NICMARCOMAPRATIVE STYDY EVALUATION OF PROBLEM IN INTERNATIONAL CONSTRUCTION CONTRACT CONDITIONS By- Ranjan Kumar-P81086 Utpal Ingle-P81115 Vikrant Desmukh-P81121 PGP PEM 8 th Batch (2012 - 2014G!"#$# B%- P&') D$*'+a, R'% A Mini Thesis submitted in Academic Requirement for the Post Graduate Programme in Project Engineering and Management (PGP PEM)
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,e.erre, pament terms an, ee+uti*n *. turnke pr*je+ts an, +iil +*nstru+ti*n +*ntra+ts
a3r*a, are +*lle+tiel re.erre, t* as Pr*je+t $p*rts #he nature *. Pr*je+t $p*rts 3eing un,ertaken in sense re.le+ts the te+hn*l*gi+al maturit an, in,ustrial +apa3ilities
*. a +*untr ep*rts *. pr*je+ts an, seri+es +an 3e 3r*a,l +ateg*rie, int* 9i: +iil
+*nstru+ti*n Pr*je+ts 9ii: turnke pr*je+ts 9iii: +*nsultan+ seri+es an, 9i:supplies
primaril 3 /a *. +apital g**,s an, in,ustrial manu.a+tures
an, timel ,elier *. 4ualit pr*,u+ts an, seri+es has earne, pr*je+t ep*rters .r*m
In,ia a .air ,egree *. g**,/ill an, stan,ing
Pr*je+t $p*rts .r*m In,ia +*mmen+e, /ith a m*,est 3eginning in the late 1;<0s %in+ethen pr*je+t ep*rts hae e*le, *er the ears /ith In,ian +*mpanies ,em*nstrating
+apa3ilities an, epertise spanning a /i,e range *. se+t*rs #he nature *. Pr*je+t $p*rts
3eing un,ertaken re.le+ts the te+hn*l*gi+al maturit an, in,ustrial +apa3ilities in the
#he Punja3 Chemi-Plants )t, PCP is a Chan,igarh 3ase, C*mpan It /as
in+*rp*rate, in 1;6; as a pu3li+ limite, +*mpan in the j*int se+t*r /ith the Punja3%tate In,ustrial Deel*pment C*rp*rati*n - P%IDC #he pai, up +apital *. PCP is Rs
<5 milli*n In a,,iti*n Rs 2 milli*n /ere +*ntri3ute, 3 P%IDC in the .*rm *.20000
re,eema3le +umulatie pre.eren+e shares *.Rs 100 ea+h It is a tightl hel, .amil
+*ntr*lle, C*mpan
PCP /as set up primaril .*r un,ertaking +*ntra+ts .*r ere+ti*n *. p*/er plants an,
+hemi+al manu.a+turing units It 3e+ame a market lea,er in the area *. its spe+ialisati*n
an, ee+ute, <0 pr*je+ts until 1;8> #he annual turn*er als* r*se .r*m Rs 1; milli*n
initiall t* *er Rs 500 milli*n in 1;8> an, t* Rs -?;> milli*ns in 1;;> It entere, the
pr*je+t ep*rt 3usiness in mi, seenties as a su3-+*ntra+t*r t* an*ther In,ian C*mpan
- $ngineering Pr*je+ts In,ia )t, /h* /ere the prime +*ntra+t*rs *. a pr*je+t in Ku/ait
)ater +iil +*nstru+ti*n 3e+ame its main line 3usiness an, it has 3een *perating m*stl
in the @ul. markets It als* takes up +*ntra+ts in the .iel, *. me+hani+al +*nstru+ti*n
maintenan+e an, *perati*ns an, turnke j*3s #he C*mpan enj*s a g**, market
reputati*n .*r its te+hni+al +*mpeten+ in pr*je+t ee+uti*n
@l*3aliati*n has 3e+*me the +at+h/*r, in the $merging +*n.igurati*ns *. nati*nal
e+*n*mies as it +reates in+rease inter,epen,en+e an, inter+*nne+te,ness *. nati*nal
e+*n*mies thus resulting in the er*si*n *. a nati*ns aut*n*m It 3rings a3*ut
multipli+it *. linkages an, inter+*nne+ti*ns 3et/een states s*+ieties an, +*rp*rate
entities It en+*mpasses the pr*+esses 3 /hi+h eentsH ,e+isi*ns an, a+tiities in *ne part *. the /*rl, +*me t* hae signi.i+ant +*nse4uen+es .*r +*mmunities +*rp*rates an,
in,ii,uals in 4uite ,istant parts *. the gl*3e
7hat /*ul, *ne p*stulate t* 3e the *ut+*me *. gl*3aliati*n
*. l*+al material "n, thr*ugh this l*+al +anas a ri+h tra,iti*n . rituals an, li.estles
/eae their */n patterns But in all these +*untries there is a rang +*mm*n threa, *. ast
e+*n*mi+ ,isparities an, als* italit *. .*lk tra,iti*ns eeking epressi*ns
21 #he !i,,le $ast=
:ur attitu,e t*/ar,s the !i,,le $ast an, "ra3s has +hange, sin+e the 3eginning *. ;<0s
7hen the *il pri+e epl*si*n turne, this ari, an, largel empt lan, int* the +hest market
in the /*rl, "t *ne time the aerage mans +*nsent *. !i,,le $ast /as ne *. the en,less
,esert +amels *ases mirages an, 3ell ,an+es
imes +hange t*,a the !i,,le $ast stan,s .*r *il (* l*nger hae the "ra3s sat stri,e his
+amel Instea, he l*unges in the 3a+k *. his +ust*m 3uilt r*lls its an aggerati*n *.+*urse 3ut it seres t* emphasis h*/ *ur mental pi+ture at the mi,,le sst in Iran %au,i
"ra3ia Ku/ait U"$ $gpt an, %u,an
uher markets su+h as Fatar man an, Bahrain are use.ul 3ut n*t parti+ularl large
rarkets su+h as )i3a an, Ira4 ma 3e large 3ut ,ue t* p*liti+al pr*3lems are resentl *.
s*me/hat limite, alue alth*ugh situati*n in )i3a seems t* 3e ianging .*r the 3etter
lul. has er small p*pulati*n /hi+h +*ul, n*t p*ssi3l sustain the +*nstru+ti*n
r*grarnme, in,e.inite 7ith the in+rease, kn*/le,ge in the .iel, *. epl*rati*n *.
ur attitu,e t*/ar,s the !i,,le $ast an, "ra3s has +hange, sin+e the 3eginning *.
1;<0s 7hen the *i I pri+e epl*si*n turne, this ari, an, largel empt lan, int* the
ri+hest market in the /*rl, "t *ne time the aerage mans +*nsent *. !i,,le $ast /as
*ne *. the en,less ,esert +amels *ases mirages an, 3ell ,an+es
#imes +hange t*,a the !i,,le $ast stan,s .*r *il (* l*nger hae the "ra3s sat astri,ehis +amel Instea, he l*unges in the 3a+k *. his +ust*m 3uilt r*lls its an eaggerati*n *.
+*urse 3ut it seres t* emphasis h*/ *ur mental pi+ture at the mi,,le east in Iran %au,i
"ra3ia Ku/ait U"$ $gpt an, %u,an
ther markets su+h as Fatar man an, Bahrain are use.ul 3ut n*t parti+ularl large
markets su+h as )i3a an, Ira4 ma 3e large 3ut ,ue t* p*liti+al pr*3lems are presentl
*. s*me/hat limite, alue alth*ugh situati*n in )i3a seems t* 3e +hanging .*r the
3etter
@ul. has er small p*pulati*n /hi+h +*ul, n*t p*ssi3l sustain the +*nstru+ti*n pr*gramme, in,e.inite 7ith the in+rease, kn*/le,ge in the .iel, *. epl*rati*n *.
