"Use FIDIC contracts or you're missing out," record-breaking webinar told

08 Jun 2021

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The latest event in FIDIC’s Covid-19 2021 webinar series took place on 8 June 2021 with an event looking at the key advantages and benefits of using the various forms of FIDIC contracts and, crucially, how to make the most of them, writes FIDIC communications advisor Andy Walker.

The webinar, “FIDIC contracts – the gold standard for projects”, was attended by 1,000 people on Zoom with more than 600 others watching live on You Tube. The event looked at why FIDIC contracts were widely and increasingly seen as the gold standard for global infrastructure, engineering and construction projects and the benefits and confidence that they bring to all parties.

The webinar was moderated by FIDIC chief executive Nelson Ogunshakin and the speakers included Pablo Laorden, managing partner at Lámbal Abogados in Spain, Karen Gough, barrister and attorney-at-law at 39 Essex Chambers in the UK, Haroon Niazi, partner and head of Middle East at HKA in the United Arab Emirates, Ellis Baker, partner and global head of construction and engineering at White & Case in the UK and Daduna Kokhreidze, FIDIC’s general counsel.  

As ever, FIDIC president Bill Howard was also on hand to introduce the event and in his opening remarks he highlighted the importance of FIDIC’s Golden Principles in ensuring that contracts were not amended or modified in ways that adversely affected the meaning of the efficacy of standard FIDIC forms. Opening the webinar, FIDIC CEO Nelson Ogunshakin hailed the record number of registrations for the webinar, (4,400) which he said was an all-time record for any FIDIC event and showed the massive interest in FIDIC contracts and their use throughout the global infrastructure sector.

Speaking first, Karen Gough, barrister and attorney-at-law at 39 Essex Chambers in the UK, stressed the importance of FIDIC contracts continuing to develop and staying ahead of emerging trends in the marketplace. “Getting the best deal that you can does not necessarily getting the best contract and we need to retain our humanity and the way that we work with one another,” she said, highlighting the need to work collaboratively. Gough urged attendees to read contracts carefully and “don’t fiddle with them and destroy the balance of risk”. Gough also highlighted the importance of training in the use of FIDIC contracts and also the need for high-level conversations in project teams on dispute avoidance. “You need to get the right people in the room at the right time,” said Gough.

Haroon Niazi, partner and head of Middle East at HKA in the United Arab Emirates, said that those who weren’t currently using FIDIC contracts were missing out and they needed to get on board. Asked about the issue of the disputes mechanism in FIDIC contracts not appearing to be as effective in preventing issues in the Middle East, Niazi said that the role of the engineer was crucial especially when contracts amendments were being contemplated. “In the Middle East we do like to change things,” he said while stressing that any changes needed to be made in accordance with FIDIC’s Golden Principles to safeguard the veracity of contracts.

Ellis Baker, partner and global head of construction and engineering at White & Case in the UK, spoke about how FIDIC contracts might need to develop in the future to remain the global standard at a time when construction emphasis is switching towards greener projects. “Moving forward, FIDIC will need to be astute about the criteria in its contracts to cope with new developments in the industry but judging by its position in the market so far I am confident that the contracts will keep pace with industry changes,” he said. He also highlighted the importance of dispute avoidance and said that he thought that there was a real appetite in the market for it.

Baker also addressed the issue of potential barriers to adopting dispute avoidance/adjudication boards (DAABs). “There is a perception about costs, but these are very small when considered alongside the overall cost of a project,” he said. These did need to be addressed though and clients reassured, he said. “The most important thing is that DAABs need to be standing bodies outlined in the contract,” he said. Baker also urged FIDIC to consider introducing a contract for the offshore wind sector, as this was a growth area with the importance of the net zero and green agenda.

Pablo Laorden, managing partner at Lámbal Abogados in Spain, talked about what was needed to help to improve the take up of FIDIC contracts in Europe and in Spain. He highlighted the “huge opportunity” in sectors like wind farms, where developers were looking for project certainty in a developing area and FIDIC contracts were ideally placed to help in that regard, he said. Laorden also suggested that FIDIC should consider convening a working group to look at how to improve the understanding of FIDIC contracts, especially regarding the use of the DAABs. This would help break down and dispel any misconceptions about the contracts, he said. Laorden also said that having contracts translated into Spanish and Portuguese would certainly be helpful in this regard.

Daduna Kokhreidze, FIDIC’s general counsel, spoke about the need to use FIDIC’s Global Principles. “It is important to keep the balance of risk allocation as they are outlined in the FIDIC contracts, so it is important that the contracts are used in the way that they were intended and the Golden Principles can help with this,” she said. The Golden Principles facilitate successful delivery of projects said Kokhreidze and they need to be followed.

There were literally hundreds of questions posted in the Zoom chat and also on You Tube and it was impossible to address them all, though the panellists were worked hard by the webinar chair and a wide range of issues were covered during a lively Q&A session. Some of the questions raised included, what to do when the FIDIC Golden Principles were violated, the role of Covid on the future development of contracts, the role of the DAABs and who pays for them, how FIDIC should respond contractually to the green agenda, how FIDIC was working with the multinational deveopment banks and many more.

Summing up the discussion, Karen Gough said that it was important for FIDIC to innovate and “stay ahead of the competition” to remain the gold standard for contracts. Ellis Baker said that FIDIC’s contracts needed to be responsive to market changes to stay relevant while Haroon Niazi highlighted the need for contracts to incorporate a “behavioural element” into contracts. Pablo Laorden stressed the need to debunk people’s fears about using FIDIC contracts and persuade them that they were proven documents in the marketplace. “We need to reflect on the market needs and dynamics and reflect on all the feedback we receive from users,” said FIDIC’s Daduna Kokhreidze, who highlighted that she would be delighted to receive that feedback direct from the attendees of the webinar.

The next FIDIC webinar is entitled, The role of the infrastructure industry in achieving a net zero world, which takes place on Tuesday 15 June 2021 at 12 noon CET. The webinar has been organised by the FIDIC Sustainable Development Committee and will look at the pivotal role of the infrastructure industry in achieving net zero. Please register your place as soon as possible to secure your place at this free event.

Click here to book your free place at the FIDIC webinar, “The role of the infrastructure industry in achieving a net zero world”.

Watch the recording of “FIDIC contracts – the gold standard for projects” on the YouTube link below.

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