unusual or unforeseen).
Sub-Clause 19.2 - Notice of Force Majeure

It has to be noted that, despite a frequent opinion, a certificate issued by the
relevant Chamber of Commerce is not necessarily required (even in Romania)
to support the occurrence of Force Majeure. Force Majeure can be proven by
other means. Furthermore, such certificate would be irrelevant for Force Ma-
jeure occurring in a foreign country.

The notice of occurrence of Force Majeure should be accompanied by appro-

priate supporting documentation. It is advisable to add at the end of first para-
graph of Sub-Clause 19.2 the following:
"and shall be accompanied by appropriate documentation evidencing the oc-

currence of Force Majeure".
Sub-Clause 19.3 - Duty to Minimise Delay

Sub-Clause 19.4 - Consequences of Force Majeure

Sub-Clause 19.5 - Force Majeure Affecting Subcontractor

Sub-Clause 19.6 - Optional termination, Payment and Release

Sub-Clause 19.7 - Release from Performance under the Law

4.3.20 Clause 20 - Claims, Disputes and Arbitration

Sub-Clause 20.1 - Contractor's Claims
This Sub-Clause defines the procedure applicable for notification and treatment
of Contractor’s claims. It endeavours to prevent situations where a contractor
would submit its claim long after the occurrence of an event or circumstance
for which it was reasonable for the Contractor to anticipate an entitlement of
time or to additional payments. Accordingly, the Employer or the Engineer
would be compromised in responding to or taking damage-limitation measures
associated with the event or circumstance. Although the figure of 28 days in
which the notice must be served was somewhat arbitrary the objective was to
limit the time period wherein a claim must be notified. The important matter is
that the Employer, through the Engineer, is put on alert, within four weeks, that
something had recently occurred for which an entitlement for time and/or addi-
tional payment might be sought.
The Engineer shall, in turn, respond within 42 days after receiving a claim or
further particulars.
Although Sub-Clause 20.1 appears to say that any claim notified more than 28
days after the event can be dismissed without consideration, this is not the way
that many DABs are interpreting the clause. Most DAB decisions have allowed
a number of claims rejected for late notice to proceed. DABs have in mind that
the object of Clause 20.1 is to prevent ambushes and minimise delays to pro-
jects, not to bar meritorious claims. The result is that Employers have been sig-
nificantly disadvantaged in the DAB process by the fact that Engineers, acting
in all good faith, have not ensured that the necessary records are kept, have not
advised on the merits and have not prepared considered determinations. Guid-

ance as to how the notice provisions should be applied in the best interests of
Employers, good project administration and fairness under the contracts.
1. Where the Engineer considers that the 28-day notice provision of Clause
20.1 may not have been complied with, he should consider the following
before rejecting the claim:
i. Is the event one which, leaving aside Clause 20, is capable of being the
basis for a valid claim?
ii. Did the Employer or the Engineer in fact know about the event giving
rise to the claim within 28 days of the event?
iii. Is the event giving rise to the claim an action or inaction by the Em-
ployer or the Engineer?
iv. Was the Employer or the Engineer aware within 28 days that a claim
was probable, or should they have been so aware?
v. Is it possible that the Contractor only considered himself entitled to
make a claim – as distinct from knowing about the event – within the 4
weeks prior to the notice?
vi. Has the timing of the notice caused the Employer or the Engineer any
significant prejudice in terms of the ability to mitigate or record the ef-
fects of the event?
vii. Has the timing of the notice benefited the Contractor or does it seem as
if it was intended to benefit the Contractor?
viii. Was there communication, whether at meetings or otherwise, about the
problem, other than by way of formal notice?
ix. Is it fair and reasonable, taking into account all of the above, to reject
the claim without consideration of the merits?
2. If the answer to item (i) is that the event is not capable of being a valid
claim, the Engineer should consider rejecting the claim on its lack of valid
basis.
3. If the answer to item (i) is yes, Engineers should consider items (ii) to (iv).
If the answer to any of these items is yes, then DABs are likely to be sym-
pathetic to the Contractor.
4. Next, consider item (v). DABs are taking notice of the first sentence of
Clause 20.1: it has been argued and accepted that if the Contractor has not
in fact considered himself entitled to claim, then the obligation to notify has
not arisen. Some events might require some investigation and advice before
a contractor decides that he has a claim. One DAB decided that the “cir-
cumstance” had not arisen until after a reasonable time for investigation. If
it is probable that the Contractor would have considered himself entitled to
claim more than 4 weeks before the notice, then rejection for lack of notice
should be considered.
5. Consider items (vi) and (vii). If there appears to have been a failure to no-
tify, has there been prejudice to the Employer or benefit to the Contractor?
In other words, would the cost or delay claimed have been reduced if earlier
notice had been given?

6. Consider item (viii). DABs do not insist that the notice is formal. If the is-
sue is raised at meetings or in general correspondence in due time, then this
is likely to be treated as adequate notice.
7. Finally, consider point (ix) and, in particular, whether any prejudice to the
Employer could be evaluated in financial terms under Clause 2.5 or in time
and deducted from any cost or time determined.
8. Promptly upon receipt of a claim and before rejecting a claim on notice
grounds, the Engineer should report to the Employer on its proposed action,
setting out its responses to the above questions. Advise whether:
a) The claim may reasonably be rejected for lack of notice;
b) The claim may reasonably be rejected for lack of notice but the Em-
ployer should nevertheless examine the merits due to the risk that the
DAB might disagree; or
c) Whether the claim should be dealt with on its merits.
Sub-Clause 20.2 - Appointment of the Dispute Adjudication Board

In the third paragraph of this Sub-Clause Letter of Acceptance” shall be deleted
and substituted with “Contract Agreement” (Article 94(2) of GD No.
925/2006).
It has to be noted that appointment of the DAB might not be opportune for all
contracts. There are two basic possibilities:
- Appointment of a DAB from the beginning of the Contract
- Pre-arbitral decision by the Engineer.
Employers should choose between these possibilities with regard to:

- Contract complexity,
- Contract size,
- Extent of activities off-site.
Unless the Engineer (although appointed by the Employer) is to make the pre-
arbitral decisions under this Clause 20, in accordance with the alternative op-
tion described below, the Contract should include the provisions under Clause
20 which, whilst not discouraging the Parties from reaching agreement on dis-
putes as the works proceed, allow them to refer contentious matters to an im-
partial dispute adjudication board.
The adjudication procedure depends for its success on, amongst other things,
the Parties' confidence in the agreed individual(s) who will serve on the DAB.
Therefore, it is essential that candidates for this position are not imposed by
either Party on the other Party; and that, if the individual is selected under Sub-
Clause 20.3, the selection is made by a wholly impartial entity. FIDIC is pre-
pared to perform this role, if this authority has been delegated in accordance
with the example wording in the Appendix to Tender.
It is preferable, but not essential, for the individual(s) to be agreed before the
Contract Agreement is concluded, and for the DAB to visit the Site on a regular

basis. Under the example text in the Appendix to Tender, the Parties may either
so agree before the Contract Agreement is concluded or agree the appointment
within the specified period thereafter. Alternatively, the Parties may prefer to
defer the appointment until a dispute has arisen, in which case Sub-Clause 20.2
plus the Appendix - General Conditions of Dispute Adjudication Agreement
with its Annex (Procedural Rules) and the Dispute Adjudication Agreement
should be amended to comply with the wording contained in the corresponding
sections of FIDIC’s Conditions of Contract for Plant and Design-Build.
Sub-Clause 20.2 provides for two alternative arrangements for the DAB:
a) One person, who acts as the sole member of the DAB, having entered
into a tripartite agreement with both Parties; or
b) A DAB of three persons, each of whom has entered into a tripartite
agreement with both Parties
The form of this tripartite agreement could be one of the two alternatives shown
in Appendix D2, as appropriate to the arrangement adopted. Both of these
forms incorporate (by reference) the General Conditions of Dispute Adjudica-
tion Agreement, which are included as Appendix to the General Conditions be-
cause they are also referred to in Sub-Clause 20.2. Under either of these forms
of Dispute Adjudication Agreement, each individual person is referred to as a
Member.
At an early stage, consideration should be given as to whether a one-person or

three-person DAB is preferable for a particular project, taking account of its
size, duration and the fields of expertise which will be involved. For some pro-
jects, it may be considered appropriate to appoint a one-person DAB for each
major field of expertise relevant to the Works; however, this may give rise to
problems if, when a dispute arises, the Parties cannot agree which field is appli-
cable and, therefore, to whom the dispute should be referred.
Typically, DAB is recommended for contracts of more than 5 million Euro and
DAB of 3 members for contracts of more than 100 million Euro.
For a one-person DAB to be mutually agreed, the Employer (or the tenderer)
could propose the names and curriculum vitae of suitable persons, for the ten-
derer (or the Employer) to accept. It may be advisable to propose alternates in
case some subsequently decline the appointment, assuming that they have not
previously indicated their willingness to accept. Each Party may be reluctant to
choose names from a list of people who have already been contacted by the
other Party.
For a three-person DAB, the Employer and the tenderer may each propose one
member, similar to the above procedure, for the tenderer and the Employer re-
spectively to accept. For the chairman, the Employer (or the tenderer) could
similarly propose suitable persons for the tenderer (or the Employer) to accept.
It may be appropriate for the chairman's retainer fee to be more than that of the
other two members, reflecting the additional administrative tasks which a
chairman will have to perform.

The appointment of the DAB may be facilitated, especially if the members are
not to be appointed at the commencement of the Contract, by including an
agreed list of potential members in the Contract: in a Schedule.
Alternatively, the Engineer may make these pre-arbitral decisions. This alterna-
tive, which has been the Engineer's traditional role in common law countries,
may be appropriate if the Engineer is an independent professional consulting
engineer with the experience and resources required for the administration of
all aspects of the contract. The Employer should recognise that, although the
Engineer generally acts for the Employer as specified in Sub-Clause 3.1(a), the
Engineer will make these pre-arbitral decisions impartially and the Employer
must not prejudice this impartiality. If this alternative is considered appropriate,
Sub-Clauses 20.2 and 20.3 should be deleted and Sub-Clause 20.4 should be
modified accordingly by deleting the second paragraph of Sub-Clause 20.4 and
substituting with:
“The Engineer shall act as the DAB in accordance with this Sub-Clause 20.4,
acting fairly, impartially and at the cost of the Employer. In the event that the
Employer intends to replace the Engineer, the Employer's notice under Sub-
Clause 3.4 shall include detailed proposals for the appointment of a replace-
ment DAB.”
Sub-Clause 20.3 - Failure to Agree Dispute Adjudication Board

It shall be noted that the president of FIDIC can be the appointing entity only if
the language for communications (as defined under Sub-Clause 1.4) is English.
Sub-Clause 20.4 - Obtaining Dispute Adjudication Board's Decision

Again, it should be noted that timely treatment of dispute is of the essence.
Sub-Clause 20.5 - Amicable Settlement

The provisions of this Sub-Clause are intended to encourage the parties to settle
a dispute amicably, without the need for arbitration: for example, by direct ne-
gotiation, conciliation, mediation, or other forms of alternative dispute resolu-
tion. Amicable settlement procedures often depend, for their success, on confi-
dentiality and on both Parties' acceptance of the procedure. Therefore, neither
Party should seek to impose the procedure on the other Party.
Clause 20.6 - Arbitration

It shall be emphasised that the presence of an arbitral clause excludes, for the
fields covered by arbitration, the use of regular courts. It is recommended, so as
to clarify this aspect, to delete the first sentence of the first paragraph of Sub-
Clause 20.6 and replace by the following sentence:
“Unless settled amicably or through a DAB decision, any dispute arising out of
or in connection with the Contract, including without limitation any dispute
regarding its breach, termination or invalidity, shall be finally settled by inter-
national arbitration.”
Furthermore, Employers should carefully check the coherence between the ar-
bitral institution, the location, language and procedure of arbitration. For exam-
ple, the International Commercial Arbitral Court near the Romanian Chamber

of Commerce and Industry uses its own procedural rules. Employers are ad-
vised to link with the relevant arbitral institutions before defining such condi-
tions.
The Contract should include provisions for the resolution by international arbi-
tration of any disputes which are not resolved amicably. In international con-
tracts, international commercial arbitration has numerous advantages over liti-
gation in national courts, and may be more acceptable to the Parties.
Careful consideration should be given to ensuring that the international arbitra-

tion rules chosen are compatible with the provisions of Clause 20 and with the
other elements to be set out in the Appendix to Tender. The Rules of Arbitra-
tion of the International Chamber of Commerce (the "ICC", which is based at
38 Cours Albert 1er, 75008 Paris, France) are frequently included in interna-
tional contracts. In the absence of specific stipulations as to the number of arbi-
trators and the place of arbitration, the International Court of Arbitration of the
ICC will decide on the number of arbitrators (typically three in any substantial
construction dispute) and on the place of arbitration.
If the UNCITRAL (or other non-ICC) arbitration rules are preferred, it may be
necessary to designate, in the Appendix to Tender, an institution to appoint the
arbitrators or to administer the arbitration, unless the institution is named (and
their role specified) in the arbitration rules. It may also be necessary to ensure,
before so designating an institution in the Appendix to Tender, that it is pre-
pared to appoint or administer.
For major projects tendered internationally, it is desirable that the place of arbi-
tration be situated in a country other than that of the Employer or Contractor.
This country should have a modern and liberal arbitration law and should have
ratified a bilateral or multilateral convention (such as the 1958 New York Con-
vention on the Recognition and Enforcement of Foreign Arbitral Awards), or
both, that would facilitate the enforcement of an arbitral award in the states of
the Parties.
It may be considered desirable in some cases for other Parties to be joined into
any arbitration between the Parties, thereby creating a multi-party arbitration.
While this may be feasible, multi- party arbitration clauses require skilful draft-
ing, and usually need to be prepared on a case-by-case basis. No satisfactory
standard form of multi-party arbitration clause for international use has yet
been developed.
Sub-Clause 20.7 - Failure to Comply with Dispute Adjudication Board De-

cision
Sub-Clause 20.8 - Expiry of Dispute Adjudication Board's Appointment

New Clause 21 Checks and Audits by Romanian and Community Bodies

For contracts funded under European Commission funds, it is recommended to
add a new Clause 21:

“The Contractor will allow the Romanian Audit Authority, the Romanian Anti-
Fraud Office, the European Commission, the European Anti-Fraud Office and
the European Court of Auditors to verify, by examining the documents or by
means of on-the-spot checks, the implementation of the project and conduct a
full audit, if necessary, on the basis of supporting documents for the accounts,
accounting documents and any other document relevant to the financing of the
project. These inspections may take place up to 7 years after the final payment.
Furthermore, the Contractor will allow the Romanian and European Anti-
Fraud Offices to carry out checks and verifications on-the-spot in accordance
with the procedures set out in the European Community legislation for the pro-
tection of the financial interests of the European Communities against fraud
and other irregularities.
To this end, the Contractor undertakes to give appropriate access to staff or

agents of the bodies mentioned under the first paragraph of the present Clause
to the sites and locations at which the Contract is carried out, including its in-
formation systems, as well as all documents and databases concerning the tech-
nical and financial management of the project and to take all steps to facilitate
their work. Access given to agents of the said bodies shall be on the basis of
confidentiality with respect to third parties, without prejudice to the obligations
of public law to which they are subject. Documents must be easily accessible
and filed so as to facilitate their examination and the Contractor must inform
the Employer of their precise location.
The Contractor guarantees that the rights of the bodies mentioned under the
first paragraph of the present Clause to carry out audits, checks and verifica-
tion will be equally applicable, under the same conditions and according to the
same rules as those set out in this Clause, to any sub-contractor or any other
party benefiting from European Commission funds.”
4.4 Dispute Adjudication Agreement

It is advisable to include a number of amendments to the General Conditions of
Dispute Adjudication Agreement. Such amendments should be included in
Clause 2 of the Dispute Adjudication Agreements. These are:
Clause 3 Warranties – second paragraph – letter (c)

There might be a lack of qualified DABs fluent in the Romanian language. In
case the language for communications defined in the Contract is Romanian, it
could be specified:
“fluent in the language for communications defined in the Contract or assisted,
whenever necessary, by a qualified translator.”
Clause 6 Payment
Replace letter (c) of first paragraph by:
“a fixed per diem for expenses incurred in connection with the Member's du-
ties, for each overnight away from the Member’s home and covering the cost of
hotel, subsistence costs, local travel and other miscellaneous costs”

And add letter (e) to the first paragraph:

(e) “other reasonable expenses incurred in connection with the Member's du-
ties, such as the cost of telephone calls, courier charges, faxes and telexes, in-
ternational travel expenses, facilities and venues for meetings and hearings: a
receipt shall be required for each item. Any air travel must be by economy class
while train travel may be by 1st class.”
Replace second paragraph by:

“The retainer and daily fees, as well as the per diem rate, shall be as specified
in the Dispute Adjudication Agreement. Unless it specifies otherwise, these fees
shall remain fixed for the first 24 calendar months, and shall thereafter be ad-
justed, at each anniversary of the date on which the Dispute Adjudication
Agreement became effective, using the following revision formula: (specify
relevant index and formula).”
Replace third paragraph by:

“The Member shall submit invoices for payment of the monthly retainer quar-
terly. Invoices for other expenses and for daily fees shall be submitted following
the conclusion of a site visit or hearing. All invoices shall be accompanied by a
brief description of activities performed during the relevant period and shall be
addressed to the Contractor.”

4.5 Guidance for Appendix to Tender

A template for the Appendix to Tender is shown in Appendix D2. Following
issues shall be covered by the Appendix to Tender:
Employer 1.1.2.2 & 1.3

Contractor 1.1.2.3 & 1.3
Engineer 1.1.2.4 & 1.3
Time for Completion 1.1.3.3
Defects Notification Period 1.1.3.7
Electronic Transmission 1.3
Governing Law 1.4
Ruling Language 1.4
Language for Communications 1.4
Time for Access to Site 2.1
Performance Security 4.2
Normal Working Hours 6.5
Delay Damages 8.7 & 14.15(b)
Maximum Amount of Delay 8.7
Damages
Provisional Sums 13.5(b)
Adjustment of Changes in Cost 13.8
Advance Payment 14.2
Repayment of Advance 14.2(a) and (b)
Percentage of Retention 14.3
Plant and Materials 14.5(b) and (c)
Interim Payment Certificate 14.6
Currency of Payment 14.15
Insurance 18.1
18.2(d)
18.3
DAB 20.2 & 20.3

5 The FIDIC Yellow Book
5.1 Introduction
of Contract and the Appendix to Tender for works contracts using the FIDIC
Conditions of Contract for Plant and Design-Build, 1st Edition 1999, i.e. the
FIDIC Yellow Book.
ber 2006.
Mandatory and additional particular conditions of contract for the FIDIC Yel-
low Book, necessary so as to harmonise the contract provisions with the current
Romanian legislation, were prepared in October 2006 to January 2007 and was
submitted to the MPF in January 2007.
proposed mandatory and additional particular conditions will, after approval by
This Guide comprises guidance and proposals for the proposed mandatory and
additional particular conditions of contract.
5.2 FIDIC Guidance

In the preparation of the General Conditions of Contract for Plant and Design-
Build, it was recognized that, while there are many sub-clauses which will be gen-
erally applicable, there are some sub-clauses which must necessarily vary to
take account of the circumstances relevant to the particular contract. The sub-
clauses which were considered to be applicable to many (but not all) contracts
have been included in the General Conditions, in order to facilitate their incorpo-
ration into each contract.
The General Conditions and the Particular Conditions will together comprise the
Conditions of Contract governing the rights and obligations of the parties. It will
be necessary to prepare the Particular Conditions for each individual contract,
and to take account of those sub-clauses in the General Conditions which men-
tion the Particular Conditions.

For this publication, the General Conditions were prepared on the following
basis:
i. Interim payments, in respect of the lump sum Contract Price, will be
made as work proceeds, and will typically be based on instalments speci-
fied in a schedule
ii. If the wording in the General Conditions necessitates further data, then
(unless it is so descriptive that it would have to be detailed in the Em-
ployer's Requirements) the sub-clause makes reference to this data being
contained in the Appendix to Tender, the data either being prescribed by
the Employer or being inserted by the Tenderer
iii. Where a sub-clause in the General Conditions deals with a matter on
which different contract terms are likely to be applicable for different con-
tracts, the principles applied in writing the sub-clause were:
(a) Users would find it more convenient if any provisions which they
did not wish to apply could simply be deleted or not invoked, than if
additional text had to be written (in the Particular Conditions) because
the General Conditions did not cover their requirements; or
(b) In other cases, where the application of (a) was thought to be inap-
propriate, the sub-clause contains the provisions which were consid-
ered applicable to most contracts.
For example, Sub-Clause 14.2 [Advance Payment] is included for convenience,

not because of any FIDIC policy in respect of advance payments. This Sub-
Clause becomes inapplicable (even if it is not deleted) if it is disregarded by not
specifying the amount of the advance. It should therefore be noted that some of
the provisions contained in the General Conditions may not be appropriate for
an apparently-typical contract.
Further information on these aspects, example wording for other arrangements,

and other explanatory material and example wording to assist in the preparation
of the Particular Conditions and the other tender documents, are included within
this publication as Guidance for the Preparation of the Particular Conditions.
Before incorporating any example wording, it must be checked to ensure that it is
wholly suitable for the particular circumstances; if not, it must be amended.
Conditions. It is essential that all these drafting tasks, and the entire preparation
of the tender documents, are entrusted to personnel with the relevant expertise,
including the contractual, technical and procurement aspects.
This publication concludes with example forms for the Letter of Tender, the Ap-
pendix to Tender (providing a checklist of the sub-clauses which refer to it), the
Contract Agreement, and alternatives for the Dispute Adjudication Agreement.
This Dispute Adjudication Agreement provides text for the agreement between
the Employer, the Contractor and the person appointed to act either as sole adjudi-
cator or as a member of a three-person dispute adjudication board; and incorpo-
rates (by reference) the terms in the Appendix to the General Conditions.

