Morinë to Merdare
Motorway
Construction from Morinë to Pristina North Junction
Kosovo
BECHTEL ENKA JOINT VENTURE11 Pilgrim Street
London /
REPUBLIC OF KOSOVO
Ministry of Transport and Communications
Contract Agreement
THIS AGREEMENT made the day of April 2010 between the Ministry of Transport and Communications on behalf of the Government of the Republic of Kosovo, of Kosovo Assembly Building, St. Mother Teresa, Third Floor, Pristina, Kosovo 10000 (hereinafter “the Employer”), of the one part, and Bechtel International, Inc. of One East First Street, Reno, Nevada, USA and Enka Insaat ve Sanayi A.S. of Balmumcu, Enka Binasi 1, Istanbul 80780 Turkey (together and hereinafter “the Contractor”), of the other part:
WHEREAS the Employer desires that the Works known as the Motorway from Morine to the Pristina North junction should be executed by the Contractor, and has accepted a bid by the Contractor for the execution and completion of these Works and the remedying of any defects therein.
WHEREAS the Contractor is committed to co-operate with the Employer so as to achieve a planned construction cost of Euro 568,804,655.5 plus Euro 91,008,744.88 of VAT (at currently applicable rates), as described in the Contract.
The Employer and the Contractor agree as follows:
1. In this Agreement words and expressions shall have the same meanings as are respectively assigned to them in the Contract documents referred to.
2. The following documents shall be deemed to form and be read and construed as part of this Agreement. This Agreement shall prevail over all other Contract documents:
(i) the General Conditions;
(ii) the Contract Data; and
(iii) the Schedules (1 to 15 inclusive).
3. In consideration of the payments to be made by the Employer to the Contractor as indicated in this Agreement, the Contractor hereby covenants with the Employer to execute the Works for such Sections as are to be constructed by the Contractor pursuant to Sub-Clause 8.1 and to remedy defects in the Works in conformity in all respects with the provisions of the Contract.
4. The Employer hereby covenants to pay the Contractor in consideration of the execution and completion of the Works for such Sections as are to be constructed by the Contractor pursuant to Clause 8.1 and the remedying of defects in the Works, the Contract Price or such other sum as may become payable under the provisions of the Contract at the times and in the manner prescribed by the Contract.
5. As described in the Conditions, the Works for such Sections as are to be constructed by the Contractor pursuant to Clause 8.1 shall be executed in accordance with Kosovar law. In relation to its interpretation meaning and otherwise, the Contract shall be governed by the Law of the Contract.
IN WITNESS whereof the parties hereto have caused this Agreement to be executed on the day, month and year indicated above.
Signed by ______(for the Employer)
Signed by ______(for Bechtel International, Inc)
Signed by ______(for Enka Insaat ve Sanayi A.S.)
General Conditions (GC)1. General Provisions 9
1.1 Definitions 9
1.2 Interpretation 18
1.3Communications 18
1.4 Law and Language 19
1.5 Priority of Documents 19
1.6 Contract Agreement 19
1.7 Assignment 19
1.8 Care and Supply of Documents 20
1.9 Delayed Drawings or Instructions 20
1.10 Employer’s Use of Contractor’s Documents 21
1.11 Contractor’s Use of Employer’s Documents 21
1.12 Confidential Details 21
1.13 Compliance with Laws 22
1.14 Joint and Several Liability 22
1.15 Third Party Rights 22
1.16 Legal Force and Effect 22
2. The Employer 22
2.1 General Obligations and Right of Access to the Site 22
2.2 Permits, Licences or Approvals 24
2.3 Employer’s Personnel 25
2.4 Employer’s Financial Arrangements 25
2.5 Employer’s Claims 25
2.6 Hazardous Waste or Materials 26
2.7 Information Provided by the Employer 26
2.8 Utilities for the Motorway 27
2.9 Other Contractors 27
3. The Engineer 27
3.1 Engineer’s Duties and Authority 27
3.2 Delegation by the Engineer 30
3.3 Instructions of the Engineer 30
3.4 Replacement of the Engineer 31
3.5 Determinations 31
4. The Contractor 32
4.1 Contractor’s General Obligations 32
4.2 Performance Security and Defects Liability Letter of Credit 33
4.3 Contractor’s Representative 35
4.4 Subcontractors 36
4.5 Assignment of Benefit of Subcontract 37
4.6 Co-operation 37
4.7 Setting Out 38
4.8 Safety Procedures 38
4.9 Quality Assurance 39
4.10 Site Data 39
4.11 Not Used 40
4.12 Unforeseeable Physical Conditions 40
4.13 Rights of Way and Facilities 40
4.14 Avoidance of Interference 41
4.15 Access Route 41
4.16 Transport of Goods 41
4.18 Protection of the Environment 42
4.19 Electricity, Water and Gas 42
4.22 Security of the Site 44
4.23 Contractor’s Operations on Site 44
4.24 Fossils 44
