Descrizione
“Turnkey” means the obligations of the Contractor to design, procure, supply, install, execute, commission, test and hand over, including the remedying of potential defects, on time and within the agreed Contract Price, the Works as defined by the Employer as to scope, purpose, performance and the functions of the Works as set out in the original Employer’s Requirements and the Assumptions and as amended in accordance with the provisions of the Contract.
The inevitable complexity of a turnkey project can be managed by creating a strong and predictable contractual framework for the execution of the project. The Employer must clearly and unequivocally state what he wants in the Employers Requirements.
The basic principle to be followed in this Contract is that the Employer specifies the desired final Works and provides the information and co-operation required by the Contractor, and the Contractor develops the Design and implements the methods intended to complete the Works to specification and within the time allowed under the Contract.
Formulating the Employer’s Requirements can be a challenging task and the information supplied in the “ER’s” may be lacking information that is nonetheless indispensable for the Contractor to assess his risks and develop his solutions. Therefore, this model form uses the concept of “Assumptions”, being written statements by either contract party provided before signing the contract (or before coming to an agreement on a variation of the works). A party states the conclusions it has derived from the information provided in writing by the other party and sets out certain assumptions on data that were not provided by the other party but which are necessary for the execution of the works and on which the assuming party may reasonably rely. This concept is necessary to reduce the incidence of disagreements due to information which is missing or unclear in the Employer’s Requirements or the Contractor’s bid which may turn into disrupting (both to budget and time to taking over) disputes. For this reason, detailed Variations provisions are included, to ensure that the Contractor is paid a reasonable price and granted a suitable extension of time for any changes in the Works.
In comparison to more traditional models of turnkey contracting, the concept of “Assumptions” will require the Employer to increase its efforts and transparency in order to be able to foresee the final Contract Price (since any material lack of information in the ER is likely to lead to an Assumption and an increased risk of costs for Variations). However, the benefits of this approach is that the Contractor should be able to provide a more competitive offer (since the need for a risk premium for uncertain events is reduced).
A significant majority of disputes on major construction projects find their origin in (1) issues relating to reliability of information provided by the Employer and/or Contractor or lack thereof and (2) deficiencies and/or ambiguities in the scope of work. This Model Agreement aims at preventing the snow ball effect of a minor misconception, for instance at the design phase, which can cause incurring major costs later on. With this model form of contract, ICC aims to provide a balanced contract for three reasons:
a. ICC represents all parties to all transactions
b. Risks are allocated to the party that is better situated to control the occurrence of the risk event, or its impact on the project, or both.
c. A balanced contract promotes the completion of a successful project in which both the Employer and the Contractor achieve their objectives.
The parties using this model form of contract are urged to leave the general conditions of this model form intact and focus their efforts on providing clear, simple and solid Employer’s Requirements on the one side and a comprehensive bid on the other, all on the basis of these un-amended general conditions of contract, with all changes or specifications duly recorded solely in the special conditions.