In addition, FIDIC has published a contracts guide to the use of its Conditions
of Contract for Construction, for Plant and Design-Build, and for EPC/Turnkey
Projects.
In order to clarify the sequence of Contract activities, reference may be made to

the charts on the next two pages and to the Sub-Clauses listed below (some Sub-
Clause numbers are also stated in the charts). The charts are illustrative and must
not be taken into consideration in the interpretation of the Conditions of Con-
tract.
1.1.3.1 & 13.7 Base Date

1.1.3.2 & 8.1 Commencement Date
1.1.6.6 & 4.2 Performance Security
1.1.4.7 & 14.3 Interim Payment Certificate
1.1.3.3 & 8.2 Time for Completion (as extended under 8.4)
1.1.3.4 & 9.1 Tests on Completion
1.1.3.5 & 10.1 Taking-Over Certificate
1.1.3.6 & 12.1 Tests after Completion (if any)
1.1.3.7 & 11.1 Defects Notification Period (as extended under 11.3)
1.1.3.8 & 11.9 Performance Certificate
1.1.4.4 & 14.13 Final Payment Certificate
Figure 5-1 Sequence of Principal Events

Figure 5-2 Sequence of Payment Events
Figure 5-3 Sequence of Dispute Events
5.2.1 Introduction
The Conditions of Contract for Plant and Design-Build - the FIDIC Yellow
Book - have been prepared by the FIDIC and are recommended for general use
for the procurement (including design, manufacture, delivery and installation)
of plant, and for the design and execution of building or engineering works,
where tenders are invited on an international basis.
Modifications to the Conditions are required to be fully adapted to the current

Romanian legislation.
Under the usual arrangements for these types of contract, the Contractor is re-
sponsible for the design and provision, in accordance with the Employer's re-
quirements, of plant and/or building and/or engineering works.

The guidance hereafter is intended to assist writers of Particular Conditions by

giving options for various sub-clauses where appropriate. Before incorporating
any example wording, it must be checked to ensure that it is wholly suitable for
the particular circumstances. Unless it is considered suitable, example wording
should be amended before use.
Conditions.
In the preparation of the Conditions of Contract to be included in the tender

documents for a contract, the following text can be used:
“The Conditions of Contract comprise the "General Conditions", which form

part of the "Conditions of Contract for Plant and Design-Build" First Edition
1999 published by the Fédération Internationale des Ingénieurs-Conseils
(FIDIC), and the following "Particular Conditions", which include amend-
ments and additions to such General Conditions.”
There are no sub-clauses in the General Conditions which require data to be

included in the Particular Conditions. The General Conditions refer to any nec-
essary data being contained in the Appendix to Tender or (for technical matters)
in the Employer's Requirements.
5.2.2 Preparation of Tender Documents

The tender documents should be prepared by suitably-qualified engineers who
are familiar with the technical aspects of the required works, and a review by
suitably-qualified lawyers may be advisable.
The tender documents issued to tenderers will consist of the Conditions of Con-
tract, the Employer's Requirements, and the Letter of Tender and Schedules for
completion by the Tenderer.
In addition, each of the Tenderers should receive the data referred to in Sub-
Clause 4.10, and the Instructions to Tenderers to advise them of any matters
which the Employer wishes them to include in their Proposal but which do not
form part of the Employer's Requirements for the Works. The Contract will
then include the accepted Proposal and completed Schedules.
The Employer's Requirements

The Employer's Requirements should specify the particular requirements for
the completed Works, including functional requirements, quality and scope,
and may require the Contractor to supply certain items, such as consumables
which could be listed in a Schedule. The matters referred to in some or all of
the following Sub-Clauses might be included:
1.8 Number of copies of Contractor's Documents
1.13 Permissions being obtained by the Employer
2.1 Phased possession of foundations, structures, plant or means of access
4.1 Intended purposes for which the Works are required

4.6 Other contractors (and others) on the Site

4.7 Setting-out points, lines and levels of reference
4.14 Third parties
4.18 Environmental constraints
4.19 Electricity, water, gas and other services available on the Site
4.20 Employer's Equipment and free-issue material
5.1 Criteria for design personnel
5.2 Contractor's Documents required, and whether for approval
5.4 Technical standards and building regulations
5.5 Operational training for the Employer's Personnel
5.6 As-built drawings and other records of the Works
5.7 Operation and maintenance manuals
6.6 Facilities for Personnel
7.2 Samples
7.4 Testing during manufacture and/or construction
9.1 Tests on Completion
9.4 Damages for failure to pass Tests on Completion
12.1 Tests after Completion
12.4 Damages for failure to pass Tests after Completion
13.5 Provisional Sums.
The Appendix to Tender

Many sub-clauses in the General Conditions make reference to data being con-
tained in the Appendix to Tender, providing a convenient location for the data
which is usually required. The example form in Appendix F2 provides a check-
list of the data required; but there is no indication, either in the General Condi-
tions or in the example Appendix to Tender, that this data is either prescribed
by the Employer or inserted by the Tenderer. The Employer should prepare the
Appendix to Tender, based on this example form, with the elements completed
to the extent of his requirements.
The Employer may require other data from Tenderers, and include a question-
naire in the Schedules.
The Instructions to Tenderers

The Instructions to Tenderers may need to specify any constraints on the com-
pletion of the Appendix to Tender and/or Schedules, and/or specify the extent
of other information which each Tenderer is to include with his Tender. If each
Tenderer is to produce a parent company guarantee and/or a tender security,
these requirements (which apply prior to the Contract becoming effective)
should be included in the Instructions to Tenderers: example forms are annexed
to this document in Appendix E1. The Instructions may include matters re-
ferred to in some or all of the following Sub-Clauses:
4.3 Contractor's Representative (name and curriculum vitae)
4.9 Quality Assurance system
9.1 Tests on Completion
12.1 Tests after Completion
18 Insurances
20 Resolution of disputes
A design-build contract may constitute a turnkey contract and include design,

construction, fixtures, fittings and equipment, the scope of which should be de-

fined in the Employer's Requirements. Full consideration should be given to

detailed requirements, such as the extent to which the Works are to be fully
equipped, ready for operation, with spare parts and consumables provided for
operation (for a specified period), typically by the Employer. In addition, the
Contractor may be required to operate the Works, either for a few months' trial
operation under Sub-Clause 9.1(c), or for some years' operation.
Understandably, the tenderers are often reluctant, in the face of intense compe-
tition, to incur great expense in preparation of tender designs. When preparing
the Instructions to Tenderers, thought should be given as to the extent of detail
which tenderers can realistically be expected to prepare and include in their
tenders. The extent of detail required should be described in the Instructions to
Tenderers. Note that there can be no description in the documents which will
constitute the Contract.
Consideration may be given to offering some remuneration to tenderers if, in

order to provide a responsive Tender, they have to undertake studies or carry
out design work of a conceptual nature.
5.3 Particular Conditions Clause-by-Clause Guidance

of contract for the FIDIC Yellow Book, with a clause-by-clause review.

It will be necessary to amend some of the definitions, due to Romanian legisla-
tion in force, the requirements of the Romanian procurement legislation and for
clarification of the general conditions.
The following definitions should be modified:

• In Sub-Clause 1.1.1.1 the definition of Contract shall reflect the deletion of
Letter of Acceptance. Under Romanian public procurement regulations,
the Contract is formed by the execution of the Contract Agreement after
lapse of a mandatory minimum time period from the communication of the
letter of award by the Employer to the Contractor (Article 205 of GEO No.
34/2006, Article 94 of GD No. 925/2006). The amendment of such defini-
tion is set out in the mandatory particular conditions in Appendix B1.
• In Sub-Clause 1.1.1.3 the definition of Letter of Acceptance shall be de-
leted.
• In Sub-Clause 1.1.3.1 the definition of the "Base Date" may be changed to
reflect a particular calendar date.
• In new Sub-Clause 1.1.3.10 a definition of the "Taking-Over Minutes on
Completion of Works" shall be included to reflect the process of taking
over of works by a commission to be appointed by the Employer in accor-
dance with Romanian regulations (Article 15 of GD No. 273/1994). Such
definition is set out in the mandatory particular conditions in Appendix B1.

• In new Sub-Clause 1.1.3.11 a definition of the "Final Taking-Over Min-

utes" shall be included to reflect the process of final taking over of works
by a commission to be appointed by the Employer in accordance with Ro-
manian regulations (Article 36 of GD No. 273/1994). Such definition is set
out in the mandatory particular conditions in Appendix B1.
• In Sub-Clause 1.1.4.1 the definition of the "Accepted Contract Amount"
shall be modified in order to reflect the deletion of the Letter of Accep-
tance.
• In Sub-Clause 1.1.4.6 the "Foreign Currency" should be indicated.
• In Sub-Clause 1.1.4.8 "Local Currency" should be defined as RON (Ro-
manian Leu).
• In Sub-Clause 1.1.6.2 "Country" should be defined as Romania.
• In Sub-Clause 1.1.6.5 “Applicable Laws” should be defined as all Roma-
nian legislation, laws, ordinances, decisions, orders and other laws and
regulations and by-laws of any legally constituted public authority having
the force of law in Romania.
• Sub-Clause 1.1.6.7 "Site". It has to be mentioned that the Contractor’s site
installation would in many cases not be part of the Site as defined under
the Contract.

If the references to "profit" are to be more precisely specified, Sub-Clause 1.2
may be varied. Such provision is recommended so as to provide a clear refer-
ence during implementation, in particular when evaluating claims.
“In these Conditions, provisions including the expression “Cost plus reason-
able profit” require this profit to be one-twentieth (5%) of the respective Cost.”

Attention is drawn on the importance of the requirements of the first sentence
of the last paragraph that, although applicable in many sub-clauses, are not re-
peated in the General Conditions. Non-compliance might have serious conse-
quences.
Sub-Clause 1.4 - Law and Language


An order of precedence is usually necessary, in case a conflict is subsequently
found among the contract documents In Sub-Clause 1.5, the order of prece-
dence shall reflect the deletion of the Letter of Acceptance (Article 94(2) of GD
No. 925/2006), as well as the fact that, if during the performance of the Con-
tract, certain elements of the Contractor’s technical offer turn out to be non-
compliant with the requirements in the Specifications, the latter shall prevail.
(Article 95(2) of GD No. 925/2006). A proposed amendment is included in the
mandatory particular conditions in Appendix B1.
It is recommendable to integrate as part of the Contract (as documents listed

under letter (h) of the present Sub-Clause, significant components of the Con-

tractor’s proposal (key personnel, key equipment, method of works, outline of

quality assurance, traffic management and/or environmental management
plans), so as to ensure some enforceability to this proposal. Even if the Contract
clearly specifies the priority of documents, consistence of these with the tender
documents should be checked and corrections, if needed, should be introduced
prior to the Contract signature. Furthermore, in case a Contractor’s programme
is included in the Contract documents, it might be recommendable to state that
any reference to calendar dates is indicative only, especially if the Contract sig-
nature or the Commencement Date occur with delays against initial time sched-
ules.
Sub-Clause 1.6 - Contract Agreement

The first sentence of Sub-Clause 1.6 shall be deleted, in order to reflect the de-
letion of Letter of Acceptance.
The form of Contract Agreement should be included in the tender documents as

an annex to the Particular Conditions. An example form is included at the con-
tractual templates in Appendix E2.
Sub-Clause 1.7 - Assignment

If the Contract is concluded pursuant to a public procurement procedure, the
assignment of the whole or any part thereof by the Contractor (even with the
prior agreement of the Employer) is a sensitive issue, as it may be considered a
means of escaping the mandatory legal provisions on public procurement of
works. The template for works contracts set out in Form 5 attached to the Pro-
curement Guide allows the assignment of the works contract by the Contractor
with the prior agreement of the Employer, provided that the Contractor remains
liable towards the Employer for the performance of any obligations under the
works contract.
Sub-Clause 1.8 - Care and Supply of Documents

Sub-Clause 1.9 - Delayed Drawings or Instructions

Sub-Clause 1.10 - Employer's Use of Contractor's Documents

Amendments to this Sub-Clause may be required if:
- The Employer will require more use of the Contractor's Documents
than as permitted in this Sub-Clause: the Contractor should then be
indemnified from liability which might arise from inappropriate use,
namely for a purpose not envisaged by the designer
- The Contractor's Documents will include computer software (pro-
grams) which the Employer will use other than as permitted in this
Sub-Clause; or
- Operation of the Works is subject to a process license.
Additional provisions may be required, if all rights to particular items of com-

puter software (for example) are to be assigned to the Employer. The provisions
should take account of the Applicable Laws.

Sub-Clause 1.11 - Contractor's Use of Employer's Documents

Sub-Clause 1.12 - Confidential Details

Sub-Clause 1.13 - Compliance with Laws

Employers should specify, when relevant, particular regulations to be complied
with by the Contractor. This should be done under the format: “Applicable
Laws of particular relevance for the Contract include, but are not limited to:
Law No. xxx”.
Under design-build arrangements, the issuance of the building permit by the

relevant authorities might require some time after submission and approval of
the Contractor’s design. Employers should make reference to such time period
so as to avoid claims from the Contractor. It is also recommended to precise the
scope of paragraph (b), for example with:
“Except for the building permit to be provided by the Employer, authorisa-

tions and/or permits required from relevant national/local authorities shall
be obtained by the Contractor, at his own expenses. Such permits include
inter alia permits for site erection, traffic diversions, route permits, resi-
dence and work permits, permits for radio communication, permits to relo-
cate public utilities, etc.
Within 21 days of the signature of the Contract Agreement, the Contractor

shall submit to the Engineer the detailed planning of the Works, together
with a list of all necessary permits with the time needed for obtaining those
permits in order to properly carry-out the Works in compliance with the
programme prepared and updated under Sub-Clause 8.3 [Programme].”
Sub-Clause 1.14 - Joint and Several Liability

For a major contract, detailed requirements for the joint venture may need to be
specified. For example, it may be desirable for each member to produce a par-
ent company guarantee: an example form is annexed to this document in the
templates of guarantees in Appendix E1.
These requirements, which apply prior to the Contract becoming effective,

should be included in the Instructions to Tenderers.
The Employer will wish the leader of the joint venture to be appointed at an
early stage, providing a single point of contact thereafter, and will not wish to
be involved in a dispute between the members of a joint venture. The Employer
should scrutinise the joint venture agreement carefully, and it may have to be
approved by the project's financing institutions.
New Sub-Clause 1.15 - Details to be Confidential

If confidentiality is required, an additional sub-clause may be added. The word-
ing of such Sub-clause could be as follows:

“The Contractor shall treat the details of the Contract Agreement as private
and confidential, except to the extent necessary to carry out his obligations
there under or to comply with applicable Laws. The Contractor shall not pub-
lish, permit to be published, or disclose any particulars of the Works in any
trade or technical paper or elsewhere without the prior written agreement of
the Employer.”

Sub-Clause 2.1 - Right of Access to the Site
If right of access cannot be granted, both early and thereafter exclusively, de-
tails should be given. Employers shall be particularly careful in relation with
this sub-clause, as non-compliance with their obligations under the present sub-
clause is a substantial failure and may lead to Termination by the Contractor
under Sub-Clause 16.2.
In case right of access is to be granted by stages, it could be desirable to define

Sections (in the Appendix to Tender) and define in this sub-clause the time for
provision of right of access for each Section.
In case right of access and possession is not to be granted exclusively, this

should be clearly stated, with all particulars.
In case right of access and possession will be granted only for limited sections
and/or for limited duration (such as in the case of rail rehabilitation works), the
Employer should state this and define the procedure that will be applied as well
as the main constraints / parameters.
The Site does not include additional working areas that the Contractor might
require, as defined under sub-clause 4.23. However, in the particular case of
temporary diversions specifically required by the Employer (for example in the
case of bridge works), the required land should be made available by the same
Employer.
It is also recommendable to specify what possession of Site implies as regards

operation and maintenance of facilities on Site and as regards traffic.
Sub-Clause 2.2 - Permits, Licences or Approvals

With reference to paragraph (a), it is good practice to include in tender and then
contract documents, and particularly in the Employer’s Requirements, all rele-
vant information. References to laws and standards should be included for for-
mal reasons, but the contract documents should be, as much as possible, self-
sufficient, so as to avoid facilitate access to the market.
Sub-Clause 2.3 - Employer's Personnel

These provisions should be reflected in the Employer's contracts with any other
contractors on the Site.
The work to be carried out by these other contractors should be described in the
tender documents, and aspects such as co-ordination and safety may need to be
specified.

Sub-Clause 2.4 - Employer's Financial Arrangements

It is possible, for example for long term contracts, to introduce a more precise
definition of what will be considered as reasonable evidence. However, it is
recommended not to delete this Sub-Clause entirely, as contractors would be
concerned by such cancellation. The anticipation of a risk in this regard would
then reflect on the prices.
It has to be noted that this Sub-Clause plays its role mainly when large costs
overruns are occurring (including due to Contractor’s claims), as Employers are
generally expected to have secured funding corresponding to the Accepted
Contract Amount before the signature of the contract.
Sub-Clause 2.5 - Employer's Claims

It has to be underlined that under sub-clause 14.7, the Employer is not allowed
to make deductions from the amounts certified by the Engineer (the mandatory
particular conditions allow however arithmetical mistakes to be corrected).
Therefore, the procedure defined in the present sub-clause has to be used in
case the Employer disagrees with an amount certified or wishes to apply vari-
ous penalties (such as delay damages).
5.3.3 Clause 3 - The Engineer

Sub-Clause 3.1 - Engineer's Duties and Authority
Any requirements for Employer's approval should be set out in the Particular
Conditions.
This list should be extended or reduced as necessary. If the obligation to obtain

the approval of the Employer only applies beyond certain limits, financial or
otherwise, the example wording should be varied.
It is clear that the Engineer has the role defined in very general terms in Article
21 paragraph d) of Law No. 10/1995. However, the Conditions of Contract
provide for several additional duties and authority.
Employers might want to limit the authority of the Engineer, in order to main-
tain control on some of the main features. Such limitations should (i) be spe-
cifically detailed in the Particular Conditions and (ii) truly correspond to those
mentioned in the Engineer’s contract.
In addition to those limitations included in the mandatory particular conditions

(Appendix B1) and deriving from the applicable Romanian legislation, Em-
ployers might want to add, for example:
a) Sub-Clause 4.4: Specific approval of the Employer is required before issu-
ing consent for any Sub-Contractor; (alternatively, this obligation could be
limited to major Sub-Contractors, that is those providing more than x% of
the Accepted Contract Amount)
b) Sub-Clause 8.4 and/or Sub-Clause 13.1: Specific approval of the Employer
is required before instructing or approving any extension of the Time for
Completion

c) Sub-Clause 13.1: Specific approval of the Employer is required before in-

structing or approving the omission of any work.
Attention of the Employers is drawn on the fact that such prior approval trans-
fers responsibility from the Engineer to the Employer.
It is also recommendable to add the following precisions, or similar:
“Notwithstanding the obligation, as set out above, to obtain approval, if, in the
opinion of the Engineer, an emergency occurs affecting the safety of life or of
the Works or of adjoining property, he may, without relieving the Contractor of
any of his duties and responsibilities under the Contract, instruct the Contrac-
tor to execute all such work or to do all such things as may, in the opinion of
the Engineer, be necessary to abate or reduce the risk. The Contractor shall
forthwith comply with any such instruction of the Engineer. The Engineer shall
determine an addition to the Contract Price, in respect of such instruction, in
accordance with Clause 13.1 and shall notify the Contractor accordingly, with
a copy to the Employer.”
Sub-Clause 3.2 - Delegation by the Engineer

Sub-Clause 3.3 - Instructions of the Engineer

Attention is drawn on the following provision:
“The Contractor shall only take instructions from the Engineer, or from an as-
sistant to whom the appropriate authority has been delegated under this
Clause.”
Therefore, under the Contract, other entities are not to issue instructions di-
rectly to the Contractor.
Sub-Clause 3.4 - Replacement of the Engineer

Sub-Clause 3.5 - Determinations

Attention is drawn on two issues:
- As per Sub-Clause 1.3, determinations should not be unreasonably
withheld or delayed. In general, claims should be dealt with in a
timely manner. Employers might consider introducing a time limit for
issuing determinations.
- Determinations enter into force immediately.
In practice, the Engineer could issue an interim determination before issuing a

final one, in order to avoid delays, while waiting for additional supporting par-
ticulars.
New Sub-Clause 3.6 - Management Meetings

It is recommendable to introduce reference to management meetings, for exam-
ple with the following:

“The Engineer or the Contractor’s Representative may require the other to at-
tend a management meeting in order to review the arrangements for future
work. Such meetings shall take place on a monthly basis. The Engineer shall
record the business of management meetings and supply copies of the record to
those attending the meeting and to the Employer, within two working days from
the meeting. In the record, responsibilities for any actions to be taken shall be
in accordance with the Contract.
The agenda for such meetings shall cover a review of progress attained, a re-
view of schedules and plants for future activities, the status of staffing, engi-
neering, safety, equipment, material supply, payments, current and anticipated
difficulties, interface with other Contractors, claims for extras, and other perti-
nent topics. Time and place of these meetings shall be mutually agreed taking
into consideration the subject to be discussed.”

Sub-Clause 4.1 - Contractor's General Obligations
Occasionally, there may be an item of Temporary Works for which the Con-
tractor will not be fully responsible. For example, the Contract may specify
temporary arrangements for river diversion which have been designed by the
Engineer. In these cases, the Sub-Clause may require amendment, taking ac-
count of the type of this item of Temporary Works, and of the extent of the
Employer's responsibility.

Sub-Clause 4.2 needs to be amended in order to comply with Romanian public
procurement regulations on the submission and release of the Performance Se-
curity (Articles 87(b) and 92(4) of GD No. 925/2006). The proposed amend-
ments are included in the mandatory particular conditions in Appendix B1.
In order to avoid the risk of termination for failure by the Contractor to submit
the Performance Security, it is recommended to request submission of the Per-
formance Security at the signature of the Contract Agreement.
The value of the Performance Security is normally based on the Accepted Con-
tract Amount. As per the provisions of Article 89 paragraph (2) of GD No.
925/2006, it cannot exceed 10% of the Contract Price VAT excluded. For large
projects with possibly important cost-overruns, it is recommendable to add the
following text at the end of this Sub-Clause:
“Whenever the Engineer determines that the Contract Price exceeds the Ac-
cepted Contract Amount or the Contract Price previously determined for the
purposes of this Sub-Clause, by more than ten (10%) percent, the Contractor,
at the Engineer’s written request, shall promptly increase the value of the Per-
formance Security by an equal percentage.”
To avoid difficulties in case of Joint Ventures, it is recommended to include:
“The Performance Security of a joint venture or consortium shall specify the

name of the joint venture or consortium.”

