CELEX: 51991PC0151
Language: en
Date: 1991-07-31
Title: PROPOSAL FOR A COUNCIL DECISION ADOPTING THE GENERAL REGULATIONS, GENERAL CONDITIONS AND PROCEDURAL RULES ON CONCILIATION AND ARBITRATION FOR WORKS, SUPPLY AND SERVICE CONTRACTS FINANCED BY THE EUROPEAN DEVELOPMENT FUND ( EDF ) CONCERNING THEIR APPLICATION IN THE ASSOCIATION OF THE OVERSEAS COUNTRIES AND TERRITORIES WITH THE EUROPEAN ECONOMIC COMMUNITY

COMMISSION OF THE EUROPEAN COMMUNITIES
                                           C0M(91) 151 final
                                            Brussels, 31 July 1991
     m
    iES                            Proposal for a
                                 COUNCIL DECISION
             adopting the General Regulations, General Conditions and
               Procedural Rules on Conciliation and Arbitration for
               Works, Supply and Service Contracts financed by the
                 European Development Fund (EDF) concerning their
                  application in the association of the overseas
                        countries and territories with the
                            European Economic Community
                           (presented by the Commission)
StA
 ---pagebreak---                                            - 2 -
              Œ M U N I C A T I O N FRCM THE COMMISSION TO THE COUNCIL
      Draft Commission proposal concerning draft for a Council Decision
       adopting the General Regulations, General Conditions and Procedural
      Rules on Conciliation and Arbitration for Works, Supply and Service
       contracts financed from the resources of the EDF concerning their
       application in the association of the Overseas Countries and
      Territories with the European Economic Community.
Articles 211 to 213 of the proposal for a Council Decision on the
association of the Overseas Countries and Territories (OCT) with the
European Economic Corrmunity ( OCM (90) 387 ) which relate to the
application of rules on competition and preferences, provide that the
Commission shall submit a proposal for General Regulations, General
Conditions and Arbitration Regulation concerning Works, Supply and Service
contracts financed from the EDF in the OCT.
The   objective     of     the General Regulations, General Conditions and
Arbitration Regulation is to maintain a certain uniformity in the field of
award and execution of contracts financed by the EDF.
Following Articles 305 to 307 of Lome IV, the ACP-EEC Council of Ministers
in 1990 has adopted rules and regulations for EDF financed contracts in the
ACP States. Indeed, the present proposal is based on the same General
Regulations, General Conditions and Arbitration Regulation as will apply
for the ACP States. However, some modifications have had to take place in
view of the special nature of the OCT compared to the ACP States. These
modifications are detailed in the enclosed "Explanatory Note".
 ---pagebreak---                                      - 3 -
                                 Proposal for a
                                COUNCIL DECISION
          adopting the General Regulations, General Conditions and
            Procedural Rules on Conciliation and Arbitration for
             Works, Supply and Service Contracts financed by the
               European Development Fund (EDF) concerning their
                application in the association of the overseas
                      countries and territories with the
                          European Economic Community
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Economic Community,
and in particular Article 136 thereof»
Having regard to the Council Decision of        1991 on the association of the
Overseas Countries and Territories with the European Economic Community, and
in particular Articles 211, 212 and 213 thereof,
Having regard to the proposal of the Commission,
Whereas  it   is necessary   to adopt    the General   Regulations and  General
Conditions governing works, supply and service contracts financed from the
resources of    the European   Development   Fund  (EDF),  administered by  the
Commission;
Whereas  it   is necessary   to adopt   Procedural  Rules on Conciliation   and
Arbitration of Contracts financed from the resources of the EDF;
Whereas the Council, by adopting this Decision has paid particular regard to
the similar documents adopted for the use of funds from the EDF in the ACP
States,
 ---pagebreak---                                        - 4 -
HAS DECIDED AS FOLLOWS
                                     Article 1
The General Regulations for Works, Supply and Service Contracts financed by
the   European   Development   Fund    (EDF)   in   the  Overseas    Countries   and
Territories, appearing in Annex I, shall apply to the preparation and award
of contracts financed from the resources of the EDF.
The performance of contracts financed from the resources of the EDF shall,
except as otherwise provided in Article 212 (b) of the Council Decision [of
        1991], be governed by:
       the General    Conditions  for   Works Contracts     financed   by  the  EDF,
       appearing in Annex II;
       the General   Conditions   for Supply Contracts      financed   by the EDF,
       appearing in Annex III;
       the General   Conditions for Service Contracts financed by the EDF,
       appearing in Annex IV.
Disputes relating to a contract       financed    from the resources of the EDF
which,   pursuant   to  the  General   Conditions    and  the   Special   Conditions
applicable    to  the   contract,   are   to  be    settled   by   conciliation   or
arbitration, shall be settled      In accordance with the Procedural Rules on
Conciliation and Arbitration of Contracts financed by the EDF, appearing in
Annex V.
 ---pagebreak---                                       - 5 -
                                 Article 2
This Decision shall apply to all public contracts financed by the EDF in the
Overseas Countries and Territories, and concluded as from 1 June 1991.
                                  Article 3
This Decision shall be published    in the Official Journal of the European
Commun i t i es.
Done at Brussels,                      For the Council
                                       The President
 ---pagebreak---           - 6-
         DRAFT
  GENERAL REGULATIONS
  GENERAL CONDITIONS
          AND
ARBITRATION REGULATION
     APPLICABLE IN
        THE OCT
 ---pagebreak---                                      - 7 -
                                EXPLANATORY MEMORANDUM
Subject:       General Regulations, General Conditions       and  Arbitration
               Regulation applicable in the OCT
1.    The General Regulations, the General Conditions and the Arbitration
      Regulation - in the following collectively referred to as the GCC -
      consist of five documents:
               the General Regulations for W)rks,       Supply   and  Service
               Contracts financed by the EDF,
               the General Conditions for Works Contracts,
               the General Conditions for Supply Contracts,
               the General Conditions for Service Contracts, and
               the Procedural   Rules  on Conciliation   and Arbitration   of
               Contracts.
2.    The documents are based on the GOC already agreed with the ACP States.
      However, modifications have had to be made taking into account the
      draft Council Decision (OCM (90) 387) as well as some of the specific
      features applicable to the ACP States which do not concern the OCT.
3.    Compared with the GCC applicable to the ACP States, the draft for the
      GCC applicable to the OCT has the following amendments and
      modifications:
      General Regulations
      Wiere apropriate the term "ACP States" has been replaced either by
       "OCT" or by "country or territory".
      Article 1 :      Reference to the 7th EDF has been deleted.
      Article 3.1 :    Definitions of "OCT" and "Council Decision" have been
                       added.
                       Definition of "Companies or Firms" has been amended in
                       accordance with the Draft Decision.
      Article 4.1 :    The origin of the supplies has been modified        in
                       accordance with the Draft Decision.
 ---pagebreak---                                  - 8 -
Article 5 (a) : Modified     to ensure publication   in EBC and OCT
                concerned as well as other appropriate information
                media in the region.
Article 7.5 and 7.9 : "ACP State" replaced by "Contracting
                Authority".
Article 7.11 :  "National Authorizing     Officer" replaced  by  "Local
                Authorizing Officer".
Article 22.1 :  "temporary associations" replaced by "joint ventures".
Article 22.2 : Modified in accordance with the Draft Decision.
Article 24.4 and 24.5 : Contents has been rearranged, however, pre-
                serving the contractor's right to be paid in Foreign
                Currency at a fixed exchange rate.
Article 26.1 : The minimum for tender guarantees has been deleted.
Article 33.3 :  "and with the Convention" has been deleted.
Article 36.2 : The last two indents have been deleted since they are
                already part of the main body of the article.
Article 41.2 : Has been deleted in view of the change in Article 1.
General Conditions for Aftforks Contracts
Article 1.1 :   Definitions of "OCT" and "Council Decision" have been
                added.
                Definitions of "ACP States" and "Convention" have been
                deleted.
                "ACP State" has been replaced by "OCT".
Article 68.5 :   "Convention" has been replaced by "Council Decision".
                 (b)(i) has been deleted giving full effect to the new
                EDF Arbitration Regulation for all transnational
                contracts.
General Conditions for Supply Contracts
The same modifications as for Works.
General Conditions for Service Contracts
The same modifications as for Works.
 ---pagebreak---                               - 9 -
 Procedural Rules on Conciliation and Arbitration of Contracts
"Where appropriate the term "ACP States" has been replaced by "OCT".
Article 2 :      Definitions of "ACP State", "Convention" and "Council
                 of Ministers" deleted.
                 Definitions of "OCT" and "Council Decision" added.
Article 5.3 :    Nationality status modified.
Article 6 :      Nationality status modified.
Article 34.1 : Nationality status modified.
Article 34.2 : Reference to "the Secretary General of the ACP General
                 Secretariat" deleted.
 ---pagebreak---              - 10 -
                       ANNEX I
     GENERAL REGULATIONS
FORWDRKS, SUPPLY, AND SERVICE
  CONTRACTS FINANCED BY THE
  EUROPEAN DEVELOPMENT FUND
          IN THE OCT
 ---pagebreak---                                      - 11 -
                              TABLE OF ODNIENTS
                                 INTRODUCTION
                                                    Page
Article  1 -Conditions                               13
Article  2 - National Law                            14
                         DEFINITIONS AND PRINCIPLES
Article 3 -Definitions                               14
Article 4 - Eligibility                              17
Article 5 - Equality of Participation                19
Article 6 - Derogation                               20
Article 7 -Competition                               20
Article 8 - Design Competition                       23
Article 9 - Preference                               24
Article 10 - Types of Contract                       25
Article 11 - Technical Specifications and Standards  26
Article 12 - Notices and "Written Communications     26
                            INVITATION TO TENDER
Article 13 - Notice of Invitation to Tender          26
Article 14 - Pre-selection of Tenderers              28
Article 15 - Direct Agreement Contracts              29
                                TENDER DOSSIER
Article 16 - Contents of Tender Dossier              29
Article 17 - Clarification of Tender Information     31
Article 18 - Amendments to Tender Dossier            31
                          INSTRUCTIONS TO TOCERERS
Article 19 - Language                                32
Article 20 - Contents of the Tender                  32
Article 21 - Lots                                    33
Article 22 - Co-operation with Third Parties         34
Article 23 -  Independence of Tenderers              35
Article 24 - Pricing of Tenders                      35
Article 25 - Period of Validity                      36
Article 26 - Tender Guarantee                        37
 ---pagebreak---                                     - 12 -
                                                     Page
Article 27 - Variant Solutions                        38
Article 28 - Pre-tender Visit                         39
Article 29 - Signing of Tenders                       39
                            SUBMISSION OF TENDERS
Article 30 - Time Limit                               40
Article 31 - Sealing and Marking of Envelopes         41
Article 32 -Withdrawals and Amendments                41
                           EXAMINATION OF TENDERS
Article 33 - Opening of Tenders                       42
Article 34 - Evaluation of Tenders                    43
Article 35 - Annulment of the Tender Procedure        45
                              JSfMSDOP CONTRACT
Article 36 - Selection                                46
Article 37 - Notification of Award                    47
Article 38 - Preparation of Contract Document         48
Article 39 - Signing of the Contract                  48
Article 40 - Performance Guarantee                    49
                        GENERAL AND FINAL PROVISIONS
Article 41 - General and Final Provisions             49
 ---pagebreak---                                    - 13 -
                               INIHODUCTICN
                                ARTICLE 1
                                Conditions
1.1 The award of W)rks, Supply and Service contracts financed from the
    resources of the European Development Fund (EDF) shall be governed by
    these General Regulations.
1.2 The performance of W>rks, Supply and Service Contracts financed from
    the resources of the European Development Fund (EDF) shall be gov-
    erned by:-
    a) the General Conditions applicable to each category of contract fi-
        nanced by the EDF, or
    b) in the case of co-financed projects and programmes, or where dero-
        gation to third parties has been granted, or in accelerated proce-
        dures or in other appropriate cases, such other General Conditions
        as may be agreed by the country or territory concerned and the Eu-
        ropean Economic Comrunity (EEC), i.e:-
        i)    the General Conditions prescribed by the national legisla-
              tion of the country or territory concerned or its estab-
              lished practices regarding international contracts, or
        ii)   any other  international General Conditions   for contracts,
              and
     c) the Special Conditions.
1.3 These General Regulations comprise the principles and conditions for
    participation in contracts, instructions to tenderers, and the prin-
     ciples and conditions for the award of contracts.
1.4 The General Conditions governing a particular category of contract
    comprise contractual clauses of an administrative, financial, legal
    and technical nature relating to the performance of contracts.
1.5 The Special Conditions applicable to each contract comprise:-
    a) amendments to the General Conditions;
    b) special contractual clauses;
    c) technical specifications; and
    d) any other matter related to the contract.
 ---pagebreak---                                    - 14 -
                                ARTICLE 2
                              National Law
    In all matters which are not covered by these General Regulations,
    the national law of the State of the Contracting Authority shall ap-
    ply.
                      DEFINITIONS AND PRINCIPLES
                                ARTICLE 3
                               Definitions
3.1 The definitions which shall apply to these General Regulations are
    the following:
    EEC: the European Economic Conminity.
    ECF: the European Development Fund.
    Council Decision: the Council Decision ../.../EEC of        on the
            association of the Overseas Countries and Territories with
             the EBC.
    OCT: the countries and terrritories associated with the EBC by the
            Council Decision.
    ACP States: the African, Caribbean and Pacific States which are sig-
            natories to the Convention.
    Comnission: the Conmission of the European Comnunities.
    Delegate: the representative of the Conmission in the OCT.
    Member States: the Member States of the European Economic Community.
    Convention: the relevant Convention between the ACP States and the
            EBC.
    Contracting Authority: the State or the legal person governed by pub-
            lic or private law which concludes the contract or on behalf
            of which the contract is concluded.
    The State of the Contracting Authority: the OCT on whose territory
            theW>rks, Supply or Service contract is to be executed
    Tenderer: any natural or legal person or group of such persons sub-
            mitting a tender, with a view to concluding a contract.
 ---pagebreak---                                 15 -
Successful Tenderer: the Tenderer selected after an invitation to
         tender procedure or, in the case of direct agreement con-
         tracts, the Tenderer who signs the contract.
Supervisor: the government department, legal person governed by pub-
         lic law, or the natural or legal person designated by the
         Contracting Authority in accordance with the law of the State
         of the Contracting Authority, who is responsible for direct-
         ing and/or monitoring the performance of the contract, and to
        Whom the Contracting Authority may delegate rights and/or
         powers under the contract.
Supervisor's Representative: any natural or legal person, designated
         by the Supervisor as such under the contract and empowered to
         represent the Supervisor in the performance of his functions,
         and in exercising such rights and/or powers as have been del-
         egated to him. Accordingly, Where functions, rights and/or
         powers of the Supervisor are delegated to the Supervisor's
         Representative, references to the Supervisor include the
         Supervisor's Representative.
W)rks:   the temporary and permanent works to be carried out under the
         contract.
Supplies: all items Which the Supplier is required to provide to the
         Contracting Authority, including, where necessary, services
         such as installation, testing, conmissioning, provision of
         expertise, supervision, maintenance, repair, training and
         other such obligations connected with the items to be pro-
         vided under the contract.
Services: tasks to be performed by the Consultant under a service
         contract such as studies, designs, provision of technical as-
         sistance and training.
Plant: machinery, apparatus, components and all items to be provided
         or incorporated under the contract.
Equipment: appliances and other machinery, and where applicable under
         the law and/or practice of the State of the Contracting
         Authority, the temporary structures on the work site, re-
         quired for carrying out the contract but excluding plant or
         other items required to form part of permanent Works.
Bill of Quantities: the document containing an itemised breakdown of
         the tasks to be carried out in a unit price contract, indi-
         cating a quantity for each item and the corresponding unit
         price.
 Price Schedule: the completed schedule of prices, including the
         breakdown of the overall price, submitted by the Tenderer
         with his tender, modified as necessary, and forming a part of
         the unit price contract.
 ---pagebreak---                              - 16 -
Breakdown of the Overall Price: the itemised list of rates and prices
         showing the build-up of the price in a lump sum contract,
         but which does not form part of the contract.
Tender Price: the sum stated by the Tenderer in his tender for carry-
         ing out the contract.
Contract Price: the sum stated in the contract representing the init-
         ial estimate payable for carrying out theTAbrks, Supplies or
         Services, or such other sum as ascertained at the end of the
         contract as due under the contract.
Drawings: drawings provided by the Contracting Authority and/or by
         the Tenderer in connection with the tender.
Day:     calendar day.
Time Limits: those periods in the contract which shall begin to run
         from the day following the act or event which serves as the
         starting point for those periods. Should the last day of
         the period fall upon a non-working day, the period shall ex-
         pire at the end of the first working day following the last
         day of the period.
Writing: any handwritten, typewritten or printed comnunication, in-
         cluding telex, cable and facsimile transmission.
Comnunications: certificates, notices, orders and instructions is-
         sued under the contract.
National Currency: the currency of the State of the Contracting
         Authority.
BOU:     European Currency Unit.
Foreign Currency: any permissible currency within the meaning of
         these General Regulations which is not the National Curren-
         cy, and which has been indicated in the tender.
Terms of Reference: the statement issued by the Contracting Authority
         giving the definition of his requirements and/or objectives
         of the Services, including, where applicable, the methods
         and means to be used and/or results to be achieved.
 ---pagebreak---                                      - 17 -
    Companies or Firms: companies or firms constituted under civil or
              conmercial law, including public or other companies, co-
              operative societies and any other legal persons or associa-
              tions governed by public or private law, save for those
              which are non-profit making, formed in accordance with the
              law of a Member States or an OCT and whose registered of-
              fice, central administration or principal place of business
              is in a Member State or that OCT; however a company or firm
              having only its registered office in a Member State or an
              OCT must be engaged in an activity which has an actual and
              continuous link with the economy of that Member State or OCT
              concerned.
3.2 The headings and titles in these General Regulations shall not be
     taken as part thereof or be taken into consideration in the interpre-
     tation of these Regulations.
3.3 Wkere the context so permits words importing the singular shall be
    deemed to include the plural and vice versa and words importing the
    masculine shall be deemed to include the feminine and vice versa.
3.4 Words importing persons or parties shall include firms and companies
     and any organization having legal capacity.
                                 ARTICLE 4
                                Eligibility
4.1  Save where a derogation is granted in accordance with the Council De-
     cision and/or Article 6:-
     a) participation in the invitations to tender and in award of con-
        tracts financed by the EDF shall be open on equal terms to:-
        i)     natural persons, companies or firms or public or semi-public
               agencies of the OCT, the ACP States and the EBC;
        ii)    cooperative societies and other legal persons governed by
               public or private law, save for those which are non-profit-
              making, of the EBC, the OCT and/or the ACP States;
        iii)   joint ventures or groupings of OCT, ACP and/or EBC companies
               or firms.
     b) Supplies must originate in the EBC, the OCT and/or the ACP States.
4.2 Natural persons, companies or firms shall not be eligible for the
     award of contracts where:-
     a) they are bankrupt;
 ---pagebreak---                                     - 18 -
    b) payments to them have been suspended in accordance with the judg-
       ment of a court other than a judgment declaring bankruptcy and re-
       sulting, in accordance with their national laws, in the total or
       partial loss of the right to administer and dispose of their prop-
       erty;
    c) legal proceedings have been instituted against them involving an
       order suspending payments and which may result, in accordance with
        their national laws, in a declaration of bankruptcy or in any
       other situation entailing the total or partial loss of the right
        to administer and dispose of their property;
    d) they have been convicted, by a final judgment, of any crime or of-
       fence concerning their professional conduct;
    e) they are guilty of serious misrepresentation with regard to infor-
       mation required for participation in an invitation to tender;
    f) they are in breach of      contract on  another  contract with  the
       Contracting Authority.
4.3 To be eligible for participation in invitations to tender and the
    award of contracts, Tenderers shall provide evidence satisfactory to
    the Contracting Authority of their eligibility under Article 4, proof
    of compliance with the necessary legal, technical and financial re-
    quirements and of their capability and adequacy of resources to carry
    out the contract effectively. To this end all tenders submitted shall
    include the following information:-
    a) a document, dated less than 90 days previously, drawn up in accor-
       dance with the Tenderer's national law or practice certifying
       that:-
              he meets the conditions laid down in Article 4.1;
              none of the situations referred to in Article 4.2 applies to
              him;
    b) copies of original documents defining the constitution and/or le-
       gal status, and establishing the place of registration and/or
       statutory seat and, if it is different, the place of central ad-
       ministration of the company, firm or partnership or, if a joint
       venture, of each party thereto constituting the Tenderer;
    c) details of the experience and past performance of the Tenderer (or
       of each party to a joint venture) on contracts of a similar nature
       within the past five years, and details of other contracts in hand
        including details of the actual and effective participation in
       each such contract;
    d) where applicable, the major items of Equipment proposed for use in
       carrying out the contract;
 ---pagebreak---                                - 19 -
e) the qualifications and experience of key personnel proposed for
   administration and execution of the contract, both at and away
   from the place of execution of the contract;
f) proposals relating to the nature, conditions and modalities of
   sub-contracting wherever the sub-contracting of any elements of
   the contract amounting to more than 10% of the Tender Price is en-
   visaged;
g) reports on the accounting and financial standing of the Tenderer
   (or of each party to a joint venture) such as profit and loss
   statements, balance sheets and auditor's reports for the past five
   years, an estimated financial projection for the next two years,
   and an authority from the Tenderer (or authorised representative
   of a joint venture) to seek references from the Tenderer's bank-
   ers; and
h) information regarding any current legal or arbitration proceedings
   or dispute in Which the Tenderer is involved. The information re-
   ferred to shall be confined to matters of direct interest to the
   award or performance of the contract.
                           ARTICLE 5
                   Equality of Participation
The OCT and the Conmission shall take the necessary measures to en-
sure the widest possible participation on equal terms in invitations
to tender for Works, Supply and Service contracts, including, as ap-
propriate, measures to:-
a) ensure publication of invitations to tender in the Official Jour-
   nal of the EBC, the Official Journal of the OCT concerned and any
   other appropriate information media, in particular in the OCT and
   ACP States in the region;
b) eliminate discriminatory practices or technical specifications
   which might stand in the way of widespread participation on equal
   terms ;
c) encourage co-operation between companies and firms of the Member
   States, the OCT and the ACP States, for example, by means of pre-
   qualification of joint ventures and consortia between companies
   and firms of the Member States, the OCT and the ACP States;
d) ensure that all the selection criteria are specified in the tender
   dossier; and
e) ensure that the tender selected conforms to the requirements of
   the tender dossier and meets the selection criteria stated
   therein.
 ---pagebreak---                                   - 20 -
                               ARTICLE 6
                              Derogation
6.1 In order to ensure the optimum cost-effectiveness of the system, nat-
    ural or legal persons from non-ACP developing countries may be
    authorised to participate in contracts financed by the EBC at the re-
    quest of the OCT concerned.
6.2 The OCT concerned shall, on each occasion, provide the Delegate with
    the information needed for the EBC to decide on such derogations,
    particular attention being given to:-
    a) the geographical location of the OCT concerned;
    b) the competitiveness of contractors, suppliers and consultants from
       the EBC, the OCT and the ACP States;
    c) the need to avoid excessive increases in the cost of performance
       of contracts;
    d) transport difficulties or delays due to delivery times or other
       similar problems;
    e) technology that is the most appropriate and best suited to local
       conditions.
6.3 Participation by third countries, Which are not parties to the Con-
    vention, in contracts financed by the EBC may also be authorised:-
    a) where the EBC participates in the financing of regional or inter-
       regional schemes involving such countries;
    b) in the case of co-financed projects and programmes;
    c) in case of emergency assistance.
6.4 In exceptional cases and in agreement with the Conmission,
    consultancy firms or experts which are nationals of third countries
    referred to in Article 6.3 may participate in Service contracts.