*il an, gas 3*th *n lan, an, *..sh*re an, large p**l *. traine, manp*/er In,ia +an
3e+*me p*tential 3i,,er .*r !i,,le $ast market
E22 7estern an, %*uthern ".ri+a=
#here is er str*ng ei,en+e t* suggest that the *il 3elt /hi+h trans.*rme, (igeria/ithin a ,e+a,e .r*m *ne *. the p**rest nati*ns in the /*rl, int* the e+*n*mi+ p*/er *.
".ri+a ma etent right ar*un, the gul. *. guinea an, that the .iel,s s* .ar ,is+*ere, are
*nl a tin .ra+ti*n *. the t*tal reseres #his ie/ /as en,*rse, in the /*rl, 3ank rep*rt
*n gl*3al *il reseres /hi+h single, *ut the /estern +*ast *. ".ri+a .r*m %enegal t* as
.ar s*uth as (ami3ia as a parti+ularl pr*mising area *. epl*rati*n #he +*untries in this
regi*n apart .r*m (igeria an, @hana I*r C*ast )i3eria %ierra )e*ne an, %enegal
Clearl the ,is+*er *. large 4uantities *. *il /*ul, trans.*rm the e+*n*m *. the
regi*n #his +*ul, make /est ".ri+a the great +*nstru+ti*n gr*/th market It there.*re
3e+*mes an area *. the /*rl, /ell /*rth inestigating %*uthern ".ri+a +*nsists *. %*uth".ri+a )es*th* %/ailan, transkei "ng*la B*ts/ana !*am3i4ue an, Gam3ia
%*me *. the +*untries in regi*n are p*liti+all n*t er sta3le 'r*m purel +*mmer+ial
p*int *. ie/ the +ase .*r inesting in the tra,ing /ith %*uth ".ri+a is etremel str*ng
#his is p*liti+all 4uite sta3le n*/ Despite un,*u3te, pr*3lems in *ther still ,eel*ping
+*untries in the regi*n there are plent *. *pp*rtunities %* the regi*n sh*ul, n*t 3e l*st
pr*t*tpe m*,el h*uses .*r rural areas in+*rp*rating 3asi+ sanitar .eatures as /ell as
s*lar /ater heating an, impr*e, +*nstru+ti*n ,etails Bhutan an, In,ia are s* +l*sel
linke, that 3*th +an 3ene.it 3 e+hange *. tra,iti*nal Bhutanese ar+hite+tural an, ,esign
*. seismi+all s*un, stru+tures
)an, sh*rtage is *ne *. the m*st a+ute pr*3lems .a+ing the !al,ies t*,a 7ith p*pulati*n gr*/th at E5 an, high rate *. ur3an migrati*n the +*untries main ur3an
+enter !ale n*/ has >50 pe*ple per he+tare #he *rigin *. t*urism is m*re in !al,ies
/as in great part ,ue t* .e/ l*+al in,ii,uals #he nee, t* e+*n*mie here meant l*+al
materials in,igen*us 3uil,ing te+hni4ues an, the +a,jan ar+hite+ture +hara+teristi+s *.
mal,iian t*urist res*rt
(epal is sprea, *ut length/ise 3et/een n*rthern UP an, 7est Bengal Katman,u is the
largest an, *er+r*/,e, *nl ur3an metr*p*lis Aighest m*untains in the n*rth an,
.ertile plains in s*uth make the t*p*graph *. (epal A*using +*nstru+ti*n in (epal has
3een the ,*main *. */n 3uil,er @*ernment *. (epal has *.. late prepare, a lan, use plan using g*ernment in.rastru+ture In,ia ,*es g*ernment h*using in a 3ig /a an,
the t/* +*untries +an hae ri+h e+hange *. pra+ti+es .*ll*/e, in ea+h *ther lan, ..
late the relati*nship 3et/een In,ia an, Pakistan sh*/ an impr*ing tren, ".ter
in,epen,en+e In,ia has ma,e greater te+hn*l*gi+al instituti*ns Until the esta3lishment
*. P7D s+h**l *. ar+hite+ture in Kara+hi the *nl aaila3le institute /as !a* s+h**l *.
art in )ah*re In the area *. health+are
Pakistan has 3een taking help .r*m In,ia /h the same +an n*t 3e eten,e, in the .iel,
*. te+hn*l*g trans.er an, training the manp*/er
EE @P
C*untr %tatisti+s at a @lan+e
C*untr rankings *. the tpe presente, 3el*/ +ann*t preten, t* 3e ,e.initieH instea,
the aspire *nl t* pr*i,e the rea,er /ith an appr*imati*n *. the high an, l*/ en,s *n
a parti+ular s+ale C*untr ,ata ar en*rm*usl ,epen,ing *n the s*ur+es an, the
#he e+hange rate epresses the nati*nal +urren+s 4u*tati*n in respe+t t* .*reign *nes
'*r eample i. *ne U% ,*llar is /*rth 10000 apanese &en then the e+hange rate *.,*llar is 10 000 &en I. s*mething +*sts E0000 &en it aut*mati+all +*sts E U% ,*llars as
a matter *. a++*untan+ @*ing *n /ith .i+ti*us num3ers a apan @DP *. 8 milli*n &en
/*ul, then 3e /*rth 800 D*llars
#hus the e+hange rate is a +*nersi*n .a+t*r a multiplier *r a rati* ,epen,ing *n the
,ire+ti*n *. +*nersi*n
In a slightl ,i..erent perspe+tie the e+hange rate is a pri+e I. the e+hange rate +an
.reel m*e the e+hange rate ma tum *ut t* 3e the .astest m*ing pri+e in the
e+*n*m 3ringing t*gether all the .*reign g**,s /ith it
usuall the results *. mat+hing *. ,eman, an, suppl *n .inan+ial markets *r in 3anking
transa+ti*n 9usuall /ith +entral 3ank as a *ne si,e *. the relati*nship:
ther 3ilateral e+hange rates ma 3e simpl +*mpute, .r*m triangular relati*nships= i.
the e+hange rate ,*llarJen is 10 000 an, the ,*llarJ"ng*lan k/ana is 100000 then as
a matter *. +*mputati*n *ne en is /*rth 10 k/ana (* ,ire+t enJk/ana transa+ti*n
nee,s t* take pla+e I. instea, there eist a .inan+ial market .*r en t* 3e e+hange,
/ith k/ana the epe+tati*n is that a+ti*ns 3 spe+ulat*rs 9ar3itrage am*ng markets:
/ill 3ring the parit *. 10 k/ana per en as an e..e+t
!ultilateral e+hange rates are +*mpute, in *r,er t ju,ge the general ,nami+s *. a
+*untrs +urren+ t*/ar, the rest *. the /*rl, ne takes a 3asket *. ,i..erent
+urren+ies sele+t a 9m*re *r less: meaning.ul set *. relatie /eights then +*mputes the
Le..e+tieL e+hange rate *. that +*untrs +urren+
'*r instan+e haing a 3asket ma,e up *. >0 U% ,*llars an, 60 @erman marks a +urren+that su..ere, .r*m a alue l*ss *. 10 in respe+t t* ,*llar an, >0 t* mark /ill 3e sai,
haing .a+e, an Le..e+tieL l*ss *. 106 X >0" M 22
%*me +*untries imp*se the eisten+e *. m*re than *ne e+hange rate ,epen,ing *n the
tpe an, the su3je+ts *. the transa+ti*n !ultiple e+hange rates then eist usuall
+urren+ in *r,er t* 3u them In this +ase higher interest rates attra+t +apital .r*m
a3r*a, an, the +urren+ sh*ul, appre+iate De+isie /*ul, 3e the ,i..eren+e 3et/een
,*mesti+ an, .*reign interest rates thus a re,u+ti*n in interest rates a3r*a, /*ul, hae
the same e..e+ts
%imilarl *ther .ie,-interest .inan+ial instruments +*ul, 3e *3je+t *. the same ,nami+s
"++*r,ingl an in+rease *. ,*mesti+ interest rates 3 the +entral 3ank is usuall
+*nsi,ering a /a t* L,e.en,L the +urren+
(*nerheless it ma happen that .*reigners rather 3u shares instea, *. #reasur 3*n,s
