DR. LUKAS KLEE, LL.M, PHD, MBA is an independent expert in international construction contracts and principal at Klee Consulting, offering construction contract services, dispute resolution and bespoke training. Lukas has dealt with international construction contracts on a daily basis for over fifteen years and has participated in construction projects in the Czech Republic and internationally. Details at: [...]

About the Author xxiii

Foreword xxv
Svend Poulsen

Acknowledgments xxvii

Introductory Remarks xxix
ShuiboZhang

Introductory Remarks xxxi
Robert Werth

Introductory Remarks xxxiii
Ilya Nikiforov

1 International Construction Projects 1

1.1 The unique nature of the construction industry 1

1.2 Individuality of construction projects 1

1.3 Roles and relationships 2

1.4 Contract administration 4

In-Text Vignette: Engineer's power to re-rate due to substantial increase in BoQ quantities by Albert Yeu (Hong Kong) 10

1.5 Further important aspects of construction projects 11

1.6 Typical contractual relationships 12

In-Text Vignette: Shipping and marine construction contracts in Asia by Knut Kirkhus (Oman)12

1.7 Motivation for international business 15

In-Text Vignette: The Italian construction industry: Between past and future by SDG & Partners (Italy) 17

1.8 Managerial analysis 20

1.9 Hazards and risks 21

1.10 Hazard identification 21

1.11 Risk analysis 22

1.12 Anti-risk measures 22

1.13 Typical hazards in the international construction business 23

In-Text Vignette: Corruption on Peruvian gas pipeline contract by Enrique Moncada Alcantara (Peru) 24

In-Text Vignette: Anticorruption and construction contract law by Enrique Moncada Alcantara (Peru) 27

In-Text Vignette: Indian law by C.K. Nandakumar and Rishabh Raheja (India) 33

1.14 Risk allocation in contracts 35

In-Text Vignette: Wrongforms of contract by James Bremen (UK) 36

In-Text Vignette: The importance of early analysis of risk, knowledge of efficient risk allocation and right choice of delivery method by Conor Mooney (France) 36

1.15 Form of Business Organization 42

In-Text Vignette: To deal with subcontracts in international construction projects by Giuseppe Broccoli and Fabio Zanchi (Italy) 42

In-Text Vignette: Interface agreements between subcontractors by Bernd Ehle and Sam Moss (Switzerland) 48

2 Civil Law and Common Law 55

2.1 Specifics of the governing law 55

2.2 Common law versus civil law: Differences and interconnections 55

In-Text Vignette: The common law of Australia and the influence of statutory law by Donald Charrett (Australia) 57

2.3 Delay damages (liquidated damages) versus contractual penalty 59

In-Text Vignette: The use of liquidated damages in construction projects by Rob Horne (UK) 60

In-Text Vignette: Penalty clauses and liquidated damages under Brazilian law by Thiago Fernandes Moreira and Caio Gabra (Brazil) 72

2.4 Substantial completion versus performance 76

2.5 Binding nature of adjudication awards 78

2.6 Limitation of liability 79

2.7 Lapse of claim due to its late notification (time bars) 79

2.8 Allocation of unforeseeable and uncontrollable risk to the contractor 80

2.9 Contract administration (the Engineer's neutrality and duty to certify) 90

2.10 Termination in convenience 90

In-Text Vignette: Isan employer in breach of contract prevented from terminating the contract for its convenience? by Cecilia Misu (Germany) 91

2.11 Time-related issues 93

2.12 Quantification of claims 94

2.13 Statutory defects liability 95

2.14 Performance responsibility: Reasonable skill and care versus fitness for purpose 95

2.15 Common law, civil law, and Sharia interconnections 96

In-Text Vignette: Considerations for the construction of offshore oil and gas structures in the Middle East by Faisal Attia and Fernando Ortega (Qatar) 97

3 Common Delivery Methods 102

3.1 Common delivery methods: Main features 102

3.2 General contracting 104

3.3 Design-build 105

In-Text Vignette: Dutch design and construct of infrastructural projects in complex environments by Joost Merema (the Netherlands) 109

In-Text Vignette: Best value in the Netherlands by J.N. (Jaap) de Koning (the Netherlands) 126

In-Text Vignette: Concern over increasing adoption of design build for infrastructure works-JICA funding projects by Takashi Okamoto (Japan) 128

3.4 Construction management 131

In-Text Vignette: Interface management and interface agreements by Zachary Ferreira (the United States) and Alex Blomfield (UK) 132

3.5 Multiple-prime contracts 138

3.6 Partnering 138

In-Text Vignette: Integrated project delivery-"Collaborate rather than litigate" by Edward J. ("Ned") Parrott (the United States) 139