The acceptable form(s) of Performance Security should be included in the ten-

der documents, annexed to the Particular Conditions. Example forms are an-
nexed to this document in the templates of guarantees in Appendix E1.
They incorporate the Uniform Rules published by the International Chamber of

Commerce (the "ICC", which is based at 38 Cours Albert 1er, 75008 Paris,
France), which also publishes guides to these Uniform Rules.
In case the Employer is not prepared to accept another form of security than the
one annexed to the Particular Conditions, it should amend the second sentence
of the second paragraph of Sub-Clause 4.2 as follows:
“The Performance Security shall be issued by an entity and from within a coun-
try (or other jurisdiction) approved by the Employer, and shall be in the form
annexed to the Particular Conditions.”

If the Representative is known at the time of submission of the Tender, the Ten-
derer may propose the Representative. The Tenderer may wish to propose al-
ternatives, especially if the contract award seems likely to be delayed. If the
ruling language is not the same as the language for day to day communications
(under Sub-Clause 1.4), or if for any other reason it is necessary to stipulate
that the Contractor's Representative shall be fluent in a particular language, one
of the following sentences may be added.
The role of the Contractor’s Representative should be highlighted. Not only his
nomination, but also his revocation has to receive the prior consent of the Engi-
neer.
In order to ensure that a properly nominated Contractor’s Representative is

available at all times, it is possible to specify (under Sub-Clause 14.3) that
Statements have to be signed by the Contractor’s Representative so as to be
taken into consideration.
It is also recommendable to make reference to the key qualifications required at

the time of tender.
Sub-Clause 4.4 - Subcontractors

The wording in the General Conditions includes the conditions which will usu-
ally be applicable.
However, under Romanian public procurement regulations, if parts of the

Works are to be performed by Subcontractors, at the signature of the Contract
Agreement, the Contractor must provide the Employer with the relevant sub-
contracts, which must comply with the terms of the Tender and shall constitute
Schedules to the Contract (Article 96 (1) of GD No. 925/2006). Moreover, the
Contractor may not replace any of the Subcontractors designated in the Tender
without the prior consent of the Engineer (Article 96 (2) of GD No. 925/2006).

Please also note that, according to the same Article 96 (2) of GD No. 925/2006,
replacement of Subcontractors nominated in the Tender must not lead to modi-
fication of the initial technical or financial offer of the Contractor.
The proposed modification is included in the mandatory particular conditions in

Appendix B1.
On a case-by-case basis, Employers might want to define a maximum limit of

sub-contracting (for example 50% of the value of the Works). In such case, this
amount should be clearly stated, typically in the Appendix to Tender.
Replace the first sentence of Sub-Clause 4.4 with:
“The Contractor shall not subcontract a larger value of the Works than the
maximum specified in the Appendix to Tender.”
Subject to the mandatory provisions of the Romanian public procurement regu-

lations, the Engineer’s prior consent for subcontractors might lead to excessive
administration. It is therefore possible to limit such requirement, as follows:
At the end of point (b), add the following:
“Such prior consent shall not be required if the value of the subcontract is less
than one percent (1%) of the Contract Price.”
Furthermore, it is recommendable, for transparency reasons, to detail on which

criteria consent will be given. Such criteria might include:
- Personal situation (no bankruptcy or similar proceedings, no final sen-
tence for professional misconduct, fulfilled obligations as per payment
of taxes and social contributions),
- Sound financial position,
- Experience in similar projects (for the type of works intended to be
performed by the proposed Subcontractor), etc.
Sub-Clause 4.5 - Nominated Sub-Contractors

In most cases under Sub-Clause 4.4, the Contractor selects Subcontractors, sub-
ject to any constraints specified in the Contract. Sub-Clause 4.5 provides for the
particular situation whereby the Employer may select a Subcontractor, although
the Contractor remains responsible for any act or default of Subcontractors, ac-
cording to Sub-Clause 4.4.
As regards the second sentence of this Sub-Clause 4.5, details may be given as
to what would be considered as a reasonable objection.
The attention of Employers is drawn on the fact that Nominated Subcontractors

shall be nominated further to a selection procedure in full accordance with the
relevant procurement legislation. Before using this Sub-Clause, Employers
might also consider the conclusion of a separate contract.

Sub-Clause 4.6 - Co-operation

In case several contractors are working simultaneously on or near the Site, it is
highly desirable that the Employer’s Requirements describe the resulting con-
straints and procedures for co-ordination.
Sub-Clause 4.7 - Setting Out

Sub-Clause 4.8 - Safety Procedures

appropriate for him to provide some of the listed items. In these circumstances,
The requirements of paragraph (d) of the present Sub-Clause might need to be

reviewed in particular cases: it might not be appropriate to ensure fencing and
lighting of a road section, for example.
It is recommended to include at the end of this Sub-Clause provisions referring

to Traffic Management Plans and similar, when relevant.
“Within 28 days of the signature of the Contract Agreement, the Contractor

shall submit to the Engineer a detailed traffic management plan.
The traffic management plan shall indicate what measures will be implemented
to manage the traffic while Works are underway. Such plan shall describe, in
the form of a sketch accompanied by narrative details, the sequence of signs,
deviations, lighting, fence, etc, to be applied to each section of road with differ-
ent cross profile characteristics (2, 3 or 4 lanes), so that road users and ripar-
ian be protected. The traffic management plan shall be approved by the Engi-
neer before the start of the Works on any part of the Site.”
Approval by the Engineer will be granted only further to the approval by the
Road Police and by the Employer’s specialised services.
In case of default on the part of the Contractor in maintaining or implementing

such traffic management plan, as approved by the Engineer, on any part of the
Site, the Employer shall be entitled, subject to Sub-Clause 2.5, to payment by
the Contractor of the Cost of remedy measures or any higher amount depending
on actual damages.
Sub-Clause 4.9 - Quality Assurance

ted as part of the tender, this Sub-Clause should establish a link with the docu-
ments provided.

ted as part of the Tender, this Sub-Clause should establish a link with the
documents provided.

Sub-Clause 4.10 - Site Data

Under this Sub-Clause, Employers are required to make available all necessary
relevant data on sub-surface and hydrological conditions, usually as part of the
tender documents.
Sub-Clause 4.11 - Sufficiency of the Accepted Contract Amount

Sub-Clause 4.12 - Unforeseeable Physical Conditions

In the case of major sub-surface works, the allocation of the risk of sub-surface
conditions is an aspect which should be considered when tender documents are
being prepared. If this risk is to be shared between the parties, the Sub-Clause
may be amended by deleting sub-paragraph (b) of Sub-Clause 4.12 and substi-
tuting by:
“(b) Payment for any such Cost, per cent (….%) of which shall be included in
the Contract Price (the balance percent of the Cost shall be borne by the
Contractor).”
Sub-Clause 4.13 - Right of Way and Facilities

Sub-Clause 4.14 - Avoidance of Interference

Sub-Clause 4.15 - Access Route

This Sub-Clause has to be put in relation with Sub-Clause 2.1 and Sub-Clause
4.13. It is therefore assumed that an access route exists (but its suitability for
transport is not guaranteed by the Employer) and that the Contractor is entitled
to use it (even if this might imply some costs).
Sub-Clause 4.16 - Transport of Goods

For a plant contract, alternative arrangements may be appropriate.
Sub-Clause 4.17 - Contractor's Equipment

If the Contractor is not to provide all the Contractor's Equipment necessary to
complete the Works, the Employer's obligations should be specified: see Sub-
Clause 4.20. If vesting of Contractor's Equipment is required, further para-
graphs may be added, subject to their being consistent with applicable laws.
This Sub-Clause refers only to Equipment brought on Site. It might be advis-

able to extend it to Equipment brought to the Contractor’s site installation, if
this is not located on the Site.
Furthermore, it is recommendable to refer to the equipment proposed by the

Contractor as part of its tender:
“The Contractor shall use for the execution of the Works Equipment of not
lower quality and capacity than the Equipment proposed in the Tender and
listed in Schedule xx to the Contract.”

Sub-Clause 4.18 - Protection of the Environment

For Works to be executed in particularly environmentally sensible areas, Em-
ployers might want to include in this Sub-Clause a provision for indemnifica-
tion in case of default. For instance:
“In case of default on the part of the Contractor in meeting the requirements of
the present Sub-Clause, the Employer shall be entitled, subject to Sub-Clause
2.5, to payment by the Contractor of the Cost of remedy measures or any
higher amount depending on actual damages.”
Sub-Clause 4.19 - Electricity, Water and Gas

If services are to be available for the Contractor to use, the Employer’s Re-
quirements should give details, including locations and prices.
Sub-Clause 4.20 - Employer's equipment and Free-Issue Material

For this Sub-Clause to apply, the Employer’s Requirements should describe
each item which the Employer will provide and/or operate and should specify
all necessary details. With some types of facilities, further provisions may be
necessary, in order to clarify aspects such as liability and insurance.
In case Employers intend to use this Sub-Clause, for use of Employer’s Equip-
ment or of free issue materials, they should be very careful so as to ensure fair
and transparent conditions of competition. The exact conditions and prices for
Equipment should be detailed and disclosed to all tenderers, while detailed in-
formation regarding the quality and quantity of free issue materials, as well as
the time and place where they will be made available should be defined. It is
advisable to have those materials surveyed as part of the tender, so as to define
their condition and suitability for use.
In case the condition of free issue materials is not known before the execution
of the Works (for example when some materials are to be re-used), Employers
should ensure that all tenderers base their prices on the same assumptions and
that the mechanism for incorporation of such materials does not distort compe-
tition.
Sub-Clause 4.21 - Progress Reports

The progress report is one of the main supporting documents to be submitted
together with the Statements. The level of detail to be provided as part of the
progress reports might be adapted to the projects requirements.
The requirement to provide 6 copies might also be adapted.
Sub-Clause 4.22 - Security of the Site

appropriate for him to be responsible for its security. In these circumstances,
The provisions of the present Sub-Clause should be adapted from one project to
another in function of the configuration of the Site.

For example, in the case of a road rehabilitation project, it is recommendable to

precise that:
“For the purposes of this Sub-Clause, the road users and riparian shall not be
considered as unauthorised persons in the normal use of the road and access to
riparian properties. Such use and access shall be regulated as part of the Con-
tractor’s traffic management plan.”
Sub-Clause 4.23 - Contractor's Operations on Site

Sub-Clause 4.24 - Fossils

New Sub-Clause 4.25 – Works Diary

It is recommendable to add a new Sub-Clause [Works Diary](or integrate these
provisions with the ones of Sub-Clause 4.21 [Progress Reports] with subse-
quent description in the Employer’s Requirements.
“The Contractor shall draw up a works diary for contemporary records, in a

format agreed by the Engineer. The works diary shall be held on Site and the
Contractor’s Representative shall daily record the following information (as a
minimum):
1. Atmospheric conditions, the work breaks due to adverse meteorological
conditions, the working hours, the number and the qualification of the per-
sonnel working on Site, the supplied materials, the materials incorporated
into the works, the equipment out of order, the tests completed, the sent
samples, the unforeseen events, as well as verbal orders given to the Con-
tractor;
2. Attachments with detailed data on all elements which are checked on Site
and used for the calculation of the payments to the Contractor, such as
completed Works, actual quantities, supplies accepted for incorporation
into the works. These attachments are part of the Works diaries, but can be
signed, if need be, as separate documents.
3. List of any obstructions and other difficulties encountered by the Contrac-
tor in the execution of the Works, during the reported period.
At the Engineer’s request, the Contractor has to provide all necessary informa-
tion for the daily completion of the works diary and attachments.
The information provided is noted in the works diary and attachments, signed
by the Contractor’s Representative and countersigned by the Engineer or his
representative. The Contractor shall be responsible to ensure that adequate
back-up of this information is provided.
In case of disagreement on a subject noted in the works diary or attachments,

the Contractor has to inform in writing the Engineer about his remarks within
14 days from the date when the notice has been recorded in the works diary or
attachments”.

5.3.5 Clause 5 - Design

This Clause might be completed with an indication of the schedule for execu-
tion and submission of the design, depending on the part of the works to be de-
signed and on the level of detail. For instance, it is advisable to request the en-
tire design documents required for application for a building permit to be pro-
duced and submitted within a given time period, while detailed drawings might
be produced at a later stage.
Furthermore, the Employer’s Requirements shall define:

- Whether a review and / or approval process is required (for the pur-
pose of Sub-Clause 5.2)
- The extent of training required (Sub-Clause 5.5)
- Details regarding the as-built documents to be provided (Sub-Clause
5.6)
- Details regarding the operation and maintenance manuals (Sub-Clause
5.7).
Sub-Clause 5.1 - General Design Obligations

The Contractor commences by scrutinising the Employer's Requirements,
which may include an outline design. Such a design might have been necessary
to establish the feasibility of the project. Tenderers should be advised of the
extent to which the Employer's outline design is a suggestion or a requirement.
The first paragraph of this Sub-Clause should be amended for the purposes of
compliance with Article 13 of Law No. 10/1995 related to the verification of
design by duly certified design checker; refer to the mandatory particular condi-
tions in Appendix B1.
Sub-Clause 5.2 - Contractor's Documents

The "Contractor's Documents" are defined as the documents which the Contrac-
tor must submit to the Engineer, as specified elsewhere in the Contract, which
will not necessarily include (for example) all the technical documents which the
Contractor's Personnel will need in order to execute the Works.
The Employer's Requirements should specify the extent to which Contractor's

Documents are required, which of them are required for approval (not just re-
view), and the submission procedures. For example, it may be appropriate for
the Employer's Requirements for a plant contract to specify that the Contrac-
tor's Documents shall include drawings showing how the Plant is to be affixed
and any other information required for:
a) Preparing suitable foundations or other means of support,
b) Providing suitable access on the Site, for the Plant and any necessary
equipment, to the place where the Plant is to be erected, and/or
c) Making necessary connections to the Plant.
Different "review periods" may be specified, taking account of the time neces-
sary to review the different types of drawing, and/or of the possibility of sub-
stantial submissions at particular stages of the design-build process.

Sub-Clause 5.3 - Contractor's Undertaking

Sub-Clause 5.4 - Technical Standards and Regulations

Sub-Clause 5.5 - Training

Sub-Clause 5.6 - As-Built Drawings

Sub-Clause 5.7 - Operation and Maintenance Manuals

Sub-Clause 5.8 - Design Error

5.3.6 Clause 6 - Staff and Labour

Sub-Clause 6.1 - Engagement of Staff and Labour
It is advisable to link key personnel to be employed with the requirements of
the tender documents, for instance:
“The Contractor shall employ key personnel as proposed in the Tender and
listed in Schedule xx to the Contract. Any replacement personnel shall be at
least of equivalent qualification and experience.”
Sub-Clause 6.2 - Rates of Wages and Conditions of Labour

Sub-Clause 6.3 - Persons in the Service of Employer

Sub-Clause 6.4 - Labour Laws

According to the Guide, the Employer must clearly indicate in the tender
documents the mandatory rules regarding labour conditions and labour safety
which must be complied with throughout the performance of the Contract. Such
obligation is deemed to be complied with if the tender documents indicate the
relevant institutions wherefrom detailed information as regards the above men-
tioned regulations can be obtained.
The Employer should require Tenderers to indicate in the Tender the fact that
obligations related to labour conditions and labour safety were taken into con-
sideration in the preparation of the Tender.
Sub-Clause 6.5 - Working Hours

If the Employer does not wish to specify working hours in the Appendix to
Tender, or to restrict them to the times specified by the Tenderer (in order to
plan the Engineer's supervision, for example), this Sub-Clause may be deleted.

In some cases, requests of the Contractor to work outside the normal working
hours will have an impact on the activity of and required inputs from the Engi-
neer. This can be limited with:
“The personnel of the Contractor will not be allowed to perform the Works in
more than one shift, except for those activities requiring continuous presence
on Site, such as traffic management.”
Sub-Clause 6.6 - Facilities for Staff and Labour

If the Employer will make some accommodation available, his obligations to
do so should be specified.
Sub-Clause 6.7 - Health and Safety

Additional health and safety requirements might be necessary depending on the
type of works and related risks: railway, chemicals, etc.
Sub-Clause 6.8 - Contractor's Superintendence

Add the following text at the end of Sub-Clause 6.8:
“A reasonable proportion of the Contractor’s superintending staff shall have a
working knowledge of Romanian language. Otherwise the Contractor shall
have a sufficient number of competent interpreters available on Site during all
working hours.”
Add the following paragraphs at the end of Sub-Clause 6.8:

“(a) Foreign Staff and Labour
The Contractor may import any personnel who are necessary for the execution
of the Works. The Contractor must ensure that these personnel are provided
with the required residence visas and work permits. The Contractor shall be
responsible for the return to the place where they were recruited or to their
domicile of imported Contractor’s Personnel. In the event of the death in the
Country of any of these personnel or members of their families, the Contractor
shall similarly be responsible for making the appropriate arrangements for
their return or burial
(b) Alcoholic Liquor or Drugs

The Contractor shall not, import, sell, give, barter or otherwise dispose of any
alcoholic liquor or drugs, or permit or allow importation, sale, gift, barter or
disposal by Contractor’s Personnel.
(c) Arms and Ammunition

The Contractor shall not give, barter or otherwise dispose to any person, any
arms or ammunition of any kind, or allow Contractor’s Personnel to do so.
(d) Illegal Payments

Any commission, advantage, gift, gratuity, reward or bribe given, promised
or offered by or on behalf of the Contractor or his agent or servant or any
other person on his or their behalf or on behalf of any of them in relation to
the obtaining or to the execution of this or any other Contract with the Em-
ployer shall, in addition to any criminal liability which may be thereby in-
curred, subject the Contractor at the Employer's option to the cancellation

of this and of all other contracts which he may have entered into with the
Employer and also the payment of any loss or damage resulting from such
cancellation. Any amount paid shall be deducted from the Contractor's
payment due.”
Sub-Clause 6.9 - Contractor's Personnel

No need for particular conditions related to this sub-clause
Sub-Clause 6.10 - Records of Contractor's Personnel and Equipment

Sub-Clause 6.11 - Disorderly Conduct

5.3.7 Clause 7 - Plant Materials and Workmanship

Sub-Clause 7.1 - Manner of Execution
It is recalled that Materials are things to be supplied or form part of the Perma-
nent Works. The prohibition of “hazardous Materials” does not exclude haz-
ardous processes (covered under Sub-Clause 4.8).
Sub-Clause 7.2 - Samples

Sub-Clause 7.3 - Inspection

In case the Contractor shall cover the costs of testing by the Employer’s Per-
sonnel (including testing equipment, etc), this should be made clear in the Em-
ployer’s Requirements.
Sub-Clause 7.4 - Testing

Sub-Clause 7.5 - Rejection

Sub-Clause 7.6 - Remedial Work

Sub-Clause 7.7 - Ownership of Plant and Materials

Sub-Clause 7.8 - Royalties

“The Contractor shall also be liable for all payments or compensation, if any,
levied in relation to the dumping of part or all of such materials, waste piles,
debris and hazardous waste.”

5.3.8 Clause 8 - Commencement, delays and Suspension

Sub-Clause 8.1 - Commencement of Work
In the second sentence of the first paragraph of Sub-Clause 8.1 “Letter of Ac-
ceptance” shall be deleted and substituted with “Contract Agreement”.
Failure of the Employer to provide access to and possession of the Site in due
time might delay the Commencement Date and have serious consequences. It is
highly recommended not to sign any contract before compliance with Sub-
Clause 2.1 and Sub-Clause 8.1 is ensured.
In case Employers know that the Commencement Date for a part of the Works
will be delayed, it is advisable to define this part as a Section (in the Appendix
to Tender) and to define under the present Sub-Clauses different Commence-
ment Dates by Sections.
On the other hand, the last sentence defines strong obligations for the Contrac-
tor. For example, the Contractor should not stop the Works if it is able to work
on part of the Works.
Sub-Clause 8.2 - Time for Completion

It has to be highlighted that the expiry of the Time for Completion does not re-
lieve the Contractor from its obligation to perform the Works, nor the Employer
from its obligation to pay (with the possibility of claiming for delay damages as
per Sub-Clause 8.7). In case the Works are not completed during the Time for
Completion, there is no need to amend the Contract in any way, as the Contract
clearly describes how to handle this situation.

Sections, in the Appendix to Tender.

It has to be highlighted that the programme is not to be approved by the Engi-
neer and / or the Employer. The programme is primarily a document prepared
by the Contractor, under its full responsibility.
It is advisable to provide a time-limit for the submission of a revised pro-

gramme. Add the following sentences:
“Such revised programme shall be submitted within 21 days from the date of
the Engineer’s notice. Failure to comply with this provision shall entitle the
Employer, subject to Sub-Clause 2.5, to payment of damages by the Contrac-
tor.”
Sub-Clause 8.4 - Extension of Time for Completion

Sub-Clause 8.5 - Delays Caused by Authorities


Sub-Clause 8.6 - Rate of Progress

Employers sometimes complain that there is little control on the performance of
the Contractor before the end of the Time for Completion. It is therefore possi-
ble to include a “milestones system” along the example provided below. Before
using such system, Employers should however ensure that they will themselves
be in a position to meet their obligations under the Contract.
Compliance of the progress of the Works with the Contractor’s programme, as

submitted under the first paragraph of Sub-Clause 8.3 or revised under the third
paragraph of Sub-Clause 8.3, is controlled through a milestones system. This
system includes five milestones for monitoring and evaluation of the progress
of the Works. Milestone 1 is defined hereafter. The four other indicators shall
be agreed by the Contractor and the Engineer within 28 days from the submis-
sion of the Contractor’s work programme. In case no agreement is reached dur-
ing such period, the Engineer will define those four indicators. Such indicators
however shall be defined based on the Contractor’s work programme.
Milestone 1 is defined as the achievement of the following indicators, 28 days

after the Commencement Date:
- All Contractor key personnel are on Site,
- The Contractor work programme under the present Sub-Clause is
submitted,
- (Other items).
In case the Contractor incurs delays in the achievement of a milestone, the Em-
ployer will be entitled, subject to Sub-Clause 2.5, to withhold from the Interim
Payment Certificates an amount equal to 0.05% of the Accepted Contract
Amount per day of delay, up to a maximum of 10% of the Accepted Contract
Amount. The amount so withheld shall be paid to the Contractor, if and when
the milestone is reached. Any remaining monies so withheld shall be paid upon
the issue of the Taking-Over Certificate for the Works.
Whenever a revised programme is being submitted, the milestones have to be

updated in accordance with the provisions above.
Sub-Clause 8.7 - Delay Damages

Under many legal systems, the amount of these pre-defined damages must rep-
resent a reasonable pre-estimate of the Employer's probable loss in the event of
delay. If the Accepted Contract Amount is to be quoted as the sum of figures in
more than one currency, it may be preferable to define these damages (per day)
as the percentage reduction which would be applied to each of these figures. If
the Accepted Contract Amount is expressed in the Local Currency, the dam-
ages per day may either be defined as a percentage or be defined as a figure in
Local Currency: see Sub-Clause 14.15(b).
It is recalled that delay damages cannot be simply deducted by Employers from

Interim Payment Certificates but the Employer’s Claims procedure defined un-
der Sub-Clause 2.5 has to be followed.

