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The European Society of Construction Law (ESCL)

The European Society of Construction Law (ESCL). Construction contracts By Attorney Peter Wengler-Jørgensen. Construction contracts. Regulation in Denmark AB 92, ABT 93, ABR 89 Agreed documents Agreed upon by parties within the industry – representatives from all sides

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The European Society of Construction Law (ESCL)

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  1. The European Society of Construction Law (ESCL) Construction contracts By Attorney Peter Wengler-Jørgensen

  2. Construction contracts • Regulation in Denmark • AB 92, ABT 93, ABR 89 • Agreed documents • Agreed upon by parties within the industry – representatives from all sides • Only applies if agreed upon by the parties to the contract • AB 92 • Standard conditions for work and deliveries in construction • Originally AB 52, revised in 1972 and in 1992 • Used in almost every construction contract in Denmark • The public sector is obligated by law to use AB 92 when they put construction contracts out to tender (both national and international) • Most of the conditions are used as general rules within construction law

  3. Construction contracts • ABT 93 • Standard conditions for turnkey contracts • Issued in 1993 • Not as widely used as AB 92 • ABR 89 • Standard conditions for technical consultancy services in regards to construction • Originally ABR 75, revised in 1989 • Widely used by architects and engineers

  4. Construction contracts • Agreed documents • Advantages • Flexibility - the conditions can be altered by the parties when needed • A balance of both parties’ interests • Customised for the reality of construction • Accepted by the parties as reasonable and practicable • Disadvantages • Legislation might be better to ensure full compliance • Legislation might be better to ensure political guidelines and safeguards • Consumer safeguards

  5. Construction contracts • International construction contracts • FIDIC general conditions • Issued by the International Federation of Consulting Engineers (FIDIC) • Different books • FIDIC Conditions of Contract for Construction (Red book) • FIDIC Conditions of Contract for Plant and Design/Build (Yellow Book) • FIDIC Conditions of Contract for EPC Turnkey Projects (Silver book) • FIDIC Short Form of Contract (Green book) • FIDIC Conditions of Contract for Design, Build and Operate Projects (Gold book) • Has a wide application area and is used worldwide

  6. Construction contracts • International construction contracts • FIDIC general conditions • Advantages • Flexibility • The different books are customised for different types of contracts • Reasonable risk allocation between the parties • Provides uniform conditions worldwide

  7. Construction contracts • Construction contracts within the European Union • Currently no legislation or general conditions applicable specifically within the European Union • European Commission • Has suggested to work towards a European Contract Law to support economic activity within the internal European Market • Green Paper from the Commission 1. July 2010 • Different suggestions in regards to the legal nature of the instrument of European Contract Law • Publication of the results of the Expert Group • Regulation establishing a European Contract Law and European Civil Code

  8. Construction Contracts • Construction contracts within the European Union • General conditions such as FIDIC and AB 92 • More advantages than disadvantages • Good experiences with FIDIC and AB 92 • Can be specifically tailored to different types of contracts such as the FIDIC books • Would be customised for the reality of construction • Would most likely be accepted by the parties as reasonable and practicable • Would provide the European Union with uniform guidelines, that could further construction contracts within the internal market

  9. Construction Contracts • Construction contracts within the European Union • Consumer contracts • Legislation would probably be better to ensure consumer safeguards • Small companies • Do not have the same bargaining power • Might be a need for legislative safeguards • Legislation could be used within these specific areas

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