4.25Hazardous Waste or Materials 45
5. Design 46
5.2 Contractor’s Obligations 46
5.3 Pre-construction Review 46
5.4 As-Built Drawings 47
5.5 Operation and Maintenance Manuals 48
6. Staff and Labour 48
6.1 Engagement of Staff and Labour 48
6.2 Rates of Wages and Conditions of Labour 48
6.3 Persons in the Service of the Other Party 48
6.4 Labour Laws 48
6.5 Working Hours 49
6.6 Facilities for Staff and Labour 49
6.7 Health and Safety 49
6.8 Contractor’s Superintendence 50
6.9 Contractor’s Personnel 50
6.10 Records of Contractor’s Personnel and Equipment 50
6.11 Disorderly Conduct 50
6.12 Foreign Personnel 50
6.13 Supply of Foodstuffs 51
6.14 Supply of Water 51
6.15 Measures against Insect and Pest Nuisance 51
6.16 Alcoholic Liquor or Drugs 51
6.17 Arms and Ammunition 51
6.18 Festivals and Religious Customs 51
6.19 Funeral Arrangements 51
6.20 Prohibition of Forced or Compulsory Labour 52
6.21 Prohibition of Harmful Child Labour 52
7. Plant, Materials and Workmanship 52
7.1 Manner of Execution 52
7.2 Samples 52
7.3 Inspection 52
7.4 Testing 53
7.5 Rejection 54
7.6 Remedial Work 54
7.7 Ownership of Plant and Materials 55
7.8 Royalties 55
8. Commencement, Delays and Suspension 55
8.1 Commencement of Works 55
8.2 Time for Completion 60
8.3 Programme 60
8.4 Extension of Time for Completion 61
8.5 Delays Caused by Authorities 61
8.5A Additional Cost 62
8.6 Rate of Progress 63
8.7 Liquidated Delay Damages 63
8.8 Suspension of Work 64
8.9 Consequences of Suspension 65
8.10 Payment for Plant and Materials in Event of Suspension 65
8.11 Prolonged Suspension 65
8.12 Resumption of Work 66
9. Tests on Completion 66
9.1 Contractor’s Obligations 66
9.2 Delayed Tests 66
9.3 Retesting 67
9.4 Failure to Pass Tests on Completion 67
10. Employer’s Taking Over 67
10.1 Taking Over of the Works and Sections 67
10.2 Taking Over of Parts of the Works 68
10.3 Interference with Tests on Completion 69
11. Defects Liability 70
11.1 Completion of Outstanding Work and Remedying Defects 70
11.2 Cost of Remedying Defects 70
11.3 Extension of Defects Notification Period 70
11.4 Failure to Remedy Defects 71
11.5 Not Used 71
11.6 Further Tests 71
11.7 Right of Access 71
11.8 Contractor to Search 71
11.9 Performance Certificate 72
11.10 Not Used 72
11.11Clearance of Site 72
12. Measurement and Evaluation 72
12.1 Not Used 72
12.2 Not Used 72
12.3 Contract Price and Evaluation 72
12.4 Lump Sums 75
13. Variations and Adjustments 76
13.1 Right to Vary 76
13.2 Not Used 77
13.3 Variation Procedure 77
13.4 Payment in Applicable Currencies 78
13.5 Provisional Sums 78
13.6 Daywork 78
13.7 Adjustments for Changes in Legislation 78
13.8 Not Used 79
14. Contract Price and Payment 79
14.1 The Contract Price 79
14.2 Advance Payment 80
14.3 Application for Interim Payment Certificates 80
14.4 Not Used 81
14.5 Not Used 81
14.6 Issue of Interim Payment Certificates 81
14.7 Payment 81
14.8 Delayed Payment 81
14.9 Not Used 82
14.10Statement at Completion 82
14.11Application for Final Payment Certificate 82
14.12Not Used 83
14.13Issue of Final Payment Certificate 83
14.14Not Used 83
14.15Not Used 83
15. Termination by Employer 83
15.1 Notice to Correct 83
15.2 Termination by Employer 83
15.3 Valuation at Date of Termination 84
15.4 Payment after Termination 85
15.5 Not Used 85
15.6 Corrupt or Fraudulent Practices 85
16. Suspension and Termination by Contractor 86
16.1 Contractor’s Entitlement to Suspend Work 86
16.2 Termination by Contractor 86
16.3 Cessation of Work and Removal of Contractor’s Equipment 87
16.4 Payment on Termination 88
17. Risk and Responsibility 88
17.1 Indemnities 88
17.2 Contractor’s Care of the Works 88
17.3 Employer’s Risks 89
17.4 Consequences of Employer’s Risks 90
17.5 Intellectual and Industrial Property Rights 90
17.6 Limitation of Liability 91
17.7 Use of Employer’s Accommodation/Facilities 93
18. Insurance 93
18.1 General Requirements for Insurances 93
18.2 Insurance for Works and Contractor’s Equipment 95
18.3 Insurance against Injury to Persons and Damage to Property 96
18.4 Insurance for Contractor’s Personnel 97
19. Force Majeure 97
19.1 Definition of Force Majeure 97
19.3 Duty to Minimise Delay 98
19.4 Consequences of Force Majeure 99
19.5 Not Used 99
19.6 Optional Termination, Payment and Release 99
19.7 Release from Performance 100
20. Claims, Disputes and Arbitration 101
20.1 Contractor’s Claims 101
20.2 Management Committee 102
20.3 Not Used 103
20.4 Not Used 103
20.5 Amicable Settlement 103
20.6 Arbitration 103
General Conditions
1.1 Definitions / In these General Conditions of Contract (“these Conditions”), the following words and expressions shall have the meanings stated. Words indicating persons or parties include corporations and other legal entities, except where the context requires otherwise.