It is also mentioned that these delay damages are the only damages due for such
default (late completion, except in the event of termination by the Employer.
This tends to restrict the constitution of “black lists” or other similar instru-
ments.
The usual practice is to limit the total amount of delay damages at a maximum
of 15% of the final Contract Price. For contracts where completion of the
Works by a certain date is of paramount importance, it might be envisaged to
(i) introduce a higher amount of delay damages, but also (ii) introduce a bonus
for acceleration.
It should also be noted that Employers might, in duly justified cases, waive
their rights to delay damages, or suspend the actual payment of such damages
by the Contractor until the completion of the Works, for example in case pay-
ment of such damages would create strong pressures on the Contractor’s cash
flow and would jeopardize the actual completion of the Works.
Sub-Clause 8.8 - Suspension of Work

It is highlighted that suspension may be instructed but does not necessarily
have to be instructed. For example, some categories of works should normally
be suspended under certain weather conditions (concreting or asphalt works
during winter time, etc).
Sub-Clause 8.9 - Consequences of Suspension

Sub-Clause 8.10 - Payment for Plant and Materials in Event of Suspension

Sub-Clause 8.11 - Prolonged Suspension

Sub-Clause 8.12 - Resumption of Work

New Sub-Clause
Incentives for early completion may be included in the tender documents (al-
though Sub-Clause 13.2 refers to accelerated completion).
5.3.9 Clause 9 - Tests on Completion

Sub-Clause 9.1 - Contractor's Obligations
The Employer's Requirements should describe the tests which the Contractor is
to carry out before being entitled to a Taking-Over Certificate. It may also be
appropriate for the Contractor's Proposal to include detailed arrangements, in-
strumentation, etc. If the Works are to be tested and taken-over in stages, the
tests requirements may have to take account of the effect of some parts of the
Works being incomplete.
The wording in the sub-paragraphs includes the conditions which are typically
applicable for a plant contract, but otherwise may require amendment. In par-

ticular, sub-paragraph (c) refers to trial operation, during which any product
produced by the Works becomes the property of the Employer. He thus be-
comes responsible for disposing of it, and entitled to retain the proceeds from
selling it. If the product is to be retained by the Contractor, the Sub-Clause
should be amended accordingly.


Sub-Clause 9.4 - Failure to Pass Tests on Completion

If the reduction referred to in the final paragraph, based on the extent of the
failure, is to be defined in the Particular Conditions or in the Employer's Re-
quirements, minimum acceptable performance criteria should also be specified.
5.3.10 Clause 10 - Employer's Taking-Over

Sub-Clause 10.1 - Taking Over of the Works and Sections
lations related to taking-over of Works set out mainly in GD No. 273/1994. The
Employer must nominate a taking-over commission (Article 7 of GD No.
Works (Article 15 of GD No. 273/1994). On the other hand, the issuance of the
Taking-Over Certificate is mandatory and therefore may not be presumed.

dix B1.
The role of the Engineer in the taking over commission is not defined. Unless
expressly forbidden by the Law, it might be recommendable that the Engineer
be nominated as representative of the Employer.
It remains for Employers and Engineers to agree on what exactly means “minor
outstanding work and defects which will not substantially affect the use of the
Works or Section for their intended purpose”.
If the Works are to be taken-over in stages, these stages should to be defined as

Sections, in the Appendix to Tender. Precise geographical definitions are ad-
visable, and the Appendix should include a table, so as to define the Time for
Completion and delay damages: the table is shown in the example Appendix.
Sub-Clause 10.2 - Taking Over of Parts of the Works

The Romanian regulations related to taking-over of parts of the Works (GD No.
273/1994, GD No. 925/2006) are reflected in the mandatory particular condi-
tions in Appendix B1.
Sub-Clause 10.3 - Interference with Tests on Completion


Sub-Clause 10.4 - Surfaces Requiring Reinstatement

5.3.11 Clause 11 - Defects Liability

Sub-Clause 11.1 - Completion of Outstanding Work and Remedying De-
fects
Sub-Clause 11.2 - Costs of Remedying Defects

Sub-Clause 11.3 - Extension of defects Liability Period

It is recommended to add:
“The Employer shall be entitled subject to Sub-Clause 2.5 to an extension of

the Defects Notification Period for the Works, a Section or a significant part of
the Works, if and to the extent that the Works, a Section, a major item of Plant
or significant part of the Works (as the case may be, and after taking over) can-
not be used for the purposes for which they are intended by reason of a defect
or damage. However, a Defects Notification Period shall not be extended by
more than two years.”
Sub-Clause 11.4 - Failure to Remedy Defects

Sub-Clause 11.5 - Removal of Defective Work

Sub-Clause 11.6 - Further Tests

Sub-Clause 11.7 - Right of Access

Sub-Clause 11.8 - Contractor to Search

Sub-Clause 11.9 - Performance Certificate

lations related to taking-over of Works set out mainly in GD No. 273/1994.
dix B1.
The issue of the Performance Certificate represents the acceptance of the

Works. It is therefore normal that the final payment and final evaluation of the
Contract Price) comes after such acceptance.
Sub-Clause 11.10 - Unfulfilled Obligations

Under Romanian law, the Contractor is liable for the latent defects of the
Works during a 10 year period, whilst his liability for defects affecting the

structure subsists during the lifetime of the Works (Article 29 of Law No.
10/1995). Such statutory periods of liability are acknowledged in the mandatory
particular conditions in Appendix B1.
Sub-Clause 11.11 - Clearance of Site

5.3.12 Clause 12 - Tests after Completion

Sub-Clause 12.1 - Procedure for Tests after Completion
The Employer's Requirements should describe the tests he requires, after tak-
ing-over, to verify that the Works fulfil his performance requirements. For
some types of Works, these Tests may be the most difficult to specify well, al-
though they are critical to a successful outcome. It may be appropriate for the
Contractor's Proposal to include detailed arrangements, and/or to define any
instrumentation required, in addition to that included in the Plant.
With many types of Works, it may be essential to define the physical inputs,
and/or for tenderers to prescribe (in a Schedule of Guarantees, probably) the
performance criteria which their Plant will achieve.
The provisions in the General Conditions are based upon the Tests after Com-
pletion being carried out by the Employer and his operating personnel, with
guidance from the Contractor's staff. If other arrangements are envisaged, they
should be specified in the Employer's Requirements, and the Sub-Clause should
be amended accordingly. For example, the provisions in FIDIC's Conditions of
Contract for EPC/Turnkey Projects are based upon these Tests being carried out
by the Contractor, with the Employer providing consumables, personnel and
power.


Sub-Clause 12.4 - Failure to Pass Tests after Completion

If the first part of this Sub-Clause is to apply, the method of calculating the
non-performance damages (based on the extent of the failure) should be defined
in the Particular Conditions or in the Employer's Requirements, and the mini-
mum acceptable performance criteria should also be specified.
5.3.13 Clause 13 - Variations and Adjustment

Variations can be initiated by any of three ways:
a) The Engineer may instruct the variation under Sub-Clause 13.1, without
prior agreement as to feasibility or price
b) The Contractor may initiate his own proposals under Sub-Clause 13.2,
which are intended to benefit both Parties, or

c) The Engineer may request a proposal under Sub-Clause 13.3, seeking prior
agreement so as to minimise dispute.

Several points have to be noted:
- Variations are initiated prior to the taking over,
- Variations are initiated by the Engineer (maybe at the request of the
Employer)
- Variations do not require to be signed or approved by the Contractor
and may be simply instructed. From this point of view, variations do
not have to be treated like an addendum. However, as any instruction,
variations have to be made or confirmed in writing
- Under the procurement legislation, additional works are to be treated
with considerable care. In particular, the conditions of Article 122 (i)
of GEO No. 34/2006 have to be met.
Sub-Clause 13.2 - Value Engineering

“The Contractor shall be fully responsible for any proposal made under this
Sub-Clause, including for the period required for its review and approval. The
Contractor shall not be entitled to any extension of time, Cost or profit related
to such period of review and approval.”
Sub-Clause 13.3 - Variation Procedure

Sub-Clause 13.4 - Payment in Applicable Currencies

Sub-Clause 13.5 - Provisional Sums

Although generally inappropriate for this type of contract, a Provisional Sum
may be required for parts of the Works which are not required to be priced at
the risk of the Contractor. For example, a Provisional Sum may be necessary to
cover goods which the Employer wants to select, or to deal with a major uncer-
tainty regarding sub-surface conditions. It is essential to define the scope of
each Provisional Sum (in a Schedule, probably), since the defined scope will
then be excluded from the other elements of the Accepted Contract Amount. If
a Provisional Sum is likely to be valued under Sub-Clause 13.5(b), the percent-
age should be quoted by tenderers in the Appendix to Tender.
It is recommended to modify point (b) (ii):
“A sum for overhead charges and profit, calculated as a percentage of these

actual amounts by applying the relevant percentage specified in the Appendix
to Tender.” Typically, a percentage of 5% is being used.
A new paragraph needs to be added at the end of this Sub-Clause reflecting the
obligation for the Contractor to comply with Romanian public procurement
regulations when purchasing Plant, Materials or services other than from a

nominated Subcontractor. The relevant wording is included in the mandatory

particular conditions in Appendix B1.
Sub-Clause 13.6 - Daywork

Sub-Clause 13.7 - Adjustment for Changes in Legislation

The possibility of such adjustments is foreseen in Article 97 paragraph (3) letter
(a) of GD No. 925/2006.
Sub-Clause 13.8 - Adjustment for Changes in Cost

These provisions for adjustments may be required if it would be unreasonable
for the Contractor to bear the risk of escalating costs due to inflation.
The possibility and principles of such adjustments are foreseen in Article 97 of

GD No. 925/2006. For any contract of duration of more than 12 months, it is
strongly recommended to include a price adjustment formula. Such formula
should be based on relevant indices published by authorised bodies, typically
by the National Institute of Statistics.
If the contract is intended to be at fixed rates, it is sufficient not to fill in any

“table of adjustment data”. However, in order to remove any ambiguity, it
might be preferable to clearly state that:
“The Tender and subsequently the Contract Amount shall have been based on
the Contractor’s projections for inflation over the implementation period. Thus
the Contract Price shall not be subject to any adjustment due to inflation, rise
or fall in the cost of labour, materials or any other matters affecting the execu-
tion of the Contract. Cases provided by clause 13.7 are not subject to this re-
striction.”
It should be noted that the proposed formula applies only for works performed
after the changes occurred (so it applies for what “remains to be executed” in
accordance with provisions of GD No. 925/2006). Actually the multiplier is
calculated for the works performed during month n.
5.3.14 Clause 14 - Contract price and Payment

Sub-Clause 14.1 - The Contract Price
amount and timing of payment(s) to the Contractor. A positive cash flow is
clearly of benefit to the Contractor, and tenderers will take account of the in-
terim payment procedures when preparing their tenders.
Normally, this type of contract is based on a lump sum price, with little or no
remeasurement. The Contractor thus takes the risk of changes in cost arising
from his design. The lump sum price may consist of two or more amounts,
quoted in the currencies of payment (which may, but need not, include the Lo-
cal Currency).

In order to value Variations, Tenders may be required to be accompanied by

detailed price break-downs, including quantities, unit rates and other pricing
information. This information can also be useful for the assessment of interim
payments. However, the information may not have been priced competitively.
When the tender documents are being prepared, the Employer must therefore
decide whether he will accept being bound by the tenderer's breakdowns. If not,
he should have ensured that the Engineer has the necessary expertise to value
any Variations which may be required.
Additional Sub-Clauses may be required to cover any exceptions to the options

set out in Sub-Clause 14.1, and any other matters relating to payment.
If Sub-Clause 14.1(a) is not to apply, the method of determining the Contract

Price should be defined in additional Sub-Clauses, as envisaged in the last sen-
tence of Sub-Clause 14.1. If payment for any part of the Works is to be made
on the basis of measurement, the part must be defined in the Contract, and the
following wording might be appropriate for one of the additional Sub-Clauses.
Sub-Clause 14.2 - Advance Payment

benefits of advance payment(s). Unless this Sub-Clause is not to apply, the total
advance payment (and the number of instalments if more than one) must be
specified in the Appendix to Tender.
This Sub-Clause needs be amended in order to reflect mandatory Romanian

regulations in respect of advance payments from the public funds (Law No.
500/2002 and GD No. 264/2003). Such amendments are included in the manda-
tory particular conditions in Appendix B1.

ments, annexed to the Particular Conditions: an example form is annexed to this
document, attached in Appendix E1.
If the Contractor is to provide major items of Plant, consideration should be

given to the benefits of stage payments during manufacture. The Employer may
consider it advisable to have some form of security, since these payments
would not relate to anything in his possession. If the Contractor is to be entitled
to stage payments prior to shipment, the tender documents may include:
a) Provisions in the Appendix to Tender linking the timing of advance pay-
ment (under this Sub-Clause) to the stages of manufacture
b) In the Schedule of Payments or other document to be used to determine the
contract value under Sub-Clause 14.3(a), a price for each of these stages
(this would require the addition of provisions for securities); or
c) Detailed amendments to Sub-Clause 14.5.
Sub-Clause 14.3 - Application for Interim Payment Certificate

It might be useful to better define which supporting documents would be re-
quired, in addition to the documents and information contained in the Contrac-
tor’s progress report.

In order to ensure that a duly appointed Contractor’s Representative will be

present at all time, it is possible to add the following sentence at the end of this
Sub-Clause:
“Any Statement under this Sub-Clause shall be signed by the Contractor’s Rep-
resentative duly appointed in accordance with Sub-Clause 4.3. In case a State-
ment is not signed by the duly appointed Contractor’s Representative, such
Statement shall be void and ineffective.”
Sub-Clause 14.4 - Schedule of Payments

The General Conditions contain provisions for interim payments to the Con-
tractor, which may be based on a Schedule of Payments. If another basis is to
be used for determining interim valuations, details should be added in the Par-
ticular Conditions. If payments are to be specified in a Schedule of Payments,
the "minimum amount of interim certificates" could be omitted from the Ap-
pendix to Tender, and the Schedule of Payments could be in one of the follow-
ing forms:
a) An amount (or percentage of the estimated final Contract Price) could be
entered for each month (or other period) during the Time for Completion,
which can prove unreasonable if the Contractor's progress differs signifi-
cantly from the expectation on which the Schedule was based; or
b) The Schedule could be based on actual progress achieved in executing the
Works, which necessitates careful definition of the payment milestones.
Disagreements may arise when the work required for a payment milestone
is nearly achieved but the balance cannot b completed until some months
later.
The figures inserted by the Tenderer in the Schedule of Payments may be com-
pared with his tender programme (if any), in order to assess whether they are
reasonably consistent with each other.
Alternatively, if the Works consist of only a few different types of operations, a

simple measurement approach for interim valuations may be appropriate.
In most cases, this Sub-Clause would apply only for the conditions of contract
for plant and design-build, and the Schedule would actually make reference to
actual progress. It is important to define such progress by reference to non-
ambiguous milestones. Situations in which payments depend on a rate of
achievement estimated by the Engineer without proper substantiation should be
avoided. It is therefore recommended to elaborate a Schedule that takes into
account the main steps of the Contract and the main “objects” in the design and
execution. Some objects might also be divided into sub-phases. In some cases,
tenderers would have to price each object. It is however preferable that the
“weight” of each sub-phase be defined in the tender documents.
Sub-Clause 14.5 - Plant and Materials intended for the Works

It is recalled that under Sub-Clause 7.7, Plant and Materials delivered to the
Site become the property of the Employer. It should be noted that the Site has a
precise definition and this does not necessarily include Contractor’s compound
and other installations.

Sub-Clause 14.6 - Issue of Interim Payment Certificates

the Contract (Law No. 500/2002) and affecting the issuance of Interim Payment
Certificates by the Engineer are reflected in the mandatory particular conditions
in Appendix B1.
Furthermore, several aspects need to be highlighted:

- The Engineer is bound by the time limit of 28 days for issue of an In-
terim Payment Certificate (failure to issue a Certificate in 56 days is a
reason for Termination by the Contractor under Sub-Clause 16.2),
- The Engineer is due to substantiate its determination, through the pro-
vision of supporting particulars,
- The Contractor is to be notified of the value of the Interim Payment
Certificate
- The Engineer shall give notice to the Contractor in case the value of a
Certificate would be less than the minimum value stated in the Ap-
pendix to Tender.
- Interim Payment Certificates are, by definition, interim. They do not
imply acceptance of any work and might be modified afterwards. Al-
though modifications of regarding works already certified should re-
main the exception, such works are considered as finally approved
only at the issue of the Performance Certificate.
Sub-Clause 14.7 - Payment

This Sub-Clause needs to be amended in order to reflect the deletion of Letter
of Acceptance, as well as the fact that issuance of an invoice by the Contractor
for each Interim Payment Certificate is mandatory under Romanian regulations.
pendix A1.
It has to be noted that the Employer is not entitled to modify any Payment Cer-
tificate, but in case of arithmetical mistakes. Any other claim of the Employer
has to be made in accordance with the procedure defined in Sub-Clause 2.5. It
also has to be noted that, in case the Employer considers that an undue payment
has been made, he can also include in his claim the related financing costs. The
scope of those provisions is to ensure that an adequate flow of cash is main-
tained.

When payments are made in Euro, it is useful to indicate that the central bank
of the Country is the European Central Bank, for example:
The financing charges for amount/s receivable not paid on the due date shall be
the interest rate applied by the European Central Bank to its principal refi-
nancing operations, as published in the C series of the Official Journal of the
European Communities, in force on the first calendar day of the month in
which the due date falls, increased by three and a half percentage points.

Sub-Clause 14.9 - Payment of Retention Money

In case the Employer agrees not to retain monies but to obtain a corresponding
bank guarantee, add the following paragraphs at the end of Sub-clause 14.9.
“The Contractor may request the payment of retention money against the sub-
mission to the Employer of a bank guarantee. In such case, the Engineer shall
certify and the Employer shall make payment to the Contractor of the amounts
related to Retention Money, after he obtains such guarantee, in a form and pro-
vided by an entity approved by the Employer, in amounts and currencies equal
to the payments to be made. The Contractor may gradually increase the amount
of the bank guarantee, in accordance with the estimates submitted under Sub-
Clause 14.4 [Schedule of Payments]. The amount of the bank guarantee shall
however be equal to the limit of Retention Money stated in the Appendix to
Tender when the total of all certified interim payments (excluding the advance
payment and deductions and repayments of retention) exceeds seventy per cent
(70%) of the Accepted Contract Amount less Provisional Sums.
The Contractor shall ensure that the guarantee is valid and enforceable until
the Contractor has executed and completed the Works and remedied any de-
fects, as specified for the Performance Security in Sub-Clause 4.2. The release
of the guarantee shall be in lieu of the release of the second half of the Reten-
tion Money under the second paragraph of Sub-Clause 14.9, while the Contrac-
tor shall be entitled, when the Taking-Over Certificate has been issued for the
Works, to a reduction of the amount of the bank guarantee corresponding with
the first half of the Retention Money.”