I. this /ere the str*ngest +*mp*nent *. +urren+ ,eman, then an in+rease *.
interest rate ma een pr**ke the *pp*site result sin+e an in+rease *. interest rate 4uite
*.ten ,epresses the st*+k market .a*uring a ti,e *. share ales 3 .*reigners
In the same LinersalL ,ire+ti*n might .*reign ,ire+t inestments /*rk " restri+tie
m*netar p*li+ usuall ,epresses the gr*/th perspe+tie *. the e+*n*m I. 'DI are
mainl attra+te, 3 sales perspe+ties an, the +*nstitute a large +*mp*nent *. +apital
.l*/s then 'DI in.l*/ might st*p an, the +urren+ /eaken
(ee,less t* sa th*se +*n,iti*ns are 4uite restri+tie an, n*t s* usuall met
"s a temp*rar +*n+lusi*n interest rates sh*ul, hae an imp*rtant impa+t *n e+hange
rate 3ut *ne has t* 3e +are.ul t* +he+k a,,iti*nal +*n,iti*ns
2 In.lati*n rate is *.ten +*nsi,ere, as a ,eterminant *. the e+hange rate as /ell " highin.lati*n sh*ul, 3e a++*mpanie, 3 ,epre+iati*n #he m*re s* i. *ther +*untries enj*
l*/er in.lati*n rates sin+e it sh*ul, 3e the ,i..eren+e 3et/een ,*mesti+ an, .*reign
in.lati*n rates t* ,etermine the ,ire+ti*n an, the s+ale *. e+hange rate m*ements
"ll this /*ul, 3e implie, 3 a /eak ersi*n *. L*ne pri+e la/L stating that pri+e
,nami+s *. a g**, are the same /*rl,/i,e a.ter taking int* a++*unt n*minal e+hange
#he +*ntra+t*rs sh*ul, pass in all items *. L$ssential Fuali.ing CriteriaL an, sh*ul,
*3tain minimum 60 marks *ut *. the 100 *. Lther Fuali.ing CriteriaL t* get sh*rt
liste, te+hni+all 4uali .ie,
#en,erer 9s: ma please n*te that their *..ers /ill 3e ealuate, as per the
+re,entialsJ,*+uments atta+he, 3 the ten,erer 9s: al*ng /ith the ten,er
'*r *n 3ehal. *.
IRC( I(#$R("#I(") )It-l#$D
Registere, ..i+e= IRC( Ii=#$R("#IiS")USlI#$ Palika Bha/an %e+t*r-OIII R
K Puram (e/ Delhi- 110066 In,ia #el (* X;1-011-2688;E6 'a (*26885 165 $-!ail= in.*[ir+*nnel+*m
>10 PR$-BID C('$R$(C$
".ter the ten,er ,*+uments are issue, t* sh*rrliste, +*ntra+t*rs an, su..i+ientl ahea, *.
the ,ate *. su3missi*n *. ten,ers a pre-3i, +*n.eren+e is hel, 3 the empl*erJt* /hi+h
all the inten,ing 3i,,ers are inite, Be.*re this +*n.eren+e the inten,ing 3i,,ers areals* en+*urage, t* isit the site an, see .*r themseles the site +*n,iti*ns the .a+ilities
aaila3le at the site an, its i+init an, eamine all ,ata *n inestigati*ns et+ that is
aaila3le /ith pr*je+t auth*rit s* that the +*ntra+t*rs hae a +lear pi+ture *. /hat is
epe+te, *. them an, the +*n,iti*ns un,er /hi+h the /*rks are t* 3e ee+ute, In the
+*n.eren+e the j*3 re4uirements /ill 3e +lari.ie, an, +*ntra+t +*n,iti*ns eplaine,
/hereer an eplanati*n is s*ught B this the +*ntra+t*rs /*ul, hae a +lear i,ea *. the
+*n,iti*ns *. the +*ntra+t an, the /ill als* 3e .ree t* ask .*r +lari.i+ati*n *n an *. the
j*3 re4uirements ,esign spe+i.i+ati*ns et+ an, the ari*us +*ntra+t +lauses in+lu,ing
their legal impli+ati*ns " summar re+*r, *. the +*n.eren+e /ill 3e prepare, an, sent t*
all the inten,ing 3i,,ers t* /h*m the +*ntra+t ,*+uments /*ul, hae 3een sent al*ng
/ith amen,ments t* the +*ntra+t ,*+uments resulting .r*m this +*n.eren+e
>11 R$C$IP# "(D PRC$%%I(@ ' #$(D$R%
D*+uments inaria3l spe+i. the ,ata timeS pla+e an, the ,esignati*n *. the *..i+er t*
/h*m the +*mplete, ,*+uments are t* 3e su3mitte, "l*ng /ith the ten,er the 3i,,ers
3 $arnest !*ne Dep*sit are n*rmall reje+te, as 3eing n*n resp*nsie It is als* a
+*ntra+tual stipulati*n that the ten,er sh*ul, 3e su3mitte, ea+tl as per the pr*isi*ns *.
the ,*+uments #en,ers /ith an ,eiati*n *r +*n,iti*nal ten,ers are summaril reje+te,
as n*n-resp*nsie #he ten,ers are *pene, in the presen+e *. the ten,erers *r their
auth*rise, representaties /h* like t* 3e
present at the n*ti.ie, time *. *pening ".ter *pening the ten,ere, am*unts are rea, *ut
3 the *..i+er *pening the ten,ers .*r the in.*rmati*n *. all th*se present %Uita3leentries *. the ten,ers re+eie, are ma,e in a register an, signe, 3 all th*se present
>12 $V ")V" #I( ' BID%
#he .irst step in the ealuati*n *. ten,ers is reje+ti*n *. all +*n,iti*nal ten,ers an, th*se
#his ,*+ument relates spe+i.i+all t* the sele+ti*n *. +*mpetent +*ntra+t*rs pri*r t* the
issue *. the initati*ns t* 3i, a pr*+e,ure kn*/n as pre4uali.i+ati*n Pre4uali.i+ati*n *.
