Conditions of Contract for Plant & Design-Build (First Ed, 1999). For Electrical & Mech. Plant & For Building & Engineering Works Designed by the Contractor. Gen. Conds; Guidance for the Prepn of Conds of Particular Application; Forms of Tender.

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 Fdration Internationale des Ingnieurs-Conseils (FIDIC), and the following "Particular Conditions", which include amendments and additions to such General Conditions.


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The updates to the FIDIC Yellow Book 1st Edition are substantial, reflecting the length of time and changes in the construction industry since 1999. It appears that many changes to the FIDIC Yellow Book build on the positive changes introduced in the Gold Book in 2008 as well as reflecting the success of the NEC3 Contract suite to date, which has focused heavily on project management.

The English courts have recently considered a number of cases involving the FIDIC suite of contracts (see here, here, and here for our previous blog posts). The most recent case of J Murphy & Sons Ltd v Beckton Energy Ltd [2016] EWHC 607 (TCC)arises out of a contract based on FIDIC Conditions of Contract for Plant and Design Build for Electrical and Mechanical Plant and for Building and Engineering Works designed by the Contractor First Edition 1999 (FIDIC Yellow Book) with amendments.

The Proposed 2017 Yellow Book includes one consolidated clause for claims, Sub-clause 20.2, under which both parties must progress their claims within the 28 and 42 day periods under Sub-clause 20.1 of the 1999 Yellow Book. It also includes a new procedure enabling a waiver of these time-limits in certain instances2, which is clearly designed to provide some clarity and a mechanism for determining when a claim will be time-barred.

Under the 1999 Yellow Book4, the Engineer was required to consult and ultimately make a fair determination within just one 42 day period. Under both the Proposed 2017 Yellow Book and the 1999 Yellow Book, the Engineer may request that further information be provided before making a determination.

The above provisions were intended by FIDIC to have already been provided for in the 1999 procedure, but which as many contractors have painfully found out, the 1999 wording was not so clear and has been the subject of fervent debate since those conditions were released. This debate is captured in the Persero series of cases in Singapore, which ran for eight years on the issue of whether a non-final DAB decision issued under Sub-clause 20.4 could be enforced summarily by an arbitral award13.

Under both the 1999 and Proposed 2017 wording, either party can prevent a DAB decision from becoming final by issuing an NOD within 28 days. However, the Proposed 2017 wording adds that if no arbitration is commenced within 182 days after the NOD is issued, then that NOD shall be deemed to have lapsed and be no longer valid. This will allow DAB decisions to become final where arbitration is not pursued, and that is helpful; however, where finality is relevant to enforcement, this provision may also be subject to dispute. For instance, if a party commences arbitration but then allows it to lapse, will a new 182 day period commence or does that prevent a non-final DAB from ever becoming final?

The 1999 Yellow Book wording was subject to debate before the Swiss Supreme Court16 and the UK Technology and Construction Court,17 and both courts found that the DAB was a mandatory pre-condition to arbitration, and that Sub-clause 20.8 would only be used in the exceptional situation where the mission of a standing DAB has expired before a dispute arises between the parties, or other limited circumstances such as the inability to constitute a DAB due to the intransigence of one of the parties. Although the Swiss Case ultimately permitted the DAB to be avoided after the Contractor had spent over 18 months attempting to have it constituted, the English case refused to allow the litigation to proceed until the DAB procedure was completed.

As noted above, the new wording includes an expanded Sub-clause 21.7 (Sub-clause 20.7 of the 1999 Yellow Book), which permits any failure to comply with a DAB decision, whether final or not-final, to be referred directly to arbitration. In relation to non-final DAB decisions, the right to enforcement by interim relief or award is subject to the fact that the merits of the dispute are reserved until resolved in a final arbitral award. Although this revised contractual clarification/position will be welcomed by contractors, there are still likely to be challenges in many jurisdictions as to whether the enforcement of non-final DAB decisions via an arbitral award is supported by the local or governing laws of the contract.

The proposed new dispute procedure provides some useful revisions which address fairly well some of the problem areas of the 1999 Yellow Book, and which are aimed at promoting compliance with the pre-arbitration steps. These include better defined responsibilities and accountability for the Engineer, and revisions to the DAB and arbitration provisions which should avoid the perpetual 1999 Yellow Book disputes as to whether an NOD cancels the binding effect of a DAB decision, and whether a non-final DAB decision can be summarily enforced in arbitration.