Appendix F1.
Sub-Clause 14.10 - Statement of Completion

Sub-Clause 14.11 - Application for Final Payment Certificate

Sub-Clause 14.12 - Discharge

Sub-Clause 14.13 - Issue of Final Payment Certificate

the Contract (Law No. 500/2002) and affecting the issuance of the Final Pay-
ment Certificate by the Engineer are reflected in the mandatory particular con-
ditions in Appendix B1.
Sub-Clause 14.14 - Cessation of Employer's Liability


Sub-Clause 14.15 - Currencies of Payment

If all payments are to be made in Local Currency, it must be named in the Let-
ter of Tender, and only the first sentence of this Sub-Clause will apply. Alterna-
tively, the Sub-Clause may then be replaced:
New Sub-Clause 14.16 Repayment

A new Sub-Clause 14.16 may be added:
“The Contractor undertakes to repay to the Employer any amounts paid in ex-
cess of the final amount due within 45 days of receiving a request to do so.
Should the Contractor fail to make repayment within the deadline set by the
Employer, the Employer may increase the amounts due by adding interest:
- At the discount rate applied by the central bank of the country of the
Employer if payments are in the currency of that country;
- At the rate applied by the European Central Bank to its main refinanc-
ing transactions in euro where payments are in euro,
on the first day of the month in which the time-limit expired, plus three and a
half percentage points. The default interest shall be incurred over the time
which elapses between that date of the payment deadline set by the Employer
(exclusive), and the date on which payment is actually made (inclusive). Any
partial payments shall first cover the interest thus established.
Amounts to be repaid to the Employer may be offset against amounts of any

kind due to the Contractor. This shall not affect the Parties’ right to agree on
payment in instalments. Bank charges incurred by the repayment of amounts
due to the Employer shall be borne entirely by the Contractor.”
Financing Arrangements
For major contracts in some markets, there may be a need to secure finance
from entities such as aid agencies, development banks, export credit agencies,
or other international financing institutions. If financing is to be procured from
any of these sources, the Particular Conditions may need to incorporate its spe-
cial requirements. The exact wording will depend on the relevant institution, so
reference will need to be made to them to ascertain their requirements, and to
seek approval of the draft tender documents.
The financing institution or bank may wish the Contract to include references
to the financing arrangements, especially if funding from more than one source
is to be arranged to finance different elements of supply. It is not unusual for
the Particular Conditions to include special provisions identifying different
categories of Plant and specifying the documents to be presented to the relevant
financing institution to obtain payment. If the financing institution's require-
ments are not met, it may be difficult (or even impossible) to secure suitable
financing for the project, and/or the institution may decline to provide finance
for part or all of the Contract.
However, where the financing is not tied to the export of goods and services
from any particular country but is simply provided by commercial banks lend-
ing to the Employer, those banks may be concerned to ensure that the Contrac-

tor's rights are very restricted. These banks may prefer the Contract to be based
upon FIDIC's Conditions of Contract for EPC/Turnkey Projects.
Alternatively, the Contractor may be prepared to initiate financing arrange-

ments and retain responsibility for them, although he would probably be unable
or unwilling to provide finance from his own resources. His financing bank's
requirement would then affect his attitude in contract negotiations. They might
well require the Employer to make interim payments, although a large propor-
tion of the Contract Price might be withheld until the Works are complete.
Since the Contractor would then have to arrange his own financing to cover the
shortfall between the payments and his outgoings, he (and his financing bank)
would probably require some form of security, guaranteeing payment when
due.
It may be appropriate for the Employer, when preparing the tender documents,
to anticipate the latter requirement by undertaking to provide a guarantee for
the element of payment which the Contractor is to receive when the Works are
complete. The acceptable form(s) of guarantee should be included in the tender
documents, annexed to the Particular Conditions: an example form is annexed
to this document, as Annex G. The following Sub-Clause may be added.
5.3.15 Clause 15 - Termination by Employer

Sub-Clause 15.1 - Notice to Correct
A notice to correct should mention that it is given under the present Sub-Clause
and state a reasonable time period for remedial. In case this period goes beyond
the Time for Completion, it should be stated that it does not prejudice any right
of the Employer (at least under Sub-Clause 8.7).
Sub-Clause 15.2 - Termination by Employer

termination clause (“pact comisoriu de gradul IV”) under Romanian law.
Moreover, the last two sentences of the last paragraph of this Sub-Clause
should be deleted. Items belonging to the Contractor may not be sold by the
Employer, unless the later has an enforceable title allowing him to do so, such
as an enforceable court decision or a security interest over such items (which is
an enforceable title per se).

pendix B1.
It should be noted, in the first place, that termination of the Contract is a failure,
both for the Contractor and for the Employer. In real terms, Employers would
often lose considerable time (including valuation, organisation of a new tender,
etc.) and might support significant additional costs in order to complete the
Works. Therefore, termination under this Sub-Clause should be used as a last
resort. Moreover, the notice period should be used to initiate negotiations and
remedy measures. In such cases, the Employer may postpone the termination
notice, so as to allow such negotiations to develop. “Rushing into termination”
would in any case be a mistake. In particular, the fact that the Contractor is in

one of the situations described in this Sub-Clause as causes for termination

should not be understood as necessarily triggering termination.
Employers might want to bring a clearer definition of the provisions of letter

(b), for example, by defining that a minimum (very low) rate of progress, such
as, say, less than 1% over the last 6 months will be considered as “abandoning”
of the works.
It is possible to insert the following text within the last paragraph after the sec-
ond sentence:
“If the Contractor fails to remove his Equipment and Temporary Works within
21 days after receiving the notice, the Employer will be entitled to use so much
of the Contractor’s Equipment and Temporary Works which have been deemed
to be reserved exclusively for the execution of the Works, under the provisions
of the Contract, as he may consider proper, up to the completion of the respec-
tive Works.”
Sub-Clause 15.3 - Valuation at Date of Termination

It is advisable to define a time limit for the Engineer’s activities under this Sub-
Clause, depending on the complexity of the project (for example, 3 months).
Sub-Clause 15.4 - Payment after Termination

Sub-Clause 15.5 - Employer's Entitlement to Termination

5.3.16 Suspension and Termination by Contractor

Sub-Clause 16.1 - Contractor's Entitlement to Suspend Work
Sub-Clause 16.2 - Termination by Contractor

See our comments under Sub-Clause 15.2 Amendments to this Sub-Clause are
included in the mandatory particular conditions in Appendix B1.A Contractor
should be aware before giving a notice of termination that once the Contract is
terminated, it cannot be resumed and in most cases a new tender procedure
would be necessary.
Employers should obviously avoid putting themselves in one of the situations

described.
Sub-Clause 16.3 - Cessation of Work and Removal of Contractor's Equip-

ment
Sub-Clause 16.4 - Payment on Termination

After termination, in accordance with the provisions of Sub-Clause 14.2, the
advance payment shall be repaid immediately by the Contractor (if not, the ad-
vance payment guarantee might be called in by the Employer).

Obviously, payments on termination will usually occur in a difficult situation of

conflict. It might be appropriate to define a time limit for the Contractor to
submit its request.
5.3.17 Risk and responsibility

Sub-Clause 17.1 - Indemnities

Sub-Clause 17.3 - Employer's Risks

Employers might want to adapt the definition of risks in accordance with the
specifics of each project. For example, under road or rail rehabilitation projects,
it seems reasonable to exclude damages to the Works caused by the road or rail
traffic from the Contractor’s risks and therefore include those under the Em-
ployer’s risks, such as: add paragraph (i) as follows:
(i) damage to components of the Employer’s property on the Site and dam-
age done to the Works resulting from any accident involving road users
while the public use of the Works is authorised by the Employer, where it
can be demonstrated by the Contractor that the accident cannot be partly
or wholly attributed to any deficiency in the Contractor’s Traffic Man-
agement Plan.
Sub-Clause 17.4 - Consequences of Employer's Risks

Sub-Clause 17.5 - Intellectual and Industrial Property Rights

Sub-Clause 17.6 - Limitation of Liability

An additional paragraph may be added if the total liability of the Contractor is
not to be limited to the Accepted Contract Amount:
“In Sub-Clause 17.6, the sum referred to in the penultimate sentence shall be -
……".
New Sub-Clause 17.7

If the Contractor is to occupy the Employer's facilities temporarily, an addi-
tional sub-clause may be added.
“The Contractor shall take full responsibility for the care of the items detailed
below, from the respective dates of use or occupation by the Contractor, up to
the respective dates of hand-over or cessation of occupation (where hand-over
or cessation of occupation may take place after the date stated in the Taking-
Over Certificate for the Works):
[Insert details]

If any loss or damage happens to any of the above items while the Contractor is
responsible for their care, arising from any cause whatsoever other than those
for which the Employer is liable, the Contractor shall, at his own cost, rectify
the Loss or damage to the satisfaction of the Engineer.”

The wording in the General Conditions describes the insurances which are to be
arranged by the "insuring Party", who is to be the Contractor unless otherwise
stated in the Particular Conditions. Insurances so provided by the Contractor
are to be consistent with the general terms agreed with the Employer. The In-
structions to Tenderers may therefore require tenderers to provide details of the
proposed terms.
If the Employer is to arrange any of the insurances under this Clause, the tender
documents should include details as an annex to the Particular Conditions (so
that tenderers can estimate what other insurances they wish to have for their
own protection), including the conditions, limits, exceptions and deductibles;
preferably in the form of a copy of each policy. The Employer may find it diffi-
cult to effect the insurances described in the third paragraph of Sub-Clause 18.2
(for Contractor's Equipment, which includes Subcontractor's equipment), be-
cause the Employer may not know the amount or value of these items of
equipment. The following sentence may be included in the Particular Condi-
tions.
Sub-Clause 18.1 - General Requirements for Insurances

This Sub-Clause needs to be modified to reflect the deletion of the Letter of
Acceptance, which is replaced by the Contract Agreement.
Sub-Clause 18.2 - Insurance for Works and Contractor's Equipment

“It shall be the responsibility of the insuring Party to notify the insurance com-
pany of any change in the nature, extent or programme for the execution of the
Works and to ensure adequacy of the insurance coverage at all times during the
period of the Contract.”
Sub-Clause 18.3 - Insurance against Injury to Persons and Damage to

Property
Sub-Clause 18.4 - Insurance for Contractor's Personnel

New Sub-Clause
If the Employer requires the additional protection of design insurance, an addi-
tional sub-clause may be added.

5.3.19 Clause 19 - Force Majeure

Sub-Clause 19.1 - Definition of Force Majeure
Attention is drawn on the criteria for an event or circumstance to be defined as
Force Majeure and to the exceptional character of such event or circumstance
(much more than unusual or unforeseen).
Sub-Clause 19.2 - Notice of Force Majeure

It has to be noted that, despite a frequent opinion, a certificate issued by the
relevant Chamber of Commerce is not necessarily required (even in Romania)
to support the occurrence of Force Majeure. Force Majeure can be proven by
other means. Furthermore, such certificate would be irrelevant for Force Ma-
jeure occurring in a foreign country.
The notice of occurrence of Force Majeure should be accompanied by appro-

priate supporting documentation. It is advisable to add at the end of first para-
graph of Sub-Clause 19.2 the following:
"and shall be accompanied by appropriate documentation evidencing the oc-

currence of Force Majeure".
Sub-Clause 19.3 - Duty to Minimise Delay

Sub-Clause 19.4 - Consequences of Force Majeure

Sub-Clause 19.5 - Force Majeure Affecting Subcontractor

Sub-Clause 19.6 - Optional termination, Payment and Release

Sub-Clause 19.7 - Release from Performance under the Law

5.3.20 Clause 20 -Claims, Disputes and Arbitration

Sub-Clause 20.1 - Contractor's Claims
This Sub-Clause defines the procedure applicable for notification and treatment
of Contractor’s claims. It endeavours to prevent situations where a contractor
would submit its claim long after the occurrence of an event or circumstance
for which it was reasonable for the Contractor to anticipate an entitlement of
time or to additional payments. Accordingly, the Employer or the Engineer
would be compromised in responding to or taking damage-limitation measures
associated with the event or circumstance. Although the figure of 28 days in
which the notice must be served was somewhat arbitrary the objective was to
limit the time period wherein a claim must be notified. The important matter is
that the Employer, through the Engineer, is put on alert, within four weeks, that
something had recently occurred for which an entitlement for time and/or addi-
tional payment might be sought.

The Engineer shall, in turn, respond within 42 days after receiving a claim or
further particulars.
Although Sub-Clause 20.1 appears to say that any claim notified more than 28
days after the event can be dismissed without consideration, this is not the way
that many DABs are interpreting the clause. Most DAB decisions have allowed
a number of claims rejected for late notice to proceed. DABs have in mind that
the object of Sub-Clause 20.1 is to prevent ambushes and minimise delays to
projects, not to bar meritorious claims. The result is that Employers have been
significantly disadvantaged in the DAB process by the fact that Engineers, act-
ing in all good faith, have not ensured that the necessary records are kept, have
not advised on the merits and have not prepared considered determinations.
Guidance as to how the notice provisions should be applied in the best interests
of Employers, good project administration and fairness under the contracts.
1. Where the Engineer considers that the 28-day notice provision of Sub-
Clause 20.1 may not have been complied with, he should consider the fol-
lowing before rejecting the claim:-
(i) Is the event one which, leaving aside Clause 20, is capable of being
the basis for a valid claim?
(ii) Did the Employer or the Engineer in fact know about the event giv-
ing rise to the claim within 28 days of the event?
(iii) Is the event giving rise to the claim an action or inaction by the
Employer or the Engineer?
(iv) Was the Employer or the Engineer aware within 28 days that a
claim was probable, or should they have been so aware?
(v) Is it possible that the Contractor only considered himself entitled to
make a claim – as distinct from knowing about the event – within
the 4 weeks prior to the notice?
(vi) Has the timing of the notice caused the Employer or the Engineer
any significant prejudice in terms of the ability to mitigate or re-
cord the effects of the event?
(vii) Has the timing of the notice benefited the Contractor or does it
seem as if it was intended to benefit the Contractor?
(viii) Was there communication, whether at meetings or otherwise, about
the problem, other than by way of formal notice?
(ix) Is it fair and reasonable, taking into account all of the above, to re-
ject the claim without consideration of the merits?
2. If the answer to item (i) is that the event is not capable of being a valid
claim, the Engineer should consider rejecting the claim on its lack of valid
basis.
3. If the answer to item (i) is yes, Engineers should consider items (ii) to (iv).
If the answer to any of these items is yes, then DABs are likely to be sym-
pathetic to the Contractor.
4. Next, consider item (v). DABs are taking notice of the first sentence of
Sub-Clause 20.1: it has been argued and accepted that if the Contractor has

not in fact considered himself entitled to claim, then the obligation to notify
has not arisen. Some events might require some investigation and advice
before a contractor decides that he has a claim. One DAB decided that the
“circumstance” had not arisen until after a reasonable time for investiga-
tion. If it is probable that the Contractor would have considered himself en-
titled to claim more than 4 weeks before the notice, then rejection for lack
of notice should be considered.
5. Consider items (vi) and (vii). If there appears to have been a failure to no-
tify, has there been prejudice to the Employer or benefit to the Contractor?
In other words, would the cost or delay claimed have been reduced if earlier
notice had been given?
6. Consider item (viii). DABs do not insist that the notice is formal. If the is-
sue is raised at meetings or in general correspondence in due time, then this
is likely to be treated as adequate notice.
7. Finally, consider point (ix) and, in particular, whether any prejudice to the
Employer could be evaluated in financial terms under Sub-Clause.2.5 or in
time and deducted from any cost or time determined.
8. Promptly upon receipt of a claim and before rejecting a claim on notice
grounds, the Engineer should report to the Employer on its proposed action,
setting out its responses to the above questions. Advise whether:
(a) The claim may reasonably be rejected for lack of notice;
(b) The claim may reasonably be rejected for lack of notice but the Em-
ployer should nevertheless examine the merits due to the risk that the
DAB might disagree; or
(c) Whether the claim should be dealt with on its merits.
Sub-Clause 20.2 - Appointment of the Dispute Adjudication Board

In the third paragraph of this Sub-Clause Letter of Acceptance” shall be deleted
and substituted with “Contract Agreement” (Article 94(2) of GD No.
925/2006).
It has to be noted that appointment of the DAB might not be opportune for all
contracts. There are two basic possibilities:
- Appointment of an “ad-hoc” DAB pre-arbitral decision by the Engi-
neer.
Employers should choose between these possibilities having regard to:

- Contract complexity,
- Contract size,
- Extent of activities off-site.
Unless the Engineer (although appointed by the Employer) is to make the pre-
arbitral decisions under this Clause 20, in accordance with the alternative op-
tion described below, the Contract should include the provisions under Clause
20 which, whilst not discouraging the Parties from reaching agreement on dis-

putes as the works proceed, allow them to refer contentious matters to an im-
partial dispute adjudication board.
The adjudication procedure depends for its success on, amongst other things,
the Parties' confidence in the agreed individual(s) who will serve on the DAB.
Therefore, it is essential that candidates for this position are not imposed by
either Party on the other Party; and that, if the individual is selected under Sub-
Clause 20.3, the selection is made by a wholly impartial entity. FIDIC is pre-
pared to perform this role, if this authority has been delegated in accordance
with the example wording in the Appendix to Tender.
Sub-Clause 20.2 envisages appointment of the DAB after a Party gives notice
of its intention to refer a dispute to a DAB. However, for certain types of pro-
ject, particularly those involving extensive work on Site, where it would be ap-
propriate for the DAB to visit the Site on a regular basis, it may be decided to
retain the services of a permanent DAB. In this case Sub-Clauses 20.2 and 20.4
together with the Appendix and Annex to the General Conditions, and the Dis-
pute Adjudication Agreement, should be amended to comply with correspond-
ing wording contained in the FIDIC Conditions of Contract for Construction.
Sub-Clause 20.2 provides for two alternative arrangements for the DAB:
(a) One person, who acts as the sole member of the DAB, having entered into
a tripartite agreement with both Parties; or
(b) A DAB of three persons, each of whom has entered into a tripartite agree-
ment with both Parties.
The form of this tripartite agreement could be one of the two alternatives shown
at the end of this publication, as appropriate to the arrangement adopted. Both
of these forms incorporate (by reference) the General Conditions of Dispute
Adjudication Agreement, which are included as the Appendix to the General
Conditions because they are also referred to in Sub-Clause 20.2. Under either
of these alternative forms of Dispute Adjudication Agreement, each individual
person is referred to as a Member.
Before the Contract is entered into, consideration should be given as to whether

a one-person or three-person DAB is preferable for a particular project, taking
account of its size, duration and the fields of expertise which will be involved.
Typically, DAB is recommended for contracts of more than 5 Million Euro and
DAB of 3 members for contracts of more than 100 Million Euro.
The appointment of the DAB may be facilitated by including an agreed list of

potential members in the Contract: in a Schedule.
Alternatively, the Engineer may make these pre-arbitral decisions. This alterna-
tive, which has been the Engineer's traditional role in common law countries,
may be appropriate if the Engineer is an independent professional consulting
engineer with the experience and resources required for the administration of
all aspects of the contract. The Employer should recognise that, although the
Engineer generally acts for the Employer as specified in Sub-Clause 3.1(a), the

Engineer will make these pre-arbitral decisions impartially and the Employer
must not prejudice this impartiality. If this alternative is considered appropriate,
Sub-Clauses 20.2 and 20.3 should be deleted and Sub-Clause 20.4 should be
modified accordingly by deleting the second paragraph of Sub-Clause 20.4 and
substituting with:
“The Engineer shall act as the DAB in accordance with this Sub-Clause 20.4,
acting fairly, impartially and at the cost of the Employer. In the event that the
Employer intends to replace the Engineer, the Employer's notice under Sub-
Clause 3.4 shall include detailed proposals for the appointment of a replace-
ment DAB.”
Sub-Clause 20.3 - Failure to Agree Dispute Adjudication Board

It shall be noted that the president of FIDIC can be the appointing entity only if
the language for communications (as defined under Sub-Clause 1.4) is English.
Sub-Clause 20.4 - Obtaining Dispute Adjudication Board's Decision

Again, it should be noted that timely treatment of dispute is of the essence.
Sub-Clause 20.5 - Amicable Settlement

The provisions of this Sub-Clause are intended to encourage the parties to settle
a dispute amicably, without the need for arbitration: for example, by direct ne-
gotiation, conciliation, mediation, or other forms of alternative dispute resolu-
tion. Amicable settlement procedures often depend, for their success, on confi-
dentiality and on both Parties' acceptance of the procedure. Therefore, neither
Party should seek to impose the procedure on the other Party.
Sub-Clause 20.6 - Arbitration

It shall be emphasised that the presence of an arbitral clause excludes, for the
fields covered by arbitration, the use of regular courts. It is recommended, so as
to clarify this aspect, to delete the first sentence of the first paragraph of Sub-
Clause 20.6 and replace by the following sentence:
“Unless settled amicably or through a DAB decision, any dispute arising out of
or in connection with the Contract, including without limitation any dispute
regarding its breach, termination or invalidity, shall be finally settled by inter-
national arbitration.”
Furthermore, Employers should carefully check the coherence between the ar-
bitral institution, the location, language and procedure of arbitration. For exam-
ple, the International Commercial Arbitral Court near the Romanian Chamber
of Commerce and Industry uses its own procedural rules. Employers are ad-
vised to link with the relevant arbitral institutions before defining such condi-
tions.
The Contract should include provisions for the resolution by international arbi-
tration of any disputes which are not resolved amicably. In international con-
struction contracts, international commercial arbitration has numerous advan-
tages over litigation in national courts, and may be more acceptable to the Par-
ties.

Careful consideration should be given to ensuring that the international arbitra-

tion rules chosen are compatible with the provisions of Clause 20 and with the
other elements to be set out in the Appendix to Tender. The Rules of Arbitra-
tion of the International Chamber of Commerce (the "ICC", which is based at
38 Cours Albert 1er, 75008 Paris, France) are frequently included in interna-
tional contracts. In the absence of specific stipulations as to the number of arbi-
trators and the place of arbitration, the International Court of Arbitration of the
ICC will decide on the number of arbitrators (typically three in any substantial
construction dispute) and on the place of arbitration.
If the UNCITRAL (or other non-ICC) arbitration rules are preferred, it may be
necessary to designate, in the Appendix to Tender, an institution to appoint the
arbitrators or to administer the arbitration, unless the institution is named (and
their role specified) in the arbitration rules. It may also be necessary to ensure,
before so designating an institution in the Appendix to Tender, that it is pre-
pared to appoint or administer.
For major projects tendered internationally, it is desirable that the place of arbi-
tration be situated in a country other than that of the Employer or Contractor.
This country should have a modern and liberal arbitration law and should have
ratified a bilateral or multilateral convention (such as the 1958 New York Con-
vention on the Recognition and Enforcement of Foreign Arbitral Awards), or
both, that would facilitate the enforcement of an arbitral award in the states of
the Parties.
It may be considered desirable in some cases for other Parties to be joined into
any arbitration between the Parties, thereby creating a multi-party arbitration.
While this may be feasible, multi- party arbitration clauses require skilful draft-
ing, and usually need to be prepared on a case-by-case basis. No satisfactory
standard form of multi-party arbitration clause for international use has yet
been developed.
Sub-Clause 20.7 - Failure to Comply with Dispute Adjudication Board De-

cision
Sub-Clause 20.8 - Expiry of Dispute Adjudication Board's Appointment

New Clause 21 Checks and Audits by Romanian and Community Bodies

For contracts funded under European Commission funds, it is recommended to
add a new Clause 21:
“The Contractor will allow the Romanian Audit Authority, the Romanian Anti-
Fraud Office, the European Commission, the European Anti-Fraud Office and
the European Court of Auditors to verify, by examining the documents or by
means of on-the-spot checks, the implementation of the project and conduct a
full audit, if necessary, on the basis of supporting documents for the accounts,
accounting documents and any other document relevant to the financing of the
project. These inspections may take place up to 7 years after the final payment.