“Affiliates” means the Contractor’s Affiliates and the Employer’s Affiliates and Affiliate means either of them.
“Aggregate” means material meeting the requirements of Kosovar Law and the Specification for use in production of materials used in the construction of the Motorway including concrete and paving.
“Kosovar Law” means any applicable law, legislation, delegated legislation, order, regulation or by-law of any Competent Authority having the force of law in the Republic of Kosovo.
“Alignment” means the specific location of the Motorway shown on the Section plan forming part of Schedule 9.
“Base Date” means 1 December 2009.
“Borrow Pit” means an agreed area, to be provided by the Employer, under Sub-Clause 2.1, outside of the Site, for the provision of borrow material suitable for embankment fill.
“Commencement Date” means for each Section the date specified in Schedule 8.
“Competent Authority” means the parliament or government of the Country or any minister, ministry or any national or local authority of the Country.
“Consents” means all consents, licences, authorizations, permissions, approvals and permits of any Competent Authority for the execution of, or relating to, the Works.
“Construction Permit” means the permit authorizing the Works in respect of a Section or Part and required by Kosovar Law.
“Contract” means the Contract Agreement, these Conditions, the Schedules and the Contract Data.
“Contract Agreement” means the contract agreement referred to in Sub-Clause 1.6 [Contract Agreement].
“Contract Data” means the pages completed by the Employer entitled contract data.
“Contract Period” means the period from the Effective date to the date on which the last in time of the Performance Certificates is issued.
“Contractor” means the person(s) named as contractor in the Contract Data.
“Contractor-Related Parties” means the Contractor, Contractor’s Affiliates and the directors, officers, employees and agents of the Contractor and such affiliates and any future assignee of the rights of the Contractor under the Contract.
“Contractor’s Affiliates” means, in respect of each entity comprising the Contractor, the Parents of such entity and any company in which such Parent owns directly or indirectly more than 50% of the shares entitled to vote at a general meeting of shareholders.
“Contractor’s Consents” means the Consents other than the Employer’s Consents.
“Contractor’s Documents” means all drawings in respect of the Temporary Works, all other drawings used by the Contractor for the purpose of instructing Subcontractors in the supply of structural materials, technical data sheets, samples and operation and maintenance manuals.
“Contractor’s Establishment Payment” means a payment in respect of the Contractor’s establishment costs in the sum of forty million Euros (€40,000,000).
“Contractor’s Equipment” means all apparatus, machinery, vehicles and other things required for the execution and completion of the Works and the remedying of any defects. However, Contractor’s Equipment excludes Temporary Works, Employer’s Equipment (if any), Plant, Materials and any other things intended to form or forming part of the Permanent Works.
“Contractor’s Personnel” means the Contractor’s Representative and all personnel whom the Contractor utilises on Site, who may include the staff, labour and other employees of the Contractor and of each Subcontractor; and any other personnel assisting the Contractor in the execution of the Works.
“Contractor’s Representative” means the person named by the Contractor in the Contract or appointed from time to time by the Contractor under Sub-Clause 4.3 [Contractor’s Representative], who acts on behalf of the Contractor.
“Contract Price” means the price defined in Sub-Clause 14.1 [The Contract Price], and includes adjustments in accordance with the Contract, and the Design Management Fee and Reimbursable Sums.
“Cost” means all costs reasonably incurred (or to be incurred) by the Contractor, whether on or off the Site, including overhead and similar charges, but does not include profit.
“Country” means the Republic of Kosovo.
“day” means a calendar day and “year” means 365 days.
“Defects Liability Letter of Credit” means a letter of credit in the form set out in Schedule 5.
“Defects Notification Period” means the period for notifying defects in the Works or a Section (as the case may be) under Sub-Clause 11.1 [Completion of Outstanding Work and Remedying Defects], which extends over eighteen months except if otherwise stated in the Contract Data (with any extension under Sub-Clause 11.3 [Extension of Defects Notification Period]), calculated from the date on which the Works or Section is completed as certified under Sub-Clause 10.1 [Taking Over of the Works and Sections].
“Design Cost” means the Design Quantities multiplied by the Unit Prices included in Schedule 1 (excluding for this purpose any escalation otherwise applicable pursuant to Sub-Clause D [Contract Price and Evaluation]).
“Design Management Fee” means the amount payable by the Employer to the Contractor for the provision of the Design Management Services.