+*ntra+t*rs is re+*mmen,e, .*r large *r +*mple /*rks an, e+epti*nall .*r +ust*m
,esigne, e4uipment an, spe+ialie, seri+es Pre4uali.i+ati*n is als* ,esira3le in *ther+ir+umstan+es .*r eample in se+t*r pr*je+ts /ith a pr*grammati+ appr*a+h an, /hen a
large num3er *. +*ntra+ts are let *n a Lsli+e an, pa+kageL 3asis
#he 4uali.i+ati*n *. a +*ntra+t*r is a separate pr*+ess .r*m the 3i, ealuati*n pr*+e,ure
/hi+h +*n+entrates *n the pri+e an, merits *. the 3i, itsel. Details *. the 3i, ealuati*n
pr*+e,ure are a,,resse, in the Banks !*,el Bi,,ing D*+uments an, Pr*+urement (*te=
Bi, $aluati*n Pr*+e,ures
6> B$($'I#% ' PR$FU")I'IC"#I(
#he pre-4uali.i+ati*n pr*+ess is *. a,antage t* +*ntra+t*rs an, pur+haser alike
#he pre-4uali.i+ati*n pr*+ess ena3les +*ntra+t*rs /h* ma 3e insu..i+ientl 4uali.ie, *n
their */n t* a*i, the epense *. Bi,,ing *r t* .*rm a j*int enture /hi+h ma gie a
3etter +han+e *. su++ess #he assuran+e that +*mpetit*rs /hi+h la+k the ne+essar
Un,er Bank-.inan+e, pr*je+ts the pur+haser is resp*nsi3le .*r preparing the pre4uali.i+ati*n ,*+uments an, ealuating the appli+ants #he pre4uali.i+ati*n
,*+uments sh*ul, pr*i,e a +lear 3asis up*n /hi+h pr*spe+tie 3i,,ers +an 3e ealuate,
.*ll*/ing an *3je+tie pr*+ess 3ase, *n .air an, transparent +riteria #he ,*+umentati*n
s*ught sh*ul, al/as 3e releant +learl state, an, s* that pr*spe+tie 3i,,ers are n*t
#he pre-4uali.i+ati*n *. 3i,,ers sh*ul, 3e a,ertise, .*ll*/ing the pr*+e,ures .*r
n*ti.i+ati*n an, a,ertising spe+i.ie, in the Banks Pr*+urement P*li+ies an, Rules
",e4uate time .*r resp*nse sh*ul, 3e all*/e, 9%ee als* the Banks (*te *n the
Preparati*n an, Pu3li+ati*n *. Pr*+urement (*ti+es:
Q PR$FU")I'IC"#I( CRI#$RI" # B$ PR$-%$#
" +lear statement *. the re4uirements .*r 4uali.i+ati*n sh*ul, 3e sent t* all appli+ants
/h* /ish t* 3e +*nsi,ere, .*r pre-4uali.i+ati*n #he spe+i.i+ +riteria an, the
pre4uali.i+ati*n ,*+ument as a /h*le must 3e +*nsi,ere, /ith +are as earl as p*ssi3le
in the pr*+urement pr*+ess A*/eer the pre4uali.i+ati*n ,*+uments sh*ul, 3e issue,*nl /hen the preparati*n *. engineering ,esigns an, 3i,,ing ,*+uments is /ell-
Pr*+e,ures su+h as the Lt/*-enel*pe sstemL /hi+h entails su3mitting pre4uali.i+ati*n
an, 3i, ,*+uments at the same time in separate enel*pes ,* n*t meet the re4uirements
*. the Pr*+urement P*li+ies an, Rules an, ,e.eat *ne *. the ke *3je+ties *.
pre4uali.i+ati*n that *. saing un4uali.ie, pr*spe+tie 3i,,ers the epense *. 3i,,ing
#he t/*-enel*pe sstem sh*ul, n*t 3e use, in *pen 3i,,ing
10 C'I("(C$D PR$C#%
In,ii,ual +*ntra+ts ma *nl 3e .inan+e, j*intl 3 the Bank an, *ther len,ers i. the
+*lan,ers agree t* the appli+ati*n *. the Banks Pr*+urement P*li+ies an, Rules #he
pr*+urement pr*+ess is then the same as in an pr*je+t .un,e, 3 the Bank
A*/eer there is n*t al/as a .ull agreement am*ng +*-.inan+iers *n the pr*+urement
pr*+e,ures t* 3e .*ll*/e, In su+h +ases spe+i.i+ ,is+rete +*ntra+ts are pr*+ure,
.*ll*/ing the respe+tie +*-.inan+iers rules un,er Lparallel +*-.inan+ingL arrangements#he pre4uali.i+ati*n ,*+uments must then a,,ress the re4uirements *. the respe+tie +*-
In s*me +ases the +* .inan+ing arrangements 9in+lu,ing the etent *. the parti+ipati*n *.
the ari*us +*-len,ers the all*+ati*n *. their .un,s t* the ari*us ,is+rete elements *. the
pr*je+t an, the etent t* /hi+h j*int +* .inan+ing /ill appl: ma n*t hae 3een
,etermine, at the time *. initing .irms .*r pre4uali.i+ati*n an, there.*re the
pre4uali.i+ati*n re4uirements .*r the ari*us elements *. the pr*je+t /*ul, n*t 3e kn*/n
#he pre4uali.i+ati*n ,*+uments sh*ul, make the p*siti*n +lear t* the appli+ants an,
all*/ .*r p*ssi3le su3,iisi*n *. the pr*je+t int* ,is+rete elements .*r a p*tential parallel
+* .inan+ing arrangement
611 !U)#IP)$ C(#R"C#%
7here a pr*je+t ma 3e ,ii,e, int* separate +*ntra+ts 9sli+es: that ma 3e +*m3ine,
int* gr*ups *. +*ntra+ts 9pa+kages: appli+ants ma 3e inite, t* pre-4uali. .*r ea+h
spe+i.i+ +*ntra+t separatel *r .*r a pa+kage *. +*ntra+ts /hi+h are essentiall *. a
similar tpe an, sie 3ut s*metimes /ith l*nger ,urati*ns "ppli+ants sh*ul, 3e aske, t*
state .*r /hi+h Lsli+esL *r Lpa+kagesL the /ish t* pre-4uali. "ppli+ants ma pre-4uali. .*r a spe+i.i+ +*ntra+t an sin gle +*ntra+t an +*m3inati*n *. +*ntra+ts *r the
entire pa+kage
"n appli+ant ma 3e all*/e, t* 3i, .*r an +*ntra+t .*r /hi+h it is pre-4uali.ie, an, it
ma 3e a/ar,e, m*re than *ne ,epen,ing *n its +apa+it t* +arr *ut a +*m3inati*n *.
+*ntra+ts In su+h +ases a/ar,s are ma,e 3 the pur+haser *n the 3asis *. the least +*st
.*r the entire pa+kage *. +*ntra+ts taking int* a++*unt an ,is+*unts *..ere, 3 3i,,ers
.*r multiple +*ntra+t a/ar,
6111 %u3 - C*ntra+t*rs
#he eperien+e an, .inan+ial res*ur+es *. su3* *ntra+t*rs ma n*t 3e a,,e, t* th*se *.
the "ppli+ant .*r purp*ses *. pre4uali.i+aQi*n #he +umulatie eperien+e an, +apa+it
*. an appli+ant as a .*rmer su3+*ntra+= t*r ma 4uali. them as appli+ants .*r
+ertain /*rks In +ases /here a highl spe+ialie, pr*+ess must 3e use, appli+ants
sh*ul, 3e re4uire, t* spe+i. the names an, 4uali.i+ati*ns *. su+h spe+ialist
su3+*ntra+t*rs i. the parti+ular pr*+ess I% n*t aaila3le in-h*use )a+k *. su+h
spe+ialie, supp*rt essential in +ertain +*nstru+ti*n *perati*ns that re4uire .*r eample
+hemi+al gr*uting *r un,er/ater repair /*rk +*ul, result in ,is4uali.i+ati*n *. the
3e met #he pre4uali.i+ati*n ,*+ument must set *ut +learl the +*n,iti*ns appling t*su+h j*int entures /hether eisting *r pr*p*se,H t* an +hange in the mem3ership *.
the j*int enturesH *r t* the ass*+iati*n *. pre-4uali.ie, .irms a.ter pre4uali.i+ati*n $a+h
part *. the j*int enture must su3mit the +*mplete ,*+umentati*n re4uire, *. an
+*ns*rtia an, *ther entures in /hi+h .irms ass*+iate /ith ea+h *ther .*rmall .*r the
purp*se *. +arring *ut a +*ntra+t j*intl Partners *. a j*int enture must +*n.irm that i.