Furthermore, the Contractor will allow the Romanian and European Anti-
Fraud Offices to carry out checks and verifications on-the-spot in accordance
with the procedures set out in the European Community legislation for the pro-
tection of the financial interests of the European Communities against fraud
and other irregularities.
To this end, the Contractor undertakes to give appropriate access to staff or

agents of the bodies mentioned under the first paragraph of the present Clause
to the sites and locations at which the Contract is carried out, including its in-
formation systems, as well as all documents and databases concerning the tech-
nical and financial management of the project and to take all steps to facilitate
their work. Access given to agents of the said bodies shall be on the basis of
confidentiality with respect to third parties, without prejudice to the obligations
of public law to which they are subject. Documents must be easily accessible
and filed so as to facilitate their examination and the Contractor must inform
the Employer of their precise location.
The Contractor guarantees that the rights of the bodies mentioned under the
first paragraph of the present Clause to carry out audits, checks and verifica-
tion will be equally applicable, under the same conditions and according to the
same rules as those set out in this Clause, to any sub-contractor or any other
party benefiting from European Commission funds.”
5.4 Dispute Adjudication Agreement

It is advisable to include a number of amendments to the General Conditions of
Dispute Adjudication Agreement. Such amendments should be included in
Clause 2 of the Dispute Adjudication Agreements. These are:
Clause 3 Warranties – second paragraph – letter (c);

There might be a lack of qualified DABs fluent in the Romanian language. In
case the language for communications defined in the Contract is Romanian, it
could be specified “fluent in the language for communications defined in the
Contract or assisted, whenever necessary, by a qualified translator.”
Clause 6 Payment
Replace letter (b) of first paragraph by:
(b) “a fixed per diem for expenses incurred in connection with the Member's
duties, for each overnight away from the Member’s home and covering the cost
of hotel, subsistence costs, local travel and other miscellaneous costs”;
Add letter (d) to the first paragraph:
(d) “other reasonable expenses incurred in connection with the Member's du-
ties, such as the cost of telephone calls, courier charges, faxes and telexes, in-
ternational travel expenses, facilities and venues for meetings and hearings: a
receipt shall be required for each item. Any air travel must be by economy class
while train travel may be by 1st class.”
Replace second paragraph by:

“The daily fee, as well as the per diem rate, shall be as specified in the Dispute
Adjudication Agreement.”
Replace third, fourth and fifth paragraphs by:
“The Member shall submit to the Contractor, with a copy to the Employer, in-
voices for his/her daily fees and expenses monthly. All invoices shall be accom-
panied by a brief description of activities performed during the relevant period.
The Contractor shall pay each of the Member's invoices in full within 28 calen-
dar days after receiving each invoice and shall apply to the Employer (in the
Statements under the Contract) for reimbursement of one-half of the amounts of
these invoices. The Employer shall then pay the Contractor in accordance with
the Contract".
5.5 Guidance for Appendix to Tender

A template for the Appendix to Tender is shown in Appendix F2. Following
issues shall be covered by the Appendix to Tender:
Item Sub-Clause Data
Employer 1.1.2.2 & 1.3
Contractor 1.1.2.3 & 1.3
Engineer 1.1.2.4 & 1.3
Time for Completion 1.1.3.3
Defects Notification Period 1.1.3.7
Electronic Transmission 1.3
Governing Law 1.4
Ruling Language 1.4
Language for Communications 1.4
Time for Access to Site 2.1
Normal Working Hours 6.5
Delay Damages 8.7 & 14.15(b)
Maximum Amount of Delay Damages 8.7
Provisional Sums 13.5(b)
Adjustment of Changes in Cost 13.8
Advance Payment 14.2
Repayment of Advance 14.2(a) and (b)
Percentage of Retention 14.3
Plant and Materials 14.5(b) and (c)
Interim Payment Certificate 14.6
Insurance 18.1
18.2(d)
18.3
DAB 20.2 & 20.3

6 The FIDIC Green Book
6.1 Introduction
of Contract and the Appendix for Works Contracts using the FIDIC Short Form
of Contract, 1st Edition 1999, i.e. the FIDIC Green Book.
ber 2006.
Mandatory particular conditions of contract for the FIDIC Green Book, neces-
sary so as to harmonise the contract provisions with the current Romanian leg-
islation, were prepared in October 2006 to January 2007 and was submitted to
the MPF in January 2007.
proposed mandatory particular conditions of contract will, after the approval by
This Guide comprises the proposed mandatory particular conditions of contract

as well as guidance regarding the conditions of contract that might lead Em-
ployers to define additional particular conditions.
6.2 FIDIC Guidance

The Conditions of Contract - the FIDIC Green Book - have been prepared by
FIDIC and are recommended for engineering and building work of relatively
small capital value, such as, in the current Romanian context, about 500,000
Euro equivalent and up to 6 months duration. However, depending on the type
of work and the circumstances, the Conditions may be suitable for contracts of
greater value. They are considered most likely to be suitable for fairly simple or
repetitive work or work of short duration without the need for specialist sub-
contracts.
The main aim has been to produce a straightforward flexible document which in-
cludes all essential commercial provisions and which may be used for all types of
engineering and building work with a variety of administrative arrangements.
Under the usual arrangements for this type of contract, the Contractor constructs

the Works in accordance with design provided by the Employer or by his repre-
sentative (if any). However, this form may also be suitable for contracts which
include, or wholly comprise, contractor-designed civil, mechanical and/or elec-
trical works.
In addition, the Employer has a choice of valuation methods. Furthermore, al-

though there is no reference to an impartial Engineer, the Employer may ap-
point an independent Engineer to act impartially, should he wish to do so.
The form is recommended for general use, though modifications are required so
as to adapt the form to the current Romanian legislation.
The intention is that all necessary information should be provided in the Ap-
pendix to the Agreement, the latter incorporating the tenderer's offer and its ac-
ceptance in one simple document. The General Conditions are expected to cover
the majority of contracts. Nevertheless, users are able to introduce Particular
Conditions if they wish, to cater for special cases or circumstances. The General
Conditions and the Particular Conditions will together comprise the Conditions
governing the rights and obligations of the parties.
To assist in the preparation of tender documents using these Conditions, Notes

for Guidance are included. These Notes will not become one of the documents
forming the Contract. Finally, applicable Rules for Adjudication are also included.
6.2.1 Notes for Guidance

General
The objective of this Contract is to express in clear and simple terms traditional
procurement concepts. The Contract is intended to be suitable for works of
simple content and short duration. If it is required that the Contractor should
undertake design, this is also provided for.
A single document is proposed for the form of tender and the agreement. This re-
flects the simple projects envisaged.
One result of the simple form of Contract is that there is an increased burden on
the Employer to set out in the Specification and Drawings the full scope of
works, including the extent of any design to be done by the Contractor.
There is no Engineer or Employer's Representative in the formal sense used in

some other FIDIC Conditions. The Employer takes all necessary actions. How-
ever, the Employer must nominate his authorised spokesman and, if he wishes to
engage a consultant to administer the Contract, may appoint a representative
with specific delegated duties and authority. The Contractor also nominates a rep-
resentative.
The Conditions contain no overall limit on the Contractor's liability. If such a

limit is required, a Clause should be inserted in the Particular Conditions.

Agreement
The printed form envisages a simple procedure of offer and acceptance. In or-
der to avoid the traps and uncertainties that surround "letters of acceptance" and
"letters of intent", it was thought preferable to promote a clear and unambiguous
practice.
It is intended that the Employer will write in the Employer's name in the
Agreement and fill in the Appendix where appropriate and send two copies to
tenderers together with the Specification, Drawings etc forming the tender
package. In respect of both copies, the Contractor is to complete, sign and date
the Offer section and complete any remaining spaces in the Appendix. Having
decided which tender to accept, the Employer signs the Acceptance section of
both copies and returns one copy to the Contractor. The Contract comes into ef-
fect upon receipt by the Contractor of his copy.
If post-tender negotiations are permitted and changes in specification or price

are agreed, then the form can still be used after the Parties have made and initialled
the appropriate changes to their respective documents. The Contractor thus
makes a revised offer in response to the Employer's revised tender documents and
the revised offer is accepted by the Employer signing and returning the Accep-
tance form. If the changes are extensive, a new form of Agreement should be
completed by the Parties.
As the Contract comes into effect upon receipt of the signed Acceptance by the
Contractor, the Employer should take steps to establish when receipt occurs, for
example by requiring the Contractor to collect and sign for the Agreement.
When the applicable law imposes any form of tax such as VAT on the Works, the
Employer should make clear whether tenderers should include such taxes in their
prices. Similarly, if payment is to be made in whole or in part in a currency other
than the currency of the Country, the Employer should make this clear to tender-
ers. See Sub-Clause 11.7.
Appendix
The Employer should complete the Appendix as indicated prior to inviting ten-
ders. Tenderers may be asked to insert a Time for Completion at 1.1.9 if none is
specified. Where tenderers are required to submit design with their tenders, the
documents containing the tendered design should be identified by the tenderer
against item 1.1.1(f) of the Appendix.
A number of suggestions have been made in the Appendix, such as the time for
submission of the Contractor's programme under Sub-Clause 7.2 and the amount
of retention under Sub-Clause 11.3. If these suggestions are adopted by the Em-
ployer, no action is required. Otherwise, they should be deleted and replaced.

6.3 Clause-by-Clause Guidance

of contract for the FIDIC Green Book, with a clause-by-clause review.

The definitions in these Conditions are not all the same as those to be found in
other FIDIC Contracts. This is as a result of the need for simplicity in Conditions
of this sort. Significantly different definitions include Commencement Date,
Site, Variation and Works.
1.1.1 "Contract". The list of documents serves two purposes: firstly, to identify
which documents form part of the Contract; and secondly, to provide an order
of priority in the event of conflict between them.
Document identification is necessary to avoid any possible doubt, for example be-
cause specifications have been subject to revisions. A complete list of Draw-
ings is always desirable and could be attached on a separate sheet.
There is no need for Particular Conditions but if amendments to these Condi-

tions are required, they should be inserted on the sheet headed Particular Condi-
tions and given priority over the General Conditions. If none, delete the reference.
The Specification should set out in clear terms any design that the Contractor is
required to undertake, including the extent to which any design proposals are to
be submitted with the tender. If none, the reference to the Contractor's tendered
design should be deleted.
If there is no bill of quantities, delete the reference.
If there are additional documents which are required to form part of the Con-
tract, such as schedules of information provided by the Contractor, these should
be added by the Employer. Consideration should be given in each case to the
required priority.
1.1.7 "Commencement Date". The starting date for the Contract is 14 days after the
date when the Contractor receives the Agreement signed by the Employer,
unless the Parties agree otherwise.
1.1.14 "Force Majeure" may include, but is not limited to, exceptional events or
circumstances of the kind listed below, so long as all of the four conditions stated
in the definition have been satisfied:
a) War, hostilities (whether war be declared or not), invasion, act of foreign
enemies
b) Rebellion, terrorism, revolution, insurrection, military or usurped power, or
civil war

c) Riot, commotion, disorder, strike or lockout by persons other than the Con-
tractor's personnel and other employees
d) Munitions of war, explosive materials, ionising radiation or contamination
by radioactivity, except as may be attributable to the Contractor's use of such
munitions, explosives, radiation or radioactivity, and
e) Natural catastrophes such as earthquake, hurricane, typhoon or volcanic ac-
tivity.
1.1.19 “Works”. The term "Works" is intended to cover all the obligations of the
Contractor, including any design and the remedying of defects.


Sub-Clause 1.4 - Law


The problem of languages is addressed by requiring the important communica-
tions such as notices and instructions to be in the language stated in the Appen-
dix. Otherwise there is no "Ruling Language". Any arbitration will be conducted
in the specified language.
Sub-Clause 1.6 - Statutory Obligations

Changes to the law after the date of the Contractor's offer are at the Employer's
risk and any delay or additional costs are recoverable by the Contractor. If the
law of the Contract is not the law of the Country, then Sub-Clause 6.1 should be
changed in the Particular Conditions.

Sub-Clause 2.1 - Provision of Site
Unless the Parties have agreed otherwise, the Site must be handed over by the
Employer to the Contractor on the Commencement Date. This is 14 days after
the Contract has come into effect, which occurs when the signed Agreement has
been returned by the Employer to the Contractor (see also Sub-Clause 1.1.7
above).
Sub-Clause 2.2 - Permits and Licences

A new paragraph should be added reflecting the obligation for the Employer to
obtain the construction permit for the execution of the Works (Article 21 of
Law No. 10/1995); refer to the mandatory particular conditions in Appendix D.
On the other hand, if for any reason, permits etc may also be required from
places other than the Country, this Sub-Clause could be limited by the addition
at the end of the words: "... in the Country but not elsewhere."

Sub-Clause 2.3 - Employer's Instructions

Sub-Clause 2.4 - Approvals

The term "approval" is only used in the Conditions in relation to the perform-
ance security at Sub-Clause 4.4 and insurances at Sub-Clause 14.1. It is impor-
tant that risks such as those of poor workmanship or Contractor's design are not
transferred to the Employer unintentionally. The Sub-Clause is intended to pre-
vent argument.
6.3.3 Clause 3 - Employer's Representative

The Contractor should know who in an Employer organisation is authorised to
speak and act for the Employer at any given time. This is achieved by Sub-Clause
3.1 and the authorised individual should be named in the Appendix.
Sub-Clause 3.2 should be entirely deleted and replaced with the wording pro-
vided in the mandatory particular conditions (Appendix C), so as to introduce
the requirements of Law No. 10/1995 related to the verification of the proper
performance of the Works through qualified persons appointed by the Em-
ployer.
In addition, for contracts of relatively higher complexity, value or duration, it is

recommendable that Employers require more extensive professional assistance
and their consultant should have clearly established delegated powers.
Once appointed, the Employer's representative acts for and in the interests of
the Employer. There is no dual role or duty to be impartial. If an impartial Em-
ployer's Representative is required with a role similar to the traditional Engi-
neer, then the following words could be used in the Particular Conditions:
"Replace the final sentence of Sub-Clause 3.2 with the following: "The Em-
ployer's Representative shall exercise in a fair and impartial manner the pow-
ers of the Employer under or in connection with the following Sub-Clauses:
1.3, 2.3, 4.2, 4.3, 5.1, 7.3, 8.2, 9.1, 9.2, 10.1, 10.2, 10.5, 11.1 to 11.6, 11.8, 12.1,
13.2 and 14.1."
To the extent that the Employer has delegated powers to an Employer's repre-
sentative, he should be careful not to exercise such powers himself in order to
avoid the risk of conflicting instructions, decisions, etc.

Sub-Clause 4.1 - General Obligations
Most contracts do not specify the exact standard required for each element of
the Works, so some benchmark standard is needed with which the Contractor is
to comply. If a more specific set of standards could be referred to for a particular
project, then an amendment in the Particular Conditions would be desirable.


Sub-Clause 4.3 - Subcontracting

If applicable, the Particular Conditions should reflect the requirements of Ro-
manian public procurement regulations as regards subcontractors (Article 96
(1) of GD No. 925/2006). The proposed modification is included in the manda-
tory particular conditions in Appendix C.

Sub-Clause 4.4 should be modified in order to comply with Romanian public
procurement regulations as regards the Performance Security (Articles 87(b)
and 92(4) of GD No. 925/2006). The proposed modification is included in the
mandatory particular conditions in Appendix C.
Suggested forms of performance bond (surety bond) or bank guarantee have not
been provided. If it is felt that the scale of project warrants security by means of
a bond, then local commercial practice should dictate the form. Example forms
are included with FIDIC's Conditions of Contract for Construction. The amount
and a reference to the desired form of any required security should be set out in
the Appendix.
Alternatively and particularly if the constitution of a bank guarantee might be

difficult for the potential contractors, the Sub-Clause could be amended, so as
to introduce the provisions of Article 90 letter (c) of the GD No. 925/2006,
namely to allow constitution of a guarantee through progressive retentions from
payments.
6.3.5 Clause 5 - Design by Contractor

Sub-Clause 5.1 - Contractor's Design
This Sub-Clause should be modified in order to acknowledge the requirement
under Romanian law for designs to be verified by a duly certified design
checker (Article 13 of Law No. 10/1995). The proposed modification is in-
cluded in the mandatory particular conditions in Appendix C.
As with all design-build contracts it is essential that the Employer's require-

ments are set out clearly and precisely. The Appendix should indicate to tender-
ers the Sub-Clause(s) in the Specification that set out the design requirement.
Where the Employer procures any part of the design, the responsibility for de-
sign will be shared as this Contract makes the Contractor responsible only for
design prepared by him. The extent of the Contractor's design obligation should
therefore be clearly stated if disputes are to be avoided. The Conditions avoid the
confusing concept of approval of design. Designs are submitted and may be re-
turned with comments or rejected. The Employer need not react at all.
Sub-Clause 5.2 - Responsibility for Design

The Contractor's responsibility for his design remains, as is made clear here and
in Sub-Clause 2.4. In the event of conflict between the Specification and Draw-
ings and the Contractor's tendered design, the order of priority in the Appendix
makes it clear that the Employer's documents prevail. This means that if the
Employer prefers the Contractor's tendered solution, the Specification and
Drawings should be amended before the Contract is signed by the Parties.

The Contractor will have an absolute obligation to ensure that the parts of the
Works designed by him are fit for their purpose, provided that the intended
purposes are defined in the Contract. The Employer must therefore make clear
in the parts of the Specification that impose design obligations, the intended pur-
poses of the part of the Works to be designed by the Contractor. This should be
done even where this seems obvious in order to avoid argument about whether an
intended purpose is defined or not.
If a party wishes to protect the intellectual property in his design, provision must
be made in the Particular Conditions.
6.3.6 Clause 6 - Employer's Liabilities

Sub-Clause 6.1 - Employer's Liabilities
This Sub-Clause gathers together in one place the grounds for extension of time
under Sub-Clause 7.3 and the grounds for claims under Sub-Clause 10.4. There
is no time or claim for bad weather although this could be adjusted in the Par-
ticular Conditions if so required.
6.3.7 Clause 7 - Time for Completion

Sub-Clause 7.1 - Execution of the Works
There is no provision for sections and for the different Times for Completion
by sections. If necessary, those should be introduced in the Particular Condi-
tions.

The Appendix should stipulate any particular requirements as to the form and
level of detail of programme to be submitted. Where Contractor's design is re-
quired, the Appendix could stipulate that the programme should show the dates on
which it is intended to prepare and submit drawings, etc.
Sub-Clause 7.3 - Extension of Time

The test for entitlement to an extension of time is whether it is appropriate. This
means that if an event under Sub-Clause 6.1 caused critical delay to the Works
and it is fair and reasonable to grant an extension of time, the Employer should
do so. An extension of time should not be granted to the extent that any failure
by the Contractor to give an early warning notice under Sub-Clause 10.3 con-
tributed to the delay.
Sub-Clause 7.4 - Late Completion

There is a maximum amount which the Contractor is liable to pay for late com-
pletion specified in the Appendix. 10% of the sum stated in the Agreement is
suggested.
6.3.8 Clause 8 - Taking-Over

Sub-Clause 8.1 - Completion

Sub-Clause 8.2 - Taking-Over Notice

lations related to taking-over of Works set out mainly in GD No. 273/1994. The
Employer must nominate a taking-over commission (Article 7 of GD No.
Works (Article 15 of GD No. 273/1994). Such amendment is included in the
mandatory particular conditions in Appendix C.
In line with normal practice, it is not envisaged that the Works need be 100%
complete before the Employer may take over. Once the Works are ready to be
used for their intended purpose, the notice should be given. There is no provi-
sion for taking-over of only parts of the Works but if this is required, provision
should be made in the Particular Conditions.
If any tests are required to be completed prior to taking-over, these should be

specified in the Specification. The definition of Works is broad enough to include
any such tests.
6.3.9 Clause 9 - Remedying Effects

Sub-Clause 9.1 - Remedying Effects
This Sub-Clause shall be modified in order to include the obligation for the
Contractor to remedy any defects, notified by the Employer, either apparent or
latent. The proposed modification is included in the mandatory particular con-
ditions in Appendix C.
There is no defined Defects Liability Period but during the period - normally 12
months - from the date of taking-over, the Employer may notify the Contractor
of defects. The Contractor must remedy such defects within a reasonable time.
If he fails to do so, the Employer may employ others for that purpose at the Con-
tractor's cost. The Employer may also notify defects at any time prior to taking-
over.
The liability of the Contractor for defects will not normally end with the expiry
of the period stated in the Appendix. Although he is then no longer obliged to
return to Site to remedy defects, the defect represents a breach of contract for
which the Contractor is liable in damages. This liability remains for as long as
Romanian law stipulates. It might therefore be provided that:
“The expiry of the period stated in the Appendix does not prejudice the Contrac-
tor’s liability for the latent defects of the Works during the periods of liability
imposed by the Applicable Laws.”
Sub-Clause 9.2 - Uncovering and Testing

6.3.10 Clause 10 - Variations and Claims

Variation is defined to include any change to the Specification or Drawings in-
cluded in the Contract. If the Employer requires a change to part of the Works

designed by the Contractor either as part of his tender or after the Contract was
awarded, then this is to be done by way of an addition to the Specification or
Drawings which by Sub-Clause 5.2 will prevail over Contractor's design.
Sub-Clause 10.2 - Valuation of Variations

This Sub-Clause sets out alternative procedures for the valuation of Variations,
to be applied in the order of priority given. It applies equally to omissions as to
additional works.
a) A lump sum should be the first method to be considered as it can encom-
pass the true cost of a Variation and avoid subsequent dispute over the indi-
rect effect. The Employer can invite the Contractor to submit an itemised
make-up (Sub-Clause 10.5) before instructing the Variation so that an agreed
lump sum can form part of the instruction.
b) Alternatively, a more traditional approach can be taken by valuing the Varia-
tion at rates in the bill of quantities and any schedules, or
c) Using these rates as a basis, or
d) Using new rates.
e) Daywork rates are normally used when the Variation is of an indeterminate
nature or is out of sequence with the remaining Works. To ensure reasonable
daywork rates, provision should be made for these to be priced competitively
in the tender documents.
Sub-Clause 10.3 - Early Warning

This Sub-Clause and Sub-Clause 10.5 require the Contractor to notify the Em-
ployer of events promptly and to detail any claim within 28 days. If the effects
of the event are increased or if the ability of the Employer to verify any claim is af-
fected by the failure to notify, then the Employer is protected.
Sub-Clause 10.4 - Right to Claim

Sub-Clause 10.5 - Variation and Claim Procedure

6.3.11 Clause 11 - Contract Price and Payment

Sub-Clause 11.1 - Valuation of the Works
Normally only one of the options in the Appendix should be used to indicate how
the sum in the offer is be calculated and presented. The following explains what
is intended:

Lump sum price A lump sum offer without any supporting details.
This would be used for very minor works where
Variations are not anticipated and the Works will be
completed in a short period requiring only one pay-
ment to the Contractor.
Lump sum price with A lump sum offer supported by schedules of rates
schedule of rates prepared by the tenderer. This would be a larger con-
tract where Variations and stage payments would be
required. If the Employer does not have the resources
to prepare his own bill of quantities then this alterna-
tive would be suitable.
Lump sum price with A lump sum offer based on bill of quantities pre-
bill of quantities pared by the Employer. This would be the same as
last but where the Employer has the resources to pre-
pare his own bill of quantities. A better contract
would result with an Employer’s bill of quantities.
Remeasurement with A sum subject to remeasurement at the rates offered

bill of quantities by the tenderer in the bill of quantities prepared by
the Employer. This would be the same as last but
would suit a contract where many changes are envis-
aged to the Works after the Contract has been
awarded.
Cost reimbursable An estimate prepared by the tenderer which will be

replaced by the actual cost of the Works calculated
in accordance with the terms set by the Employer.
This would suit a project where the extent of work can-
not be ascertained before the Contract is placed. An
example of this would be an emergency reconstruc-
tion of a building damaged by fire.
However, if for some special reason, more than one option is selected, for ex-
ample there is a remeasureable element in a lump sum Contract, then the details
should be carefully defined.
The Foreword indicates that this Short Form of Contract is intended for works of
short duration. In the event of a contract for works of long duration, a new clause
could be inserted at Sub-Clause 11.1 to adjust for the rise and fall in the cost of
labour, materials and other imports to the Works. Such a clause could be
adapted from the other FIDIC Conditions of Contract.
Sub-Clause 11.2 - Monthly Statements

If the Contract is for a lump sum, consideration should be given as to how the
work is to be valued for the purposes of interim payments. In completing the
Appendix for Sub-Clause 11.1, the Employer may request tenderers to submit a

cash flow forecast linked to a stage payment proposal for agreement. This
would be reviewed in the event of an extension of time made in accordance with
Sub-Clause 7.3.
Alternatively, interim payment can be based on valuation of the Works which

would also be appropriate for remeasurement and cost reimbursable Contracts.
Payment could also be based on the achievement of milestones or a schedule of
activities to which values are assigned.
An invoice may also be required, in which case it could be submitted with the
statement.
Sub-Clause 11.3 - Interim Payments

No provision is made for advance payments. If such a payment is to be made,
there should be provision in the Particular Conditions and for any security to be
provided by the Contractor. An example form of advance payment guarantee is
to be found in FIDIC's Conditions of Contract for Construction (Sub-Clause
14.2).
Sub-Clause 11.4 - Payment of First Half of Retention

The deduction of retention is sometimes replaced by the provision of security
by the Contractor to the Employer. Alternatively, the entire retention sum de-
ducted is released after taking-over upon the provision by the Contractor of secu-
rity. In either event, suitable text would be required in the Particular Conditions.
An example form of retention guarantee is to be found in the FIDIC Conditions of
Contract for Construction; refer Appendix F1.
Sub-Clause 11.5 - Payment of Second Half of Retention

The release of the second part of the retention will serve as confirmation that all
notified defects have been remedied.
Sub-Clause 11.6 - Final Payment

This Sub-Clause should be modified in order to provide for the obligation for
the Contractor to issue an invoice; refer to the mandatory particular conditions
in Appendix C.
Sub-Clause 11.7 - Currency

It is assumed that payments will be in a single currency. If this is not the case,
the proportions of different currencies should be stated in the Appendix and
provision made in the Specification or the Particular Conditions as to how
payment is to be made.

