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Construction Law/CLAUSE 70.1 & 70.2, FIDDIC & PEC


My question is relating to Clause 70.1 & 70.2, what is the difference between two clauses,and where we can use or claim these clauses separately in one invoice, however both have concerning to price Escalation and adjustment, please clarify my confusion by giving some example?

Dear Sabir,
Thank you for your answer, I will like to clarify as follows:
FIDIC 1987 clause 70.1 and 70.2 relate to following topics.
a) Clause 70.1: This relate to rise or fall in the cost of specified labor, materials or any other matter effecting the cost of execution of the works. The bidder is to mention prices/indices of these specified materials at 28 days prior to bid submission and this become the basis for change in their prices with IPCs submitted later on. This is submitted with each IPC but can sometime be submitted separately also as there may be committees appointed to approve the same and hence segregated billing avoids delay in approval of routine IPC.
b) Clause 70.2: This is also to establish a baseline for increase in cost compensation particularly due to legistralatory enactment that has been issued after 28 days prior to the date of submission of tenders. This increase compensation do not cover specified items of clause 70.1 which are specifically mentioned in the bid document with weightages specified with reference to a specified formula.

Hope this clarify the matter.

Liaqat Hayat

Construction Law

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Liaqat Hayat


I can answer questions based on FIDIC 4 and FIDIC 1999 [design-build] with particular reference to time extension , price adjustment and disputes. I am in particular more inclined for response to points pertaining to how claims should be framed and put up in case of technical or other contractual shortcomings. Regarding procurement matters I have spent over 5 years as procurement specialist for highway authority and dealt with numerous claims and disputes in the capacity of "The Engineer" .

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