                               ARTICLE 7
                              Competition
7.1 Save as otherwise provided in Article 7, Wbrks and Supply contracts
    financed from the EDF shall be concluded following an open invitation
    to tender and Service contracts shall be concluded following a re-
    stricted invitation to tender.
 ---pagebreak---                                    - 21 -
7.2 The OCT may, in accordance with the provisions in Article 7.3, 7.4
    and 7.7, and in agreement with the Conmission:-
    a) place contracts after restricted invitations to tender following,
        Where applicable, a call for pre-qualification;
    b) conclude contracts by direct agreement;
    c) perform contracts through public or semi-public departments of the
        OCT.
7.3 Restricted invitation to tender may be used:-
    a) where the urgency of the situation is established or where the na-
         ture, or certain particular characteristics of the contracts so
        warrant;
    b) for projects or programmes of a highly specialised nature;
    c) for large-scale contracts after pre-qualification.
7.4 Direct agreement contracts may be awarded in the following cases:-
    a) small-scale operations, or in urgent       situations or  short-term
         technical cooperation schemes;
    b) emergency assistance;
     c) operations assigned to individual experts;
    d) operations which are complementary to or necessary for the comple-
         tion of others already in hand;
     e) where the execution of the contract is exclusively reserved for
        holders of patents or licences to use, process or import the ar-
         ticles concerned;
     f) following an unsuccessful invitation to tender.
7.5 The following procedure shall apply to restricted invitations to ten-
    der and direct agreement contracts:-
     a) in the case of Wbrks and Supply contracts, a short-list of pro-
         spective Tenderers shall be drawn up by the Contracting Authority
         in agreement with the Delegate following, where applicable, a call
         for pre-qualification of tenders;
     b) in the case of Service contracts, the short-list of prospective
         Tenderers shall be drawn up by the Contracting Authority, in
         agreement with the Conmission, on the basis of the proposals of
         the Contracting Authority and the proposals submitted by the Com-
        mission;
 ---pagebreak---                                   - 22 -
    c) in direct agreement contracts, the Contracting Authority shall en-
        ter freely into such discussions as it may consider appropriate
        with the prospective Tenderers whom it has short-listed in accor-
        dance with Article 7.5 (a) and (b) and award the contract to the
        Tenderer whom it has selected.
7.6 For Service Contracts, due account shall be taken of the availability
    of suitable candidates residing in the OCT concerned.
    Direct Labour
7.7 Contracts shall be performed by direct labour through public or semi-
    public agencies or departments of the OCT concerned, where the State
    has the qualified management staff available in its departments, in
    cases of emergency assistance, service contracts and all other opera-
     tions the estimated cost of which is less than ECU 5 million.
7.8 The Comnunity shall contribute to the costs of the department in-
    volved by providing the equipment and/or materials that it lacks
    and/or resources to allow it to acquire additional staff required in
    the form of experts from within the OCT concerned or other OCT or ACP
    States. The participation of the Comnunity shall cover only costs
    incurred by supplementary measures and temporary expenditure relating
    to execution strictly confined to the requirements of the project in
    question.
    Emergency Assistance Contracts
7.9 Contracts under emergency assistance shall be undertaken in such a
    way as to reflect the urgency of the situation. To this end, for all
    operations relating to emergency assistance, the Contracting
    Authority may, in agreement with the Delegate, authorize:-
    a) the conclusion of contracts by direct agreement;
    b) the performance of contracts by direct labour;
    c) implementation through specialized agencies;
    d) direct implementation by the Commission.
 ---pagebreak---                                     - 23 -
     Accelerated Procedure
7.10 With the aim of ensuring the rapid and effective implementation of
     projects and programmes, an accelerated tendering procedure shall be
     used except as otherwise indicated by the OCT concerned, or by the
     Commission by way of a proposal for the agreement of the OCT con-
     cerned. The accelerated procedure for issuing invitations to tender
      shall involve shorter Time Limits for tendering and the call for ten-
     der is confined to the OCT concerned and the neighbouring OCT or ACP
     States, in accordance with the rules in force in the OCT concerned.
     The accelerated procedure shall apply in the following cases:-
      a) Works Contracts: the estimated cost of Which is less than ECU 5
         mi 11i on;
      b) Emergency assistance: irrespective of the value of the contract.
7.11 Byway of derogation, the OCT Authorising Officer, in agreement with
      the Delegate, may procure Supplies and/or Services of a limited
      amount Where they are available in the OCT concerned or neighbouring
     OCT or ACP States.
7.12  In order to speed up the procedure, the OCT may request the Commis-
      sion to negotiate, draw up and conclude Service contracts on their
      behalf directly or through its relevant agency.
                                  ARTICLE 8
                             Design Competition
8.1  Wfciere the Contracting Authority, for technical, aesthetic or finan-
      cial reasons, considers it appropriate, an invitation to tender may
      be issued for participation in a design competition. The design com-
      petition shall take place on the basis of a schedule and criteria
      drawn up by the Contracting Authority. Further, the following shall
      apply:-
      a) The schedule may make provision for prizes to be awarded for the
         best proposals. Such prizes shall be specified by the schedule and
          awarded to the originators of the said proposals in accordance
         with the order established by the Contracting Authority. The
         Contracting Authority may withhold prizes if the proposals are not
          judged satisfactory.
      b) Unless otherwise stated in the invitation to tender, copyright in
          the proposals submitted shall belong to the competitors. However,
          the Contracting Authority may, with the agreement of the competi-
          tors, use the proposals for further development.
8.2   The Contracting Authority may invite tenders for further investiga-
      tion, study and design as may be necessary for further development of
      the project.
 ---pagebreak---                                   - 24 -
8.3 Subject to Article 8.1 (b) and 8.2, the Contracting Authority may in-
    vite tenders for detailed development of a competitor's design and
    the preparation of documents to the stage Where tenders for supply or
    construction may be invited.
8.4 The Contracting Authority may invite tenders for design and build
    proposals on a turnkey basis. Such tenders shall be of the lump sum
    type. Tenders shall be assessed according to their aesthetic, prac-
    tical, technical and economic merits. No prizes shall be offered.
                                ARTICLE 9
                               Preference
9.1 Measures shall be taken to encourage the widest participation of the
    natural and legal persons of the OCT in the performance of contracts
    financed by the EDF in order to permit the optimization of the physi-
    cal and human resources of those countries and territories. To this
    end : -
    a) For W>rks contracts of value less than ECU 5 million, Tenderers
        of the OCT, provided that at least one quarter of the capital
        stock and management staff originates from one or more OCT, shall
        be accorded 10% price preference Where tenders of an equivalent
        economic and technical quality are compared;
    b) For Supply contracts, irrespective of the value of these Supplies,
        Tenderers of the OCT Who offer supplies of at least 50% in con-
        tract value of OCT origin shall be accorded a 15% price prefe-
        rence where tenders of equivalent economic and technical quality
        are compared;
     c) In respect of Service contracts, given the required competence,
        preference shall be given to experts, institutions or consultancy
        companies or firms from the OCT, where tenders of equivalent eco-
        nomic and technical quality are compared;
    d) Where sub-contracting is envisaged, preference shall be given by
        the Successful Tenderer to natural persons, companies and firms of
        the OCT capable of performing the contract required on similar
        terms.
9.2 The threshold and the percentages referred to in Article 9.1 may be
    altered on the basis of the relevant Council Decision.
 ---pagebreak---                                     - 25 -
                                 ARTICLE 10
                              Types of Contract
10.1 Contracts may be one of the following:-
     a) lump sum contracts, where an all-in price shall cover the whole of
         the Works, Supplies and Services which are the subject of the con-
         tract;
     b) unit-price contracts, ^where theW>rks, Supplies and Services shall
         be broken down on the basis of the Bill of Quantities and the pro-
         posed unit prices shall be indicated;
     c) cost-plus contracts, where the Wbrks, Supplies and Services shall
         be priced on the basis of actual costs with an addition for
         overheads and profit;
     d) composite contracts, where the prices shall be fixed on the basis
         of at least two of the methods laid down in Article 10.1;
     e) provisional price contracts, Where in the exceptional cases pro-
         vided in Article 10.2, contracts are awarded without prices being
         predetermined after consultation and agreement between Contracting
         Authority and the Tenderer, and paid for in the manner agreed.
10.2 The award of a provisional price contract, may only be made:-
     a) Where the contract is of a complex nature or involves new tech-
         niques presenting considerable technical hazards which necessitate
         commencement before all conditions of execution can be determined;
     b) in the event of exceptional and unforeseeable circumstances, such
         as where the contract is urgent or the nature and means of execu-
          tion are difficult to determine.
10.3 Except for provisional price contracts, contracts shall be awarded on
      the basis of predetermined prices. These prices may be lump-sums or
     unit prices.
10.4 The instructions to Tenderers shall:-
      a) state the type of contract;
      b) for cost-plus contracts, state      the rules for  calculating  the
          costs, overheads and profit;
      c) for composite contracts, state the methods which are to be used
          for calculating amounts to be paid under the contract.
 ---pagebreak---                                      - 26 -
                                ARTICLE 11
                  Technical Specifications and Standards
11.1 The technical specifications and methods of testing, checking, accep-
     tance and calculation in each contract, may be defined in order of
     precedence, by reference to the common standards accepted by the EBC
     and the OCT concened, or the standards of the OCT concerned or of a
     Member State, or any other standard, including international stan-
     dards.
11.2 Unless it can be justified by the subject of the contract, technical
     specifications Which mention products of a specific make or source,
     or a particular process, and which therefore favour or eliminate cer-
     tain products, shall be prohibited. Such prohibition shall cover
     trade marks, patents or types, or a specific origin or production.
     However, where products or processes cannot be specified in terms
     which are sufficiently precise and intelligible, they may be named,
     provided that the words "or equivalent" are added.
                                ARTICLE 12
                    Notices and VJrit ten Comnuni cat ions
12.1 Unless otherwise specified in the Special Conditions, Communications
     between the Contracting Authority and/or the Supervisor on the one
     hand, and Tenderers or the Successful Tenderer on the other hand,
     shall be sent by post, cable, telex, facsimile transmission or per-
     sonal delivery, to the appropriate addresses designated by these par-
     ties for the purpose.
12.2 If the sender requires evidence of receipt, he shall state such re-
     quirement in his Communication and shall demand such evidence of re-
     ceipt whenever there is a deadline for the receipt of the Communi-
     cation. In any event, the sender shall take all the necessary mea-
     sures to ensure receipt of his Communication.
                           INVITATION TO    TOEER
                                ARTICLE 13
                      Notice of Invitation to Tender
13.1 A Contracting Authority wishing to award a contract by open tendering
     procedure or by restricted tendering procedure with pre-selection
      shall make known its intention by means of a notice published by the
     Commission in the Official Journal of the EBC, the Official Journal
     of the OCT concerned and any other appropriate information media, in
     particular in the OCT and the ACP States in the region.
 ---pagebreak---                                    - 27 -
13.2 The Contracting Authority shall submit before issuing invitations to
     tender the invitation to tender dossier to the Delegate.
13.3 The Delegate shall:-
     a) for accelerated procedures, direct agreement contracts, and con-
         tracts for emergency assistance, approve, before the Contracting
        Authority issues them, the invitation to tender dossier within 30
         days of its submission to him by the Contracting Authority;
     b) for all cases other than those mentioned in Article 13.3 (a)
         above, transmit the invitation to tender dossier to the Commission
         for approval within 30 days of its submission to him by the
         Contracting Authority.
13.4 In an open tendering procedure, the notice of invitation to tender
     shall state:-
     a) the subject, purpose and extent of the contract; if the contract
         is subdivided into several lots, the order of magnitude of the
         different lots and the possibility of tendering for one, several
         or all of the lots; the possibility of submitting variant solu-
         tions where authorised; if the notice concerns an invitation to
         tender for a design-and-build competition, the design criteria and
         other requirements necessary for Tenderers to understand the
         scope of the contract and to tender accordingly;
     b) eligibility criteria and any important or unusual tender evalua-
         tion criteria (e.g. margin of preference);
      c) the location of the project, the source of financing, the period
         of performance, and in the case of Supplies contracts, the place
         of delivery and/or installation;
     d) the Contracting Authority, and the name and address of the depart-
         ment awarding the contract;
      e) the method of tendering, the place where the tender dossier may be
         inspected and the terms on which it may be acquired;
     f) the period, reckoned from the final date fixed for receipt of ten-
         ders, during which Tenderers shall remain bound by their tenders;
     g) the final date and time fixed for receipt of tenders, the address
         to Which they must be sent, the number of copies required and the
         language in which they mist be drawn up;
     h) Where appropriate, the place, date and time for the opening of the
         tenders;
 ---pagebreak---                                      - 28 -
     i) the various guarantees which the Contracting Authority requires,
        the amount of each guarantee, where appropriate expressed as a
        percentage of the tender, and the time when such guarantees are to
        be presented;
     j) the address of the departments from which tenderers may obtain any
        further information.
13.5 In a restricted tendering procedure with pre-selection, the notice
     shall state in particular:-
     a) the method of tendering and the information referred to in Article
        13.4(a), (b), (c), (d) and (g);
     b) the terms on which the tender dossier may be acquired;
     c) where appropriate, the final date for the issue of invitations to
        tender by the Contracting Authority;
     d) the information to be given in the request to participate, in the
        form of statements and documents concerning the applicant's stand-
         ing and ability Which the Contracting Authority requires in accor-
        dance with Article 4 together with the economic and technical con-
        ditions each applicant must fulfil if he wishes to be considered
        for selection.
                                 ARTICLE 14
                         Pre-selection of Tenderers
14.1 In a restricted tender with pre-selection, a short-list of prospec-
     tive Tenderers shall be drawn up in accordance with Article 14.2 fol-
     lowing, where applicable, a call for pre-qualification after pub-
     lication of the notice referred to in Article 13.1.
14.2 The short-list shall be drawn up, inter alia, in accordance with the
     provisions of Article 7.5 and the necessary qualifications to perform
     the intended project, in particular the provisions of Article 4.
14.3 The Contracting Authority shall select the prospective Tenderers on
     the basis of the information given by them in the request made
     pursuant to Article 13.5 (d). The prospective Tenderers selected
     shall receive an invitation to tender stating in particular the
     following:-
     a) the information given in Article 13.4 (e), (f) (g), (h), (i), and
     b) a reference to the notice mentioned in Article 13.5;
     c) any amendments, as referred to in Article 18.
 ---pagebreak---                                      - 29 -
                                ARTICLE IS
                        Direct Agreement Contracts
15.1 For direct agreement contracts, the W)rks, Supplies or Services
     which are to be the subject of the contract shall be defined after
     negotiations between the Contracting Authority and the Tenderer.
15.2 \Miere the procedure by direct agreement is applied, the candidate
      shall be chosen by the OCT concerned on the basis of a short list
      drawn up in accordance with Articles 4.4 and 7.5.
15.3 On completion of the negotiations, the Contracting Authority shall
      draw up and notify the text of the contract in accordance with
     Article 38.
15.4 The Contracting Authority and the Tenderer shall agree on a date
     Which shall be deemed to be the date of the conclusion of the con-
      tract. This date shall be set out in the text of the contract.
                               TQEER DOSSIER
                                 ARTICLE 16
                        Contenta of Tender Dossier
16.1 The invitation to tender dossier shall contain details of the way in
     which tenders are to be presented and the criteria for selection of
      the successful tender. In addition to the invitation to tender, the
      tender dossier may contain any or all of the following:-
      a) the instructions to Tenderers;
      b) the General Conditions applicable to the particular category of
         contract;
      c) the Special Conditions for the specific contract;
      d) the technical specifications and/or Terms of Reference;
      e) the form for the Breakdown of the Overall Price in the case of
         lump sum contracts, or the form for the unit Price Schedules
         and/or the Bill of Quantities in the case of unit price contracts;
      f) the schedule of requirements or additional information;
      g) the Drawings;
      h) the tender form;
 ---pagebreak---                                     - 30 -
     i) the tender guarantee form;
     j) the contract form;
     k) the performance guarantee form; and
     l) a description of the tender evaluation system giving the criteria
        for evaluation and the weight attached to the individual criteria.
16.2 In addition, and depending on the nature of the contract, the tender
     dossier shall be accompanied by a "Note of General Information". This
     Note will be prepared by the Delegate in consultation with the OCT
     concened and subject to the approval by the latter. It will be pro-
     vided for information only and shall not form part of the contract.
     It shall include all or part of the following:-
     a) geographical notes on the region in which the place of execution
        of the contract is located including notes on the climate;
     b) location of the place of execution of the contract, access routes
        and other infrastructures which may be used in the performance of
        the contract;
     c) information concerning   customs, tax and price laws and regula-
        tions;
     d) wage scales and legal or contractual charges payable by employers,
        including an indication of minimum or normal wage levels laid down
        by the law of the State of the Contracting Authority or customary
        in the place where the contract is to be performed, corresponding
        to the main local categories of labour required for the contract;
     e) information on the exchange control laws and regulations and the
        monetary and banking system of the State of the Contracting Au-
        thority;
     f) any other information relating to the laws and regulations of the
        State of the Contracting Authority Which govern the performance of
        contracts, including details as to the departments to which appli-
        cation should be made to obtain copies of those laws and regula-
        tions.
16.3 The Terms of Reference for Service contracts shall contain in partic-
     ular:-
     a) a description, which shall be as detailed as possible, of the ob-
        ject of the contract;
     b) factual details, such as  data in the possession of the Contracting
        Authority, restrictions    that are binding upon the Contracting
        Authority in observance   of certain technical or other rules, and
        obligations laid down by  the Contracting Authority;
 ---pagebreak---                                     - 31 -
     c) depending on the nature of the contract, preliminary draft studies
         or implementation schemes, and a draft contract, if available;
     d) general documentation comprising, in particular, the laws and reg-
         ulations relating to the technical field covered by the contract,
         or any other reference enabling access to such laws and regula-
         t i ons.
16.4 The Tenderer shall carefully examine all instructions, conditions,
     forms, terms, specifications and Drawings in the tender dossier. The
     Tenderer shall be solely responsible for the responses he provides to
      the requirements in the tender dossier and for any amission or errors
      in his responses. Failure to furnish all information required by the
      tender dossier or submission of a tender which is not responsive to
      the tender dossier in every respect, will be at the Tenderer's own
     risk and may result in rejection of his tender.
                                 ARTICLE 17
                    Clarification of Tender Information
     Wiere, in response to a Tenderer's queries or otherwise, information
      regarding the contract to be performed or other information which may
     affect the pricing of the tender is supplied to a Tenderer, such in-
      formation shall also be issued in writing by the Contracting
     Authority to the other Tenderers, insofar as these are known, pro-
     vided that information of a commercial nature relating to the accept-
     ability of variant solutions shall not be issued to the other
     Tenderers. The Contracting Authority will respond only to those que-
      ries or requests for clarification which it receives at least 30 days
     prior to the deadline for the submission of tenders.
                                 ARTICLE 18
                       Amendments to Tender Dossier
     Any change made to the tender dossier during the tender period by the
     Contracting Authority shall be communicated forthwith in writing to
      all prospective Tenderers -who have been provided with the tender doc-
     uments, together with notice of any extension of the tender period
     which the Contracting Authority may consider necessary to enable
     Tenderers to take account of such a change.
 ---pagebreak---                                    - 32 -
                         INSTRUCTIONS TO TENDERERS
                                ARTICLE 19
                                 Language
     The tender, contract documents and all correspondence and documents
     relating to them shall be in the language stated in the instructions
     to Tenderers.
                                ARTICLE 20
                          Contents of the Tender
20.1 The tender to be prepared and submitted by the Tenderer shall, in ac-
     cordance with the requirements stated in the tender dossier, com-
     prise:-
     a) the completed tender form and appendix thereto;
     b) the tender guarantee;
     c) the Breakdown of the Overall Price in the case of lump sum con-
         tracts, or the unit Price Schedule and/or the Bill of Quantities
         in the case of unit price contracts;
     d) schedules of supplementary information;
     e) the documents providing proof of the standing and ability of the
        Tenderer referred to in Article 4, save in the event of a re-
         stricted tendering procedure with pre-selection;
     f) the authorised variant solutions, and any other elements required
         to be submitted in accordance with the instructions to Tenderers
        embodied in the tender dossier;
     g) all information necessary to assess the tenders;
     h) if the instructions to Tenderers specify that an after-sales ser-
        vice is required, a note indicating the means with Which the
        Tenderer shall meet the obligations to provide such a service;
     i) Where appropriate, additional guarantees proposed by the Tenderer
        concerning, inter alia, the period of performance and the scope of
        work;
     j) all information on any sub-contracting envisaged; and
     k) the tender price and the method and the currencies of payment.
 ---pagebreak---                                     - 33
20.2 After-sales service shall be required for Supply contracts unless the
     nature of the Supplies do not justify such service. Wiere the
     Contracting Authority requires an after-sales service:-
     a) the Special Conditions shall specify the conditions and modalities
         of this service and its duration;
     b) the Successful Tenderer shall, unless the nature of the Supplies
         or relevant conditions do not so justify, establish within the
         State of the Contracting Authority the required after-sales ser-
         vice.
                                 ARTICLE 21
                                    Lots
21.1  In considering how a project may be carried out, account shall be
      taken of the advantage, for economic and technical reasons, of divid-
      ing the project into homogeneous lots which are as large as possible.
21.2 Wiere a project has been divided into lots, the instructions to
     Tenderers shall state:-
      a) the number of lots;
     b) the nature, location and size of each lot; and
      c) Where appropriate, the minimum and maximum number of lots for
         which a Tenderer may tender.
21.3 The procedure for submitting a tender shall be as follows:-
      a) a Tenderer may submit a tender for each lot;
      b) unless the instructions to Tenderers provide otherwise, a Tenderer
         may include in his tender the overall rebate he would grant in the
         event of amalgamation of some or all of the lots for which he has
          submitted individual tenders;
      c) unless the instructions to Tenderers state that lots apportioned
          to the same Tenderer shall form a single contract, each lot shall
         form a separate contract;
      d) where lots are to be apportioned to different Tenderers, the invi-
          tation to tender dossier or the instructions to Tenderers may pro-
         vide that the Tenderer for a particular lot shall ensure the coor-
         dination of the execution of all the lots.
 ---pagebreak---                                     - 34 -
                                ARTICLE 22
                      Co-operation with Third Parties
22.1  In order to enhance the OCT's capacity to build up their technical
      skills and to improve the know-how of their consultants, co-operation
     partnership arrangements shall be encouraged between consultancy
     firms, consulting engineers, experts and institutions of the EBC and
      those of the OCT. To this end, the Commission and the OCT shall make
     every effort to:-
     a) encourage by means of joint ventures, sub-contracting or the use
         of experts who are nationals of the OCT in teams employed by
         consultancy firms, consulting engineers or institutions in the
         EBC;
     b) inform Tenderers in the tender dossier of the selection criteria
         and preferences provided for in these General Regulations, partic-
         ularly those relating to the encouragement of the use of OCT human
         resources.
22.2 The Contracting Authority may, in the invitation to tender or during
      the negotiation of a contract, propose to prospective Tenderers the
     assistance of other OCT or ACP companies or firms or national experts
     or consultants selected by mutual agreement. This co-operation may
      take the form either of a joint venture, or of a sub-contract or of
     on-the-job training of trainees.
22.3 When the co-operation takes the form of:-
     a) a joint venture, Article 4.3 (b) shall apply;
     b) a sub-contract, Article 4.3 (f) shall apply;
     c) on-the-job training of trainees, the trainees proposed by the
         Contracting Authority mist have basic skills consistent with
         effective participation in the on-the-job training tasks involved
         in the performance of the contract. The maximum number of trainees
         shall be stipulated in the Special Conditions. In the calculation
         of remuneration or Tender Prices, account shall be taken of any
         cost borne by the Tenderer as a result of the provision of on-the-
         job training for trainees. On-the-job training of trainees shall
         not under any circumstances limit the obligations of the Success-
         ful Tenderer with whom the contract is concluded, nor shall it im-
         pose any liability whatsoever on the Contracting Authority or the
         Supervisor.