An invoice to be issued by the Contractor may also be required.
6.3.12 Clause 12 - Default

Sub-Clause 12.1 - Default by Contractor
The Employer may terminate the Contract if the defaulting Contractor does not
respond to a formal notice by taking all practicable steps to put right his default.
This recognises that not all defaults are capable of correction in 14 days. If ter-

mination takes place, the Employer may take over and use the Contractor's
Equipment to complete the Works. Care should be taken, however, if the equip-
ment on Site is hired: no specific provision is made to cover this situation and the
Employer is unlikely to be able to retain such equipment.

termination clause (“pact comisoriu de gradul IV”) under Romanian law; refer
to the mandatory particular conditions provided in Appendix C.
Sub-Clause 12.2 - Default by Employer

This provision provides the Contractor's main remedy for non-payment. 7 days
after the Employer's receipt of a default notice, which must refer to Sub-Clause
12.2, the Contractor may suspend all or part of his work. 21 days later the op-
tion to terminate arises if the Employer persists with non-payment or other de-
fault. The Contractor must use his right to terminate within 21 days or lose it.
This is to prevent a party abusing a right to terminate in his dealings with the
other party for the remainder of the project.

termination clause (“pact comisoriu de gradul IV”) under Romanian law; refer
to the mandatory particular conditions provided in Appendix C.
If Contractor's Equipment is essential for the safety or stability of the Works, the
Employer will be obliged to agree terms with the Contractor for the retention of
such equipment.
Sub-Clause 12.3 - Insolvency

The right of the Employer to retain the Contractor's Equipment may clash with
the right of a liquidator or receiver to realise the assets of an insolvent Contractor.
Reference to the applicable law would be necessary.
Sub-Clause 12.4 - Payment upon Termination

This Sub-Clause enables the financial aspects of the Contract to be resolved quickly
and without the necessity to await the completion of the Works by others. By
specifying the damages payable to the innocent party for the defaults leading to
the termination, much delay, complication and scope for dispute are avoided. The
Employer's costs in obtaining a replacement contractor will generally be higher
than the Contractor's loss of profit.
6.3.13 Clause 13 - Risk and Responsibility

Although the Contractor is responsible for the Works prior to taking-over, he is
protected by the obligation to insure the Works under Clause 14 and by his abil-
ity to recover under Clause 6 his Cost if one of the Employer's Liabilities oc-
curs.
Sub-Clause 13.2 - Force Majeure

To qualify as Force Majeure, events must prevent performance of an obligation.
See also the definition at Sub-Clause 1.1.14. Notice must be given at once.


Sub-Clause 14.1 - Extent of Cover
The Employer should set out his precise requirements in the Appendix. Third
Party, public liability insurance would normally be mandatory. As smaller con-
tracts are likely to fall within tenderers' standing Contractors' All Risk (CAR)
insurance policies, tenderers should generally be asked to submit details of their
insurance cover with their tenders.
Any requirements for insurance after the date of the Employer's notice under
Sub-Clause 8.2, or arising from taking-over parts of the Works, should be cov-
ered by Particular Conditions. See also Clause 13.
If the Employer wishes to take out the insurances instead of the Contractor, the
following should be used as a Particular Condition in place of Sub-Clause 14.1:
• "Replace the text of Sub-Clause 14.1 with the following: "The Employer
shall, prior to the Commencement Date, effect insurance in the joint names
of the Parties of the types, in the amounts and with the exclusions stipulated in
the Appendix. The Employer shall provide the Contractor with evidence that
any required policy is in force and that the premiums have been paid."
Sub-Clauses 14.2 and 14.3 should be deleted if the Employer takes out the in-
surance.
It should be noted that in the event of the Employer's failure to insure, the Con-
tractor may give notice under Sub-Clause 12.2.
Sub-Clause 14.2 - Arrangements

Sub-Clause 14.3 - Failure to Insure

6.3.15 Clause 15 - Resolution of Disputes

Sub-Clause 15.1 - Adjudication
There are advantages in appointing an adjudicator from the outset even though
the adjudicator may not be required to take any action or earn any fee unless and
until a dispute is referred to him. Delays will inevitably occur if the parties initi-
ate the procedure to appoint an adjudicator only when a dispute has arisen. It is
therefore recommended that the Employer propose a person to act as adjudicator
either at tender stage or shortly after the Agreement is signed and that the matter
is discussed and agreed as soon as possible.
Care should be taken about whether an adjudicator should be local or from a neu-
tral country. Although the adjudicator should be impartial, the costs of employing
someone from a third country could be disproportionate if it is necessary for the
adjudicator to visit or if a hearing became necessary. However, in view of the
costs involved in arbitration, even of minor disputes, any extra cost of a truly im-
partial adjudicator is a recommended investment.

It is intended that all decisions made by the Employer or his representative should
be capable of being reviewed by an adjudicator and, if required, by an arbitrator.
Sub-Clause 15.2 - Notice of Dissatisfaction

Sub-Clause 15.3 - Arbitration

Arbitration may not be commenced unless the dispute has first been the subject
of adjudication. The Rules of arbitration should be stipulated in the Appendix.
6.4 Guidance for the Appendix to Tender

A template for the Appendix to Tender is shown in Appendix F2. Following
issues shall be covered by the Appendix:

Contract Documents 1.1.1
Time for Completion 1.1.9
Law of the Contract 1.4
Language 1.5
Provision of Site 2.1
Authorised Person 3.1
Employer's Representative 3.2
Contractor's Design 5.1
Programme 7.2
Amount Payable due to Failure 7.4
to Complete
Period for Notifying Works 9.1 & 11.5
Variation Procedure - Dayworks 10.2
Valuation of the Works 11.1
Materials and Plant 11.2
Retention 11.3
Rate of Interest 11.8
Insurances 14.1
Arbitration Rules 15.3
Document identification is necessary to avoid any possible doubt, for example

because specifications have been subject to revisions. A complete list of Draw-
ings is always desirable and could be attached on a separate sheet.
The Specification should set out in clear terms any design that the Contractor is
required to undertake, including the extent to which any design proposals are to
be submitted with the tender. If none, the reference to the Contractor's tendered
design should be deleted.
If there is no bill of quantities, delete the reference.

If there are additional documents which are required to form part of the Con-
tract, such as schedules of information provided by the Contractor (elements of
the Contractor proposal), these should be added by the Employer. Considera-
tion should be given in each case to the required priority.

7 Templates for Guarantees

This section presents the following templates for guarantees:
• Parent Company Guarantee
• Tender Security
• Performance Security - Demand Guarantee
• Advance Payment Guarantee
• Retention Money Guarantee
• Payment Guarantee by Employer.
The templates are attached in Appendix D. It is foreseen that these templates

can be applied for all the 3 FIDIC books, i.e. the FIDIC red, yellow and green
books.
Parent Company Guarantee

This template is based on the template proposed by FIDIC, refer their Annex A,
and adjusted in compliance with the requirements of the Romanian legislation
as follows:
• The waiver of the benefits of discussion and division is required under
Romanian law to ensure that the guarantor's obligation is a primary obliga-
tion and that a guarantor may not claim against the Employer that he is not
liable for the full amount in case there are several guarantors
• The assignability of the guarantee is usually required by financing bank.
Tender Security
This template is based on the template proposed by FIDIC, refer their Annex B,
and adjusted in compliance with the requirements of the Romanian legislation,
i.e. the provisions of GD No. 925/2006 on public procurement.
Performance Security - Demand Guarantee

This template is based on the template proposed by FIDIC, refer their Annex C,
as follows:
• The release of up to 70% has been provided in the mandatory particular
conditions, as required by the public procurement regulations
• The assignability of the guarantee is usually required by financing bank.
A performance security as surety bond is not covered by the public procure-

ment regulations that require a bank guarantee.

Advance payment Guarantee

This template is based on the template proposed by FIDIC, refer their Annex E,
on public finance, where the advance payment is to be returned by the end of
the financial year, refer GD No. 264/2003.
Retention Money Guarantee

This template is based on the template proposed by FIDIC, refer their Annex F,
and adjusted in compliance with the requirements of the Romanian legislation.
Payment Guarantee by Employer

This template is based on the template proposed by FIDIC, refer their Annex G,
and adjusted in compliance with the requirements of the Romanian legislation.

8 Templates for Contractual Issues
8.1.1 FIDIC Red and Yellow Books

This section presents the following templates for contractual issues for the
FIDIC red and yellow books:
• Letter of Tender
• Appendix to Tender
• Contract Agreement.
The templates are attached in Appendix E.1, Templates for Contractual Issues.
Letter of Tender
The Letter of Tender is based on the draft proposed by FIDIC, modified for
particular requirements of Romanian legislation.
Appendix to Tender
The Appendix to Tender is based on the draft proposed by FIDIC, modified for
Contract Agreement
The Contract Agreement is based on the draft proposed by FIDIC, modified for
8.1.2 FIDIC Green Book

This section presents the following templates for contractual issues:
• Agreement
• Appendix.
The templates are attached in Appendix E.2, Templates for Contractual Issues.
Agreement
The Agreement is based on the draft proposed by FIDIC, modified for particu-
lar requirements of Romanian legislation.
Appendix
The Appendix is based on the draft proposed by FIDIC, modified for particular
requirements of Romanian legislation.

8.1.3 Dispute Adjudication Agreements

The proposed DAB Agreements are based on the draft proposed by FIDIC,
modified for particular requirements of Romanian legislation:
• Dispute Adjudication Agreement (one person DAB)
• Dispute Adjudication Agreement (three person DAB).
The templates are attached in Appendix F, DAB Agreements

Appendix A - PC's for the FIDIC Red Book

This Appendix A contains the proposed particular conditions for the FIDIC red
book as follows:
• Appendix A1, Mandatory Particular Conditions of Contract
• Appendix A2, Additional Particular Conditions of Contract.
The Mandatory Particular Conditions was approved by the MPF in January

2007.

Appendix A1 - Mandatory Particular Conditions

The following pages provide the mandatory particular conditions for the FIDIC
red book.

Appendix A2 - Additional Particular Conditions

The following pages provide the proposed additional particular conditions for
the FIDIC red book.

Appendix B - PC's for the FIDIC Yellow Book

This Appendix A contains the proposed particular conditions for the FIDIC yel-
low book as follows:
• Appendix B1, Mandatory Particular Conditions of Contract
• Appendix B2, Additional Particular Conditions of Contract.

2007.

Appendix B1 - Mandatory Particular Conditions

The following pages provide the mandatory particular conditions for the FIDIC
yellow book.

Appendix B2 - Additional Particular Conditions

The following pages provide the proposed additional particular conditions for
the FIDIC yellow book.

Appendix C - PC's for the FIDIC Green Book

This Appendix C contains the proposed mandatory particular conditions for the
FIDIC green book.
2007.
No additional particular conditions of contract are proposed for the FIDIC
green book.

Appendix D - Templates for Guarantees

This Appendix D includes the recommended six (6) templates for guarantees as
outlined in Chapter 7 above:
• Parent Company Guarantee
• Tender Security
• Performance Security - Demand Guarantee
• Advance Payment Guarantee
• Retention Money Guarantee
• Payment Guarantee by Employer.
The templates are applicable for the FIDIC red, yellow and green books.

PARENT COMPANY GUARANTEE
Brief description of Contract: <Insert description>
Name and address of Employer: <Insert name and address> (together with successors and assigns).
We have been informed that <Insert name of Tenderer> (hereinafter called the "Contractor") is submitting an
offer for such Contract in response to your invitation, and that the conditions of your invitation require his
offer to be supported by a parent company guarantee.
In consideration of you, the Employer, awarding the Contract to the Contractor, we <Insert name of parent
company> irrevocably and unconditionally guarantee to you, as a primary obligation, and waiving the
benefits of discussion and division, the due performance of all the Contractor's obligations and liabilities
under the Contract, including the Contractor's compliance with all its terms and conditions according to their
true intent and meaning.
If the Contractor fails to so perform his obligations and liabilities and comply with the Contract, we will
indemnify the Employer against and from all damages, losses and expenses (including legal fees and
expenses) which arise from any such failure for which the Contractor is liable to the Employer under the
Contract.
This guarantee shall come into full force and effect when the Contract comes into full force and effect. If the
Contract does not come into full force and effect within a year of the date of this guarantee, or if you
demonstrate that you do not intend to enter into the Contract with the Contractor, this guarantee shall be void
and ineffective. This guarantee shall continue in full force and effect until all the Contractor's obligations and
liabilities under the Contract have been discharged, when this guarantee shall expire and shall be returned to
us, and our liability hereunder shall be discharged absolutely.
This guarantee shall apply and be supplemental to the Contract as amended or varied by the Employer and
the Contractor from time to time. We hereby authorise them to agree any such amendment or variation, the
due performance of which and compliance with which by the Contractor are likewise guaranteed hereunder.
Our obligations and liabilities under this guarantee shall not be discharged by any allowance of time or other
indulgence whatsoever by the Employer to the Contractor, or by any variation or suspension of the works to
be executed under the Contract, or by any amendments to the Contract or to the constitution of the
Contractor or the Employer, or by any other matters, whether with or without our knowledge or consent.
This guarantee shall be governed by the law of the same country (or other jurisdiction) as that which governs
the Contract and any dispute under this guarantee shall be finally settled under the Rules of Arbitration of the
International Chamber of Commerce by one or more arbitrators appointed in accordance with such Rules.
We confirm that the benefit of this guarantee may be assigned subject only to the provisions for assignment
of the Contract.
Date __________________________ Signature(s) ________________________________________

TENDER SECURITY
Name and address of Beneficiary: <Insert name and address> (defined as the Employer).
We have been informed that <Insert name of Tenderer> (hereinafter called the "Principal") is submitting an
offer for such Contract in response to your invitation, and that the conditions of your invitation (the
"conditions of invitation", which are set out in a document entitled Instructions to Tenderers) require his offer
to be supported by a tender security.
At the request of the Principal, we <Insert name of bank> hereby irrevocably undertake to pay you, the
Beneficiary/Employer, any sum or sums not exceeding in total the amount of <Insert amount> (say: <Insert
amount in words>) upon receipt by us of your demand in writing and your written statement (in the demand)
stating that:
(a) The Principal has, without your agreement, withdrawn his offer after the latest time specified for its
submission and before the expiry of its period of validity, or
(b) You awarded the Contract to the Principal and he has refused to execute the Contract Agreement, or
(c) You awarded the Contract to the Principal and he has failed to comply with sub-clause 4.2 of the
conditions of the Contract.
Any demand for payment must contain your signature(s) which must be authenticated by your bankers or by
a notary public. The authenticated demand and statement must be received by us at this office on or before
<Insert date> (the date 35 days after the expiry of the validity of the Letter of Tender), when this guarantee
shall expire and shall be returned to us.
This guarantee is subject to the Uniform Rules for Demand Guarantees, published as number 458 by the
International Chamber of Commerce, except as stated above.
Date __________________________ Signature(s) ________________________________________

PERFORMANCE SECURITY -DEMAND GUARANTEE
Name and address of Beneficiary: <Insert name and address> (whom the Contract defines as the
Employer).
We have been informed that <Insert name of contractor> (hereinafter called the "Principal") is your contractor
under such Contract, which requires him to obtain a performance security.
At the request of the Principal, we <Insert name of bank> hereby irrevocably undertake to pay you, the
Beneficiary/Employer, any sum or sums not exceeding in total the amount of <Insert amount> (the
"guaranteed amount", say: <Insert amount in words>) upon receipt by us of your demand in writing and your
written statement stating:
(a) That the Principal is in breach of his obligation(s) under the Contract, and
(b) The respect in which the Principal is in breach.
Following the receipt by us of an authenticated copy of the taking-over certificate for the whole of the works
under Clause 10 of the conditions of the Contract, such guaranteed amount shall be reduced by 70% and we
shall promptly notify you that we have received such certificate and have reduced the guaranteed amount
accordingly.1
Any demand for payment must contain your [minister's/director's] (1) signature(s) which must be
authenticated by your bankers or by a notary public. The authenticated demand and statement must be
received by us at this office on or before <Insert date> (the date 70 days after the expected expiry of the
Defects Notification Period for the Works) (the "expiry date"), when this guarantee shall expire and shall be
returned to us.
We have been informed that the Beneficiary may require the Principal to extend this guarantee if the
performance certificate under the Contract has not been issued by the date 28 days prior to such expiry
date. We undertake to pay you such guaranteed amount upon receipt by us, within such period of 28 days,
of your demand in writing and your written statement that the performance certificate has not been issued,
for reasons attributable to the Principal, and that this guarantee has not been extended.
[This guarantee is fully transferable in favour of [financing institution) its successors and assignees).]
This guarantee shall be governed by the laws of Romania and shall be subject to the Uniform Rules for
Demand Guarantees, published as number 458 by the International Chamber of Commerce, except as
stated above.
Date __________________________ Signature(s) ________________________________________
1
When writing the tender documents, the writer should ascertain whether to include the optional text, shown in
parentheses [ ]

ADVANCE PAYMENT GUARANTEE
We have been informed that <Insert name of Contractor> (hereinafter called the "Principal") is your
contractor under such Contract and wishes to receive an advance payment, for which the Contract requires
him to obtain a guarantee.
At the request of the Principal, we <Insert name of Bank> hereby irrevocably undertake to pay you, the
"guaranteed amount", say: <Insert amount in words>) upon receipt by us of your demand in writing and your
(a) That the Principal has failed to repay the advance payment in accordance with the conditions of the
Contract, and
(b) The amount which the Principal has failed to repay.
This guarantee shall become effective upon receipt [of the first instalment] of the advance payment by the
Principal. Such guaranteed amount shall be reduced by the amounts of the advance payment repaid to you,
as evidenced by your notices issued under sub-clause 14.6 of the conditions of the Contract. Following
receipt (from the Principal) of a copy of each purported notice, we shall promptly notify you of the revised
guaranteed amount accordingly.
<Insert date> (the "expiry date"), when this guarantee shall expire and shall be returned to us.
advance payment has not been repaid by the date 28 days prior to such expiry date. We undertake to pay
you such guaranteed amount upon receipt by us, within such period of 28 days, of your demand in writing
and your written statement that the advance payment has not been repaid and that this guarantee has not
been extended.
stated above.
Date __________________________ Signature(s) ________________________________________

RETENTION MONEY GUARANTEE
We have been informed that <Insert name of Contractor> (hereinafter called the "Principal") is your
contractor under such Contract and wishes to receive early payment of [part of] the retention money, for
which the Contract requires him to obtain a guarantee.
"guaranteed amount", say: <Insert amount in Words>) upon receipt by us of your demand in writing and your
(a) That the Principal has failed to carry out his obligation(s) to rectify certain defect(s) for which he is
responsible under the Contract, and
(b) The nature of such defect(s).
At any time, our liability under this guarantee shall not exceed the total amount of retention money released
to the Principal by you, as evidenced by your notices issued under sub-clause 14.6 of the conditions of the
Contract with a copy being passed to us.
<Insert date> (the date 70 days after the expected expiry of the Defects Notification Period for the Works)
(the "expiry date"), when this guarantee shall expire and shall be returned to us.
performance certificate under the Contract has not been issued by the date 28 days prior to such expiry
date. We undertake to pay you such guaranteed amount upon receipt by us, within such period of 28 days,
of your demand in writing and your written statement that the performance certificate has not been issued,
for reasons attributable to the Principal, and that this guarantee has not been extended.
This guarantee is fully transferable in favour of [financing institution] its successors and assignees.
stated above.
Date __________________________ Signature(s) ________________________________________

PAYMENT GUARANTEE BY EMPLOYER
Name and address of Beneficiary: <Insert name and address> (defined as the Contractor).
We have been informed that <Insert name of Employer> (whom the Contract defines as the Employer and
who is hereinafter called the "Principal") is required to obtain a bank guarantee.
Beneficiary/Contractor, any sum or sums not exceeding in total the amount of <Insert amount> (say: <Insert
amount in words>) upon receipt by us of your demand in writing and your written statement stating:
(a) That, in respect of a payment due under the Contract, the Principal has failed to make payment in full
by the date fourteen days after the expiry of the period specified in the Contract as that within which
such payment should have been made, and
(b) The amount(s) which the Principal has failed to pay.
Any demand for payment must be accompanied by a copy of [list of documents evidencing entitlement to
payment], in respect of which the Principal has failed to make payment in full.
<Insert date> (the date six months after the expected expiry of the Defects Notification Period for the Works)
when this guarantee shall expire and shall be returned to us.
stated above.
Date __________________________ Signature(s) ________________________________________

Appendix E - Templates for Contractual Issues

E.1 - FIDIC Red and Yellow Books
This Appendix E.1 includes the recommended templates for the FIDIC red and
yellow books for the contractual issues as outlined in Chapter 8 above:
• Letter of Tender
• Appendix to Tender
• Contract Agreement.

