New Red B.

Harmonised for MDB

MDB- Multilateral Development Banks
Following MDBs have participated in the
production of the Harmonised Edition
African Development Bank
Asian Development Bank
Black Sea Trade and development bank
European Bank for Reconstruction & Development
Inter-American Development Bank
International Bank for Reconstruction
Development
Islamic Bank for Development
Nordic Development Fund 1
New Red B. Harmonised for MDB
Need for harmonizing MDB Contracts
For many years MDBs used FIDIC as
Standard
It has been the practice to introduce
additional clauses in particular applications
These additional clauses have standard
wordings which have to be repeated for
each new project

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New Red B. Harmonised for MDB
Need for harmonizing MDB Contracts
Provisions in the tender documents varied
b/n MDBs
The additional clauses have varied b/n
MDB’s
This created inefficiencies & uncertainties
among users

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New Red B. Harmonised for MDB
To overcome the above problems
The MDBs harmonized their tender
documents on an international basis
The MDBs decided to have a modified form
of FIDIC construction contract 1999
This modified contract form contain the
standard wordings which have been
incorporated by MDBs in the particular
conditions

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New Red B. Harmonised for MDB
Changes from FIDIC Cons. 1999
Changes that affect Many Clauses
‘Appendix to Tender’ becomes ‘Contract
Data’
‘Contract Data’ becomes Part A of
Particular Conditions
‘Reasonable profit’ becomes “profit” (5%)
DAB changed to DB

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New Red B. Harmonised for MDB
Clause 1
Bank & Borrower defined(1.1.2.11, 1.1.2.12)
“Date for submission of tender” to “Base date”
“Tender”=Bid, “tenderer”= bidder(1.2)
“Versions of contract in different languages”
removed(1.4)
Any error- not only “technical”- to be
informed(1.8)
Contract details to confidential(1.12)
Bank may inspect or audit (1.15)

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New Red B. Harmonised for MDB
Clause 2
Contractor to be informed if bank suspends
disbursement (2.4)
Notice of employer’s claim to be given
within 28 days…..”should have become
aware”(2.5)

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New Red B. Harmonised for MDB
Clause 3
Employer may change authority of
Engineer(3.1)
Response the contractor within 28 days(3.1
Engineer to get specific approval of
employer for the following
• 4.12 extra time /cost for unforeseeable phys.
• 13.1 instructing variations(except in emergency
or below a stated amount
• 13.2 approving contractor's proposal for variat.
• 13.4 specifying the amount payable in each of
applicable currencies
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New Red B. Harmonised for MDB
Clause 3 (cont.)
Notice to change the engineer not less
than 21 days (42 days in FIDIC)(3.4)
Engineer to obtain specific approval of
Employer before acting
• 4.12 extra time/cost for unforeseeable
physical conditions
• 13.1 instructing variations(except
emergency or below stated amount in
the “Contract data”

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New Red B. Harmonised for MDB
Engineer to obtain specific approval (cont.)
• 13.3 Approving a proposal for variations
submitted by the contractor in
accordance with 13.1& 13.2
• 13.4 Specifying the amount payable in
each of the applicable currencies

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New Red B. Harmonised for MDB
Notice to change the engineer
Not less than 21 days in MDB
Not less than 42 days in FIDIC 1999

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New Red B. Harmonised for MDB
Clause 4- Contractor
Materials & services to be from eligible
countries(4.1)
Subparagraph (a) to (d) deleted(4.2
Performance security) unnecessary
wording
Performance security may be increased or
decreased for variations >or< 25%

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New Red B. Harmonised for MDB
Clause 4- Contractor (cont.)
If contractor’s representative is not fluent
in the language of the contract interpreter
required (4.3)
Contractor shall ensure that the
requirement imposed on the contractor by
sub-clause 1.12(confidential details) apply
equally to the sub-contractor (4.4)

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New Red B. Harmonised for MDB
Clause 4- Contractor (cont.)
Contractor shall give fair & reasonable
opportunity for sub-contractor’s from the
country(4.4)
Clause 5- Nominated Subcontractors
Subcontractor to paid if and when the
contractor has received payment

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New Red B. Harmonised for MDB
Clause 6- staff & Labor (many additions
To the extent practicable & reasonable
employ labor from the country(6.1)
Contractor shall inform his personnel about
their liability to pay personal income taxes
(6.2)
The contractor shall conduct an HIV-AIDS
awareness program (6.7)

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New Red B. Harmonised for MDB
Added clauses (6.12-6.22)
Foreign personnel (6.12)
Supply of food stuffs(6.13)
Supply of water(6.14)
Measures against insects & pest nuisance
Alcoholic Liquors or drugs(6.16)
Arms & Ammunitions (6.17)

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New Red B. Harmonised for MDB
Festivals & Religious customs (6.18)
Funeral arrangements (6.19)
Prohibition of compulsory or forced labor
Prohibition of Harmful child labor (6.21)
Employment Records of workers (6.22)

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New Red B. Harmonised for MDB
Clause 8 – Extension of Time/cost
Considers delay by employer’s personnel
any where not only on site(8.4(d)
New paragraph added(8.6)- additional
costs of revised methods including
acceleration measures instructed by the
Engineer to reduce delays from causes
listed in 8.4 shall be paid by the employer

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New Red B. Harmonised for MDB
Clause 8- extension of Time(cont.)
Resumption of work (8.12)

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