22.4 The parties involved shall undertake to co-operate mitually and shall
     agree on the procedure for such co-operation and in particular the
     responsibilities arising from it.
 ---pagebreak---                                    - 35 -
                                 ARTICLE 23
                         Independence of Tenderers
23.1 If a Tenderer in the case of Service contracts, has entered into a
     legal relationship with natural or legal persons who might partici-
     pate in the carrying out of W>rks, or the provision of Supplies,
     which the services are intended to define or prepare, or if he other-
     wise maintains with them special relations likely to compromise his
     independence, he shall inform the Contracting Authority thereof in
     his tender, or at the time of negotiation of the contract, or
     whenever such circumstances arise before the award of the contract.
23.2  If, notwithstanding such information, a contract is concluded with
      the said Tenderer, the Contracting Authority shall reserve the right
      to exclude the natural or legal persons concerned from participating
      in carrying out such Works or providing such Supplies.
                                 ARTICLE 24
                             Pricing of Tenders
24.1 The Tenderer shall provide the information required by the tender
     dossier for the pricing, make the necessary arithmetical calcula-
      tions, sign the form of tender and attach it to his tender.
24.2 The total amount of the tender shall be written in figures and in
     words. In all cases where there is a discrepancy between a price
      stated in figures and also in words, the price stated in words shall
     prevail. Wiere the instructions to Tenderers so require, the follow-
      ing shall also be written in figures and inwords:-
      a) the Breakdown of the Overall Price in the case of lump sum con-
         tracts;
      b) the unit prices for each item in the Bill of Quantities and/or the
         unit Price Schedule in the case of unit price contracts;
      c) in the case of a composite contract, the Breakdown of the Overall
         Price part as well as the Bill of Quantities and/or the Price
         Schedule for the unit price part.
24.3 Prices must correspond to the relative value of each item in relation
      to the total amount of the tender. Prices should not be of such a
     nature as to distort the comparison of tenders or to result in
      interim payments which are disproportionate to the value of the work
     done.
 ---pagebreak---                                    - 36 -
24.4 Tenders shall be expressed in the National Currency of the State of
      the Contracting Authority.
24.5 A Tenderer may request in his tender that a justified part, expressed
     as a percentage of the tender price, be paid directly to him in
     Foreign Currency. The justification required shall be assessed in
      the light of the verifiable facts as regards the real origin of the
     Wbrks, Supplies or Service to be performed and the expenditure to
     which they give rise. The conversion rate to be applied for the
     foreign currency payment shall be that in force 30 days prior to the
      latest date fixed for the submission of tenders.
24.6 The price offered by the Tenderer shall take into account the tax
     arrangements applicable as set out in the Convention.
                                 ARTICLE 25
                             Period of Validity
25.1 Tenderers shall remain bound by their tenders for the period pre-
     scribed by the Contracting Authority, pursuant to Article 13. Any
      tender valid for a shorter period may be rejected by the Contracting
     Authority. The period fixed by the Contracting Authority shall be
     sufficient to permit evaluation and comparison of tenders, for ob-
     taining all necessary clearances and approvals, and for the notifi-
     cation of the award of contract. The validity period should normally
     not exceed 120 days from the final date fixed for the submission of
      tenders but it may vary depending on the nature and complexity of the
     contract.
25.2  In exceptional circumstances, prior to the expiry of the original
      tender validity period, the Contracting Authority may request the
     Tenderer for a specified extension in the period of validity.
     Tenderers agreeing to the request will neither be required nor per-
     mitted to modify their tenders, but will be required to extend the
     validity of their tender guarantees correspondingly. The provisions
     of Article 26 regarding discharge and forfeiture of the tender guar-
     antee shall continue to apply during the extended period of tender
     validity.
25.3 The Successful Tenderer shall remain bound by his tender for a
      further period of 60 days following the receipt of the communication
     notifying him of his selection.
 ---pagebreak---                                     - 37 -
                                ARTICLE 26
                             Tender Guarantee
26.1 Unless otherwise provided in the instructions to Tenderers, Tenderers
     for Works and Supplies contracts shall, as an earnest of their ten-
     ders, provide a guarantee. The tender dossier shall specify the
     amount of this guarantee which shall in no case exceed 2 % of the
     amount of the tender.
26.2 The tender guarantee shall be provided in the form of a bank guaran-
     tee, a banker's draft, a certified cheque, a bond provided by an in-
     surance or bonding company, an irrevocable letter of credit or a cash
     deposit made with the Contracting Authority. If the tender guarantee
     is to be established in the form of a bank guarantee , a banker's
     draft, a certified cheque or a bond, it shall be issued by a bank,
      insurance or bonding company, approved by the Contracting Authority
     and established in the OCT, an ACP or a Member State. The bank guar-
     antee or the bond shall be in strict conformity with the tender guar-
     antee form included in the tender dossier or, in the case of direct
     agreement contract, in the Special Conditions. Whatever form it
     takes, the guarantee shall be independent and payable on first demand
     and valid for at least 60 days beyond the tender validity period.
26.3 Any tender not accompanied by an acceptable tender guarantee may be
     rejected by the Contracting Authority.
26.4 The tender guarantees of Tenderers who have not been selected will be
     released not later than 60 days after the expiration of the tender
     validity period, as extended where appropriate in accordance with
     Article 25.2, or upon the award of the contract, Whichever is ear-
      lier.
26.5 The tender guarantee of the Successful Tenderer shall be discharged
     when the Tenderer has signed the contract and furnished the required
     performance guarantee, to the satisfaction of the Contracting
     Authority.
26.6 The tender guarantee may be called up without notice:-
     a) if a Tenderer withdraws his tender during the period of tender va-
         lidity of his tender;
     b) in the case of the Successful Tenderer, if he fails within the
         specified Time Limit to sign the contract or furnish the required
         performance guarantee.
 ---pagebreak---                                   - 30 -
                                ARTICLE 27
                             Variant Solutions
27.1 Unless otherwise stated in the instructions to Tenderers, Tenderers
     may submit a tender based on a variant solution. The instructions to
     Tenderers mist specify any limitations, design criteria and other
     requirements applicable to a variant solution. Unless stated other-
     wise in the instructions to Tenderers, the submission of a tender
     based on a variant solution is conditional upon the submission of a
     tender based on the conforming solution.
27.2 Variant solutions may not derogate from the requirements of these
     General Regulations. Tenders based on the tender dossier and those
     for variant solutions shall be evaluated simultaneously.
27.3 The instructions to Tenderers must state whether the Tenderer submit-
     ting a variant solution is to be responsible for the design of the
     variant solution, and if this is the case, must specify procedures,
      in particular for checking, revision and approval.
27.4 The submission of any variant solution shall comprise:
     a) an individual tender for the variant solution;
     b) a demonstration of the benefit of the variant solution over the
         conforming solution, including quantifiable justification of any
         economic advantage;
     c) a draft of the amendments to the technical provisions of the
         Special Conditions necessitated by the variant solution;
     d) the Drawings and specifications provided for in the conforming so-
         lution, but not affected by the variant solution;
     e) the Drawings and specifications affected by the variant solution;
     f) a technical note on the conception of the variant solution and
         where appropriate, Drawings and the calculations;
     g) for lump sum contracts, an itemised Breakdown of the Overall Price
         as modified by the variant solution;
     h) for unit-price contracts, a Bill of Quantities      and/or a Price
         Schedule as modified by the variant solution.
 ---pagebreak---                                    - 39 -
                                 ARTICLE 28
                              Pre-tender Visit
28.1 The Tenderer is advised to visit and inspect the place where the con-
      tract is to be executed and its surroundings and obtain for himself,
     on his own responsibility, all information that may be necessary for
     preparing the tender and entering into a contract. The costs of vi-
      siting the place Where the contract is to be executed shall be borne
     by the Tenderer.
28.2 The Tenderer and any of his personnel or agents will, so far as is
     practicable, be granted permission by the Contracting Authority to
     enter the place where the contract is to be executed for the purpose
     of such inspection, provided that the Tenderer, his personnel or
     agents will release and indemnify the Contracting Authority and its
     personnel and agents from and against all liability in respect
      thereof. Accordingly, the Tenderer will be responsible for any per-
      sonal injury, whether fatal or otherwise, loss or damage which, but
     for acting on such permission, would not have arisen.
28.3 Without prejudice to the laws and regulations on immigration of the
     State of the Contracting Authority, the OCT concerned shall grant an
      entry permit to any person who substantiates his eligibility in terms
      of Article 4 as a participant in an invitation to tender, or any
      agent of such person, for the purpose of carrying out visits enabling
     him to prepare his tender. This permit shall expire on the day fol-
      lowing the end of the tender validity period.
                                 ARTICLE 29
                             Signing of Tenders
29.1 The tender shall be signed by the Tenderer or by his duly authorised
      agent as required by the instructions to Tenderers. It shall be
      drawn up in a single original bearing the word "original". The num-
      ber of copies to be supplied by the Tenderer shall be stated in the
      instructions to Tenderers. Copies shall be signed in the same way as
      the original and shall bear the word "copy".
29.2 A tender submitted by an agent must state the name of the principal
      on whose behalf he is acting. No agent may represent more than one
      Tenderer. Agents shall attach to the tender the simple contract or
      notarial act or deed which empowers them to act on behalf of
      Tenderers. A signature to a deed mist be certified in accordance
     with the national law of the State of the principal.
 ---pagebreak---                                    - 40 -
29.3  If a Tenderer is a joint venture or consortium of two or more per-
      sons, the tender mist be single with the object of securing a single
     contract, each person mist sign the tender, and all such persons
      shall be jointly and severally bound by the tender and any resulting
     contract according to the law of the State of the Contracting
     Authority, and shall designate one of such persons to act as leader
     with authority to bind the joint venture or consortium. The composi-
      tion or constitution of the joint venture or consortium shall not be
     altered without the prior consent in writing of the Contracting
     Authority.
29.4 The tender may be signed by the representative of the joint venture
     or consortium only if he has been expressly so authorised in writing
     by the members of the joint venture or consortium, and the
     authorising contract, notarial act or deed is attached to the tender.
     All signatures to the authorizing instrument must be certified in ac-
     cordance with the national laws and regulations of each of the par-
     ties comprising the joint venture or the consortium together with the
     Powers of Attorney establishing, in writing, that the signatories to
     the tender are empowered to enter into commitments on behalf of the
     members of the joint venture or consortium. Each member of such
     joint venture or consortium must provide the proof required under
     Article 4 as if he, himself, were the Tenderer.
29.5 The complete tender shall be without alterations, interlineation or
     erasures, except those to accord with instructions issued by the Con-
     tracting Authority, or necessary to correct errors made by the
     Tenderer. Alterations and corrections shall be initialled by the
     person or persons signing the tender.
29.6 Except in the case of lots pursuant to Article 21 and variant solu-
     tions pursuant to Article 27, only one tender may be submitted by
     each Tenderer. No Tenderer may participate in the tender of another
     for the same contract in any capacity whatsoever.
                           SUBMISSION OF TENDERS
                                ARTICLE 30
                                Time Limit
30.1 Tenders mist be received by the Contracting Authority at the address
     and no later than the date and time specified in accordance with
     Article 13. In determining this date, the Contracting Authority must
      ensure that adequate time is allowed, taking into account the nature,
      size, complexity, and location of the intended project and other rel-
     evant factors. Such period shall not, however, be less than 90 days
     for an open invitation to tender.
 ---pagebreak---                                    - 41 -
30.2 The Contracting Authority may, at its discretion, extend the deadline
     referred to in Article 30.1 for the submission of tenders by amending
     the tender dossier in accordance with Article 18, in which case all
     previous rights and obligations of the Contracting Authority and Ten-
     derers, subject to the previous deadline, will thereafter be subject
     to the deadline as extended. Should a Tenderer exercise his right
     ofwithdrawal after receiving notice of the extension, his tender
     shall be returned to him and his tender guarantee shall be released
     after the tender opening session.
30.3 Any tenders received by the Contracting Authority after the deadline
     for receipt of tenders prescribed by the Contracting Authority, in
     accordance with Articles 13.4(g) and 18 shall be rejected and re-
     turned to the Tenderer after the tender opening session.
                                ARTICLE 31
                     Sealing and Marking of Envelopes
31.1 The tender, the annexes thereto as stipulated in the instructions to
     Tenderers and the supporting documents referred to in Article 4 shall
     be placed in a sealed non - identifiable envelope, bearing only:-
     a) the address designated for submission of tenders in the notice of
         invitation to tender or in the invitation to tender;
     b) the reference to the notice of invitation to tender in reply to
         which the tender is being submitted;
      c) where appropriate, the numbers of the lots tendered for; and
     d) the words "not to be opened before the tender opening session"
         written in the language of the tender dossier.
31.2 The instructions to Tenderers shall specify in each case whether the
     documents relating to the price proposal shall be placed together
     with the technical proposal in one envelope or in separate envelopes.
      In the latter case, the price proposal shall be placed in a separate
      identifiable envelope, bearing the words "Tender Price", Which shall
     be sealed and placed together with the technical proposal in the en-
     velope referred to in Article 31.1.
                                ARTICLE 32
                        Withdrawals and Amendments
32.1 Any Tenderer may modify or withdraw his tender before the deadline
      referred to in Article 30.3, provided that written notice of such
     modification or withdrawal is received by the Contracting Authority
     prior to that deadline.
 ---pagebreak---                                    - 42 -
32.2 The Tenderer's modification or withdrawal notice shall be prepared,
     sealed, marked and dispatched in accordance with the provisions of
     Article 31. A withdrawal notice may also be sent by personal deliv-
     ery or by telex, cable, or facsimile transmission but followed by a
     signed confirmation copy, post marked not later than the deadline for
     submission of tenders. Withdrawals will be unconditional and will
     end further participation in the tendering procedure.
32.3 No tender may be modified subsequent to the deadline referred to in
     Article 30.3, except in accordance with Article 34.1.
32.4 No tender may be withdrawn in the interval between the deadline re-
     ferred to in Article 30.3 and the expiration of the period of tender
     validity. Withdrawal of a tender during this interval may result in
      forfeiture of the tender guarantee.
                           EXAMINATION OF TENDERS
                                 ARTICLE 33
                             Opening of Tenders
33.1 On receipt of the tenders, the envelopes shall be entered in a spe-
      cial register in the order in which they arrive. The registration
     number and the date and time of arrival shall be recorded on the en-
     velope. Envelopes remain sealed and be kept in a safe place until
      they are opened under the conditions set out in Articles 33.2 and
      33.3.
33.2 At a public tender opening, the Tenderers' names, the Tender Prices,
     written1 notifications of tender modifications and withdrawals, the
     presence of the requisite tender guarantee, and such other details as
      the Contracting Authority may consider appropriate shall, if any, be
      announced. In the case of a "two-envelope" system as mentioned in
     Article 31.2 the announcement shall include the fact that no price
      envelope has been opened.
33.3 Opening and examination of tenders shall comply with the rules of the
     OCT concerned, and shall be for the purpose of checking whether the
      tenders are complete, whether the requisite tender guarantee has been
     furnished, whether the documents have been properly signed and
     whether the tenders are generally in order.
33.4 The envelopes which bear the words "Tender Price" in accordance with
     Article 31 shall not be opened until the work of evaluating the ten-
     ders, other than the prices, has been completed.
 ---pagebreak---                                    - 43 -
33.5 Only the tenders contained in those envelopes which have been re-
     ceived not later than the deadline referred to in Article 30.3 fixed
     for the receipt of tenders shall be taken into consideration in the
     evaluation.
33.6 The Contracting Authority shall prepare, for its own records, minutes
     of the tender opening, including the information disclosed to those
     present in accordance with Article 33.2.
33.7 After the public opening of tenders, information relating to the ex-
     amination, clarification, evaluation and comparison of tenders and
     recommendations concerning the award of the contract shall not be
     disclosed to Tenderers or other persons not officially concerned with
     such process.
33.8 Any attempt by a Tenderer to influence the Contracting Authority in
     the process of examination, clarification, evaluation and comparison
     of tenders, and in decisions concerning the award of the contract,
     shall result in the rejection of his tender.
33.9 The Delegate shall be present at the opening of tenders, and shall
     receive a copy of each tender.
                                ARTICLE 34
                           Evaluation of Tenders
34.1 To facilitate the examination, evaluation and comparison of tenders,
      the Contracting Authority may ask each Tenderer individually for
      clarification of his tender, including breakdowns of unit prices.
     The request for clarification and the response shall be in writing
      and communicated by any of the means referred to in Article 12, but
     no change in the price or substance of the tender shall be sought,
      offered or permitted except as required to confirm the correction of
      arithmetic errors discovered by the Contracting Authority during the
      evaluation of the tenders pursuant to Article 34.7.
34.2  Prior to the detailed evaluation of tenders, the Contracting
     Authority shall determine whether each tender is substantially re-
      sponsive to the requirements of the tender dossier.
34.3 For the purpose of Article 34, a responsive tender is one which con-
      forms to all the terms, conditions and specifications of the tender
     dossier without material deviation or reservation. A material devia-
      tion or reservation is one which affects the scope, quality or per-
      formance of the contract, or which, in any substantial way, is incon-
      sistent with the tender dossier or limits the Contracting Authority's
      rights or the Tenderer's obligations under the contract, and affects
     unfairly the competitive position of Tenderers presenting responsive
      tenders.
 ---pagebreak---                                    - 44 -
34.4  If a tender is not responsive to the tender dossier, it shall be re-
      jected by the Contracting Authority, and may not subsequently be made
      responsive by correction or withdrawal of the deviation or res-
      ervation.
34.5  Tenders determined to be responsive shall be evaluated technically
      for conformity with the invitation to tender dossier and the pro- vi-
      sions of Article 36, and then ranked on the basis of their tech-
      nical qualities. The Special Conditions shall, where appropriate,
      specify the detailed criteria for technical evaluation.
34.6  Following the completion of the technical evaluation, tenders which,
      on the basis of Article 34.5, are technically responsive shall be
      evaluated financially. Tenders shall be compared in the National Cur-
      rency.
34.7  Tenders determined to be responsive shall be checked by the Contract-
       ing Authority for any arithmetic errors in computation and summation.
      Errors shall be corrected by the Contracting Authority as follows:-
      a) where there is a discrepancy between amounts in figures and also
          in words, the amount in words shall prevail; and
      b) except for lump-sum contracts, where there is a discrepancy be-
          tween the unit price and the total amount derived from the multi-
          plication of the unit price and quantity, the unit price as quoted
          shall prevail, unless in the opinion of the Contracting Authority
          there is an obvious error in the unit price, in which event the
          total amount as quoted shall prevail and the unit price shall be
          corrected by the Contracting Authority.
34.8  The amount stated in the tender, corrected if necessary by the Con-
      tracting Authority, in accordance with Article 34.7, shall be consid-
      ered as binding upon the Tenderer. If the Tenderer does not accept
      the corrected amount of the tender, his tender shall be rejected.
34.9  After tenders have been evaluated fully in accordance with the provi-
      sions of Article 34, responsive tenders shall be grouped into tenders
      offered by those Tenderers eligible for preference under Article 9
      and tenders offered by other Tenderers. For the purposes of further
      evaluation and comparison of tenders only, the tender prices, cor-
      rected where necessary, of the Tenderers not eligible for preference
      shall be increased by the percentage margin of preference. Further
      details of the procedures to be used in giving effect to the margin
      of preference provisions of Article 9 shall be as laid down by the
      Contracting Authority in the tender dossier.
34.10 The evaluation proceedings shall be recorded in properly signed min-
      utes which shall not be made public or communicated to any Tenderer.
      A copy of these minutes will be sent to the Delegate.
 ---pagebreak---                                      - 45 -
                                 ARTICLE 35
                      Annulment of the Tender Procedure
35.1 The Contracting Authority may, prior to awarding the contract,
     without thereby incurring any liability to the Tenderers, and not-
     withstanding the stage reached in the procedures leading to the con-
     clusion of the contract:-
     a) either decide to annul the tender procedure in accordance with
         Article 35.2, or order that the procedure be recommenced, if nec-
         essary, using another method; or
     b) where the project is divided into lots, award only certain of the
         lots and possibly decide that the others are to be the subject of
         another tender or other tenders, if necessary, using another
         method.
35.2 The annulment by the Contracting Authority of a tender procedure may
      take place in the following cases:-
      a) if no tender is responsive to the tender dossier;
      b) if no tender satisfies the criteria for the award of the contract
         as set out in Article 36;
      c) if the economic or technical data of the project have been al-
          tered;
      d) if exceptional circumstances render normal performance of the con-
          tract impossible;
      e) if every tender received exceeds the financial resources earmarked
         for the contract;
      f) if the tenders received contain serious irregularities resulting
          in interference with the normal play of market forces; or
      g) if there has been no competition.
35.3  In the event of annulment of any tender procedure, Tenderers who are
      still bound by their tenders shall be notified thereof by the
     Contracting Authority. Such Tenderers shall not be entitled to
      compensation; they shall be entitled to the immediate release of the
      tender guarantee.
35.4 When the annulment of the tender procedure is caused by circumstances
     which do not necessitate the opening of tenders, the unopened and
      sealed envelopes containing the price proposals, where appropriate,
      and, in any event, the other elements of the tender shall be returned
      to the Tenderers at the Tenderers' cost.
 ---pagebreak---                                       - 46 -
                             iS&ftRD OF ODNIRACT
                                 ARTICLE 36
                                  Selection
36.1 The Contracting Authority shall award the contract to the Tenderer:-
      a) whose tender is found to be responsive to the tender dossier; and
      b) for Wbrks and Supply contracts, who has offered the most advanta-
         geous tender as assessed inter alia on the basis of:-
         i)    the price, the operating and maintenance costs;
         ii)   the qualifications of, and the guarantees offered by the
               Tenderers, as well as the technical qualities of the tender,
               including the offer of an after-sales service in the OCT
               concerned;
         iii)  the nature of, the conditions and the time limits for per-
               forming the contract, and the adaptation to local conditi-
               ons;
      c) for Service contracts, who offers the most advantageous tender
         taking into account, inter alia, the price, the technical value of
         the tender, the organization and the methodology proposed for the
         provision of the Services, as well as the competence, independence
         and availability of the personnel proposed.
36.2 Wiere two tenders are acknowledged to be equivalent on the basis of
      the criteria stated above, preference shall be given to:-
     a) the tenderer of the OCT or an ACP State; or
     b) if no such tender is forthcoming, to the tenderer Who permits the
         best possible use of the physical and human resources of the OCT.
36.3 The Contracting Authority shall:-
     a) complete the evaluation of tenders within the tender validity pe-
         riod taking into consideration the period required for the approv-
         al of contracts;
     b) transmit the result of the examination of the tenders and a pro-
         posal for placing the contract to the Delegate.
 ---pagebreak---                                        - 47 -
36.4 The Delegate shall:-
     a) approve, within 30 days the Contracting Authority's proposal for
         the placing of the contract for all:-
         i)      direct agreement contracts;
         ii)     service contracts;
         iii)    contracts relating to emergency assistance; and
         iv)     contracts by accelerated procedures, for \*forks contracts
                worth less than BCD 5 million and Supply contracts worth
                 less than ECU 1 million;
     b) approve within 30 days the Contracting Authority's proposal for
         the placing of the contract not covered by Article 36.4 (a)
         wherever the following conditions are fulfilled: the tender se-
         lected is the lowest of those conforming to the requirements of
         the tender dossier, meets the selection criteria stated therein
         and does not exceed the sum earmarked for the contract;
     c) where the conditions set out in Article 36.4 (b) are not ful-
         filled, forward the proposal for the placing of the contract to
          the Commission which shall decide thereon within 60 days of the
          receipt by the Delegate. Wiere the price of the selected tender
         exceeds the sum earmarked for the contract, the Commission shall,
         upon giving approval to the award, make the necessary financial
          commi tment.