LETTER OF TENDER
NAME OF CONTRACT: <Insert Name of Contract>
TO: <Insert name of the Employer>
We have examined the Conditions of Contract, Specification, Drawings, Bill of Quantities, the other
Schedules, the attached Appendix and Addenda Nos. <Insert Nos.> for the execution of the above-named
Works. We offer to execute and complete the Works and remedy any defects therein in conformity with this
Tender which includes all these documents, for the sum of (in currencies of payment)
…………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………….
or such other sum as may be determined in accordance with the Conditions of Contract.
We accept your suggestions for the appointment of the DAB, as set out in Schedule <Insert no.>. [We have
completed the Schedule by adding our suggestions for the other Member of the DAB, but these suggestions
are not conditions of this offer].*
We agree to abide by this Tender until <Insert validity date> and it shall remain binding upon us and may be
accepted at any time before that date. We acknowledge that the Appendix forms part of this Letter of Tender.
If this offer is accepted, we will provide the specified Performance Security, commence the Works as soon as
is reasonably practicable after the Commencement Date, and complete the Works in accordance with the
above-named documents within the Time for Completion.
Unless and until a formal Agreement is prepared and executed this Letter of Tender, together with your
written acceptance thereof, shall constitute a binding contract between us.
We understand that you are not bound to accept the lowest or any tender you may receive.
Signature ________________ in the capacity of ____________________________________________
duly authorised to sign tenders for and on behalf of _________________________________________
Address: ___________________________________________________________________________
Date: ______________________________________________________________________________
* If the Tenderer does not accept, this paragraph may be deleted and replaced by:
We do not accept your suggestions for the appointment of the DAB. We have included our
suggestions in the Schedule, but these suggestions are not conditions of this offer. If these
suggestions are not acceptable to you, we propose that the DAB be jointly appointed in accordance
with Sub-Clause 20.2 of the Conditions of Contract.

APPENDIX TO TENDER
[Note: with the exception of the items for which the Employer's requirements have been inserted, the
following information must be completed before the Tender is submitted]

Employer's name and address 1.1.2.2 & 1.3 <Insert name of Employer>
Contractor's name and address 1.1.2.3 & 1.3 <To be filled by the Contractor>
Engineer's name and address 1.1.2.4 & 1.3 <Insert name of the Engineer>
Time for Completion of the Works 1.1.3.3 <Insert time> days
Defects Notification Period 1.1.3.7 365 days
Electronic transmission systems 1.3 Facsimile only
Governing Law 1.4 Romanian law
Ruling language 1.4 Romanian
Language for communications 1.4 Romanian
Time for access to the Site 2.1 21 days after Commencement Date
Amount of Performance Security 4.2 10 % of the Accepted Contract Amount, in

the currencies and proportions in which
the Contract Price is payable
Maximum Amount of Sub- 4.4 50% of the Accepted Contract Amount

Contracting
Period for Notifying unforeseeable 5.1 <Insert No.> days

errors, faults and defects in the Em-
ployer' Requirements
Normal working hours 6.5 08:00 - 16:00 Monday to Friday
Delay damages for the Works 8.7 & 14.15(b) 0.1% of the final Contract Price per day, in
the currencies and proportions in which
the Contract Price is payable
Maximum amount of delay damages 8.7 15% of the final Contract Price
Percentage for adjustment of Provi- 13.5(b) 5%

sional Sums
Initials of signatory of Tender ___________________________________________________________

Adjustment for Change in Cost Table 13.8

of adjustment data
Example
Coefficients and description Cost index Range of coefficient Coefficient value
of related cost elements (2) value (4)
(1) (3)
a - fixed 0.1 0.1
b - Labour L 0.01 – 0.25
c - Bitumen B 0.01 – 0.25
d - Fuel F 0.01 – 0.25
e - Aggregates A 0.01 – 0.25
f - Energy E 0.01 – 0.25
g - Equipment/Machinery M 0.01 – 0.25
h - Steel S 0.01 – 0.25
i - Cement C 0.01 – 0.25
Total 1.00
Note:
The tenderer shall fill in column (4) with value of relevant coefficient - falling within the range specified in column (3).
Sources of indices:
Index for adjustment (1) Published source of Index (2) Base value at
Base Date (3)
Labour L National Institute of Statistics. Monthly Bulletin
Table for: Average nominal salary, for the na-
tional economy, Construction Industry, Gross
average salary for the month in question
Bitumen B As above. Tables for indices of price for the
industrial production. Sector of crude oil ex-
traction
Fuel F As above. Tables for indices of market price
goods and services. Sector: liquid fuels
Aggregates A As above. Tables for indices of prices for the
industrial production. Sector: other non metallic
mineral products manufacturing
Energy E As above. Tables for indices of prices for the
industrial production. Sector: production,
transport and distribution of electricity, gas and
hot water
Equipment/Machinery M As above. Tables for indices of prices for the
industrial production. Sector: Outfits for mines,
quarries and construction manufacturing.
Steel S As above. Tables for indices of prices for the
industrial production. Sector: metallic construc-
tion and components manufacturing.
Cement C As above. Tables for indices of prices for the
industrial production. Sector: cement manufac-
turing.
Note: The tenderer shall quote in column (3) the value of the cost index at the Base Date.

Total advance payment 14.2 In accordance with the provisions of Gov-

ernment Decision No. 264/2003 as further
modified and completed
Number and timing of instalments 14.2 In accordance with the provisions of Gov-
Currencies and proportions 14.2 In accordance with the provisions of Gov-

Start repayment of advance payment 14.2(a) In accordance with the provisions of Gov-
Repayment amortisation of advance 14.2(b) In accordance with the provisions of Gov-

payment ernment Decision No. 264/2003 as further
Percentage of retention 14.3 10% of each certificate
Limit of Retention Money 14.3 5% of Accepted Contract Amount
If Sub-Clause 14.5 applies:

Plant and Materials for payment 14.5(b) [project requirements]
when shipped en route to the Site [project requirements]
Minimum amount of Interim Payment 14.6 1% of Accepted Contract Amount

Certificates
Currency/currencies of payment 14.15 Romanian Leu (RON)
Periods for submission of insurance:

(a) evidence of insurance 18.1 14 days
(b) relevant policies 18.1 21 days
Maximum amount of deductibles for 18.2(d)

insurance of the Employer's risks
Minimum amount of third party insur- 18.3 500,000 EUR per occurrence with the
ance number of occurrences unlimited

Date by which the DAB shall be ap- 20.2

70 days after the Commencement Date
pointed
The DAB shall be 20.2 DAB of one member
Appointment (if not agreed) to be 20.3 The President of FIDIC or a person ap-
made by pointed by the President
Number of arbitrators 20.6 1
Language of arbitration 20.6 Romanian
Place of arbitration 20.6 Bucharest
If there are Sections:

Definition of Sections:
Description Time for Completion Delay Damages

(Sub-Clause 1.1.5.6) (Sub-Clause 1.1.3.3) (Sub-Clause 8.7)
Signature _____________________________________
Capacity _____________________________________
duly authorised to sign for and on behalf of _______________________________________

CONTRACT AGREEMENT
This Agreement made the <Insert date, month and year>.
Between <Insert name of Employer> of Romania (hereinafter called "the Employer") of the one part, and
<Insert name and country of Contractor> (hereinafter called "the Contractor") of the other part.
Whereas the Employer desires that the Works known as <Insert project name> should be executed by the
Contractor, and has accepted a Tender by the Contractor for the execution and completion of these Works
and the remedying of any defects therein,
The Employer and the Contractor agree as follows:

1. In this Agreement words and expressions shall have the same meanings as are respectively assigned
to them in the Conditions of Contract hereinafter referred to.
2. The following documents shall be deemed to form and be read and construed as part of this
Agreement:
(a) The Letter of Tender dated <Insert date>
(b) The Addenda Nos. <Insert nos., if any>
(c) The Conditions of Contract
(d) The Specification
(e) The Drawings, and
(f) The completed Schedules.
3. In consideration of the payments to be made by the Employer to the Contractor as hereinafter
mentioned, the Contractor hereby covenants with the Employer to execute and complete the Works
and remedy any defects therein, in conformity with the provisions of the Contract.
4. The Employer hereby covenants to pay the Contractor, in consideration of the execution and
completion of the Works and the remedying of defects therein, the Contract Price at the times and in
the manner prescribed by the Contract.
In Witness whereof the parties hereto have caused this Agreement to be executed the day and
SIGNED by: ______________________________ SIGNED by: ______________________________
for and on behalf of the Employer in the presence for and on behalf of the Contractor in the presence
of of
Witness: ________________________________ Witness: ________________________________
Name: ________________________________ Name: ________________________________
Address: ________________________________ Address: ________________________________
Date: ________________________________ Date: ________________________________

E.2- FIDIC Green Book

This Appendix E.2includes the recommended templates for the FIDIC green
book for contractual issues as outlined in Chapter 8 above:
• Agreement
• Appendix.

AGREEMENT
The Employer is
…………………………………………………………………………………………………………………………. of
…………………………………………………………………………………………………………………………….
The Contractor is
…………………………………………………………………………………………………………………………. of
…………………………………………………………………………………………………………………………….
The Employer desires the execution of certain Works known as
…………………………………………………………………………………………………………………………….
OFFER
The Contractor has examined the documents listed in the Appendix which forms part of this Agreement and
offers to execute the Works in conformity with the Contract for the sum, excluding value added tax (VAT), of
………………………………………………………………………………………………………………… (in words)
……………………………………………………………………….…….….. (in figures) (…………………………..)
to which the following VAT amount will be added
………………………………………………………………………………………………………………… (in words)
……………………………………………………………………….…….….. (in figures) (…………………………..)
or for such other sum as may be ascertained under the Contract.
This offer, of which the Contractor has submitted two signed originals, may be accepted by the Employer by
signing and returning one original of this document to the Contractor before…………………… (date).
The Contractor understands that the Employer is not bound to accept the lowest or any offer received for the
Works.
Signature: ……………………………………….. Date: ………………………………………………..

Name: ……………………………………….. Authorised to sign on behalf of (organization name):
………………………………………………………………..
Capacity: ………………………………………..
ACCEPTANCE
The Employer has by signing below, accepted the Contractor's offer and agrees that in consideration for the
execution of the Works by the Contractor, the Employer shall pay the Contractor in accordance with the
Contract. This Agreement comes into effect on the date when the Contractor receives one original of this
document signed by the Employer.
Signature: ……………………………………….. Date: ………………………………………………..

Name: ……………………………………….. Authorised to sign on behalf of (organization name):
………………………………………………………………..
Capacity: ………………………………………..

APPENDIX
This Appendix forms part of the Agreement.
[Note: with the exception of the items for which the Employer's requirements have been inserted, the
Contractor shall complete the following information before submitting his offer.]
Documents forming the Contract listed in 1.1.1
the order of priority
Document (delete if not applicable) Document Identification
(a) The Agreement…………………
(b) Particular Conditions…………...
(c) General Conditions……………..
(d) The Specification……………….
(e) The Drawings…………………..
(f) The Contractor's tendered design
(g) The bill of quantities……………
(h) ………………………………….
(i) …………………………………..
Time for Completion 1.1.9 _____ days
Law of the Contract 1.4 Romanian Law
Language 1.5 Romanian
Provision of Site 2.1 Commencement Date
Authorised Person 3.1
Name and Address of Employers Repre- 3.2

sentative (if known)
Performance Security (if any)
Amount 4.4 10% of the sum stated in the Agreement
Form 4.4 As per form attached
Requirements for Contractor's design (if 5.1 Refer Specification Clause No. ….
any)
Programme
Time for Submission 7.2 Within 14 days of the Commencement Date
Form of Programme 7.2
Amount payable due to failure to com- 7.4 0.1% per day up to a maximum of 10% of sum
plete stated in the Agreement
Period for notifying defects 9.1 & 11.5 365 days calculated from the dated stated in
the notice under Sub-Clause 8.2
Variation procedure
Daywork rates 10.2 ______________ (details)
Valuation of the Works
Lump sum Price 11.1 ______________ (details)

Lump sum price with schedules of 11.1 ______________ (details)

rates
Lump sum price with bill of quanti- 11.1 ______________ (details)

ties
Remeasurement with tender bill 11.1 ______________ (details)

of quantities
Cost reimbursable 11.1 ______________ (details)

Percentage of value of Materials and 11.2 Materials __________ 80%
Plant
Plant ______________ 90%
As all Materials and Plant on Site are deemed
to be the property of the Employer (Sub-
Clause 4.1)
Percentage of retention 11.3 ___________________ 5%
Currency of payment 11.7 __________________ RON
Rate of interest 11.8 National Bank of Romania reference rate at

Contract signature plus 3 percentage points,
per annum
Insurances 14.1
Type of Cover: Amount: Exclusions:
The Works, Materials, Plants and The sum stated in the Agree-
Fees ment plus 15%
Contractor's Equipment Full replacement cost
Third Party injury to persons and 500 000 Euro per event. Unlim-
damage to property ited number of events
Workers As per legislation in force
Other cover
Arbitration Rules 15.3 Rules of procedures of the International

Commercial Arbitration Court at the Romanian
Chamber of Commerce and Industry
Appointing Authority 15.3 President of the International Commercial Ar-

bitration Court at the Romanian Chamber of
Commerce and Industry
Place of Arbitration 15.3 Bucharest
Signature _____________________________________
Capacity _____________________________________
duly authorised to sign for and on behalf of _______________________________________

Appendix F - DAB Agreements

This Appendix F includes the recommended templates for the following DAB
agreements as outlined in Chapter 8 above:
• Dispute Adjudication Agreement (one person DAB)
• Dispute Adjudication Agreement (three person DAB).

DISPUTE ADJUDICATION AGREEMENT [for a one-person DAB]
Name and details of Contract _______________________________________________________

Name and address of Employer _______________________________________________________
Name and address of Contractor _______________________________________________________
Name and address of Member _______________________________________________________
Whereas the Employer and the Contractor have entered into the Contract and desire jointly to appoint the
Member to act as sole adjudicator who is also called the "DAB".
The Employer, Contractor and Member jointly agree as follows:
1. The conditions of this Dispute Adjudication Agreement comprise the "General Conditions of Dispute
Adjudication Agreement", which is appended to the General Conditions of the "Conditions of Contract
for Construction" First Edition 1999 published by the Fédération Internationale des Ingénieurs-
Conseils (FIDIC), and the following provisions. In these provisions, which include amendments and
additions to the General Conditions of Dispute Adjudication Agreement, words and expressions shall
have the same meanings as are assigned to them in the General Conditions of Dispute Adjudication
Agreement.
2. [Details of amendments to the General Conditions of Dispute Adjudication Agreement, if any. For
example:
In the procedural rules annexed to the General Conditions of Dispute Adjudication Agreement, Rule _
is deleted and replaced by: ………]
3. In accordance with Clause 6 of the General Conditions of Dispute Adjudication Agreement, the
Member shall be paid as follows:
A retainer fee of <Insert amount> per calendar month, plus
A daily fee of <Insert amount> per day.
4. In consideration of these fees and other payments to be made by the Employer and the Contractor in
accordance with Clause 6 of the General Conditions of Dispute Adjudication Agreement, the Member
undertakes to act as the DAB (as adjudicator) in accordance with this Dispute Adjudication
Agreement.
5. The Employer and the Contractor jointly and severally undertake to pay the Member, in consideration
of the carrying out of these services, in accordance with Clause 6 of the General Conditions of Dispute
Adjudication Agreement.
6. This Dispute Adjudication Agreement shall be governed by the law of Romania.

SIGNED by: _________________ SIGNED by: _________________ SIGNED by: ______________
for and on behalf of the Employer for and on behalf of the Contractor The Member in the presence of
in the presence of in the presence of in the presence of
Witness: _________________ Witness: _________________ Witness: _______________

Name: _________________ Name: ____________________ Name: _______________
Address: _________________ Address: _________________ Address: _______________
Date: _________________ Date: _________________ Date: _______________

DISPUTE ADJUDICATION AGREEMENT [for each member of a three-person DAB]
Name and details of Contract _______________________________________________________

Name and address of Employer _______________________________________________________
Name and address of Contractor _______________________________________________________
Name and address of Member _______________________________________________________
Whereas the Employer and the Contractor have entered into the Contract and desire jointly to appoint the
Member to act as one of the three persons who are jointly called the "DAB" [and desire the Member to act as
chairman of the DAB].
The Employer, Contractor and Member jointly agree as follows:
1. The conditions of this Dispute Adjudication Agreement comprise the "General Conditions of Dispute
Adjudication Agreement", which is appended to the General Conditions of the "Conditions of Contract
for Construction" First Edition 1999 published by the Fédération Internationale des Ingénieurs-
Conseils (FIDIC), and the following provisions. In these provisions, which include amendments and
additions to the General Conditions of Dispute Adjudication Agreement, words and expressions shall
have the same meanings as are assigned to them in the General Conditions of Dispute Adjudication
Agreement.
2. [Details of amendments to the General Conditions of Dispute Adjudication Agreement, if any. For
example:
In the procedural rules annexed to the General Conditions of Dispute Adjudication Agreement, Rule _
is deleted and replaced by: " … "]
3. In accordance with Clause 6 of the General Conditions of Dispute Adjudication Agreement, the
Member shall be paid as follows:
A retainer fee of <Insert amount> per calendar month; plus
A daily fee of <Insert amount> per day.
4. In consideration of these fees and other payments to be made by the Employer and the Contractor in
accordance with Clause 6 of the General Conditions of Dispute Adjudication Agreement, the Member
undertakes to serve, as described in this Dispute Adjudication Agreement, as one of the three persons
who are jointly to act as the DAB.
5. The Employer and the Contractor jointly and severally undertake to pay the Member, in consideration
of the carrying out of these services, in accordance with Clause 6 of the General Conditions of Dispute
Adjudication Agreement.
6. This Dispute Adjudication Agreement shall be governed by the law of Romania.

SIGNED by: _________________ SIGNED by: _________________ SIGNED by: ______________
for and on behalf of the Employer for and on behalf of the Contractor The Member in the presence of
in the presence of in the presence of in the presence of
Witness: _________________ Witness: _________________ Witness: _______________

Name: _________________ Name: ____________________ Name: _______________
Address: _________________ Address: _________________ Address: _______________
Date: _________________ Date: _________________ Date: _______________

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Romania

Ministry of Public Finance

Funded by the European Union

Member of COWI Consortium

Report no. Employer User Guide for Particular Conditions of Contract

1 Introduction and Background 4

2 Basic Rules for Works Contracts 8

3 The FIDIC 1999 Documents 10

4 The FIDIC Red Book 14

5 The FIDIC Yellow Book 64

6 The FIDIC Green Book 113

bfc2-071_fidic user guide_250407_final.DOC .

7 Templates for Guarantees 129

8 Templates for Contractual Issues 131

bfc2-071_fidic user guide_250407_final.DOC .

bfc2-071_fidic user guide_250407_final.DOC .

1 Introduction and Background

In November 2006, the Contract was proposed modified by eliminating activi-

1.2 Application of the FIDIC Conditions of Contract

In this Agreement, FIDIC granted non-exclusive rights to MPF to translate into

According to Clause 4 of the Agreement, the copyright of the translation shall

bfc2-071_fidic user guide_250407_final.DOC .

1.3 Romanian Legislation

bfc2-071_fidic user guide_250407_final.DOC .

• Legal framework with regard to public finance:

1.4 Standard Tender Documents

bfc2-071_fidic user guide_250407_final.DOC .

General Conditions of Contract

bfc2-071_fidic user guide_250407_final.DOC .

2 Basic Rules for Works Contracts

2.1 Procurement Rules

2.2 Tender Procedure and Conditions of Contract

Finally, it should be understood that tender procedures do not replace adequate

2.3 Procurement Rules after Contract Signature

bfc2-071_fidic user guide_250407_final.DOC .

In particular, modifications to the original contract incorporating additional

2.4 Particular Conditions

It is therefore recommended that Employers, when drafting particular condi-

2.5 Contract Management

bfc2-071_fidic user guide_250407_final.DOC .

3 The FIDIC 1999 Documents

3.1 The FIDIC 1999 Documents

bfc2-071_fidic user guide_250407_final.DOC .

3.2 Choice between the FIDIC Documents

General guidance is provided in the FIDIC Contracts Guide - issued in 2000 -

Relatively small value contract, short construction time or involving simple

Larger or more complex projects

1. Is the Employer (or the Engineer) going to do most of the design?

2. Is the Contractor going to do most of the design?

bfc2-071_fidic user guide_250407_final.DOC .

- The Engineer (or Employer's representative) administered the Contract,

3. Is it a privately Financed (or Public/Private Financed) Project, of the

4. Is it a Process Plant or a Power Plant (or a factory or similar) where the

bfc2-071_fidic user guide_250407_final.DOC .

5. Is it an Infrastructure Project (e.g., road, rail link, bridge, water or sewage

6. Is it a Building Project where the Employer wishes to have his building(s)

7. Is it a reconstruction or refurbishment or other type of Project?

bfc2-071_fidic user guide_250407_final.DOC .

4 The FIDIC Red Book