pre-4uali.ie, the j*int enture 3i, /ill 3e su3mitte, /ith a .*rmal j*int enture
agreement an, that all parties t* that agreement /ill 3e legall 3*un, j*intl an,seerall .*r the 3i, an, an +*nse4uent +*ntra+t #he lea, partner in the j*int enture
sh*ul, als* 3e ,esignate, as /ell as the in,ii,ual /ith *erall resp*nsi3ilit .*r the
j*int appli+ati*n /hi+h /ill 3e the prin+ipal +*nta+t .*r +*mmuni+ati*ns #he
the spe+i.ie, +ash re4uirement net *. *ther kn*/n +*mmitments at the time *. a/ar,
an, su3je+t t* eri.i+ati*n
1; )I#I@"#I( AI%#R&
Pur+hasers sh*ul, 3e *n their guar, against +*ntra+t*rs /h* res*rt t* e+essie +laims
an, litigati*n as a means t* in+rease in+*me a.ter an a/ar, *. +*ntra+t A*/eer in s*me
+*untries res*rting t* +laims is an esta3lishe, 3usiness pra+ti+e "ppli+ants /ith a
+*nsistent an, signi.i+ant hist*r *. e+essie +*ntra+t ar3itrati*n an, litigati*n resulting
in a/ar,s *r ,e+isi*ns against them sh*ul, n*t 3e 4uali.ie, t* 3i,
%* that the litigati*n hist*r ma 3e ealuate, appli+ants sh*ul, 3e re4uire, t* list all
+*ntra+ts *er a state, num3er *. ears 9n*rmall the last .ie ears: that resulte, inlitigati*n *r ar3itrati*n pr*+ee,ings /ith an in,i+ati*n *. the matters in ,ispute the
parties in*le, the am*unts in ,ispute an, the *ut+*me *. the litigati*n
".ter the pur+haser has pr*+esse, an, ealuate, the pre4uali.i+ati*n su3missi*ns an,
re+eie, the Banks Ln* *3je+ti*nL t* the results *. the ealuati*n the pur+haser sh*ul,
n*ti. the appli+ants *. the ,e+isi*n
In all +ases the n*ti.i+ati*n sh*ul, in,i+ate that pre4uali.i+ati*n /ill 3e .*ll*/e, 3
eri.i+ati*n at the time *. 3i,,ing an, that 3i,s shall 3e reje+te, 3 the pur+haser at its,is+reti*n i. the eri.i+ati*n is unsatis.a+t*r *r i. the 3i,,er is una3le t* +*n.irm the
spe+i.ie, re4uirements
"ppli+ants sh*ul, 3e a,ise, that *nl .irms an, j*int entures that hae 3een
pre4uali.ie, un,er this .ull pr*+ess /ill 3e eligi3le t* 3i,
#he pur+haser sh*ul, make aaila3le the list *. pre-4uali.ie, 3i,,ers pri*r t* the
issuan+e *. the initati*n t* 3i, in *r,er t* all*/ su3+*ntra+t*rs an, suppliers
9parti+ularl l*+al .irms: t* +*nta+t the pre-4uali.ie, 3i,,ers
:2> I(VI#"#I( # #$(D$R
Initati*ns t* 3i, sh*ul, .*ll*/ as s**n as p*ssi3le a.ter pre-4uali.ie, 3i,,ers hae 3een
n*ti.ie, #he 3i, ,*+uments sh*ul, 3e issue, *nl t* pre-4uali.ie, .irms an, sh*ul, re.er
t* the nee, t* pr*i,e spe+i.ie, up,ate, in.*rmati*n an, an pre-a/ar, eri.i+ati*n
AF %e4uen+e *. *perati*ns inter ,epen,en+ies B"RCA"R#
"nalsis *. pr*per +*st %tu, BF an, ,e+i,e .i nal alue *. 3i, %tu, imp*rtant
+lauses in internati*nal +*ntra+t
<;1 D$%I@( B)I@"#I(
I. a +*ntra+t*r is t* 3e resp*nsi3le .*r the +*mpleti*n *. the +*nstru+ti*n /*rks /ithin a
.ie, pri+e an, time then the +*ntra+t*r nee,s t* hae +*ntr*l *er a num3er *. aspe+ts
*. the /*rk 3i*usl the +*ntra+t*r /ill pri+e .*r the resp*nsi3ilit /hi+h it takes *n
#hus i. at the *utset there is a pr*perl +*nsi,ere, per.*rman+e spe+i.i+ati*n .*r the-
pr*je+t the +*ntra+t*r /ill 3e a3le t* ,esign Dr pr*+ure the ,esign an, take resp*nsi3ilit
.*r that ,esign A*/eer the sp*ns*r must a*i, inter.ering /ith the ,etaile, ,esign
*ther than in haing a m*nit*ring r*le #hus /hilst it is 4uite +*mm*n .*r the sp*ns*r t*app*int an in,epen,ent +*nsultant t* m*nit*r an, in,ee, t* hae p*/ers *. *3je+ti*n t*
the +*ntra+t*rs ,esign the in.luen+e is passie ie a right *. *3je+ti*n rather than a+tual
,esign *. /*rks
Un,er $nglish +*n+epts *. la/ /here a +*ntra+t*r has a ,esign *3ligati*n there is an
implie, term that the , sign /ill 3e .it .*r its purp*se (*rmall +*nsultants *nl hae an
*3ligati*n t* use all ,ue pr*.essi*nal skill +are an, ,iligen+e 3ut the ,* n*t guarantee
that the ,esign /ill 3e .it .*r its purp*se #hus /here a ,esigner has n*t 3een negligent
3ut the ,esign ,*es n*t a+tuall a+hiee that /hi+h /as *riginall inten,e, the
+*nsultant ma /ell hae n* lia3ilit
Designs .*r these tpes *. pr*je+ts ten, t* 3e trie, an, teste, alth*ugh the a+tual use *rmeth*, *. +*nstru+ti*n ma 3e inn*atie #his re,u+es a su3stantial area *. risk s* .ar
as the +*ntra+t*r is +*n+erne, as /ell as haing the a,,e, a,antage *. assuring the
.un,ing instituti*ns an, inest*rs that the /ill n*t 3e the pr*u, */ners *. a L/hite
elephantL
In s* .ar as the sp*ns*r ma /ish t* hae ariati*ns it is n*rmall the resp*nsi3ilit *.