                                   ARTICLE 37
                             Notification of Award
37.1 Prior to the expiration of the period of tender validity, the Con-
      tracting Authority shall notify the Successful Tenderer in writing
      that his tender has been accepted.
37.2 Unless otherwise provided in the tender dossier, in the case of W)rks
      and Supply contracts, once the Successful Tenderer has furnished a
     performance guarantee in accordance with the provisions of Article
     40, the Contracting Authority shall promptly notify the other
     Tenderers that their tenders have been unsuccessful, and return their
      tender guarantees.
37.3 The Contracting Authority shall not be obliged to state the reasons
     for its choice nor enter into any discussion or correspondence with
     Tenderers on the results of the invitation to tender.
 ---pagebreak---                                    - 48 -
37.4 The results of public invitations to tender shall be published in the
     Official Journal of the EBC and, subject to the practice in the OCT
     concerned, in the Official Journal of the State and/or any other ap-
     propriate information media.
                                ARTICLE 38
                     Preparation of Contract Document
38.1 After communication of the result of the tender in accordance with
     Article 37, the contract shall be prepared by the Contracting
     Authority for submission to the Successful Tenderer for signature.
     This document shall include at least the following:-
     a) a list of documents comprising the contract specifying the order
        of precedence of the documents;
     b) any agreed additions to and derogations from these documents;
     c) the Contract Price;
     d) any decisions   taken  by   the Contracting Authority  pursuant to
        Article 34.7.
     e) the names of the Supervisor and the Supervisor's Representative,
        if these are not included in the Special Conditions.
38.2 The contract document shall be submitted to the Successful Tenderer
     for signature.
                                ARTICLE 39
                          Signing of the Contract
39.1 Unless otherwise provided in the tender dossier, within 30 days of
     receipt of the contract document, the Successful Tenderer shall sign
     the contract. After signature by the Successful Tenderer, the con-
     tract document shall be returned to the Contracting Authority or his
     authorised representative or the competent authority of the OCT con-
     cerned for approval as necessary, and signature.
39.2 The Contracting Authority shall not, unless otherwise provided by the
     tender dossier, sign the contract until the performance guarantee has
     been established in accordance with Article 40.
39.3 By the signature of the Contracting Authority, the contract becomes
     binding upon both parties and the Successful Tenderer shall be no-
     tified of the fact of such signature.
 ---pagebreak---                                   - 49
39.4 Notwithstanding the provisions of Article 39.1 to 39.3, the
     Contracting Authority may, depending on the nature of the contract,
     decide to conclude the contract on the basis of the letter of con-
     tract procedure whereby the notification of award of contract shall
     constitute the conclusion of the contract. In such case, the items
     listed in Article 38.1 shall be attached to the letter.
39.5 In the event of withdrawal by the Successful Tenderer, the Contract-
     ing Authority may call up his tender guarantee. In addition, it may
     approach the other Tenderers according to the order in which their
     tenders are classified, or may initiate a fresh procedure for the in-
     vitation of tenders. If necessary, a contract by direct agreement may
     be negotiated.
                                ARTICLE 40
                          Performance Guarantee
40,Î Unless otherwise provided by the tender dossier,the Successful
     Tenderer for a W^rks or Supply contract shall, within 30 days of re-
     ceipt of the notification of award from the Contracting Authority
     furnish to the Contracting Authority a performance guarantee in the
     form specified in the General Conditions.
40.2 Failure of the Successful Tenderer to comply with the requirements of
     Article 40.1 shall constitute sufficient grounds for the annulment of
     the award and forfeiture of the tender guarantee, in which event the
     Contracting Authority may proceed in accordance with Article 39.5.
                       GENERAL AND FINAL PROVISIONS
                                ARTICLE 41
                       General and Final Provisions
41.1 All documents and proposals submitted by the Contracting Authority to
     the Commission or the Delegate for agreement or approval in accor-
     dance with these General Regulations shall be approved or deemed to
     be approved within the time limits laid down by these General Regula-
     tions, or where no time limit is stated herein, within 30 days.
41.2 Claims accepted for delayed payments shall be borne by the OCT con-
     cerned and by the Commission, each from its own resources, for that
     part of the delay for which it is responsible.
 ---pagebreak---              - 50 -
                       ANNEX II
    GENERAL CONDITIONS
   FOR "VWDRKS CONTRACTS
      FINANCED BY THE
EUROPEAN DEVELOPMENT FUND
         IN THE OCT
 ---pagebreak---                                     - 51 -
                              TABLE OF CONTENTS
                            PRELIMINARY PROVISIONS
                                                         Page
Article 1  Definitions                                    53
Article 2  Law and Language of the Contract               56
Article 3  Order of Precedence of Contract Documents      56
Article 4  Notices and Written Communications             56
Article 5  Supervisor and Supervisor's Representative     57
Article 6  Assignment                                     57
Article 7  Sub-Contracting                                58
                 OBLIGATIONS OP THE OONIRACITNG AUBCRITY
Article 8  Supply of Documents                            59
Article 9  Access to Site                                 60
Article 10 Assistance with Local Regulations              60
Article 11 Delayed payments to the Contractor's Staff     61
                       OBLIGATIONS OF THE OONIRACICR
Article 12 General Obligations                            61
Article 13 Superintendence of the Wforks                  62
Article 14 Staff                                          63
Article 15 Performance Guarantee                          63
Article 16 Insurance                                      65
Article 17 Performance Programme                          66
Article 18 Detailed Breakdown of Prices                   66
Article 19 Contractor's Drawings                          67
Article 20 Sufficiency of Tender Prices                   68
Article 21 Exceptional Risks                              68
Article 22 Security of Sites                              69
Article 23 Safeguarding Adjacent Properties               70
Article 24 Interference with Traffic                      70
Article 25 Cables and Conduits.                           71
Article 26 Setting-Out                                    71
Article 27 Demolished Materials                           72
Article 28 Discoveries                                    72
Article 29 Temporary "Wforks                              73
Article 30 Soil Studies                                   73
Article 31 Overlapping Contracts                          74
Article 32 Patents and Licences                           74
                           OCKMENCENffNT AND DELAYS
Article 33 Commencement Orders                            75
Article 34 Period of Performance                          75
 ---pagebreak---                                      - 52 -
                                                           Page
Article 35  Extension of Period of Performance              75
Article 36  Delays in Performance                           76
Article 37  Variations                                      77
Article 38  Suspension                                      79
                           MATERIALS ANDWKKNftNSHIP
Article 39 "ttfork Register                                 80
Article 40  Qiality of W>rks and Materials                  81
Article 41  Inspection and Testing                          81
Article 42  Rejection                                       83
Article 43  Property in Plant and Materials                 84
                                    PAYMENTS
Article 44 General Provisions                               85
Article 45  Provisional Price Contracts                     85
Article 46 Advances                                         85
Article 47 Retention Sum                                    87
Article 48 Revision of Prices                             : 87
Article 49 Measurement                                      88
Article 50  Interim Payments                                89
Article 51  Final Statement of Account                      91
Article 52 Direct Payments to Sub-Contractors               92
Article 53 Delayed Payments                                 93
Article 54  Payments to Third Parties                       93
Article 55 Claims for Additional Payment                    94
Article 56  Payments in Foreign Currency                    94
                           ACCEPTANCE AND MAINTENANCE
Article 57  General Clauses                                 95
Article 58  Tests on Completion                             95
Article 59  Partial Acceptance                              96
Article 60  Provisional Acceptance                          96
Article 61 Maintenance Obligations                          97
Article 62  Final Acceptance                                99
                       BREACH OF CONTRACT AND TERMINATION
Article 63  Breach of Contract                              99
Article 64 Termination by the Contracting Authority        100
Article 65 Termination by the Contractor                   102
Article 66  Force Majeure                                  102
Article 67 Decease                                         104
                             SETIUBMENT OF DISFUIES
Article 68 Settlement of Disputes                          104
 ---pagebreak---                                  - 53
                          PRELIMINARY PROVISIONS
                                ARTICLE 1
                               Definitions
1.1 The following definitions apply to these General Conditions and to
     the Contract.
    EBC: the European Economic Community.
    OCT: the association of the Overseas Countries and Territories with
             the EBC.
    Contract: the signed agreement entered into by the parties for the
             execution of the Works including all attachments thereto and
             all documents incorporated therein.
    Contractor: the party with whom the Contracting Authority concludes
             the Contract.
    Contracting Authority: the State or the legal person governed by pub-
             lic or private law which concludes the Contract, or on behalf
             of which the Contract is concluded, with the Contractor.
    The State of the Contracting Authority: the OCT on Whose territory
             the Works Contract is to be executed.
    Supervisor: the government department, legal person governed by pub-
             lic law, or the natural or legal person designated by the
             Contracting Authority in accordance with the law of the State
             of the Contracting Authority, who is responsible for direct-
             ing and/or monitoring the execution of the Works Contract,
             and to whom the Contracting Authority may delegate rights
             and/or powers under the Contract.
    Supervisor's Representative: any natural or legal person, designated
             by the Supervisor as such under the Contract, and empowered
             to represent the Supervisor in the performance of his func-
             tions, and in exercising such rights and/or powers as have
             been delegated to him. Accordingly, where functions, rights
             and/or powers of the Supervisor have been delegated to the
             Supervisor's Representative, references to the Supervisor in-
             clude the Supervisor's Representative.
    Works:   the temporary and permanent Works to be carried out under the
             Contract.
    Plant: machinery, apparatus, components and all items to be provided
             under the Contract for incorporation in the Works.
 ---pagebreak---                               - 54 -
Equipment: appliances and other machinery, and, where applicable
        under the law and/or practice of the State of a Contracting
        Authority, the temporary structures on the Site required for
         carrying out the Works but excluding plant or other items re-
        quired to form part of the permanent works.
Bill of Quantities: the document containing an itemised breakdown of
         the Works to be carried out in a unit price Contract, indi-
         cating a quantity for each item and the corresponding unit
        price.
Price Schedule: the completed schedule of prices, including the
        breakdown of the overall price, submitted by the Contractor
        with his tender, modified as necessary and forming a part of
         the unit price Contract.
Breakdown of the Overall Price: the itemised list of rates and prices
         showing the build-up of the price in a lump sum Contract, but
        not forming part of the Contract.
Contract Price: the sum stated in the Contract representing the init-
         ial estimate payable for the execution of the Works or such
         other sum as ascertained by the final statement of account as
        due to the Contractor under the Contract.
Provisional Sum: a sum included in the Contract and so designated for
         the execution of work or the supply of goods, materials,
        Plant or services, or for contingencies, which sum may be
        used in whole or in part, or not at all, as instructed by the
         Supervisor.
Drawings: drawings provided by the Contracting Authority and/or the
         Supervisor, and/or drawings provided by the Contractor and
         approved by the Supervisor, for the carrying out of the
        Vforks.
Site:    the places provided by the Contracting Authority where the
        Works are to be carried out, and other places stated in the
        Contract as forming part of the Site.
Maintenance Period: the period stated in the Contract immediately
        following the date of provisional acceptance, during which
         the Contractor is required to complete the Works and to rem-
        edy defects or faults as instructed by the Supervisor.
Final Acceptance Certificate: certificate(s) issued by the Supervisor
         to the Contractor at the end of the Maintenance Period stat-
         ing that the Contractor has completed his obligations to con-
        struct, complete and maintain the Works concerned.
Day:    calendar day.
 ---pagebreak---                                     - 55 -
    Time Limits: those periods in the Contract which shall begin to run
             from the day following the act or event which serves as the
             starting point for those periods. Should the last day of the
             period fall upon a non-working day, the period shall expire
             at the end of the first working day following the last day of
              the period.
    Writing: any handwritten, typewritten or printed communication, in-
             cluding telex, cable and facsimile transmission.
    Communications: certificates, notices, orders and instructions issued
             under the Contract.
    Administrative Order: any instruction or order issued by the Super-
             visor to the Contractor in writing regarding the execution of
             the Works.
    National Currency: the currency of the State of the Contracting
             Authority.
    Foreign Currency: any permissible currency which is not the National
             Currency, and which is indicated in the Contract.
    General Damages: the sum, not stated beforehand in the Contract,
             which is awarded by a court or arbitration tribunal, or
             agreed between the parties, as compensation payable to an in-
              jured party for a breach of the Contract by the other party.
    Liquidated Damages: the sum stated in the Contract as compensation
             payable by the Contractor to the Contracting Authority for
             failure to complete the Works or part thereof within the pe-
             riods under the Contract, or as payable by either party to
              the other for any other specific breach identified in the
             Contract.
    Special Conditions: the Special Conditions issued by the Contracting
             Authority as part of the invitation to tender, as amended
             where necessary, and incorporated into the Contract, consist-
              ing of:
             a)        amendments to these General Conditions;
             b)        special contractual clauses;
              c)       technical specifications; and
             d)        any other matter related to the Contract.
1.2 The headings and titles in these General Conditions shall not be
     taken as part thereof or be taken into consideration in the interpre-
     tation of the Contract.
 ---pagebreak---                                      - 56 -
1.3 TOiere the context so permits words importing the singular shall be
     deemed to include the plural and vice versa and words importing the
     masculine shall be deemed to include the feminine and vice versa.
1.4  Words importing persons or parties shall include firms and companies
     and any organization having legal capacity.
                                  ARTICLE 2
                      Law and Language of the Contract
2.1  The law of the Contract shall be the law of the State of the Con-
      tracting Authority unless otherwise stated in the Special Conditions.
2.2   In all matters which are not covered by these General Conditions, the
      law of the Contract shall apply.
2.3  The language of the Contract and of all communications between the
     Contractor, Contracting Authority and Supervisor or their representa-
      tives shall be as stated in the Special Conditions.
                                  ARTICLE 3
                 Order of precedence of Contract Documents
     Unless otherwise stipulated in the Contract, the order of precedence
      of the Contract documents shall be as stated in the Special Condi-
      t i ons.
                                  ARTICLE 4
                     Notices and Written Communications
4.1  Unless otherwise specified in the Special Conditions, Communications
     between the Contracting Authority and/or the Supervisor on the one
     hand, and the Contractor on the other hand, shall be sent by post,
     cable, telex, facsimile transmission, or personal delivery, to the
     appropriate addresses designated by these parties for that purpose.
4.2   If the sender requires evidence of receipt, he shall state such re-
     quirement in his communication and shall demand such evidence of re-
     ceipt whenever there is a deadline for the receipt of the Communica-
      tion. In any event, the sender shall take all the necessary measures
      to ensure receipt of his Communication.
 ---pagebreak---                                    - 57 -
4.3 \toierever in the Contract provision is made for the giving or issue of
     any notice, consent, approval, certificate or decision, unless other-
    wise specified such notice, consent, approval, certificate or deci-
     sion shall be in writing and the words "notify", "certify", "ap-
     prove" or "decide" shall be construed accordingly. Any such consent,
     approval, certificate or decision shall not unreasonably be withheld
     or delayed.
                                 ARTICLE 5
                Supervisor and Supervisor's Representative
5.1 The Supervisor shall carry out the duties specified in the Contract.
     Except as expressly stated in the Contract, the Supervisor shall not
     have authority to relieve the Contractor of any of his obligations
     under the Contract.
5.2 The Supervisor may, from time to time, while retaining ultimate re-
     sponsibility, delegate to the Supervisor's Representative any of the
     duties and authority vested in the Supervisor and he may at any time
     revoke such delegation or replace the representative. Any such dele-
     gation, revocation or replacement shall be in writing and shall not
     take effect until a copy thereof has been delivered to the Contrac-
     tor.
5.3 Any communication given by the Supervisor's Representative to the
     Contractor in accordance with the terms of such delegation shall have
     the same effect as though it had been given by the Supervisor, pro-
     vided that:-
     a) any failure on the part of the Supervisor's Representative to dis-
        approve any work, materials or plant shall not prejudice the au-
        thority of the Supervisor to disapprove such work, materials or
        plant and to give the instructions necessary for the rectification
        thereof;
     b) the Supervisor shall be at liberty to reverse or vary the contents
        of such Communication.
5.4  Instructions and/or orders issued by the Supervisor shall be by way
     of Administrative Orders. Such orders shall be dated, numbered and
     entered by the Supervisor in a register, and copies thereof delivered
     by hand, where appropriate, to the Contractor's representative.
                                 ARTICLE 6
                                Assignment
6.1 An assignment shall be valid only if it is a written agreement by
    which the Contractor transfers his Contract or part thereof to a
     third party.
 ---pagebreak---                                    - 58 -
6.2 The Contractor shall not, without the prior written consent of the
    Contracting Authority, assign the Contract or any part thereof, or
    any benefit or interest thereunder, except in the following cases:-
    a) a charge, in favour of the Contractor's bankers, of any monies due
        or to become due under the Contract; or
    b) assignment to the Contractor's insurers of the Contractor's right
        to obtain relief against any other person liable in cases where
        the insurers have discharged the Contractor's loss or liability.
6.3 For the purpose of Article 6.2, the approval of an assignment by the
    Contracting Authority shall not relieve the Contractor of his obliga-
     tions for the part of the Contract already performed or the part not
    assigned
6.4  If the Contractor has assigned his Contract without authorization,
     the Contracting Authority may, without giving formal notice thereof,
    apply as of right the sanctions for breach of Contract provided for
     in Articles 63 and 64.
6.5 Assignees must satisfy the eligibility criteria applicable for the
    award of the Contract.
                                ARTICLE 7
                             Sub-Contracting
7.1 A sub-contract shall be valid only if it is a written agreement by
    which the Contractor entrusts performance of a part of his Contract
    to a third party.
7.2 The Contractor shall not sub-contract without the prior written au-
    thorization of the Contracting Authority. The work to be sub-
    contracted and the identity of the sub-contractors shall be notified
    to the Contracting Authority. The Contracting Authority shall with
    due regard to the provisions of Article 4.3, within 30 days of re-
    ceipt of the notification, notify the Contractor of his decision,
    stating reasons should he withhold such authorization.
7.3 In the selection of sub-contractors, preference shall be given by the
    Contractor to natural persons, companies or firms of the State of the
    Contracting Authority capable of performing the work required on sim-
    ilar terms.
7.4 Sub-contractors must satisfy the eligibility criteria applicable for
    the award of the Contract.
7.5 Subject to Article 52, the Contracting Authority shall have no con-
    tractual relations with the sub-contractors.
 ---pagebreak---                                     - 59 -
7.6 The Contractor shall be responsible for the acts, defaults and ne-
    gligence of his sub-contractors and their agents or employees, as if
    they were the acts, defaults or negligence of the Contractor, his
    agents or employees. The approval by the Contracting Authority of
    the sub-contracting of any part of the Contract or of the sub-
    contractor to perform any part of the Works shall not relieve the
    Contractor of any of his obligations under the Contract.
7.7  If a sub-contractor has undertaken any continuing obligation extend-
     ing for a period exceeding that of the Maintenance Period under the
    Contract towards the Contractor in respect of the work executed or
     the goods, materials, Plant or services supplied by the sub-contrac-
     tor, the Contractor shall, at any time after the expiration of the
    Maintenance    Period,   transfer   immediately  to   the  Contracting
    Authority, at the Contracting Authority's request and cost, the bene-
    fit of such obligation for the unexpired duration thereof.
7.8  If the Contractor enters into a sub-contract without approval, the
    Contracting Authority may apply, as of right without giving formal
    notice thereof, the sanctions for breach of Contract provided for in
    Articles 63 and 64.
                 OBLIGATIONS OF THE CCNERACriNS AUnCRITY
                                 ARTICLE 8
                            Supply of Documents
8.1 Within 30 days of the establishment of the performance guarantee pro-
    vided for in Article 15, the Supervisor shall provide to the Contrac-
     tor, free of charge, a copy of the Drawings prepared for the perfor-
    mance of the Contract as well as two copies of the specifications and
    other Contract documents. The Contractor may purchase additional
     copies of these Drawings, specifications and other documents, insofar
    as they are available. Upon the issue of the maintenance certifi-
    cate, or upon final acceptance, the Contractor shall return to the
    Supervisor all Drawings, specifications and other Contract documents.
8.2 Unless it is necessary for the purposes of the Contract, the Draw-
     ings, specifications and other documents provided by the Contracting
    Authority shall not be used or communicated to a third party by the
    Contractor without the prior consent of the Supervisor.
8.3 The Supervisor shall have authority to issue to the Contractor Admin-
     istrative Orders incorporating such supplementary documents and in-
     structions as shall be necessary for the proper and adequate execu-
     tion of the Works and the remedying of any defects therein.
 ---pagebreak---                                    - 60 -
                                ARTICLE 9
                             Access to Site
9.1  The Contracting Authority shall, in due time and in conformity with
     the progress of the Works, place the Site and access thereto at the
     disposal of the Contractor in accordance with the programme of per-
     formance referred to in these General Conditions. The Contractor
     shall afford all reasonable opportunities to other persons concerned
     for carrying out their work as set out in the Special Conditions or
     as required by Administrative Orders.
9.2  Any land procured for the Contractor by the Contracting Authority
     shall not be used by the Contractor for purposes other than the per-
     formance of the Contract.
9.3  The Contractor shall preserve any premises placed at his disposal in
     a good state while he is in occupation and shall, if so required by
     the Contracting Authority or the Supervisor, restore them to their
     original state on completion of the Contract, taking into account
     normal wear and tear.
9.4  The Contractor shall not be entitled to any payment for improvements
     resulting from work carried out on his own initiative.
                                ARTICLE 10
                    Assistance with Local Regulations
10.1 The Contractor may request the assistance of the Contracting Author-
     ity in obtaining copies of laws, regulations and information on local
     customs, orders or bye laws of the country where the Works are lo-
     cated, which may affect the Contractor in the performance of his ob-
     ligations under the Contract. The Contracting Authority may provide
     the assistance requested to the Contractor at the Contractor's cost.
10.2 Subject to the provisions of the laws and regulations on foreign
     labour of the State in which the Works are to be carried out, the
     Contracting Authority shall make all efforts necessary to facilitate
     the procurement by the Contractor of all required visas and permits,
     including work and residence permits, for the personnel whose ser-
     vices the Contractor and the Contracting Authority consider necessary
     as well as residence permits for their families.
 ---pagebreak---                                    - 61 -
                                ARTICLE 11
                Delayed Payments to the Contractor's Staff
     Wnere there is a delay in the payment to the Contractor's employees
     of wages and salaries owing and of the allowances and contributions
      laid down by the law of the State in which the Works are located, the
     Contracting Authority may give notice to the Contractor that within
      15 days of the notice he intends to pay such wages, salaries, allow-
      ances and contributions direct. Should the Contractor contest that
      such payments are due, he shall make representations to the Contract-
      ing Authority with reasons, within the 15 day period. If the Con-
      tracting Authority, having considered such representations, is of the
      opinion that payment of the wages and salaries should be made, it may
     pay such wages, salaries, allowances and contributions out of amounts
     due to the Contractor. Failing this, he may obtain a contribution
     under any of the guarantees provided for in these General Conditions.
     Any action taken by the Contracting Authority under this Article,
      shall not relieve the Contractor of his obligations to his employees,
      except to the extent that any obligation may be satisfied by this ac-
      tion. The Contracting Authority shall not assume any responsibi-
      lity towards the Contractor's employees by this action.
                       OBLIGATIONS OF THE CONTRACTOR
                                ARTICLE 12
                            General Obligations
12.1 The Contractor shall, with due care and diligence, and in accordance
     with the provisions of the Contract, design the Works to the extent
      stated in the Contract, and execute, complete and remedy any defects
      in the Works. The Contractor shall provide all superintendence, per-
      sonnel, materials, Plant, Equipment and all other items, whether of a
      temporary or permanent nature required in and for such design, execu-
      tion, completion and remedying of any defects, insofar as specified
      in, or can be reasonably inferred from, the Contract.