3.7 Alliancing 140

In-Text Vignette: Targetprice and early risk identification/management: London 2012 Olympics by Klaus Grewe (UK) 140

3.8 Extended delivery methods (PPP, BOT, DBO) 143
In-Text Vignette: Public-private partnerships by Steven Van Garsse (Belgium) 144

In-Text Vignette: Infrastructure through public-private partnerships in the Philippines by Aris L. Gulapa and

Dan Kevin C. Mandocdoc (the Phillipines) 146

3.9 Further aspects of delivery methods 153

In-Text Vignette: BIM-The way forward? by Christopher Miers (UK) 156

In-Text Vignette: Developments in BIM application: Legal aspects by Joost Merema (the Netherlands) 159

In-Text Vignette: BIM: A superior approach for infrastructure construction by Josef ?ák (the Czech Republic) 166

4 Specifics of EPC and EPCM 172

4.1 EPC and EPCM 172

4.2 Engineer procure construct (EPC) 172

In-Text Vignette: The employer's pitfall in the use of FIDIC conditions of contract for the EPC/turnkey projects (Silver book) in Indonesia by Sarwono Hardjomuljadi (Indonesia) 175

4.3 Bespoke EPC contracts 177

In-Text Vignette: Mitigating the risk of delays in power plant projects: An EPC contractor's view on different contractual concepts by Jacob C. Jørgensen (Denmark) 178

4.4 Turnkey EPC contracts 185

In-Text Vignette: Water treatment wind farm, and road construction projects in Asian and African countries by Stéphane Giraud (France) 186

4.5 Front end engineering design 188

In-Text Vignette: Key issues in the procurement of international hydropower construction contracts by Alex Blomfield (UK) 189

4.6 Engineer procure construction management (EPCM) 192

In-Text Vignette: The use of the EPCM delivery method in the mining industry by Mark Berry (UK) and Matthew Hardwick (UK) 195

4.7 EPC versus EPCM 200

In-Text Vignette: Offshore construction by Fernando Ortega (Qatar) 202
5 Unification and Standardization in International Construction 215

5.1 Unification of contracts 215

5.2 Unification per law, principles, and sample documents 215

In-Text Vignette: Resolving construction claims under investment treaty arbitration by Fernando Ortega (Qatar) 218

5.3 Lenders and their influence on unification 220

5.4 Standard form of contract in a governing law context 222

5.5 Purpose of sample documents in construction projects 222

5.6 Standard sample forms as a source of law 224

5.7 Lex causae 224

5.8 Interpretation 225

In-Text Vignette: Inconsistency in contract documents by Patrick Kain (South Africa) 226

5.9 Trade usage and business custom 229

In-Text Vignette: A common law of construction contracts-or Vive La différence? by Donald Charrett (Australia) 230

5.10 Lex constructionis principles 232

In-Text Vignette: Contractor's duty to mitigate delay and damages under FIDIC 1999 standard forms and in lex mercatoria by Vladimir Vencl (Serbia) 234

5.11 The use of lex constructionis 240

In-Text Vignette: Future-proofing construction contracts by Shy Jackson (UK) 240

6 Price 244

6.1 Contract price 244

In-Text Vignette: International construction measurement standards: Global consistency in cost analysis by Simon Collard (United Arab Emirates) 245

6.2 Bid pricing methods 247

6.3 Methods of contract price determination 248

6.4 Re-measurement 249

6.5 The lump sum 252

6.6 Cost plus 252

6.7 Guaranteed maximum price 253

6.8 Target price 253

6.9 Payment 254

In-Text Vignette: Taxation in international construction contracts by Alex Blomfield (UK) 255

In-Text Vignette: Managing the risk of non-payment by Sean Sullivan Gibbs (UK) 257

6.10 Contract price under FIDIC forms 261

6.11 Cost overruns 263

6.12 Abnormally low tender (ALT) 264

In-Text Vignette: Best value approach in the Netherlands by Wiebe Witteveen (the Netherlands) 265

6.13 Claims as part of contract price 273

6.14 Public procurement law limitations 273

In-Text Vignette: A concept of variation in a construction contract under Polish public procurement by Michä Skorupski (Poland) 275

7 Time 280

7.1 Time in construction 280

7.2 Delay 280

7.3 The United Kingdom Society of construction law delay and disruption protocol 282

7.4 Time program 283

7.5 Ownership of floats 285

In-Text Vignette: Time extension and float ownership under the FIDIC Red and Yellow Books (1999) by Frank Thomas (France) 285

7.6 Time at large and extension of time (EOT) 298

7.7 Concurrent delay 300

In-Text Vignette: Delay clauses in different jurisdictions by Jacob C. Jørgensen (Denmark)...