the +*ntra+t*r t* ,esign su+h ariati* ns an, i. it 3eliees that these /ill hae an a,erse
e..e+t up*n the +*mplete, /*rk s it must hae the right t* *3je+t t* them
In 3rie. there.*re the sp*ns*r /ill hae resp*nsi3ilit .*r the ,esign 3rie. an,
per.*rman+e spe+i.i+ati*n an, it /ill 3e .*r the +*ntra+t*r t* meet th*se +riteria In +ases
/here the +*ntra+t*r +arries *ut ,esin there nee,s t* 3e s*me in,epen,ent
t==-
,esign au,it #here is little purp*se in ea+h *. the sp*ns*r @*ernment an, .un,ing
institute their */n in,epen,ent +he+ker @*ernments are *.ten un/illing t* pa .*r anin,epen,ent au,it an, et re+*r, this t* 3e ,*ne "++*r,ingl *ne +*mpr*mise is .*r the
sp*ns*r t* pa .*r the seri+es *. an in,epen,ent +*nsultant ari, .*r th*se seri+es t* 3e
ren,ere, primaril .*r the 3ene.it *. @*ernment
#he +*ntra+t*r ma*r ma n*t 9,epen,ing up*n the *erall ealuati*n *. risk: 3e
all*/e, etensi*ns *. time .*r ,elas 3 the in,epen,ent
+he+ker %imilar
pr*isi*ns ma eist .*r an in,epen,ent au,it as t* 4ualit +*ntr*l 3i*usl 4ualit+*ntr*l is *. interest t* all parties 7hilst this has al/as 3een the +ase the a3ilit t*
a+hiee it ,epen,s up*n the 4ualit an, a3ilit *. the pers*nnel in*le, #hus in
+h**sing th*se /h* are t* 3e in*le, in these tpes *. pr*je+ts it is essential that the
hae eperien+e *. /*rking /ithin the parti+ular l*+ati*n an, hae ne+essar te+hni+al
n m*st maj*r pr*je+ts there ,*es seem t* 3e a +*nsensus that the +*ntra+t*r sh*ul, take
resp*nsi3ilit .*r gr*un, +*n,iti*ns %*metimes it ma transpire that the gr*un,+*n,iti*ns .*un, at the site strike at the er heart *. the pr*je+t an, in su+h +ases there
has t* 3e s*me +*mmer+ial settlement
#he ,egree *. risk an, the pri+ i ng *. that risk 3 the +*ntra+t*r is a matter /hi+h
,epen,s *n the parti+ular +ir+urra stan+es Pr*i,e, that the +*ntra+t*r is a3le t* ,esign
*ut *. a,erse gr*un, +*n,iti*n=s then it /*ul, appear that a num3er *. internati*nal
+*ntra+t*rs are prepare, t* take the risk In that respe+t it is 4uite n*ti+ea3le that
a++ept risk *. a,erse gr*un, +*n,iti*ns than sa +*ntra+t*r .r*m the Unite, King,*m
#his ,i..eren+e in appr*a+h ma relate t* the appr*a+h *. +*ntra+t*rs in their
internati*nal regi*ns 3ut neertheless it ,*es seem that i. a +*ntra+t*r /ishes t*
parti+ipate in a limite, re+*urse .inan+e pr*je+t then a,erse gr*un, +*n,iti*ns are
resp*nsi3ilit that he /ill hae t* a++ept
3: Variati*ns
#here are in e..e+t t/* tpes *. ariati*ns 'irst there are ariati*ns pr*p*se, 3 the+*ntra+t*r .*r a ariet *. reas*ns in+lu,es gr*un, +*n,iti*ns pr*gramming *r +*st
saing #hese ma 3e ariati*ns .r*m ,esigns t* /hi+h the sp*ns*r *r the in,epen,ent
+he+ker has raise, n* *3je+ti*n *r the ma 3e +hanges .r*m the appr*e, ,esign
+riteria !*st +*ntra+ts permit ariati*ns *riginating .r*m the +*ntra+t*r pr*i,e, that
the ,* n*t ,epart .r*m the stan,ar, *r integrit *. the *erall Pr*je+t 'urther the
+*ntra+t*r /*ul, 3e epe+te, t* 3ear the a,,iti*nal +*st *. su+h ariati*ns an, is entitle,
t* 3ene.it .r*m an saings ma,e
7ith regar, t* C*ntra+t*rs ariati*ns the %p*ns*r has a +*n+ern /hi+h is ,i..erent .r*m
that *. the +*ntra+t*r #he %p*ns*r ma 3e l**king .*r high 4ualit s* as t* ensure l*/maintenan+e +*sts a.ter pra+ti+al *r su3stantial +*mpleti*n an, ,uring the running *. the
Pr*je+t #he C*ntra+t*r /ill n*t *ther than in respe+t *. an e4uit shareh*,ing s*
intereste, in the +*st *. maintenan+e 3ut ma /ell 3e l**king .*r an *erall saing *n the
+*st *. +*nstru+ti*n #hus a p*ssi3le s*luti*n is that ea+h time a +*ntra+t*r puts .*r/ar,
a ariati*nH it is re4uire, t* as+ertain that the ariati*n /ill n*t in+rease the re4uirements
.*r maintenan+e . +*urse this ten,s t* 3e a su3je+tie rather than a *3je+tie test 3ut
"ssuming that there is a ,ela in +*mpleti*n .*r /hi+h the C*ntra+t*r is n*t entitle, t* an
etensi*n *. time it is then ne+essar t* +*nsi,er /hat ,amages sh*ul, 3e pai, 3 the
+*ntra+t*r Depen,ing up*n the parties in*le, there are a ariet *. *pti*ns=
i that the limit *. the lia3ilit *. the +*ntra+t*r in respe+t *. ,elas is the am*unt *. the
li4ui,ate, ,amages /hi+h is a sum less than the am*unt re4uire, t* seri+e the ,e3t ,uet* the .un,ing instituti*nsH
ii that there are n* li4ui,ate, ,amages an, the +*ntra+t*r remains lia3le .*r all l*sses
/hi+h .l*/ 9this is unlikel t* 3e a++epta3le t* the +*ntra+t*r:H
iii the C*ntra+t*r agrees t* pa li4ui,ate, ,amages an, 3 /a *. separate agreement
agrees t* seri+e the ,e3t ,uring the peri*, *. ,ela 9this ,epen,s up*n the e4uit
p*siti*n *. the C*ntra+t*r:
+: $arl C*mpleti*n
"ssuming that the +*ntra+t*r has t* pa su3stantial li4ui,ate, ,amages in the eent *.
,ela he ma /ell +*nsi,er himsel. entitle, t* 3*nuses in the eent that the pr*je+t
3e+*mes reenue earning earlier than *riginall anti+ipate, n m*st pr*je+ts this is
+*nsi,ere, appr*priate alth*ugh +learl a pr*isi*n has t* 3e in+*rp*rate, /here3 i. the
+*ntra+t*r is preente, .r*m re+*ering the 3*nus 3 reas*n *. ,ela 3 the sp*ns*r then
this ,*es n*t +reate an a,,iti*nal lia3ilit up*n the sp*ns*r 9parti+ularl 3earing in min,
that he ma hae n* .un,s /ith /hi+h t* pa this at the time that +*mpleti*n is a+hiee,:
#he 3*nus is n*rmall pai, *ut *. S the earl reenue .r*m the Pr*je+t
<;> Insuran+e
#he /h*le 4uesti*n *. e+essesH ,e,u+ti3les an, uninsure, risk .alls /ithin the general
+*mmer+ial neg*tiati*ns P*liti+al risk an, nu+lear risk *.ten .all up*n the %p*ns*r an,
in,ee, in the ultimate analsis /ith a limite, re+*urse .inan+e, pr*je+t /ill .all up*n the
'un,ing Instituti*ns #he ma*r ma n*t insure against p*liti+al risk ,epen,ing up*n
their ie/ *. the g*ernment +*n+erne, n the Channel #unnel .*r instan+e i. *ne
g*ernment ,e+i,es t* en, the pr*je+t then there are pr*isi*ns *. re+*mpense t* 3epai, t* the %p*ns*rs /hi+h /*ul, ena3le the C*ntra+t*r t* 3e Pai, It ma 3e
appr*priate .*r p*liti+al risk insuran+e t* 3e +*nsi,ere,
%* .ar as C*ntra+t*rs "ll Risk an, #hir, Part lia3ilit Insuran+e is +*n+erne, 9ie
insuran+e *. the 7*rks ,uring the peri*, *. +*nstru+ti*n an, insuran+e against lia3i lities
*/e, t* thir, parties: again pr*per a,i+e sh*ul, 3e taken #he ten,en+ is .*r the
"lth*ugh the a3*e stan,ar, .*rms are still /i,el use, internati*nall 'IDIC hasrepla+e, them 3 the .*ll*/ing 'irst $,iti*ns pu3lishe, in %eptem3er 1;;;=
C*nstru+ti*n kn*/n as the LRe, B**kL has 3een up,ate, an, repla+e, /ith a ne/
stan,ar, .*rm #he title *. the ne/ 1;;; 'irst $,iti*n +*nstru+ti*n 3**k /hi+h is re, in
+*l*ur is LC*n,iti*ns *. C*ntra+t .*r C*nstru+ti*n .*r Buil,ing an, $ngineering 7*rksDesigne, 3 the $mpl*erL 9L(e/ Re, B**kL: "n a3stra+t *. the (e/ Re, B**k is
/ell /ithin +*ntra+t re4uirement is t* he +arrie, at the risk an, +*st *. the +*ntra+t*r #he$mpl*er +an seek etensi*nT*. De.e+ts (*ti.i+ati*n Peri*, i. a maj*r item *.