12.2 The Contractor shall take full responsibility for the adequacy, sta-
      bility and safety of all operations and methods of construction under
      the Contract.
12.3 The Contractor shall comply with Administrative Orders given by the
      Supervisor. Wnere the Contractor considers that the requirements of
      an Administrative Order go beyond the authority of the Supervisor or
      of the scope of the Contract he shall, on pain of being time-barred,
      give notice, with reasons, to the Supervisor within 30 days after re-
      ceipt thereof. Execution of the Administrative Order shall not be
      suspended because of this notice.
 ---pagebreak---                                     - 62 -
12.4 The Contractor shall respect and abide by all laws and regulations in
      force in the State of the Contracting Authority and shall ensure that
     his personnel, their dependents, and his local employees also respect
      and abide by all such laws and regulations. The Contractor shall in-
     demnify the Contracting Authority against any claims and proceedings
      arising from any infringement by the Contractor, his employees and
      their dependents of such laws and regulations.
12.5  If the Contractor or any of his sub-contractors, agents or servants
     offers to give or agrees to offer or to give or gives to any person,
     any bribe, gift, gratuity or commission as an inducement or reward
     for doing or forbearing to do any act in relation to the Contract or
     any other Contract with the Contracting Authority; or for showing
     favour or disfavour to any person in relation to the Contract or any
     other Contract with the Contracting Authority, then the Contracting
     Authority may, without prejudice to any accrued rights of the Con-
      tractor under the Contract, terminate the Contract in which case the
     provisions of Articles 63 and 64 hereof shall apply.
12.6 The Contractor shall treat all documents and information received in
     connection with the Contract as private and confidential, and shall
     not, save insofar as may be necessary for the purposes of the execu-
      tion thereof, publish or disclose any particulars of the Contract
     without the prior consent in writing of the Contracting Authority or
      the Supervisor after consultation with the Contracting Authority. If
     any disagreement arises as to the necessity for any publication or
     disclosure for the purpose of the Contract, the decision of the Con-
      tracting Authority shall be final.
12.7  If the Contractor is a joint venture or consortium of two or more
     persons, all such persons shall be jointly and severally bound to
      fulfil the terms of the Contract according to the law of the State of
      the Contracting Authority and shall, at the request of the Contract-
      ing Authority, designate one of such persons to act as leader with
      authority to bind the joint venture or consortium.    The composition
      or the constitution of the joint venture or consortium shall not be
      altered without the prior consent of the Contracting Authority.
                                 ARTICLE 13
                        Superintendence of the Works
13.1 The Contractor shall himself superintend the Works or shall appoint a
      representative to do so. Such appointment shall be submitted to the
     Supervisor for approval. The approval may at any time be withdrawn.
     Should the Supervisor refuse to approve, or withdraw approval of the
     appointment, he shall set out the grounds on which his decision is
     based, and the Contractor shall submit an alternative appointment
     without delay.
 ---pagebreak---                                       - 63 -
13.2  If the Supervisor withdraws his approval of the Contractor's repre-
      sentative, the Contractor shall, as soon as is practicable, after re-
      ceiving notice of such withdrawal, remove the representative from the
     Works and replace him with another representative approved by the Su-
     pervisor.
13.3 The Contractor's representative shall have full authority to make any
     decision necessary for the execution of the Works, to receive and
      carry out Administrative Orders and to countersign the work register
      referred to in Article 39 or attachment, where appropriate. In any
      event, the Contractor shall be responsible for ensuring that the
     Works are carried out satisfactorily including ensuring that the
      specifications and Administrative Orders are adhered to by his own
      employees and by his sub-contractors and their employees.
                                  ARTICLE 14
                                     Staff
14.1 The persons employed by the Contractor must be sufficient in number,
      and permit the optimum use of the human resources of the State in
     which the Works are located. Such employees must have the skills and
      experience necessary to ensure due progress and satisfactory execu-
      tion of the Works. The Contractor shall immediately replace all em-
      ployees indicated by the Supervisor as likely to jeopardise the sat-
      isfactory execution of the Works.
14.2 The rates of remuneration and the general working conditions, as laid
      down by the law of the State of the Contracting Authority, shall
      apply as a minimum to employees on the Site.
                                  ARTICLE IS
                             Performance Guarantee
15.1 The Contractor shall, within 30 days of receipt of the notification
      of the award of Contract, furnish to the Contracting Authority a
      guarantee for the full and proper performance of the Contract. The
      amount of the guarantee shall be as specified in the Special Condi-
      tions and shall not exceed 109b of the amount of the Contract Price
      including any amounts stipulated in riders to the Contract, save
     where the Special Conditions provide otherwise. However, it may in
      no case exceed 2 0 % of such price.
15.2  The performance guarantee shall be held against payment to the Con-
      tracting Authority for any loss resulting from the Contractor's fail-
      ure to fully and properly perform his obligations under the Contract.
 ---pagebreak---                                   - 64 -
15.3 The performance guarantee shall be in the format given in the Special
     Conditions, and may be provided in the form of a bank guarantee, a
     banker's draft, a certified cheque, a bond provided by an insurance
     and/or bonding company, an irrevocable letter of credit or a cash de-
     posit made with the Contracting Authority. If the performance guaran-
     tee is to be provided in the form of a bank guarantee, a banker's
     draft, a certified cheque or a bond, it shall be issued by a bank or
     bonding and/or insurance company approved by the Contracting
     Authority in accordance with the eligibility criteria applicable for
     the award of the Contract.
15.4 Unless stated otherwise in the Special Conditions, the performance
     guarantee shall be denominated in the types and proportions of cur-
     rencies in which the original Contract is payable.
15.5 No payments shall be made in favour of the Contractor prior to the
     provision of the guarantee. The guarantee shall continue to remain
     valid until the Contract has been fully and properly performed.
15.6 During the performance of the Contract, if the natural or legal per-
     son providing the guarantee is not able to abide by his commitments,
     the guarantee shall cease to be valid. The Contracting Authority
     shall give formal notice to the Contractor to provide a new guarantee
     on the same terms as the previous one. Should the Contractor fail to
     provide a new guarantee, the Contracting Authority may terminate the
     Contract.
15.7 The Contracting Authority shall demand payment from the guarantee of
     all sums for which the guarantor is liable under the guarantee due to
     the Contractor's default under the Contract, in accordance with the
     terms of the guarantee and up to the value thereof. The guarantor
     shall, without delay, pay those sums upon demand from the Contracting
     Authority and may not raise any objection for any reason whatsoever.
     Prior to making any claim under the performance guarantee, the Con-
     tracting Authority shall notify the Contractor stating the nature of
     the default in respect of which the claim is to be made.
15.8 Unless the Contract provides otherwise the performance guarantee
     shall be released within 30 days of the issue of the signed final
     statement of account referred to in Article 51.
 ---pagebreak---                                     - 65 -
                                ARTICLE 16
                                 Insurance
16.1 The Contractor shall insure in the joint names of the Contracting Au-
      thority and himself against loss or damage for Which he is liable un-
     der the Contract. Such insurance shall, unless the Special Condi-
      tions provide otherwise, cover:-
     a) the Works, together with materials and Plant for incorporation
         therein, to the full replacement cost against all loss or damage
         from whatever cause arising other than from force majeure or risks
     * attributable under the Contract to the Contracting Authority;
     b) an additional sum of 15% of such replacement cost, or as may be
         specified in the Special Conditions, to cover any additional costs
         of and incidental to the rectification of loss or damage including
         professional fees and the cost of demolishing and removing any
         part of the Works and of removing debris of whatever nature;
      c) the Contractor's Equipment and other things brought onto the Site
         by the Contractor, for a sum sufficient to provide their replace-
         ment at the Site.
16.2 The Contractor may substitute the insurance provided for in Article
      16.1 by a global policy of insurance which covers, inter alia, the
      elements of Article 16.1(a), (b) and (c). In such case, the Con-
      tractor shall notify the insurer of the Contracting Authority's in-
      terest.
16.3 The Contractor shall take out insurance covering his liability with
      regard to industrial accidents and civil liabilities to any person
     employed by him on the Works, to the Contracting Authority and any
     employee of that authority, arising from the execution of the Works.
     Such liability shall be unlimited in the case of personal injuries.
16.4 The Contractor shall take out insurance covering liability with re-
     gard to risks and civil liability resulting from an act or omission
     attributed to him, to his legal successors or agents. Such insurance
     shall be for at least the amount stated in the Special Conditions.
     Furthermore, he shall ensure that all his sub-Contractors have taken
     out a similar insurance.
16.5 All the insurance referred to in this Article shall be taken out
     within 30 days of the notification of the award of the Contract, and
     shall be subject to approval by the Contracting Authority. Such in-
     surance shall take effect from the commencement of the Works and
     remain in force until final acceptance of the Works. The Contractor
     shall produce to the Contracting Authority the insurance policy and
     shall furnish proof of regular payment of premiums without delay
     whenever he is required to do so by the Contracting Authority or the
     Supervisor.
 ---pagebreak---                                     - 66 -
16.6 Notwithstanding the obligations of the Contractor to insure in accor-
     dance with Article 16, the Contractor shall be solely liable and
     shall indemnify the Contracting Authority and the Supervisor against
     any claims by third parties for damage to property or personal inju-
     ries arising from the execution of the Works by the Contractor, his
     sub-contractors and employees in connection with the Works.
                                ARTICLE 17
                           Performance Programme
17.1 The Contractor shall draw up, and submit for the approval of the Su-
     pervisor, a programme of performance of the Contract, in accordance
     with the Special Conditions. The programme shall contain at least the
     following:-
     a) the order in which the Contractor proposes to carry out the Works;
     b) the Time Limits within which submission and approval of the Draw-
         ings are required;
     c) a general description of the methods which the Contractor proposes
         to adopt for carrying out the Works, and
     d) such further details and information as the Supervisor may reason-
         ably require.
17.2 The approval of the programme by the Supervisor shall not relieve the
     Contractor from any of his obligations under the Contract.
17.3 No material alteration to the programme shall be made without the ap-
     proval of the Supervisor. If, however, the progress of the Works
     does not conform to the programme, the Supervisor may instruct the
     Contractor to revise the programme and submit the revised programme
      to him for approval.
                                ARTICLE 18
                       Detailed Breakdown of Prices
18.1 Wnere appropriate and within a period of not more than 20 days fol-
      lowing the Supervisor's reasoned request, the Contractor shall pro-
     vide a detailed breakdown of his rates and prices, where such break-
     down is required for any purpose under the Contract.
 ---pagebreak---                                      - 67 -
18.2  After the notification of award, the Contractor shall, within the
      Time Limit stated in the Special Conditions, provide to the Supervi-
      sor for his information only, a detailed cash flow estimate, in quar-
      terly periods, of all payments which may be due to the Contractor
      under the Contract. The Contractor shall subsequently supply revised
      cash flow estimates at quarterly intervals, if so required by the Su-
      pervisor. The Communication shall not impose any liability whatso-
      ever on the Contracting Authority or the Supervisor.
                                 ARTICLE 19
                            Contractor's Drawings
19.1  The Contractor shall submit to the Supervisor for approval:-
      a) such drawings, documents, samples and/or models as may be speci-
          fied in the Contract within the Time Limits laid down therein or
          in the programme of performance;
      b) such drawings as the Supervisor may reasonably require for the
          performance of the Contract.
19.2  If the Supervisor fails to notify his decision of approval referred
      to in Article 19.1 within the Time Limits referred to in Contract or
    • the approved programme of performance, such drawings, documents,
      samples or models shall be deemed to be approved at the end of the
      Time Limits specified. If no Time Limit is specified, they shall be
      deemed to be approved 30 days after receipt.
19.3  Approved Drawings, documents, samples and models shall be signed or
      otherwise identified by the Supervisor and shall not be departed from
       except as otherwise instructed by the Supervisor. Any Contractor's
      drawings, documents, samples or models which the Supervisor fails to
      approve, shall be forthwith modified to meet the requirements of the
      Supervisor and resubmitted by the Contractor for approval.
19.4  The Contractor shall supply additional copies of approved Drawings in
       the form and numbers stated in the Contract or in subsequent Adminis-
       trative Orders.
19.5  The approval of the Drawings, documents, samples or models by the
      Supervisor shall not relieve the Contractor from any of his obliga-
       tions under the Contract.
19.6  The Supervisor shall have the right at all reasonable times to in-
      spect all Contract Drawings, documents, samples or models at the Con-
      tractor's premises.
 ---pagebreak---                                     - 68 -
19.7 Before provisional acceptance of the Works, the Contractor shall sup-
     ply operation and maintenance manuals together with drawings, Which
     shall be in such detail as will enable the Contracting Authority to
     operate, maintain, adjust and repair all parts of the Works. Unless
     otherwise stated in the Special Conditions, the manuals and drawings
     shall be in the language of the Contract and in such forms and num-
     bers as stated in the Contract. The Works shall not be considered to
     be completed for the purpose of provisional acceptance until such
     manuals and drawings have been supplied to the Contracting Authority.
                                 ARTICLE 20
                        Sufficiency of Tender Prices
20.1 The Contractor shall be deemed to have inspected and examined the
     Site and its surroundings and to have satisfied himself before sub-
     mitting his tender, as to the nature of the ground and sub-soil, and
      to have taken into account the form and nature of the Site, the ex-
      tent and nature of the work and materials necessary for the comple-
      tion of the Works, the means of communication with and access to the
     Site, the accommodation he may require and in general to have ob-
      tained for himself all necessary information as to risks, contingen-
      cies and all other circumstances influencing or affecting his tender.
20.2 The Contractor shall be deemed to have satisfied himself before sub-
     mitting his tender as to the correctness and sufficiency of the ten-
     der and of the rates and prices stated in the Bill of Quantities or
     Price Schedule which shall, except in so far as it is otherwise pro-
     vided in the Contract, cover all his obligations under the Contract.
20.3 Since the Contractor is deemed to have determined his prices on the
     basis of his own calculations, operations and estimates, he shall
     carry out without additional charge any work which is the subject of
     any item whatsoever in his tender for which he neither indicates a
     unit price nor a firm sum.
                                 ARTICLE 21
                             Exceptional Risks
21.1 If during the execution of the Works the Contractor encounters arti-
     ficial obstructions or physical conditions which could not reasonably
     have been foreseen by an experienced Contractor, and if the Contrac-
     tor is of the opinion that additional costs will be incurred and/or
     an extension of the period of performance of the Contract will be
     necessary as a result of this, he shall give notice to the Supervisor
     in accordance with Articles 35 and/or 55. The Contractor shall
     specify in such notice the artificial obstructions and/or physical
     conditions, giving details of the anticipated effects thereof, the
     measures he is taking or intends to take and the extent of the anti-
     cipated delay in or interference with the execution of the Works.
 ---pagebreak---                                     - 69 -
21.2 Following receipt of the notice, the Supervisor may inter alia:-
     a) require the Contractor to provide an estimate of the cost of the
        measures he is taking or intends to take;
     b) approve measures referred to in Article 21.2 (a) with or without
         modification;
     c) give written instructions as to how the artificial obstructions or
         physical conditions are to be dealt with;
     d) order a variation, a suspension, or termination of the Contract.
21.3 To the extent that the Supervisor shall decide that the whole or part
     of the said artificial obstructions or physical conditions could not
     reasonably have been foreseen by an experienced Contractor, the Su-
     pervisor shall:-
     a) take into account any delay suffered by the Contractor as a result
         of such obstructions or conditions in determining any extension of
         the period of performance to Which the Contractor is entitled un-
         der Article 35; and/or
     b) in case of artificial obstructions or physical conditions other
          than weather conditions, determine additional payments due to the
         Contractor in accordance with Article 55.
21.4 Weather conditions shall not entitle the Contractor to claims under
     Article 55.
21.5  If the Supervisor decides that the artificial obstructions or physi-
      cal conditions could, in whole or in part, have been reasonably fore-
      seen by an experienced Contractor, he shall so inform the Contractor
     as soon as practicable.
                                 ARTICLE 22
                              Security of Sites
22.1 The Contractor shall have the right to forbid access to the site to
     any person not involved in the performance of the Contract, with the
     exception of persons authorised by the Supervisor.
22.2 The Contractor shall ensure the security of sites during the whole
     period of execution and shall be responsible for taking the necessary
     steps, in the interests of his employees, agents of the Contracting
     Authority and third parties, to prevent any loss or accident which
     may result from carrying out the Works.
 ---pagebreak---                                       70 -
22.3 The Contractor shall take all essential steps, on his own responsi-
     bility and at his expense, to ensure that existing structures and in-
      stallations are protected, preserved and maintained. He shall be re-
      sponsible for providing and maintaining at his own expense all light-
      ing, protection, fencing and security equipment which proves neces-
      sary for the proper performance of the Works or Which may reasonably
     be required by the Supervisor.
22.4  If, during the performance of the Contract, urgent measures are nec-
     essary to obviate any risk of accident or damage or to ensure secu-
      rity following any accident or damage, the Supervisor shall give for-
     mal notice to the Contractor to do what is necessary. If the Con-
      tractor is unwilling or unable to undertake the necessary measures,
      the Supervisor may carry out the work at the expense of the Contrac-
      tor to the extent that the Contractor is liable.
                                 ARTICLE 23
                      Safeguarding Adjacent Properties
23.1 On his own responsibility and at his expense, the Contractor shall
      take all the precautions required by good construction practice and
     by the prevailing circumstances to safeguard adjacent properties and
     avoid causing any abnormal disturbance therein.
23.2 The Contractor shall indemnify the Contracting Authority against the
     financial consequences of all claims by neighbouring landowners or
     residents to the extent that the Contractor is liable and to the ex-
     tent that the damage to adjacent properties is not the result of a
     hazard created through the design or method of construction imposed
     by the Contracting Authority or the Supervisor upon the Contractor.
                                 ARTICLE 24
                          Interference with Traffic
24.1 The Contractor shall ensure that the Works and installations do not
     cause damage to, or obstruct traffic on, communication links such as
     roads, railways, waterways and aerodromes, save as permitted under
     the Special Conditions. He shall, in particular, take account of
     weight restrictions when selecting routes and vehicles.
24.2 Any special measures which the Contractor considers necessary or
     which are specified in the Special Conditions or which are required
     by the Contracting Authority in order to protect or strengthen sec-
     tions of roads, tracks or bridges, shall be at the expense of the
     Contractor, whether or not they are carried out by the Contractor.
     The Contractor shall inform the Supervisor of any special measures he
     intends to take before carrying them out. The repair of any damage
     caused to roads, tracks or bridges by the transport of materials,
     Plant or Equipment shall be at the expense of the Contractor.
 ---pagebreak---                                      - 71 -
                                ARTICLE 25
                            Cables and Conduits
25.1 Where, in the course of carrying out the Works, the Contractor en-
      counters bench-marks indicating the course of underground cables,
      conduits and installations, he shall keep such bench-marks in posi-
      tion or replace them, should execution of the Works have necessitated
      their temporary removal. Such related operations require the autho-
      rization of the Supervisor.
25.2 The Contractor shall be responsible for the preservation, removal and
      replacement, as the case may be, of the cables, conduits and instal-
      lations specified by the Contracting Authority in the Contract and
      for the cost thereof.
25.3 Wnere the presence of cables, conduits and installations has not been
      specified in the Contract but is revealed by bench-marks and refer-
      ences, the Contractor shall be under a general duty of care and simi-
      lar obligations regarding preservation, removal and replacement to
      those set out above. In this case, the Contracting Authority shall
     compensate him for expenditure, to the extent that such work is nec-
      essary for the execution of the Contract.
25.4 However, the obligations to remove and replace cables, conduits and
      installations and the expenditure resulting therefrom shall not be
      the responsibility of the Contractor if the Contracting Authority de-
     cides to accept that responsibility. The same shall apply where this
     obligation and the expenditure resulting therefrom devolve upon
     another specialist administration or an agent.
25.5 When any work on the Site is likely to cause disturbances in or dam-
      age to a public utility service, the Contractor shall immediately in-
     form the Supervisor in writing, giving a reasonable period of notice
      so that suitable measures can be taken in time to allow work to con-
      tinue normally.
                                ARTICLE 26
                                Setting-Out
26.1 The Contractor shall be responsible for:
      a) the accurate setting-out of the Works in relation to original
         marks, lines and levels of reference given by the Supervisor;
     b) the correctness, of the position, levels, dimensions and alignment
         of all parts of the Works, and
      c) the provision of all necessary instruments, appliances and labour
         in connection with the foregoing responsibilities.
 ---pagebreak---                                    - 72
26.2  If, at any time during the execution of the Works, any error appears
      in the position, levels, dimensions or alignment of any part of the
     Works, the Contractor, shall, if the Supervisor so requires, at the
     Contractor's cost, rectify such error to the satisfaction of the
     Supervisor, unless such error is based on incorrect data supplied by
      the Supervisor, in which case the Contracting Authority shall be re-
      sponsible for the cost of rectification.
26.3 The checking of any setting-out or of any line or level by the Super-
     visor shall not in anyway relieve the Contractor of his responsibil-
      ity for the accuracy thereof and the Contractor shall carefully pro-
      tect and preserve all bench-marks, sight-rails, pegs and other items
     used in setting-out the Works.
                                ARTICLE 27
                           Demolished Materials
27.1 Wnere the Contract includes demolition work, materials and articles
     obtained therefrom shall, unless the Special Conditions and/or the
      law of the State of the Contracting Authority otherwise provide and
      subject to the provisions of Article 28, be the property of the Con-
      tractor.
27.2 Should the Special Conditions reserve to the Contracting Authority
      the right of ownership of materials or all or part of the articles
      obtained from the demolition work, the Contractor shall take all the
     necessary precautions to ensure that these are preserved. He shall
      be liable for any destruction of, or damage to, such materials or ar-
      ticles caused by him or his agents.
27.3  Irrespective of the use to which the Contracting Authority intends to
     put the materials or articles, in respect of which he reserves the
      right of ownership, all costs incurred in transporting and storing
      them and all warehouse charges at the place indicated by the Supervi-
      sor shall be borne by the Contractor for any carriage not exceeding
      100 metres.
27.4  Save where the Special Conditions provide otherwise, the Contractor
      shall, at his expense, progressively remove rubble and other demoli-
      tion materials, rubbish and debris from the site.
                                ARTICLE 28
                                Discoveries
28.1 Discoveries of any interest whatsoever made during excavation or dem-
     olition work shall be brought immediately to the attention of the Su-
     pervisor. The Supervisor shall decide how such discoveries are to be
     dealt with, taking due account of the law of the State of the Con-
     tracting Authority.
 ---pagebreak---                                     - 73 -
28.2 The Contracting Authority reserves the right of ownership of materi-
     als found during the excavation and demolition work carried out on
      land belonging to him, subject to compensating the Contractor for any
      special efforts.
28.3 Artifacts, antiquities    and natural, numismatic, or other objects
     which are of scientific    interest, and also rare objects or objects
     made of precious metals    found during excavation or demolition work
      shall be the property of  the Contracting Authority.
28.4  In the event of disagreements, the Contracting Authority shall have
     sole authority to decide as to the qualifications set out in Articles
     28.1 and 28.3.
                                 ARTICLES 29
                              Temporary Wbrks
29.1 The Contractor shall carry out at his expense all the temporary works
      to enable the Works to be carried out. He shall submit to the Super-
     visor the drawings for temporary works which he intends to use, such
     as cofferdams, scaffolding, trusses and shuttering. He shall take
      into account any observations made to him by the Supervisor while as-
      suming responsibility for these drawings.
29.2 Wiere the design of particular temporary works is specified in the
     Special Conditions to be the responsibility of the Contracting Au-
      thority, the Supervisor shall provide the Contractor with all Draw-
      ings necessary in reasonable time to enable the Contractor to under-
      take the temporary works in accordance with his programme. In such
      cases, the Contracting Authority shall be solely responsible for the
      safety and adequacy of the design. However, the Contractor shall be
      responsible for the proper construction.
