The Fédération Internationale des Ingénieurs-Conseils (FIDIC), in association with the International Tunnelling and Underground Space Association (ITA-AITES), launched the First Edition of the “Conditions of Contract for Underground Works” (Emerald Book) for tunnelling and underground works on 7 May 2019 at the World Tunnel Congress 2019 in Naples.
The Second Edition of the “Conditions of Contract for Plant and Design-Build, 2007” (Yellow Book 2017) was used as the basis for drafting the Emerald Book’s General Conditions of Contract. You can consult our previous blog post for detailed information on the Yellow Book 2017 and the second editions of the other Rainbow Suite books (https://globalarbitrationnews.com/fidic-rainbow-suite-second-editions-unveiled/). The Emerald Book aims to address the risks particular to subsurface construction projects, which are dependent on the ground’s geological, hydrogeological and geotechnical properties and intends to meet the developments in the rapidly growing underground market sector. The Emerald Book continues to maintain the FIDIC contracts’ fundamental principles regarding the allocation of risks and includes new concepts concerning the risks that are particular to underground works.
The Emerald Book specifically addresses the following key areas:
- Balanced risk allocation
- The disclosure of all available geological and geotechnical information and the inclusion of a contractual geotechnical baseline
- Tailored “Unforeseeable Physical Conditions” clause
- The implementation of a ground classification system and supporting particular conditions that properly reflect the effort of excavation and stabilisation
- Time for completion being influenced by ground conditions
- The provision of a flexible mechanism for remuneration according to ground conditions, foreseen and unforeseen.
The Emerald Book provides:
- General Conditions
- Guidance for the Preparation of Particular Conditions and Annexes: Example Forms of Securities
- Guidance for the Preparation of Tender Documents and Annexes: Table of Contents of the Geotechnical Baseline Report, Example Forms of Schedule of Baselines, Completion Schedule, Schedule of Contractor’s Key Equipment
- Forms of Letter of Tender, Letter of Acceptance, Contract Agreement and Dispute Adjudication/Avoidance Agreement.
The Emerald Book will be widely used due to the growing number of underground projects in various sectors including energy, transport and urban infrastructure. As the parties’ respective needs and interests may differ from project to project, for instance in regards to the allocation of risks for pricing and timing, the new FIDIC book will also provide valuable guidance for agreeing on a bespoke contract tailored to the specific project.