However, to the extent that these non-final determinations are not able to be enforced then, except in limited circumstances (for instance, where no DAB is in place at the time of dispute), parties may be required to go through an even longer mandatory claims procedure than under the 1999 Yellow Book before they are able to commence an arbitration that will give them final and enforceable relief. Parties should therefore think carefully as to whether this mechanism, in whole or part, is suitable for their particular needs.

Under new Sub-Clause 3.1, there is also a new requirement that the Engineer must be fluent in the language of the Contract as defined in Sub-Clause 1.4. The 1999 Yellow Book does not contain any specific language requirement.

Under Sub-Clause 3.5 of the 1999 Yellow Book, the Engineer is under an obligation to consult with the parties in an endeavour to reach agreement. This obligation is retained and expanded upon substantially in new Sub-Clause 3.7.

As mentioned above, under new Sub-Clause 3.7.2, the Engineer must give a Notice to both Parties of his determination within a further 42 days if no agreement is reached within the first 42-day period. In addition to the supporting particulars previously required under Sub-Clause 3.5 of the 1999 Yellow Book, the Engineer must also expressly give reasons under new Sub-Clause 3.7.2.

HKA and CMS had a thought-provoking debate on the FIDIC Yellow Book 1999. During the debate, the speakers explored, analysed and challenged the fairness of the FIDIC Yellow Book 1999 clauses in the construction industry today.

Under the FIDIC Red and Yellow Books 1999 and the FIDIC 2017 editions, if the contractor fails to complete within the Time for Completion (meaning the time for completing the Works including any extension of time due to the contractor), further price rise risk is allocated to the contractor, and the benefit of any falling prices is allocated to the employer.


Adjustments to prices after the Time for Completion are made using the most favourable to the employer of:

Under both the FIDIC 1999 and 2017 editions, an application for an Interim Payment Certificate under Sub-Clause 14.3 must include any amounts to be added or deducted for changes in cost under Sub-Clause 13.8. The contractor is not obliged to give notice under Sub-Clause 20.1 of the FIDIC 1999 editions.



As a FIDIC Certified Contract Manager, the individual also has basic understanding and awareness of all other FIDIC Body of Knowledge (FBOK) documents, as described on the FIDIC website (www.fidic.org) and in particular, the FIDIC Procurement Procedure Guide (1st edition 2011).

Late last year, the Fdration Internationale Des Ingnieurs-Conseils1 ("FIDIC") launched the First Edition Conditions of Subcontract for Plant and Design-Build (the "Yellow Book Subcontract"). The Yellow Book Subcontract is the first standard form intended for use with the 1999 FIDIC Conditions of Contract for Plant and Design-Build (the "1999 Yellow Book"). The Clauses of general application in the Yellow Book Subcontract are similar to those in the 2011 FIDIC First Edition Conditions of Subcontract for Construction, known as the "Red Book Subcontract". 

The Yellow Book Subcontract is intended for use on projects where the 1999 Yellow Book is the "Main Contract". The approach to passing through obligations is premised on the Subcontractor being familiar with the provisions of the Main Contract and Sub-Clause 2.1 requires the Contractor to make the Main Contract documents available to the Subcontractor for inspection (other than pricing and other confidential elements). The Subcontractor is then required to comply with the Main Contract in respect of the Subcontract Works, and to "assume all the obligations and liabilities of the Contractor under the Main Contract, save where the provisions of the Subcontract otherwise require." (Sub-Clause 2.2).

The Yellow Book Subcontract is a welcome addition to the FIDIC family. Whilst it is perhaps curious that 2 years after the publication of the Second Edition of the FIDIC Yellow Book, FIDIC has decided to publish a subcontract for use with its First Edition, this nevertheless reinforces the reality that the 1999 Editions of the FIDIC forms are, and will continue to be, in widespread use for the foreseeable future.

Generally, an Employer procuring a project under a FIDIC Yellow Book 1999 will instruct a Design Professional to convert its concept into a preliminary design which it includes within its tender documentation to procure a project. be457b7860

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