An article appeared in the January 2020 edition of Engineering News written by Cameron Staude, a partner in the law firm Nupen Staude de Vries, stating that most government organisations and State-Owned Enterprises have standardised on the use of the New Engineering Contract (NEC).

The reasons for this according to Staude are as follows:

• International construction industry-specific contract format.
• Improved roll-out and execution of infrastructure projects.

Points to note regarding the NEC:

• It allocates risk effectively amongst the parties, which affords clarity on the various roles.
• With all parties knowing their exact role and responsibilities, this helps projects to progress amid complex environments.
• Other important elements are the site information and works information, which set out the conditions of the site and scope of work of the work of the project respectively.
• The NEC provides an understandable and robust contract that can be modified to meet project needs quickly and clearly, with risks and responsibilities clearly assigned.

The NEC 4 Suite of Contract Documents published in June 2017 is the latest suite of contractual agreements and consists of the following contracts:

• Dispute Resolution Service Contract
• Supply Contract
• Design Build and Operate Contract
• Engineering and Construction Contract
• Engineering and Construction Subcontract
• Framework Contract
• Professional Service Contract
• Term Service Contract
• Alliance Contract

It is however important for members to note that the CIDB Standard for Uniformity in Engineering & Construction Works Contract as published in the Government Gazette on 8 August 2019 only recognises the following two NEC Contract Agreements:

• NEC 3 Engineering and Construction Short Contract
• NEC 3 Engineering and Construction Contract

The Association has had no official confirmation of the adoption of the NEC suite of Contracts from the CIDB or the Department of Works, as alluded to by Cameron Staude. The Association’s Training Academy is now offering courses on the NEC 3 Engineering and Construction Contract and the Association urges all members to upskill themselves on this contract before encountering it in a tender document that would have to be submitted within a few weeks.

Ross Stembridge | Building Services Manager