plant+ann*t 3e use, .*r purp*ses .*r /hi+h the are inten,e, 3ut n*t e+ee,ing #/*
ears in etensi*n I. a3+e reme, is n*t +arrie, *ut the $mpl*er +an +arr *ut the
/*rk himsel. *r 3 *thers at +*ntra+t*rs +*st 3ut the +*ntra+t*r shall hae n*
resp*nsi3ilit .*r this /*rk I. $mpl*er agrees the ,e.e+tie material +an 3e rem*e,
.*r the site .*r repairs #he +*ntra+t*r +an 3e aske, 3 the $ngineer t* sear+h .*r the
+ause *. an ,e.e+t #he +*st plus pr*.it shall 3e pai, t* the +*ntra+t*r unless the +ause
n*ti+e, is ,ue t* ,e.e+tie /*rkmanship *. +*ntra+t*r C*ntra+t*rs *3ligati*ns are n*t
+*st t* +*ntra+t pri+e ,ue t* a3*e +hange shall 3e share, 3et/een $mpl*er the
+*ntra+t a.ter a,justing .*r l*ss i. an in 4ualit li.e an, *perati*nal per.*rman+e #he pr*isi*nal sumaaila3le in the +*ntra+t pri+e shall 3e use, as per $ngineers instru+ti*ns
a.ter *3taining 4u*tati*ns in*i+es *u+hers an, re+eipts in su3stantiati*n #he +*ntra+t
pri+e is a,juste, .*r an in+rease *r ,e+rease in +*st resulting .r*m a +hange in the )a/s
*. the C*untr ma,e a.ter the Base Date in the +*ntra+t $s+alati*n +lause applies *nl i.
pr*i,e, .*r in the +*ntra+t %u+h +lause ma*r ma n*t 3e su..i+ient .*r +*mpensati*n
,ue t* rise in +*sts /hi+h hae g*ne up +*mpare, t* Base Date ,ata I. +*ntra+t*r .ails
t* +*mplete /*rks /ithin time .*r +*mpleti*n a,justment *. pri+e /ill 3e linke, t* ,ate
4uarterl peri*,s starting .r*mT>2 ,as a.ter the +*mmen+ement ,ate #he $ngineerma make an +*rre+ti*n i. ne+essar t* an prei*us pament +erti.i+atesin+e pament
+erti.i+ate shall n*t 3e ,eeme, t* In,i+ate $ngineers a++eptan+e *. /*rk I. +*ntra+t*r
.*r +*nstru+ti*n It ,*es +*er natural +atastr*phes su+h as earth4uake hurri+ane
tph**n *r *l+ani+ a+tiit
I. a part is preente, .r*m per.*rming an *. its *3ligati*ns a n*ti+e shall 3e gien
/ithin 1> ,as *. the eent +*nstituting '*r+e !ajeure #he part shall 3e e+use, .r*m
per.*rman+e *. its *3ligati*ns as l*ng as '*r+e !ajeure persists e+ept .*r *3ligati*n *.
the part^ t* make paments i. ,ue I. +*ntra+t*r su..ers ,elas +*sts ,ue t* '*r+e
!ajeure 3e shall 3e +*mpensate, 3 ne+essar time etensi*n +*st - +*mpensati*n I.'*r+e !ajeure +lauses .*r su3+*ntra+t*r are 3r*a,erJ/i,er than +*ntra+t*rs pr*je+ti*ns
un,er this +lause then th*se issues +ann*t 3e the e+use *. +*ntra+t*r .*r n*n-
per.*rman+e *r 3asis .*r relie. un,er the +lause
I. a single '*r+e !ajeure eent persists .*r 8> ,as *r +umulatiel .*r 1>0 ,as ,ue t*
multiple *++asi*ns then either part ma gie n*ti+e t* the *ther part a n*ti+e *. < ,as
i #he empl*er is re4uire, t* su3mit /ithin 28 ,as a.ter re+eiing an re4uest .r*m the+*ntra+t*r reas*na3le ei,en+e that .inan+ial arrangements hae 3een ma,e an, are
3eing maintaine, /hi+h /ill ena3le the empl*er t* the +*ntra+t pri+e in a++*r,an+e /ith
the +*ntra+t I. the empl*er inten,s t* make an material +hange t* his .inan+ial
arrangements he is re4uire, t* gie n*ti+e t* the +*ntra+t*r /ith ,etaile, parti+ulars
9%u3-Clause 2> - $mpl*ers 'inan+ial "rrangements:
ii I. the empl*er +*nsi,ers himsel. t* 3e entitle, t* an pament un,er *r in +*nne+ti*n
/ith the +*ntra+t an,J*r an etensi*n *. the De.e+ts (*ti.i+ati*n peri*, 9the ne/ name
.*r the De.e+ts )ia3ilit Peri*,: the empl*er *r the engineer must gie n*ti+e an,
parti+ulars t* the +*ntra+t*r #he parti+ulars must spe+i. the +lause *r *ther 3asis *. the+laim an, in+lu,e su3stantiati*n *. the am*unt an,J*r
etensi*n t* /hi+h the $mpl*er +*nsi,ers himsel. t* 3e entitle, #he n*ti+e must 3e
gien as s**n as pra+ti+a3le a.ter the empl*er is epressl ,enie, the right t* set *..
against *r make an ,e,u+ti*n .r*m a +erti.ie, am*unt *r *ther/ise +laim against the
+*ntra+t*r e+ept in a++*r,an+e /ith this pr*isi*n 9%u3-Cause 25 - $mpl*ers +laims:
iii #he empl*ers in epressl entitle, t* eten, the De.e+ts (*ti.i+ati*n Peri*, .*r the/*rks *r a se+ti*n *. the /*rks .*r up t* t/* ears i. it +ann*t 3e use, .*r the purp*ses
.*r /hi+h it /as inten,e, 3 reas*n *. a ,e.e+t *r ,amage 9%u3-Clause I 1E - $tensi*n
*. ,e.e+ts (*ti.i+ati*n peri*,:
i #he C*ntra+t*r right t* a,justment *. the +*ntra+t pri+e t* take a++*unt *. an
in+rease *r ,e+rease in +*st 9as ,e.ine,: resulting .r*m a +hange in la/ in the +*untr
/here the site is l*+ate, has 3een eten,e, 93e*n, +hanges in legislati*n as in eg the
*range 3**k: t* in+lu,e +hange, in the ju,i+ial *r *..i+ial g*ernmental interpretati*n *.
la/s ma,e a.ter the 3ase ,ate 9as ,e.ine,: /hi+h e..e+t the +*ntra+t*r in the per.*rman+e
*. his *3ligati*ns 9su3-+lause 1E< -",justment .*r Changes in )egislati*n:
I. the +*ntra+t*r is n*t pai, *n time the +*ntra+t*r is entitle, t* re+eie .inan+ing
+harges +*mp*un,e, m*nthl *n the am*unt unpai, ,uring the peri*, *. ,ela Unless
*ther/ise state, in the Parti+ular C*n,iti*ns these .inan+ing +harges are t* 3e +al+ulate,
at the annual rate *. three per+entage p*ints a3*e the ,is+*unt rate *. the +entral 3ank in
the +*untr *. the +urren+ *. pament an, sh*ul, 3e pai, in su+h +urren+ 9%u3-Clause
1>8 - ,elae, pament: #he a3*e pr*isi*n is ,erie, .r*m the range B**k 7hile
the *l, Re, B**k pr*i,e, that the +*ntra+t*r /as entitle, t* interest *n late paments it
,i, n*t spe+i. h*/ this /as t* 3e +al+ulate,
i #he +*ntra+t*r is n*/ entitle, a.ter giing n*ti+e t* suspen, *r re,u+e the rate *.