                                  ARTICLE 30
                                Soil Studies
     Subject to the Special Conditions and to the technical specifica-
      tions, the Contractor shall make available to the Supervisor, the
     personnel and Equipment necessary for carrying out any soil survey
     which the Supervisor considers reasonably necessary. The Contractor
     shall be compensated for the actual cost of the manpower and Equip-
     ment used or made available in such work, if not already provided for
      in the Contract.
 ---pagebreak---                                     - 74 -
                                 ARTICLE 31
                           Overlapping Contracts
31.1 The Contractor shall, in accordance with the requirements of the Su-
     pervisor, afford all reasonable opportunities for carrying out their
     work to any other contractors employed by the Contracting Authority
     and their workmen, to the workmen of the Contracting Authority and of
     any other public authorities who may be employed on or near the Site
      in the execution of any work not included in the Contract, or of any
     Contract which the Contracting Authority may enter into in connection
     with, or ancillary to, the Works.
31.2  If, however, the Contractor, on the written request of the Supervi-
      sor, makes available to any such contractor, or public authority, or
      to the Contracting Authority, any roads or ways for the maintenance
     of which the Contractor is responsible, or permits the use by any
      such other persons of the Contractor's temporary works, scaffolding
     or other Equipment on the Site, or provides any other service of
     whatsoever nature, which was not provided for in the Contract, the
     Contracting Authority shall pay to the Contractor in respect of such
     use or service, such sums and/or grant such extension of time, as
      shall, in the opinion of the Supervisor, be reasonable.
31.3 The Contractor shall not by reason of Article 31 be relieved of any
     of his obligations under the Contract nor shall he be entitled to any
     claims other than those provided for in Article 31.2.
                                 ARTICLE 32
                            Patents and Licences
     Save where otherwise provided in the Special Conditions, the Contrac-
     tor shall indemnify the Contracting Authority and the Supervisor
     against any claim resulting from the use as specified in the Contract
     of patents, licences, Drawings, designs, models, or brand or trade
     marks, except where such infringement results from compliance with
     the design or specification provided by the Contracting Authority
     and/or the Supervisor.
 ---pagebreak---                                    - 75 -
                         (IMvCNCEMENT AND DELAYS
                                ARTICLE 33
                           Commencement Orders
33.1 The Contracting Authority shall fix the date on which performance of
     the Contract is to commence, and advise the Contractor either in the
     notification of award of Contract or by Administrative Order issued
     by the Supervisor.
33.2 The date for commencing performance shall be not later than 180 days
     following notification of award of Contract unless agreed otherwise
     by the parties.
                                ARTICLE 34
                          Period of Performance
     The period of performance shall commence on the date fixed in accor-
     dance with Article 33.1 and shall be as stated in the Contract, with-
     out prejudice to extensions of the period which may be granted under
     Article 35.
                                ARTICLE 35
                    Extension of Period of Performance
35.1 The Contractor may request an extension to the period of performance
     if he is or will be delayed in completing the Contract by any of the
     following causes:-
     a) exceptional weather conditions in the State of the Contracting Au-
        thority;
     b) artificial obstructions or physical conditions which could not
        reasonably have been foreseen by an experienced contractor;
     c) Administrative Orders affecting the date of completion other than
        those arising from the Contractor's default;
     d) failure of the Contracting Authority to fulfil his obligations un-
        der the Contract;
     e) any suspension of the Works which is not due to the Contractor's
        default;
 ---pagebreak---                                   - 76 -
     f) force majeure;
     g) any other causes referred to in these General Conditions Which are
         not due to the Contractor's default.
35.2 The Contractor shall, within 30 days of becoming aware that delay may
     occur, notify the Supervisor of his intention to make a request for
     extension of the period of performance to which he may consider him-
      self entitled, and shall, as soon thereafter as is reasonable in the
     circumstances, deliver to the Supervisor full and detailed particu-
      lars of the request, in order that such request may be investigated
     at the time.
35.3 The Supervisor shall, by written notice to the Contractor after due
     consultation with the Contracting Authority and, where appropriate,
      the Contractor, grant such extension of the period of performance as
     may be justified, either prospectively or retrospectively, or inform
      the Contractor that he is not entitled to an extension.
                                ARTICLE 36
                           Delays in Performance
36.1  If the Contractor fails to complete the Works within the time pe-
     riod(s) specified in the Contract, the Contracting Authority shall,
     without formal notice and without prejudice to his other remedies un-
     der the Contract be entitled to Liquidated Damages for every day or
     part thereof which shall elapse between the end of the period speci-
     fied for performance or extended period of performance under Article
     35 and the actual date of completion, at the rate and up to the maxi-
     mum amount specified in the Special Conditions. If the Works have
     been the subject of partial acceptance in accordance with Article 59,
     the Liquidated Damages specified in the Special Conditions may be re-
     duced in the proportion which the value of the accepted part bears to
     the value of the whole of the Works.
36.2 If the Contracting Authority has become entitled to the maximum claim
     under Article 36.1 he may, after giving notice to the Contractor:-
     a) seize the performance guarantee; and/or
     b) terminate the Contract; and
     c) enter into a contract with a third party at the Contractor's cost
         for the provision of the balance of the Works
 ---pagebreak---                                    - 77 -
                                ARTICLE 37
                                Variations
37.1 The Supervisor shall have power to order any variation to any part of
     the Works necessary for the proper completion and/or functioning of
     the Works. Such variations may include additions, omissions, substi-
     tutions, changes in quality, quantity, form, character, kind, posi-
     tion, dimension, level or line and changes in the specified sequence,
     method or timing of execution of the Works. No order for a variation
     shall have the effect of invalidating the Contract, but the financial
     effect, if any, of all such variations shall be valued in accordance
     with Articles 37.5 and 37.7.
37.2 No variation shall be made except by Administrative Order, provided
     that:-
     a) if for any reason, the Supervisor shall find it necessary to give
         an order orally, he shall as soon as possible thereafter confirm
         the order by an Administrative Order;
     b) if the Contractor shall confirm in writing an oral order given for
         the purpose of Article 37.2 (a) and the confirmation shall not be
         contradicted in writing forthwith by the Supervisor, an Adminis-
         trative Order shall be deemed to have been issued for the varia-
         tion;
     c) an Administrative Order for variation shall not be required for
         increase or decrease in the quantity of any work where such in-
         crease or decrease is the result of the quantity exceeding or
         being less than that stated in the Bill of Quantities or Price
         Schedule.
37.3 Save as provided by Article 37.2, prior to any Administrative Order
     for variation, the Supervisor shall notify the Contractor of the
     nature and form of such variation. As soon as possible, after re-
      ceiving such notice, the Contractor shall submit to the Supervisor a
     proposal containing:-
     a) a description of the tasks, if any, to be performed     or the mea-
         sures to be taken and a programme for execution; and
     b) any necessary modifications to the programme of performance or to
         any of the Contractor's obligations under the Contract; and
      c) any adjustment to the Contract Price in accordance with the rules
         as set out in Article 37.
 ---pagebreak---                                    - 78 -
37.4 Following the receipt of the Contractor's submission referred to in
     Article 37.3, the Supervisor shall, after due consultation with the
     Contracting Authority and, where appropriate, the Contractor, decide
     as soon as possible whether or not the variation shall be carried
     out. If the Supervisor decides that the variation shall be carried
     out he shall issue the Administrative Order stating that the varia-
     tion shall be carried out at the prices and under the conditions
     given in the Contractor's submission referred to in Article 37.3 or
     as modified by the Supervisor in accordance with Article 37.5.
37.5 The prices for all variations ordered by the Supervisor in accordance
     with Articles 37.2 and 37.4 shall be ascertained by the Supervisor in
     accordance with the following principles:-
     a) where work is of similar character and executed under similar con-
        ditions to work priced in the Bill of Quantities or Price Schedule
         it shall be valued at such rates and prices contained therein;
     b) where work is not of a similar character or is not executed under
        similar conditions, the rates and prices in the Contract shall be
        used as the basis for valuation so far as is reasonable, failing
        Which, a fair valuation shall be made by the Supervisor;
     c) if the nature or amount of any variation relative to the nature or
        amount of the whole of the Contract or to any part thereof shall
        be such that in the opinion of the Supervisor any rate or price
        contained in the Contract for any item of work is by reason of
        such variation rendered unreasonable, then the Supervisor shall
        fix such rate or price as in the circumstances he shall think rea-
        sonable and proper;
     d) where a variation is necessitated by default or breach of Contract
        by the Contractor, any additional cost attributable to such varia-
        tion shall be borne by the Contractor.
37.6 On receipt of the Administrative Order requesting the variation, the
     Contractor shall proceed to carry out the variation and be bound by
     these General Conditions in so doing as if such variation were stated
     in the Contract. The Works shall not be delayed pending the granting
     of any extension of time for completion or adjustment to the Contract
     Price. Where the order for a variation precedes the adjustment to
     the Contract Price, the Contractor shall keep records of the costs of
     undertaking the variation and of time expended thereon. Such records
     shall be open to inspection by the Supervisor at all reasonable
     times.
 ---pagebreak---                                     - 79 -
37.7 Wiere on provisional acceptance, an increase or reduction in the to-
      tal value of the Works resulting from an Administrative Order, or
     from some other circumstance which is not caused by the Contractor's
     default, exceeds 15% of the Contract price, the Supervisor shall,
     after consultation with the Contracting Authority and the Contractor
     determine any additions to or reduction from the Contract Price as a
      consequence of the application of Article 37.5. The sum so deter-
     mined shall be based on the amount by which the increase or decrease
      in value of the Works exceeds 15%. The sum shall be notified by the
     Supervisor to the Contracting Authority and the Contractor and the
     Contract Price adjusted accordingly.
                                ARTICLE 38
                                 Suspension
38.1 The Contractor shall, on the order of the Supervisor, suspend the
     progress of the Works or any part thereof for such time or times and
      in such manner as the Supervisor may consider necessary.
38.2 During the period of suspension, the Contractor shall take such pro-
      tective measures as may be necessary to safeguard the Works, Plant,
     Equipment and Site against any deterioration, loss or damage. Addi-
      tional expenses incurred in connection with such protective measures
      shall be added to the Contract Price, unless such suspension is:-
      a) otherwise provided for in the Contract; or
      b) necessary by reason of some default of the Contractor; or
      c) necessary by reason of normal climatic conditions on Site; or
     d) necessary for the safety or the proper execution of the Works or
         any part thereof insofar as such necessity does not arise from any
         act or default by the Supervisor or the Contracting Authority or
         from any of the exceptional risks referred to in Article 21.
38.3 The Contractor shall not be entitled to such additions to the Con-
      tract Price unless he notifies the Supervisor, within 30 days after
      receipt of the order to suspend the Works, of his intention to make a
      claim for them.
38.4 The Supervisor, after consultation with the Contracting Authority and
      the Contractor, shall determine such extra payment and/or extension
      of the period of performance to be made to the Contractor in respect
      of such claim as shall, in the opinion of the Supervisor, be fair and
      reasonable.
38.5  If the period of suspension exceeds 180 days and the suspension is
     not due to the Contractor's default, the Contractor may, by notice to
      the Supervisor, request permission to proceed within 30 days or ter-
     minate the Contract.
 ---pagebreak---                                     - 80 -
                         MATERIALS ATO WORKMANSHIP
                                ARTICLE 39
                               Work Register
39.1 A work register shall, unless otherwise provided by the Special Con-
     ditions, be kept on the Site by the Supervisor, who shall enter in it
     at least the following information:-
     a) the weather conditions, interruptions of work owing to inclement
         weather, hours of work, number and type of workmen employed on the
         Site, materials supplied, equipment in use, equipment not in work-
         ing order, tests carried out in situ, samples dispatched, unfore-
         seen circumstances, as well as orders given to the Contractor;
     b) detailed statements of all the quantitative and qualitative ele-
         ments of the work done and the supplies delivered and used, capa-
         ble of being checked on the Site and relevant in calculating pay-
         ments to be made to the Contractor.
39.2 The statements shall form an integral part of the work register but
     may, where appropriate, be recorded in separate documents. The tech-
     nical rules for drawing up the statements shall be as set out in the
     Special Conditions.
39.3 The Contractor shall ensure that statements are drawn up, in good
      time and in accordance with the Special Conditions, in respect of
     work, services and supplies which cannot be measured or verified sub-
      sequently; failing this, he shall accept the decisions of the Super-
     visor unless, at his own expense, he provides evidence to the con-
      trary.
39.4 Entries made in the work register as work progresses shall be signed
     by the Supervisor and countersigned by the Contractor or his repre-
      sentative. If the Contractor objects, he shall communicate his views
      to the Supervisor within 15 days following the date on which the en-
      try or the statements objected to are recorded. Should he fail to
     countersign or to submit his views within the period allowed, the
     Contractor shall be deemed to agree with the notes shown in the reg-
     ister. The Contractor may examine the work register at any time and
     may, without removing the document, make or receive a copy of entries
     which he considers necessary for his own information.
39.5 The Contractor shall, on request, provide the Supervisor with the in-
     formation needed to keep the work register in good order.
 ---pagebreak---                                     - 81 -
                                 ARTICLE 40
                      Quality of Works and Materials
40.1 The Works, components and materials shall conform to the specifica-
     tions, Drawings, surveys, models, samples, patterns and other re-
     quirements in the Contract which shall be held at the disposal of the
     Contracting Authority or the Supervisor for the purposes of identifi-
     cation throughout the period of performance.
40.2 Any preliminary technical acceptance stipulated in the Special Condi-
     tions shall be the subject of a request sent by the Contractor to the
     Supervisor. The request shall indicate the reference to the Con-
     tract, the lot number and the place where such acceptance is to take
     place, as appropriate. The components and materials specified in the
     request must be certified by the Supervisor as meeting the require-
     ments for such acceptance prior to their incorporation in the Works.
40.3 Even if materials or items to be incorporated in the Works or in the
     manufacture of components have been technically accepted in this way,
     they may still be rejected and must be replaced immediately by the
     Contractor if a further examination reveals defects or faults. The
     Contractor may be given the opportunity to repair and make good mate-
     rials and items which have been rejected, but such materials and
      items will be accepted for incorporation in the Works only if they
     have been repaired and made good to the satisfaction of the Supervi-
     sor.
                                 ARTICLE 41
                           Inspection and Testing
41.1 The Contractor shall ensure that the components and materials are de-
      livered to the Site in time to allow the Supervisor to proceed with
     acceptance of the components and materials. The Contractor is deemed
      to have fully appreciated the difficulties which he might encounter
      in this respect, and he shall not be permitted to advance any grounds
     for delay in fulfilling his obligations.
41.2 The Supervisor shall be entitled, either by himself or his agent, to
      inspect, examine, measure and test the components, materials and
     workmanship, and check the progress of preparation, fabrication or
     manufacture of anything being prepared, fabricated or manufactured
     for delivery under the Contract in order to establish whether the
     components, materials and workmanship are of the requisite quality
     and quantity. This shall take place at the place of manufacture, fab-
     rication, preparation or on the Site or at such other places as may
     be specified in the Contract.
 ---pagebreak---                                        82 -
41.3 For the    purposes of  such  tests  and  inspections,  the Contractor
      shall:-
      a) provide to the Supervisor, temporarily and free of charge, such
         assistance, test samples, parts, machines, equipment, tools or ma-
         terials and labour as are normally required for inspection and
         testing;
     b) agree, with the Supervisor, on the time and place for tests;
      c) provide access for the Supervisor at all reasonable times to the
         place where the tests are to be carried out.
41.4  If the Supervisor is not present on the date agreed for tests, the
     Contractor may, unless otherwise instructed by the Supervisor, pro-
      ceed with the tests, which shall be deemed to have been made in the
     Supervisor's presence. The Contractor shall forthwith forward duly
      certified copies of the test results to the Supervisor, who shall, if
     he has not attended the test, be bound by the test results.
41.5 Wnen components and materials have passed the tests referred to in
     Article 41, the Supervisor shall notify the Contractor or endorse the
     Contractor's certificate to that effect.
41.6  If the Supervisor and the Contractor disagree on the test results,
      each shall give a statement of his views to the other within 15 days
     after such disagreement arises. The Supervisor or the Contractor may
      require such tests to be repeated on the same terms and conditions
     or, if either party so requests, by an expert to be selected by
      common consent. All test reports shall be submitted to the Supervisor
     who shall communicate the results of these tests without delay to the
     Contractor. The results of the retesting shall be conclusive. The
      cost of the retesting shall be borne by the party whose views are
     proved wrong by the retesting.
41.7  In the performance of his duties, the Supervisor and all persons au-
      thorized by him shall disclose only to those persons who are entitled
      to know of it information which he has obtained by reason of his in-
      spection and testing of the methods of manufacture and operation of
      the undertaking.
 ---pagebreak---                                   - 83 -
                                ARTICLE 42
                                 Rejection
42.1 Components and materials which are not of the specified quality shall
     be rejected. A special mark may be applied to the rejected compo-
     nents or materials. This shall not be such as to alter them or af-
     fect their commercial value. Rejected components and materials shall
     be removed by the Contractor from the Site within a period which the
     Supervisor shall specify, failing which they shall be removed by the
     Supervisor as of right at the expense and risk of the Contractor.
     Any work incorporating rejected components or materials shall be re-
      jected.
42.2 The Supervisor shall, during the progress of the Works and before the
     Works are taken over have the power to order or decide:-
     a) the removal from the Site, within such Time Limits as may be spec-
          ified in the order, of any components or materials which, in the
         opinion of the Supervisor, are not in accordance with the Con-
         tract;
     b) the substitution of proper and suitable components or materials;
         or
     c) the demolition and proper re-execution, or satisfactory repair,
         notwithstanding any previous test thereof or interim payment
         therefor, of any work which, in respect of components, materials,
         workmanship or design by the Contractor for which he is responsi-
         ble, is not, in the opinion of the Supervisor, in accordance with
         the Contract.
42.3 The Supervisor shall, as soon as reasonably practicable, give to the
     Contractor notice in writing of his decision specifying particulars
     of the alleged defects.
42.4 The Contractor shall with all speed and at his expense make good the
     defects so specified. If the Contractor does not comply with such
     order, the Contracting Authority shall be entitled to employ other
     persons to carry out the same and all expenses consequent thereon or
      incidental thereto may be deducted by the Contracting Authority from
     any monies due or which may become due to the Contractor.
42.5 The provisions of Article 42 shall not affect the right of the Con-
     tracting Authority to claim under Articles 36 and 63.
 ---pagebreak---                                    - 84 -
                                ARTICLE 43
                      Property in Plant and Materials
43.1 All Equipment, temporary works, Plant and materials provided by the
     Contractor shall, when brought on the Site, be deemed to be ex-
      clusively intended for the execution of the Works and the Contractor
      shall not remove the same or any part thereof, except for the purpose
      of moving it from one part of the Site to another, without the con-
      sent of the Supervisor. Such consent shall, however, not be required
      for vehicles engaged in transporting any staff, labour, Equipment,
      temporary works, Plant or materials to or from the Site.
43.2 The Special Conditions may provide that all Equipment, temporary
     works, Plant and materials on Site owned by the Contractor or by any
      company in which the Contractor has a controlling interest shall, for
      the duration of the execution of the Works, be:-
      a) vested in the Contracting Authority; or
      b) made subject to a lien in favour of the Contracting Authority; or
      c) made subject to any other arrangement regarding priority interest
         or security.
43.3  In the event of termination of the Contract in accordance with
     Article 63 due to the Contractor's breach of Contract, the
     Contracting Authority shall be entitled to use the Equipment, tempo-
      rary works, Plant and materials on Site in order to complete the
     Works.
43.4 Any agreement for the hire by the Contractor of Equipment, temporary
     works, Plant or materials brought onto the Site, shall contain a pro-
     vision that on request in writing made by the Contracting Authority
     within 7 days after the date on which the termination under Article
     64 becomes effective, and on the Contracting Authority undertaking to
     pay all hire charges in respect thereof from such date, the owner
      thereof will hire such Equipment, temporary works, Plant or materials
      to the Contracting Authority on the same terms as they were hired by
      the Contractor, save that the Contracting Authority shall be entitled
      to permit the use thereof by any other contractor employed by him for
      completing the Works under the provisions of Article 64.3
43.5 Upon termination of the Contract before completion of the Works, the
     Contractor shall deliver to the Contracting Authority any Plant, tem-
     porary works, Equipment or materials the property in which has vested
      in the Contracting Authority or been made subject to a lien by virtue
     of Article 43.2. If he fails to do so, the Contracting Authority may
      take such appropriate action as it deems fit in order to obtain pos-
      session of such Plant, temporary works, Equipment, and materials and
      recover the cost of so doing from the Contractor.
 ---pagebreak---                                     -85 -
                                  PAMANTS
                                ARTICLE 44
                            General Provisions
44.1 Payments shall be made in the National Currency except as otherwise
     stipulated in the Contract.
44.2 The administrative or technical conditions to which the payment of
     advances, interim and/or final payments made in accordance with
     Articles 45 to 56 are subject, shall be as stated in the Special Con-
     ditions.
                                ARTICLE 45
                        Provisional Price Contracts
45.1 In exceptional cases, where a provisional price contract has been
     awarded, the amounts payable under the Contract shall be calculated
     as follows:-
     a) as for cost-plus Contracts in Article 49.1 (c); or
     b) initially on the basis of provisional prices and, after the condi-
         tions for performing the Contract are known, as for lump-sum Con-
         tracts or unit price Contracts in Article 49.1 (a) and (b) respec-
         tively, or as in a composite contract.
45.2 The Contractor shall supply such information as the Contracting
     Authority or the Supervisor may reasonably require in respect of any
     matter relating to the Contract for the purpose of the calculation.
     Wnere agreement cannot be reached on the valuation of the Works, the
     amounts payable shall be determined by the Supervisor.
                                ARTICLE 46
                                 Advances
46.1  If the Special Conditions so provide, advances shall be granted to
      the Contractor, at his request, for operations connected with the ex-
     ecution of the Works, in the cases listed hereinafter:-
     a) as a lump-sum advance enabling him to meet expenditure resulting
         from the commencement of the Contract;
 ---pagebreak---                                      - 86 -
     b) if he affords proof of the conclusion of a Contract for the pur-
         chase or order of materials, Plant, Equipment, machines and tools,
         necessary for the execution of the Contract, and of any other sub-
         stantial prior expenses such as the acquisition of patents or
         study costs.
46.2 The Special Conditions shall state the amount of the advances which
      shall not exceed 10% of the original Contract Price in respect of the
     lump-sum advance in Article 46.1(a) and 20% of such prices for all
     other advances in Article 46.1(b).
46.3 No advance shall be granted until:-
     a) the conclusion of the Contract;
     b) provision to the Contracting Authority by the Contractor of the
         performance guarantee in accordance with Article 15; and
     c) provision to the Contracting Authority by the Contractor of a sep-
         arate directly liable guarantee for the full amount of the advance
         by the institutions referred to in Article 15.3, which shall re-
         main effective until the advance has been completely repaid by the
         Contractor out of interim payments under the Contract.
46.4 The Contractor shall use the advance exclusively for operations con-
     nected with the execution of the Works. Should the Contractor misuse
     any portion of the advance, it shall become due and repayable immedi-
     ately and no further advance payments will be made to him.
46.5 Should the advance guarantee cease to be valid and the Contractor
     fail to re-validate it, either a deduction equal to the amount of the
     advance may be made by the Contracting Authority from future payments
     due to the Contractor under the Contract, or the Contracting
     Authority may apply the provisions of Article 15.6.
46.6 If the Contract is terminated for any reason whatsoever, the guaran-
     tees securing the advances may be invoked forthwith in order to repay
     the balance of the advances still owed by the Contractor, and the
     guarantor shall not delay payment or raise objection for any reason
     whatever.
46.7 The advance guarantee provided for in Article 46 shall be released as
     and when advances are repaid.
