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Construction Law/EPC and turnkey projects


QUESTION: In this case which book to follow  and avoid overlapping and bringing transparency, in EPC and turnkey projects

ANSWER: Dear Mr Ravi,
hope you refer to FIDIC books. If it is a lump sum turnkey contract where the front end engineering is done by Employer, use Red book. If it is an EPC contract involving large amount of design and manufacture outside the site, use Silver book.
But if the turnkey project is mostly done at site (construction only) and the owner appoints the architect and consultants, then you can use Red book for the turnkey project.
Hope this clarifies
---r sivaraman

---------- FOLLOW-UP ----------

QUESTION: It is a turnkey project which is broken in to three phases or portions where the first portion involves construction , engineering and procurement , the second portion involves again engineering, procurement of specialized areas and engineering installation , the third portion is Installation commissioning and operations and yet maintenance contract is not touched which is the final portion to the contract.

Here when any issue of clog come up the concessionaires wno look to arbitrate and mitigation issues and this is one big risk where extension is got on the project , does FIDIC encourages extension of time on the project may be due to delay in procurement , delay in various conditions , labour procurement problems etc

Suggest how FIDIC looks to mitigation and risk and failure analysis

Mr Ravi,
All models of FIDIC allows and adequately addresses the delays due to procurement, various conditions and labour procurement problems, if they are promptly notified to either party and documented.

What you have described is not an usual way or ideal model for packaging a project as it would create lot of interface issues, scope confusions and disconnects. Although there is a clear distinction of different phases of your project, I don't suggest to use multiple models of FIDIC as the jurisdiction of Engineers varies from red book to yellow book and silver book contracts. Single model of FIDIC to be used across all phases of the project to have a better control and to avoid conflicts being used twist for financial advantage by parties concerned.
There are various clauses in each FIDIC model to address your issues.
As such FIDIC does not account for any failure analysis but make provision for addressing failures and conflicts.
Hope this clarifies.
-- r sivaraman  

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