/*rk /here the engineer .ails t* +erti. an interim pament +erti.i+ate *r the
resp*n, t* the merits *. the +*ntra+t*rs +laims at all e+ept in the +ase *. a ,ispute
9Clause 6< - %ettlement *. Disputes:
iii Un,er the @eneral C*n,iti*ns *. the ne/ B**ks .*r maj*r /*rks ,isputes are n*/
re4uire, t* 3e su3mitte, t* a D"B .*r ,e+isi*n In the +ase *. the ne/ Re, an, &ell*/
B**ks the D"B must 3e app*inte, at the time the +*ntra+t is signe, an, remain in pla+euntil it is +*n+lu,e, 9un,er the @eneral C*n,iti*ns *. the %iler B**k a D"B is
app*inte, .*r ea+h ,ispute an, *r,inaril *nl remains in *..i+e until that ,ispute is
,e+i,e,: 9Clause 20 - Claims Disputes an, "r3itrati*n: Un,er the *l, Re, an, &ell*/
B**ks ,isputes ha, t* 3e su3mitte, t* the engineer .*r a ,e+isi*n as a +*n,iti*n t*
ar3itrati*n #he pr*isi*n .*r a Da3 t* repla+e the engineer .*r the settlement *. ,isputes
in the @eneral C*n,iti*ns ma 3e the m*st .a*ra3le *. the inn*ati*ns in the ne/ 3**ks
.r*m the +*ntra+t*rs p*int *. ie/
<112 Pr*isi*ns Relate, t* the $mpl*er
i #he empl*er is n*/ entitle, *n n*t less than >2 ,as n*ti+e t* repla+e the engineer
pr*i,e, that the empl*er ma 110t ,* s* /ith a pers*n against /h*m the +*ntra+t*r
Repla+ement *. the $ngineers: I. the +*ntra+t spe+i.ies the +*ntra+t*r shall ,esign an
part *. the permanent /*rks 9as ,e.ine,: then su+h part must /hen +*mplete, 3e .it .*r
su+h purp*ses .*r /hi+h the part is inten,e, as are spe+i.ie, in the C*ntra+t 9%u3Clause>1 9+: - C*ntra+t*rs @eneral 3ligati*ns: Un,er the *l, Re, B**k there /as n*
re4uirement that an /*rks ,esigne, 3 the +*ntra+t*r 3e .it .*r purp*se
ii 7here the +*ntra+t*r makes a +laim .*r a,erse Phsi+al +*n,iti*ns 9as ,e.ine,: the
engineer ma reie/ /hether *ther phsi+al +*n,iti*ns in similar parts *. the 7*rks 9i.
an: /ere m*re .a*ra3le than +*ul, reas*na3l hae 3een .*reseen I. s* the engineer
ma re,u+e the am*unt *. an +*st 9as ,e.ine,: +laime, 3 the +*ntra+t*r .*r a,erse
phsi+al +*n,iti*ns 3 the am*unt *. the re,u+ti*n in +*st *. su+h m*re .a*ra3le
+*n,iti*ns s* l*ng as the net e..e+t ,*es n*t result in a re,u+ti*n in the +*ntra+t pri+e
re4uire, t* a++*mpan the +*ntra+t*rs appli+ati*ns .*r interim pament +erti.i+ates:
impling that pament ma 3e +*n,iti*nal *n the re+eipt *. su+h rep*rts
i #he empl*er has the right a.ter n*ti+e t* the +*ntra+t*r t* terminate the +*ntra+t at
an time .*r the empl*ers +*nenien+e pr*i,e, that the empl*er ma n*t ,* s* in
*r,er t* ee+ute the /*rks himsel. *r t* arrange .*r them t* 3e ee+ute, 3 an*ther+*ntra+t*r In the +ase *. su+h terminati*n the +*ntra+t*r is pai, .*r /*rk ,*ne 3ut is
,eprie, *. the right t* pr*.it *n the 3alan+e *. the +*ntra+t 9%u3 Clauses 155 -
$mpl*ers $ntitlement t* #erminati*n an, 1;6 pti*nal terminati*n pament an,
release:
#he +*ntra+t*r is re4uire, t* gie n*ti+e t* the engineer *. an +laim .*r an etensi*n *.
time *r a,,iti*nal pament n*t later than 28 ,as a.ter the +*ntra+t*r 3e+ame a/are *r
sh*ul, hae 3e+*me a/are *. the eent *r +ir+umstan+e giing rise t* a +laim I. he .ails
t* ,* s* the empl*er is state, t* 3e ,is+harge, .r*m all lia3ilit in +*nne+ti*n /ith the
+laim In a,,iti*n the +*ntra+t*r is re4uire, t* sen, t* the engineer a .ull ,etaile, +laim
/ithin >2 ,as a.ter the +*ntra+t*r 3e+ame a/are *r sh*ul, hae 3e+*me a/are *. the
eent *r +ir+umstan+es giing rise t* the +laim 9unless the engineer appr*es a l*nger
peri*,: I. the +*ntra+t*r sh*ul, .ai I t* +*mpl /ith this latter re4uirement an
etensi*n *. time an,J*r a,,iti*nal pament must 3e a,juste, t* take a++*unt *. the
etent t* /hi+h the .ailure ma hae preente, *r preju,i+e, pr*per inestigati*n *. the
+laim 9%u3-Clause 201 - C*ntra+t*rs Claims:
CA"P#$R 10
C(C)U%I(
=Q=je+t $p*rts has helpe, In,ian +*mpanies an, @*ernment . In,ia .*r earning
Qlaliel m*re '*reign $+hange 3e+ause its *lume an, alue is huge +*mpare, t* eer
3usinesses In,ians are 3ene.ite, as the inter.a+e /ith the latest te+hn*l*gies earns #*rem*ne there.*re liing stan,ar, impr*es an, lea,s t* *erall ,eel*pment *. mple
%u++ess *. the pr*je+t starts /ith su++ess.ul ten,ering an, 3i,,ing pr*+ess Qen,ering
an, 3i,,ing is the .irst step in an kin, *. +*nstru+ti*n +*ntra+ting #he stu, nalse,
the pe+uliarities *. internati*nal +*nstru+ti*n 3usiness an, eamine, the =i..erent aspe+ts
*. ten,ing an, 3i,,ing internati*nal pr*je+ts #he stu, is 3ase, *n Q*r*ughl analsing
I I==IIUelL IIH LLS1 UIUUIlIe II nlHHIIIUlIVI1UI VV11HU SILLVII 1 LLV
#here is l*t *. s+*pe .*r In,ian +*ntra+t*rs in the *erseas +*nstru+ti*n market "t
present there are >0 pr*je+t ep*rt +*ntra+ts alue, at *er Rs 1<800 +r*r+ 9appr*U%N > Bn: un,er ee+uti*n in E; +*untries a+r*ss "sia ".ri+a an, $ur*pe 3 E1 In,ian