46.8 Further conditions and procedures for granting and repaying advances
     shall be as laid down in the Special Conditions.
 ---pagebreak---                                     - 87 -
                                 ARTICLE 47
                               Retention Sum
47.1 The sum which  shall be retained from interim payments byway of guar-
     antee to meet  the Contractor's obligations during the Maintenance Pe-
     riod, and the  detailed rules governing that guarantee, shall be stip-
     ulated in the  Special Conditions, provided that it shall, in no case,
     exceed 10% of  the Contract Price.
47.2 Subject to the approval of the Contracting Authority, the Contractor
     may, if he so wishes, substitute, not later than the date fixed for
     the commencement of the Works, these retention sums by a retention
     guarantee issued in accordance with Article 15.3.
47.3 The sum retained or the retention guarantee shall be released within
     90 days of the date of final acceptance of the Works.
                                 ARTICLE 48
                             Revision of Prices
48.1 Unless otherwise stipulated in the Special Conditions, and except as
     provided in Article 48.4, the Contract shall be at fixed prices which
      shall not be revised.
48.2 Wiere prices may be revised under the Contract, such revision shall
      take into account variations in the prices of significant local or
      external elements which served as a basis for the calculation of the
      tender price, such as manpower, services, materials and supplies, as
     well as charges laid down by law or regulation. The detailed rules
     for the revision shall be as laid down in the Special Conditions.
48.3 Prices contained in the Contractor's tender shall be deemed:-
     a) to have been arrived at on the basis of the conditions in force 30
         days prior to the latest date fixed for submission of tenders; or
         in the case of direct agreement Contracts, on the date the Con-
         tract;
     b) to have taken account of the legislation and the relevant tax ar-
         rangements applicable at the reference date fixed in Article 48.3
         (a).
48.4 In the event of changes to, or introduction of, any national or State
     statute, ordinance, decree or other law, or any regulation or bye-law
     of any local or other public authority, after the date stated in Ar-
     ticle 48.3 which causes a change in the contractual relationship be-
     tween the parties to the Contract, the Contracting Authority and the
     Contractor shall consult on how best to proceed further under the
     Contract, and may as a result of such consultation decide:-
 ---pagebreak---                                    - 88 -
     a) to modify the Contract; or
     b) on payment of compensation     for  the resulting imbalance  by one
        party to the other; or
     c) to terminate the Contract by mutual agreement.
48.5 In the event of a delay in the execution of the Works for which the
     Contractor is responsible, or at the end of the period of performance
     revised as necessary in accordance with the Contract, there shall be
     no further revision of prices within the 30 days before provisional
     acceptance, except for the application of new price indexation, if
     this is to the benefit of the Contracting Authority.
                                 ARTICLE 49
                                Measurement
49.1 The following methods    shall apply to the valuation of Works Con-
     tracts:
     a) For lump-sum contracts, the amount due under the Contract shall be
        determined on the basis of the breakdown of the overall Contract
        Price, or on the basis of a breakdown expressed as a percentage of
         the Contract Price corresponding to completed stages of the Works.
        Wnere items are accompanied by quantities, these shall be firm
        quantities for which the Contractor has submitted his all-in
        price, and shall be paid for irrespective of the quantities of
        work actually carried out.
     b) For unit price contracts:-
         i)   the amount due under the Contract shall be calculated by ap-
              plying the unit rates to the quantities actually executed for
              the respective items, in accordance with the Contract;
         ii)  the quantities set out in the Bill of Quantities shall be the
              estimated quantities of the Works, which shall not be taken
              as the actual and correct quantities of the Works to be exe-
              cuted by the Contractor in fulfillment of his obligations un-
              der the Contract;
         iii) the Supervisor shall determine by measurement the actual
              quantities of the Works executed by the Contractor, and these
              shall be paid for in accordance with Article 50. Unless
              otherwise provided in the Special Conditions no additions
              shall be made to the items in the Bill of Quantities except
              as a result of a variation in accordance with Article 37 or
              other provision of the Contract entitling the Contractor to
              additional payment;
 ---pagebreak---                                      - 89 -
          iv)  the Supervisor shall, when he requires any parts of the Works
               to be measured, give reasonable notice to the Contractor to
               attend, or to send a qualified agent to represent him. The
               Contractor or his agent shall assist the Supervisor in making
               such measurements and shall furnish all particulars required
               by the Supervisor. Should the Contractor not attend, or omit
               to send such agent, the measurement made by the Supervisor or
               approved by him shall be binding on the Contractor;
         v)    the Works shall be measured net, notwithstanding any general
               or local custom, except where otherwise provided for in the
               Contract.
      c) For cost-plus contracts, the amount due under the Contract shall
         be determined on the basis of actual costs with an agreed addition
          for overheads and profit. The Special Conditions shall stipulate
          the information which the Contractor is required to submit to the
         Supervisor for the purpose of Article 49.1(c) and the manner in
         which it should be submitted.
49.2 Wnere an item in the Contract is indicated as "provisional" the Pro-
     visional Sum set aside for it shall not be taken into account in cal-
      culating the percentages referred to in Article 37.
                                  ARTICLE 50
                               Interim Payments
50.1 Unless otherwise specified in the Special Conditions, the Contractor
      shall submit an application for interim payment to the Supervisor at
      the end of each period referred to in Article 50.7 in a form approved
     by the Supervisor. The application shall include the following
      items, as applicable:-
     a) the estimated Contract value of the permanent Works executed up
          to the end of the period in question;
     b) an amount reflecting any revision of prices pursuant to Article
         48;
     c) an amount to be withheld as retention sum under of Article 47;
     d) any credit and/or debit for the period in question in respect of
         Plant and materials on Site intended for, but not yet incorporated
         in, the permanent Works in the amount and under the conditions set
         out in Article 50.2;
     e) an amount to be deducted on account of the advance repayment under
         the provisions of Article 46; and
     f) any other sum to which the Contractor may be entitled under the
         Contract.
 ---pagebreak---                                      - 90 -
50.2 The Contractor shall be entitled to such sums as the Supervisor may
      consider proper in respect of Plant and materials intended for, but
     not yet incorporated in, the permanent Works provided that:-
     a) the Plant and materials conform with the specifications for the
         permanent Works and are set out in batches in a way that they may
         be recognised by the Supervisor;
     b) such Plant and materials have been delivered to the Site, and are
         properly stored and protected against loss or damage or deteriora-
         tion to the satisfaction of the Supervisor;
      c) the Contractor's record of requirements, orders, receipts and use
         of Plant and materials under the Contract are kept in a form
         approved by the Supervisor and such records are available for in-
         spection by the Supervisor;
     d) the Contractor submits with his statement, the estimated value of
         the Plant and materials on Site together with such documents as
         may be required by the Supervisor for the purpose of valuation of
         the Plant and materials and providing evidence of ownership and
         payment therefor; and
      e) where the Special Conditions so provide, ownership of the Plant
         and materials referred to in Article 43 shall be deemed to be
         vested in the Contracting Authority.
50.3 Approval by the Supervisor of any interim payment certified by him in
      respect of Plant and materials pursuant to Article 50 shall be
     without prejudice to the exercise of any power of the Supervisor un-
     der the Contract to reject any Plant or materials which are not in
      accordance with the provisions of the Contract.
50.4 The Contractor shall be responsible for any loss or damage to, and
      for the cost of storing and handling of, such Plant and materials on
     Site and shall effect such additional insurance as may be necessary
      to cover the risk of such loss or damage from any cause.
50.5 Within 30 days of receipt of the said application for interim pay-
     ment, it shall be approved or amended in such manner that, in the Su-
     pervisor's opinion, the application reflects the amount due to the
     Contractor in accordance with the Contract. In cases where there is
     a difference of opinion as to the value of an item, the Supervisor's
     view shall prevail. On determination of the amount due to the Con-
      tractor, the Supervisor shall issue to the Contracting Authority and
     the Contractor an interim payment certificate for the amount due to
     the Contractor and shall inform the Contractor of the Works for which
     payment is being made.
 ---pagebreak---                                      - 91 -
50.6 The Supervisor may, by an interim payment certificate, make any cor-
     rections or modifications to any previous certificate issued by him
     and shall have power to modify the valuation in, or withhold the
     issue of, any interim payment certificate if the Works or any part
     thereof are not being carried out to his satisfaction.
50.7 Unless the Special Conditions provide otherwise, the frequency shall
     be one interim payment per month.
                                 ARTICLE 51
                         Final Statement of Account
51.1 Not later than 90 days after the issue of the Final Acceptance cer-
     tificate referred to in Article 62, the Contractor shall submit to
     the Supervisor a draft final statement of account with supporting
     documents showing in detail the value of the work done in accordance
     with the Contract, together with all further sums which the Contrac-
      tor considers to be due to him under the Contract in order to enable
      the Supervisor to prepare the final statement of account. The Spe-
     cial Conditions may, however, in accordance with Article 51.6, state
      that the draft final statement of account and further proceedings re-
      lated thereto, be dealt with before the issue of the provisional ac-
      ceptance certificate.
51.2 Within 90 days after receipt of the draft final statement of account
     and of all information reasonably required for its verification, the
     Supervisor shall prepare the final statement of account, which deter-
     mines :-
     a) the amount which in his opinion is finally due under the Contract;
         and
     b) after establishing the amounts previously paid by the Contracting
         Authority and all sums to which the Contracting Authority is en-
         titled under the Contract, the balance, if any, due from the
         Contracting Authority to the Contractor, or from the Contractor to
         the Contracting Authority, as the case may be.
51.3 The Supervisor shall issue to the Contracting Authority or to its
     duly authorised representative, and to the Contractor, the final
     statement of account showing the final amount to which the Contractor
     is entitled under the Contract. The Contracting Authority or its
     duly authorised representative and the Contractor shall sign the fi-
     nal statement of account as an acknowledgement of the full and final
     value of the work performed under the Contract and shall promptly
     submit a signed copy to the Supervisor. However, the final statement
     of account shall not include amounts in dispute which are the subject
     of negotiations, conciliation, arbitration or litigation.
 ---pagebreak---                                     - 92 -
51.4 The final statement of account signed by the Contractor shall consti-
      tute a written discharge of the Contracting Authority confirming that
      the total in the final statement of account represents full and final
      settlement of all monies due to the Contractor under the Contract,
     other than those amounts which are the subject of amicable settle-
     ment, arbitration or litigation. However, such discharge shall
     become effective only after any payment due in accordance with the
     final statement of account has been made and the performance guaran-
      tee referred to in Article 15 has been returned to the Contractor.
51.5 The Contracting Authority shall not be liable to the Contractor for
      any matter or thing whatsoever arising out of, or in connection with,
      the Contract or execution of the Works, unless the Contractor shall
     have included a claim in respect thereof in his draft final statement
      of account.
51.6 The provisions of Article 51 may be varied by the Special Conditions
     having regard to the practices in the State of the Contracting Au-
      thority.
                                ARTICLE 52
                    Direct Payments to Sub-Contractors
52.1 Wnen the Supervisor receives a claim from a sub-contractor duly ap-
     proved under Article 7 to the effect that the Contractor has not met
     his financial obligations so far as the sub-contractor is concerned,
      the Supervisor shall give notice to the Contractor either to pay the
      sub-contractor or to inform him of the reasons why payment should not
     be made. Should such payment not be made, or reasons not be given
     within the period of notice, the Supervisor may, after satisfying
     himself that the work has been carried out, certify, and the
     Contracting Authority shall meet the debt claimed by the sub-
      contractor out of the sums remaining due to the Contractor. The Con-
      tractor shall remain entirely responsible for the work in respect of
     which direct payment has been made.
52.2  If the Contractor gives adequate reasons for refusing to meet all or
     part of the debt claimed by the sub-contractor, the Contracting
     Authority shall only pay to the sub-contractor such sums as are not
      in dispute. Sums claimed by the sub-contractor in respect of which
      the Contractor has given adequate reasons for his refusal to pay
     shall be paid by the Contracting Authority only after the parties
     have come to an amicable settlement, or after the decision of an ar-
     bitrating authority or after a judgment of a court has been duly no-
     tified to the Supervisor.
52.3 Direct payments to sub-contractors shall not exceed the value at Con-
     tract prices of the services performed by the sub-contractors for
     which they request payment; the value at Contract prices shall be
     calculated or assessed on the basis of the Bill of Quantities, the
     Price Schedule or the breakdown of the lump sum price.
 ---pagebreak---                                      - 93 -
52.4 Direct payments   to sub-contractors shall be made entirely in the Na-
      tional Currency  of the country in which the Contract is performed, or
     partly in such   national currency and partly in Foreign Currency, in
      accordance with  the Contract.
52.5 Wnere direct payments to sub-contractors are made in Foreign Cur-
      rency, they shall be calculated in accordance with Article 56. They
      shall not result in any increase in the total amount payable in For-
      eign Currency, as stipulated in the Contract.
52.6 The provisions of Article 52 shall apply subject to the requirements
     of the law applicable by virtue of Article 54 concerning the right to
     payment of creditors who are beneficiaries of an assignment of credit
     or of a collateral security.
                                 ARTICLE 53
                              Delayed Payments
53.1 Payment to the Contractor of the amounts due under each of the in-
      terim payment certificates and the final statement of account issued
     by the Supervisor shall be made by the Contracting Authority within
     90 days of such certificate or statement being delivered to the Con-
      tracting Authority. If the period laid down for payment has been ex-
     ceeded, the Contractor shall qualify for interest calculated pro rata
     on the basis of the number of days delay at the rate specified in the
     Special Conditions, subject to a maximum period, also specified
      therein. The Contractor shall be entitled to such payment without
     prejudice to any other right or remedy under the Contract. In the
     case of the final statement of account, the interest for the delayed
     payment shall be calculated on a daily basis at the rate specified in
      the Special Conditions.
53.2 Any default in payment of more than 120 days from the expiry of the
     period laid down in Article 53.1 shall entitle the Contractor either
     not to perform the Contract or to terminate it.
                                 ARTICLE 54
                          Payments to Third Parties
54.1 All orders for payments to third parties may be carried out only af-
      ter an assignment made in accordance with Article 6. The assignment
      shall be notified to the Contracting Authority.
54.2 Notification of beneficiaries of the assignment shall be the sole re-
     sponsibility of the Contractor.
 ---pagebreak---                                      - 94 -
54.3  In the event of a legally binding attachment of the property of the
     Contractor affecting payments due to him under the Contract, without
      prejudice to the Time Limit laid down in Article 53, the Contracting
     Authority shall have 30 days, starting from the day when it receives
      notification of the definitive lifting of the obstacle to payment, to
      resume payments to the Contractor.
                                 ARTICLE 55
                       Claims for Additional Payment
55.1  If under the Contract there are circumstances which the Contractor
      considers entitle him to additional payment, the Contractor shall:-
      a) if he intends to make any claim for additional payment, give to
         the Supervisor notice of his intention or make such claim within
         15 days after the said circumstances become known to the Contrac-
         tor, stating the reason for his claim; and
      b) as soon as is reasonably practicable after the date of such notice
         but not later than 60 days after such notice, unless otherwise
         agreed by the Supervisor, submit to the Supervisor full and de-
         tailed particulars of his claim. In any event, such particulars
         shall be submitted no later than the date of submission of the
         draft final statement of account. The Contractor shall thereafter
         promptly submit such further particulars as the Supervisor may
         reasonably require to assess the validity of the claim.
55.2 Wnen the Supervisor has received the full and detailed particulars of
      the Contractor's claim that he requires, he shall, without prejudice
      to Article 21.4, after due consultation with the Contracting
     Authority and, where appropriate, the Contractor, determine whether
      the Contractor is entitled to additional payment and notify the par-
      ties accordingly.
55.3 The Supervisor may reject any claim for additional payment which does
     not comply with the requirements of Article 55.
                                 ARTICLE 56
                        Payments in Foreign Currency
     Wnere under the Contract the Contractor is entitled to payments in
     Foreign Currency, the rates of exchange for calculating the payments
      shall be those prevailing, as determined by the Central Bank of the
     State of the Contracting Authority, 30 days prior to the latest date
     fixed for the submission of tenders for the Contract. Such rates of
      exchange shall not be varied.
 ---pagebreak---                                      - 95 -
                        ACCEPTANCE AND MAINTENANCE
                                ARTICLE 57
                              General Clauses
57.1 Verification of the Works by the Supervisor with a view to provi-
      sional or final acceptance shall take place in the presence of the
     Contractor. The absence of the Contractor shall not be a bar to ver-
      ification on condition that the Contractor has been summoned in due
      form at least 30 days prior to the date of verification.
57.2 Should exceptional circumstances make it impossible to ascertain the
      state of the Works or otherwise proceed with their acceptance during
      the period fixed for provisional or final acceptance, a statement
      certifying such impossibility shall be drawn up by the Supervisor
      after consultation, where possible, with the Contractor. The verifi-
      cation shall take place and a statement of acceptance or rejection
      shall be drawn up by the Supervisor within 30 days following the date
     on which such impossibility ceases to exist. The Contractor shall
     not invoke these circumstances in order to avoid his obligation to
     present the Works in a state suitable for acceptance.
                                ARTICLE 58
                            Tests on Completion
58.1 The Works shall not be accepted until the prescribed verifications
     and tests have been carried out at the expense of the Contractor.
     The Contractor shall notify the Supervisor of the date on which such
     verification and tests may commence.
58.2 Works which do not satisfy the terms and conditions of the Contract,
     or in the absence of such terms and conditions, which are not carried
      out in accordance with trade practices in the State where the Works
      are located, shall, if required, be demolished and rebuilt by the
     Contractor or repaired to the satisfaction of the Supervisor, other-
     wise this shall be done as of right after due notice at the expense
      of the Contractor, by order of the Supervisor. The Supervisor may
      also require the demolition and reconstruction by the Contractor, or
      repair to the satisfaction of the Supervisor, under the same condi-
      tions of wotfk, in which unacceptable materials have been used, or
      carried out in the periods of suspension provided for in Article 38.
 ---pagebreak---                                      - 96 -
                                 ARTICLE 59
                             Partial Acceptance
59.1 The Contracting Authority may make use of the various structures,
     parts of structures or sections of the Works forming part of the Con-
      tract as and when they are completed. Any' taking over of the struc-
      tures, parts of structures or sections of the Works by the Contract-
      ing Authority shall be preceded by their partial provisional accep-
     tance. However, Works may in cases of urgency be taken over prior to
     acceptance provided an inventory of outstanding work is drawn up by
     the Supervisor and agreed to by the Contractor and the Supervisor be-
     forehand. Once the Contracting Authority has taken possession of a
     structure, a part thereof or section of the Works, the Contractor
     shall no longer be required to make good any damage resulting other-
     wise than from faulty construction or workmanship.
59.2 The Supervisor may, at the request of the Contractor and if the na-
     ture of the Works so permits, proceed with partial provisional ac-
     ceptance, provided that the structures, parts of structures or sec-
      tions of the Works are completed and suited to the use as described
      in the Contract.
59.3  In the cases of partial provisional acceptance referred to in Article
     59.1 and 59.2 the maintenance period provided for in Article 62
      shall, unless the Special Conditions provide otherwise, run as from
      the date of such partial provisional acceptance.
                                 ARTICLE 60
                           Provisional Acceptance
60.1 The Works shall be taken over by the Contracting Authority when they
     have satisfactorily passed the tests on completion and a certificate
      of provisional acceptance has been issued or is deemed to have been
      issued.
60.2 The Contractor may apply, by notice to the Supervisor, for a certifi-
      cate of provisional acceptance not earlier than 15 days before the
     Works, in the Contractor's opinion, are complete and ready for provi-
      sional acceptance. The Supervisor shall within 30 days after the re-
      ceipt of the Contractor's application either:-
     a) issue the certificate of provisional acceptance to the Contractor
         with a copy to the Contracting Authority stating, where appropri-
         ate, his reservations, and, inter alia, the date on which, in his
         opinion, the Works were completed in accordance with the Contract
         and ready for provisional acceptance; or
     b) reject the application giving his reasons and specifying the ac-
         tion which, in his opinion, is required of the Contractor for the
         certificate to be issued.
 ---pagebreak---                                    - 97 -
60.3 If the Supervisor fails either to issue the certificate of provi-
     sional acceptance or to reject the Contractor's application within
     the period of 30 days, he shall be deemed to have issued the certifi-
     cate on the last day of that period. The certificate of provisional
     acceptance shall not be deemed to be an admission that the Wbrks have
     been completed in every respect. If the Works are divided by the
     Contract into sections, the Contractor shall be entitled to apply for
     separate certificates for each of the sections.
60.4 Upon provisional acceptance of the Works, the Contractor shall dis-
     mantle and remove temporary structures as well as materials no longer
     required for use in connection with the performance of the Contract.
     He shall also remove any litter or obstruction and redress any change
     in the condition of the Site as required by the Contract.
60.5 Immediately after provisional acceptance, the Contracting Authority
     may make use of all the Works as completed.
                               ARTICLE 61
                         Maintenance Obligations
61.1 The Contractor shall be responsible for making good any defect in, or
     damage to, any part of the Works which may appear or occur during the
     Maintenance Period or within 30 days after its expiration and which
     arises either from:-
     a) the use of defective Plant or materials or faulty workmanship or
        design of the Contractor; and/or
     b) any act or omission of the Contractor during the Maintenance Pe-
        riod.
61.2 The Contractor shall at his own cost make good the defect or damage
     as soon as practicable. The Maintenance Period for all items re-
     placed or renewed shall recommence from the date when the replacement
     or renewal was made to the satisfaction of the Supervisor. If the
     Contract provides for partial acceptance, the Maintenance Period
     shall be extended only for the part of the Works affected by the re-
     placement or renewal.
61.3 If any such defect appears or such damage occurs, during the period
     referred to in Article 61.1, the Contracting Authority or the Super-
     visor shall notify the Contractor. If the Contractor fails to remedy
     a defect or damage within the Time Limit stipulated in the notifica-
     tion, the Contracting Authority may:-
 ---pagebreak---                                     - 98 -
     a) carry out the Works himself, or employ someone else to carry out
         the Works, at the Contractor's risk and cost, in which case the
         costs incurred by the Contracting Authority shall be deducted from
         monies due to or from guarantees held against, the Contractor, or
         from both; or
     b) terminate the Contract.
61.4 If the defect or damage is such that the Contracting Authority has
     been deprived substantially of the whole or a part of the benefit of
     the Works, the Contracting Authority shall, without prejudice to any
     other remedy, be entitled to recover all sums paid in respect of the
     parts of the Works concerned together with the cost of dismantling
     such parts and clearing the Site.
61.5  In case of emergency, where the Contractor cannot be reached immedi-
     ately or, having been reached, is unable to take the measures re-
     quired, the Contracting Authority or the Supervisor may have the work
     carried out at the expense of the Contractor. The Contracting Au-
      thority or the Supervisor shall as soon as practicable inform the
     Contractor of the action taken.
61.6 Wnere the Special Conditions stipulate that the maintenance work, ne-
      cessitated by normal wear and tear, shall be carried out by the Con-
      tractor, such work shall be paid for from a Provisional Sum. Deter-
      ioration resulting from the circumstances provided for in Article 21
      or from abnormal use shall be excluded from this obligation unless it
      reveals a fault or defect justifying the request for repair or repla-
      cement under Article 61.
61.7 The maintenance obligations shall be stipulated in the Special Con-
     ditions and technical specifications. If the duration of the Main-
      tenance Period is not specified, it shall be 365 days. The Mainte-
     nance Period shall commence on the date of provisional acceptance.
61.8 After provisional acceptance and without prejudice to the maintenance
      obligations referred to in Article 61, the Contractor shall no longer
      be responsible for risks which may affect the Works and which result
      from causes not attributable to him. However, the Contractor shall
      be responsible as from the date of provisional acceptance for the
      soundness of the construction, as laid down in the Special Conditions
      or in the law of the State of the Contracting Authority.
 ---pagebreak---                                      - 99 -
                                 ARTICLE 62
                              Final acceptance
62.1 Upon the expiration of the Maintenance Period, or where there is more
      than one such period, upon the expiration of the latest period, and
     when all defects or damage have been rectified, the Supervisor shall
      issue to the Contractor a Final Acceptance Certificate and a copy
      thereof to the Contracting Authority stating the date on which the
     Contractor completed his obligations under the Contract to the Super-
     visor's satisfaction. The Final Acceptance Certificate shall be
      given by the Supervisor within 30 days after the expiration of the
      above stated period, or as soon thereafter as any Works as in-
      structed, pursuant to Article 61, have been completed to the satis-
      faction of the Supervisor.
62.2 The Works shall not be considered as completed until a Final Accep-
      tance Certificate shall have been signed by the Supervisor and deliv-
      ered to the Contracting Authority, with a copy to the Contractor.
62.3 Notwithstanding the issue of the Final Acceptance Certificate, the
     Contractor and the Contracting Authority shall remain liable for the
      fulfillment of any obligation incurred under the Contract prior to
      the issue of the Final Acceptance Certificate, which remains
     unperformed at the time such Final Acceptance Certificate is issued.
     The nature and extent of any such obligation shall be determined by
      reference to the provisions of the Contract.
                     BREACH OF CONTRACT ArO TESMINATICN
                                 ARTICLE 63
                             Breach of Contract
63.1 Either party commits a breach of Contract where he fails to discharge
      any of his obligations under the Contract.
63.2 "Where a breach of Contract occurs, the party injured by the breach
      shall be entitled to the following remedies:-
      a) damages; and/or
      b) termination of the Contract.
63.3 Damages may be either:-
      a) General Damages; or
      b) Liquidated Damages.
 ---pagebreak---                                    - 100 -
63.4 In any case where the Contracting Authority is entitled to damages,
     he may deduct such damages from any sums due to the Contractor or
     from the appropriate guarantee.
                                 ARTICLE 64
                  Termination by the Contracting Authority
64.1 The Contracting Authority may, at any time and with immediate effect,
     terminate the Contract, except as provided for under Article 64.2.
64.2 Except as otherwise provided in these General Conditions, the Con-
     tracting Authority may, after giving 7 days notice to the Contractor,
     terminate the Contract and expel the Contractor from the Site in any
     of the cases where:-
     a) the Contractor fails to carry out the Works substantially in ac-
         cordance with the provis the Contract;
     b) the Contractor fails to comply within a reasonable time with a no-
         tice given by the Supervisor requiring him to make good any ne-
        glect or failure to perform his obligations under the Contract
        which seriously affects the proper and timely performance of the
        Works;
     c) the Contractor refuses or neglects to carry out Administrative Or-
        ders given by the Supervisor;
     d) the Contractor assigns the Contract or sub-contracts without the
        authorization of the Contracting Authority;
     e) the Contractor becomes bankrupt or insolvent, or has a receiving
        order made against him, or compounds with his creditors, or car-
        ries on business under a receiver, trustee or manager for the ben-
        efit of his creditors, or goes into liquidation;
     f) any adverse final judgment is made in respect of an offence re-
        lating to the professional conduct of the Contractor;
     g) any other legal disability hindering performance of the Contract
        occurs;
     h) any organizational modification occurs involving a change in the
         legal personality, nature or control of the Contractor, unless
         such modification is recorded in an endorsement to the Contract;
     i) the Contractor fails to provide the required guarantee or insur-
        ance, or if the person providing the earlier guarantee or insur-
        ance is not able to abide by his commitments;
 ---pagebreak---                                     101 -
64.3 Termination shall be without prejudice to any other rights or powers
     under the Contract of the Contracting Authority and the Contractor.
     The Contracting Authority may, thereafter, complete the Works himself
     or conclude any other Contract with a third party for the account of
     the Contractor. The Contractor's liability for delay in completion
     shall immediately cease when the Contracting Authority expels him
     from the Site without prejudice to any liability thereunder that may
     have already occurred.
64.4 The Supervisor shall, upon the issue of the notice of termination of
     the Contract, instruct the Contractor to take immediate steps to
     bring the Works to a close in a prompt and orderly manner and to re-
     duce expenditure to a minimum.
64.5 The Supervisor shall, as soon as is possible after termination, cer-
     tify the value of the Works and all sums due to the Contractor as at
     the date of termination.
64.6 In the event of termination:-
     a) a report of work performed by the Contractor shall be drawn up by
        the Supervisor as soon as possible after inspection of the Works,
        and inventory taken of temporary structures, materials, Plant and
        Equipment. The Contractor shall be summoned to be present during
        the inspection and the taking of the inventory. The Supervisor
        shall also draw up statements of emoluments still owed by the Con-
        tractor to workers employed by him in relation to the Contract and
        of sums owed by the Contractor to the Contracting Authority;
     b) the Contracting Authority shall have the option of acquiring in
        whole or in part temporary structures which have been approved by
        the Supervisor, Plant and materials specifically supplied or manu-
        factured in connection with the execution of work under the Con-
        tract;
     c) the purchase price of the temporary structures, Equipment, Plant
        and materials referred to above shall not exceed the unpaid por-
         tion of the expenditure incurred by the Contractor, such expen-
        diture being limited to that required for the performance of the
        Contract under normal conditions;
     d) the Contracting Authority may purchase, at market prices, the ma-
        terials and items supplied or ordered by the Contractor and not
        already paid for by the Contracting Authority on such conditions
        as the Supervisor considers appropriate.
64.7 The Contracting Authority shall not be obliged to make any further
     payments to the Contractor until the Works are completed, whereupon
     the Contracting Authority shall be entitled to recover from the Con-
     tractor the extra costs, if any, of completing the Works, or pay any
     balance due to the Contractor prior to the termination of the Con-
     tract.
 ---pagebreak---                                    - 102 -
64.8  If the Contracting Authority terminates the Contract, it shall be en-
      titled to recover from the Contractor any loss it has suffered up to
      the maximum amount stated in the Contract. If no maximum amount is
      stated, the Contracting Authority shall not be entitled to recover
     more than the part of the Contract Price corresponding to the value
     of that part of the Works which cannot, by reason of the Contractor's
     failure, be put to the intended use.
64.9 Wnere the termination is not due to an act or omission of the Con-
      tractor, the latter shall be entitled to claim in addition to sums
      owing to him for work already performed, an indemnity for loss suf-
      fered.
                                ARTICLE 65
                       Termination by the Contractor
65.1 The Contractor may, after giving 14 days notice to the Contracting
     Authority, terminate the Contract if the Contracting Authority:-
      a) fails to pay the Contractor the amounts due under any certificate
         issued by the Supervisor after the expiry of the Time Limit stated
         in Article 53.2; or
      b) consistently fails to meet his obligations after repeated remind-
         ers; or
      c) suspends the progress of the Works or any part thereof for more
         than 180 days, for reasons not specified in the Contract, or not
         due to the Contractor's default.
65.2  Such termination shall be without prejudice to any other rights of
      the Contracting Authority or the Contractor under the Contract. Upon
      such termination, the Contractor shall, subject to the law of the
      State of the Contracting Authority, be entitled to immediately remove
     his Equipment from the Site.
65.3  In the event of such termination, the Contracting Authority shall pay
      the Contractor for any loss or damage the Contractor may have suf-
      fered. Such additional payment shall not exceed a limit which has to
     be specified in the Contract.
                                ARTICLE 66
                               Force Majeure
66.1 Neither party shall be considered to be in default or     in breach of
     his obligations under the Contract if the performance of   such obliga-
      tions is prevented by any circumstances of force majeure which arises
     after the date of notification of award or the date when   the Contract
     becomes effective, whichever is the earlier.
 ---pagebreak---                                   - 103 -
66.2 The term "force majeure", as used herein shall mean acts of God,
     strikes, lock-outs or other industrial disturbances, acts of the pub-
     lic enemy, wars whether declared or not, blockades, insurrection, ri-
     ots, epidemics, landslides, earthquakes, storms, lightning, floods,
     washouts, civil disturbances, explosions, and any other similar un-
     foreseeable events, not within the control of either party and which
     by the exercise of due diligence neither party is able to overcome.
66.3 Notwithstanding the provisions of Articles 36 and 64, the Contractor
     shall not be liable to forfeiture of his performance guarantee, liq-
     uidated damages or termination for default if, and to the extent
     that, his delay in performance or other failure to perform his obli-
     gations under the Contract is the result of an event of force
     majeure. The Contracting Authority shall similarly not be liable,
     notwithstanding the provisions of Articles 53 and 65, to payment of
      interest on delayed payments, for non-performance or for termination
     by the Contractor for default, if, and to the extent that, the
     Contracting Authority's delay or other failure to perform its obliga-
     tions is the result of force majeure.
66.4  If either party considers that any circumstances of force majeure
     have occurred which may affect performance of his obligations, he
     shall promptly notify the other party and the Supervisor, giving de-
     tails of the nature, the probable duration and the likely effect of
     the circumstances.    Unless otherwise directed by the Supervisor in
     writing, the Contractor shall continue to perform his obligations un-
     der the Contract as far as is reasonably practicable, and shall seek
     all reasonable alternative means for performance of his obligations
     which are not prevented by the force majeure event. The Contractor
     shall not put into effect such alternative means unless directed so
     to do by the Supervisor.
66.5 If the Contractor incurs additional costs in complying with the Su-
     pervisor's directions or using alternative means under Article 66.4,
     the amount thereof shall be certified by the Supervisor.
66.6 If circumstances of force majeure have occurred and continue for a
     period of 180 days then, notwithstanding any extension of time for
     completion of the Works that the Contractor may by reason thereof
     have been granted, either party shall be entitled to serve upon the
     other 30 days' notice to terminate the Contract. If, at the expiry
     of the period of 30 days, force majeure still continues, the Con-
     tract shall terminate and, in consequence thereof under the law gov-
     erning the Contract, the parties shall be released from further per-
     formance of the Contract.
 ---pagebreak---                                     - 104 -
                                 ARTICLE 67
                                  Decease
67.1 Wnere the Contractor is a natural person, the Contract shall be auto-
     matically terminated if that person dies. However, the Contracting
     Authority shall examine any proposal made by the heirs or beneficia-
      ries if they have notified their wish to continue the Contract. The
     decision of the Contracting Authority shall be notified to those con-
      cerned within 30 days of receipt of such proposal.
67.2 Wnere the Contractor consists of natural persons and one or more of
      them die, a report shall be agreed between the parties on the
     progress of the Works and the Contracting Authority shall decide
     whether to terminate or continue the Contract in accordance with the
     undertaking given by the survivors and by the heirs or beneficiaries,
      as the case may be.
67.3  In the cases provided for in Article 67.1 and 67.2, persons offering
      to continue to perform the Contract shall notify the Contracting Au-
      thority thereof within 15 days of the date of decease.
67.4 Such persons shall be jointly and severally liable, or as otherwise
      stated in the Special Conditions, for the proper performance of the
     Contract to the same extent as the deceased Contractor. Continuation
      of the Contract shall be subject to the rules relating to establish-
     ment of the guarantee provided for in Article 15.
                           SETILBdENTOF DISFUIES
                                 ARTICLE 68
                           Settlement of disputes
68.1 The Contracting Authority and the Contractor shall make every effort
      to amicably settle disputes relating to the Contract which may arise
      between them, or between the Supervisor and the Contractor.
68.2 The Special Conditions shall prescribe:-
      a) the procedure for the amicable settlement of disputes;
     b) the Time Limits within which the amicable settlement procedure may
         be invoked after notification of the dispute to the other party
         and the maximum Time Limit within which such settlement may be
         reached, which may not exceed 120 days from the commencement of
         the adopted procedure;
 ---pagebreak---                                   - 105 -
     c) the Time Limits for responding in writing to a request for amica-
        ble settlement or to other requests permitted during the course of
        that procedure and the consequence of failure to comply with those
        Time Limits.
68.3 The parties may agree to the settlement of the dispute by concilia-
     tion within a specific Time Limit by a third party after the amicable
     settlement procedure adopted has failed.
68.4 The amicable settlement or conciliation procedure adopted shall in
     all cases involve a procedure in which complaints and responses are
     notified to the other party.
68.5 In the absence of an amicable settlement or settlement by concilia-
     tion within the maximum Time Limits specified, the dispute shall:-
     a) in the case of a national contract, be settled in accordance with
        the national    legislation of the State of the Contracting
        Authority; and
     b) in the case of a transnational Contract, be settled by arbitration
        in accordance with the procedural rules adopted by the EBC
        Council.
 ---pagebreak---              - 106 -
                      ANNEX III
    GENERAL CONDITIONS
   FOR SUPPLY CONTRACTS
      FINANCED BY THE
EUROPEAN DEVELOPMENT FUND
         IN THE OCT
 ---pagebreak---                                    - 107 -
                             TABLE OF OONTOHS
                          PRELIMINARY PROVISIONS
                                                        Page
Article 1  Definitions                                  109
Article 2  Law and Language of the Contract             112
Article 3  Order of Precedence of Contract documents    112
Article 4  Notices and VWritten Communications          112
Article 5  Supervisor and Supervisor's Representative   113
Article 6  Assignment                                   113
Article 7  Sub-Contracting                              114
                OBLIGATIONS OP THE CONTRACTING AUnCRITY
Article 8  Supply of Documents                          115
Article 9  Assistance with Local Regulations            116
                       OBLIGATIONS OP THE SUPPLIER
Article 10 General Obligations                          116
Article 11 Performance Guarantee                        117
Article 12 Insurance                                    119
Article 13 Performance Programme                        119
Article 14 Detailed Breakdown of Prices                 120
Article 15 Supplier's Drawings                          120
Article 16 Sufficiency of Tender Prices                 121
Article 17 Patents and Licenses                         122
                         gaMErCR/en* AND DELAYS
Article 18 Commencement Orders                          122
Article 19 Period of Performance                        123
Article 20 Extension of Period of Performance           123
Article 21 Delays in Performance                        124
Article 22 Variations                                   124
Article 23 Suspension                                   126
                        MATERIALS ATOTORKMWSHIP
Article 24 Quality of Supplies                          128
Article 25 Inspection and Testing                       128
Article 26 Property in the Supplies                     129
 ---pagebreak---                                      - 108 -
                                  PAYMENTS          Page
Article 27 General Provisions                        130
Article 28 Provisional Price Contracts               130
Article 29 Advances                                  131
Article 30 Retention Sums                            132
Article 31 Revision of Prices                        132
Article 32  Interim Payments                         133
Article 33 Final Statement of Account                135
Article 34 Payments to Third Parties                 136
Article 35 Delayed Payments                          137
Article 36 Payment in Foreign Currency               137
                        Aa^FIANŒ AND MAINTENANCE
Article 37 Delivery                                  137
Article 38 Verification Operations                   139
Article 39 Provisional Acceptance.                   140
Article 40 \forranty Obligations                     141
Article 41 After Sales Service                       142
Article 42 Final Acceptance                          143
                          BREACHES AND TERMINATION
Article 43 Breach of Contract                        143
Article 44 Termination by the Contracting Authority  144
Article 45 Termination by the Supplier               146
Article 46  Force Majeure.                           146
Article 47 Decease                                   148
                           SETILBdENT OF DISHJIES
Article 48  Settlement of Disputes                   148
 ---pagebreak---                                   - 109-
                         PRELIMINARY PROVISIONS
                                ARTICLE 1
                               Definitions
1.1 The following definitions apply to these General Conditions and to
    the Contract.
    EBC: the European Economic Community.
    OCT: the association of Overseas Countries and Territories with
            the EBC.
    Contract: the signed agreement entered into by the parties for the
            Supplies, including all attachments thereto and all documents
             incorporated therein.
    Supplier: the party with whom the Contracting Authority concludes the
            Contract.
    Contracting Authority: the State or the legal person governed by pub-
            lic or private lawwhich concludes the Contract, or on behalf
            of which the Contract is concluded, with the Supplier.
    The State of the Contracting Authority: the OCT on whose territory
            the Supply Contract is to be executed.
    Supervisor: the government department, legal person governed by pub-
            lic law, or the natural or legal person designated by the
            Contracting Authority in accordance with the law of the State
            of the Contracting Authority, who is responsible for direct-
            ing and/or monitoring the execution of the Supply Contract,
            or to Whom the Contracting Authority may delegate rights
            and/or powers, under the Contract.
    Supervisor's Representative: any natural or legal person, designated
            by the Supervisor as such under the Contract, and empowered
            to represent the Supervisor in the performance of his func-
            tions, and in exercising such rights and/or powers as have
            been delegated to him. Accordingly, where functions, rights
            and/or powers of the Supervisor have been delegated to the
            Supervisor's Representative, references to the Supervisor in-
            clude the Supervisor's Representative.
    Supplies: all items which the Supplier is required to supply to the
            Contracting Authority, including Where necessary, service
            such as installation, testing, commissioning, provision of
            expertise, supervision, maintenance, repair, training and
            other such obligations connected with the items to be pro-
            vided under the Contract.
 ---pagebreak---                               - 110 -
Bill of Quantities: the document containing an itemised breakdown of
          the Supplies to be provided in a unit price contract, indi-
          cating a quantity for each item and the corresponding unit
          price.
Price Schedule: the completed schedule of prices including the break-
          down of the overall price submitted by the Supplier with his
          tender modified as necessary, and forming part of the unit
          price Contract.
Breakdown of the Overall Price: the itemised list of rates and prices
          showing the build-up of the price in a lump sum Contract, but
          not forming part of the Contract
Contract Price: the sum stated in the Contract representing the init-
          ial estimate payable for the provision of the Supplies or
          such other sum as ascertained by the final statement of ac-
          count as due to the Supplier under the Contract.
Drawings: drawings provided by the Contracting Authority and/or the
          Supervisor, and/or drawings provided by the Supplier and ap-
          proved by the Supervisor, for the provision of the Supplies.
Communications: certificates, notices, orders and instructions issued
          under the Contract.
Writing: any handwritten, typewritten or printed communication, in-
          cluding telex, cable and facsimile transmission.
'TOirranty Period: the period stated in the Contract immediately fol-
          lowing the date of provisional acceptance, during which the
          Supplier is required to complete the Contract and to remedy
          defects or faults as instructed by the Supervisor.
Final Acceptance Certificate: certificate(s) issued by the Supervisor
          to the Supplier at the end of the "Warranty Period stating
          that the Supplier has completed his obligations under the
          Contract.
Day:      calendar day.
Time Limits: those periods in the Contract Which shall begin to run
          from the day following the act or event which serves as the
          starting point for those periods. Should the last day of the
          period fall upon a non-working day, the period shall expire
          at the end of the first working day following the last day of
          the period.
Administrative Order: any instruction or order issued by the Super-
          visor to the Supplier in writing regarding the provision of
          the Supplies.
 ---pagebreak---                                     - 111 -
    National Currency: the currency of the State of the Contracting
               Authority.
     Foreign Currency: any permissible currency Which is not the National
               Currency and which is indicated in the Contract.
     Provisional Sum: a sum   included in the Contract and so designated for
               the supply of   goods, materials, plant or services, or for
               contingencies, which sum may be used in whole or in part, or
               not at all, as instructed by the Supervisor.
    Liquidated Damages: the sum stated in the Contract as compensation
               payable by the Supplier to the Contracting Authority for
               failure to complete the Contract or part thereof within the
               periods under the Contract, or as payable by either party to
               the other for any other specific breach identified in the
               Contract.
    General Damages: the sum, not stated beforehand in the Contract,
              Which is awarded by a court or an arbitration tribunal, or
               agreed between the parties, as compensation payable to an in-
               jured party for a breach of the Contract by the other party.
     Special Conditions: the Special Conditions issued by the Contracting
               Authority as part of the invitation to tender, as amended
              where necessary, and incorporated into the Contract, consist-
               ing of:
               a)      amendments to these General Conditions;
               b)      special contractual clauses;
               c)      technical specifications; and
               d)      any other matter related to the Contract.
1.2  The headings and titles in these General Conditions shall not be
     taken as part thereof or be taken into consideration in the interpre-
     tation of the Contract.
1.3 Where the context so permits, words importing the singular shall be
     deemed to include the plural and vice versa and words importing the
    masculine shall be deemed to include the feminine and vice versa.
1.4 "ttfords importing persons or parties shall include firms and companies
     and any organisation having legal capacity.
 ---pagebreak---                                    - 112 -
                                 ARTICLE 2
                     Law and Language of the Contract
2.1 The law of the Contract shall be the law of the State of the Con-
     tracting Authority unless otherwise stated in the Special Conditions.
2.2  In all matters which are not covered by these General Conditions, the
     law of the Contract shall apply.
2.3 The language of the Contract and of all communications between the
    Supplier, Contracting Authority and Supervisor or their representa-
     tives shall be as stated in the Special Conditions.
                                 ARTICLE 3
                Order of precedence of Contract Documents
    Unless otherwise stipulated in the Contract, the order of precedence
    of the Contract documents shall be as stated in the Special Condi-
     tions.
                                 ARTICLE 4
                    Notices and Written Communications
4.1 Unless otherwise specified in the Special Conditions, Communications
    between the Contracting Authority and/or the Supervisor, on the one
    hand, and the Supplier on the other hand, shall be sent by post,
     cable, telex, facsimile transmission, or personal delivery, to the
    appropriate addresses designated by these parties for that purpose.
4.2  If the sender requires evidence of receipt, he shall state such re-
    quirement in the Communication and shall demand such evidence of re-
     ceipt whenever there is a deadline for the receipt of the Communica-
     tion. In any event, the sender shall take all the necessary measures
     to ensure receipt of his Communication.
4.3 Wherever in the Contract provision is made for the giving or issue of
     any notice, consent, approval, certificate or decision, unless other-
    wise specified such notice, consent, approval, certificate or deci-
     sion shall be in writing and the words "notify", "certify", "approve"
     or "decide" shall be construed accordingly. Any such consent, appro-
    val, certificate or decision shall not unreasonably be withheld or
    delayed.
 ---pagebreak---                                   - 113 -
                                 ARTICLE 5
                Supervisor and Supervisor's Representative
5.1 The Supervisor shall carry out the duties specified in the Contract.
    Except as expressly stated in the Contract, the Supervisor shall not
    have authority to relieve the Supplier of any of his obligations
    under the Contract.
5.2 The Supervisor may, from time to time, while retaining ultimate re-
     sponsibility, delegate to the Supervisor's Representative any of the
    duties and authority vested in the Supervisor and he may at any time
     revoke such delegation or replace the representative. Any such de-
     legation, revocation or replacement shall be in writing and shall not
     take effect until a copy thereof has been delivered to the Supplier.
5.3 Any communication given by the Supervisor's Representative to the
    Supplier in accordance with the terms of such delegation shall have
     the same effect as though it had been given by the Supervisor, pro-
    vided that:-
    a) any failure on the part of the Supervisor's Representative to dis-
        approve any Supplies shall not prejudice the authority of the
        Supervisor to disapprove such Supplies and to give the instruc-
        tions necessary for the rectification thereof;
    b) the Supervisor shall be at liberty to reverse or vary the content
        of such Communication.
5.4  Instructions and/or orders issued by the Supervisor shall be by way
    of Administrative Orders. Where applicable, such orders shall be
    dated, numbered and entered in a register and copies thereof deliv-
    ered by hand, where appropriate, to the Supplier's representative.
                                 ARTICLE 6
                                Assignment
6.1 An assignment shall be valid only if it is a written agreement by
    Which the Supplier transfers his Contract or part thereof to a third
    party.
6.2 The Supplier shall not, without the prior written consent of the Con-
    tracting Authority, assign the Contract or any part thereof, or any
    benefit or interest thereunder, except in the following cases:-
    a) a charge, in favour of the Supplier's bankers, of any monies due
        or to become due under the Contract; or
    b) assignment to the Supplier's insurers, of the Supplier's right to
        obtain relief against any other person liable in cases Where the
        insurers have discharged the Supplier's loss or liability.
 ---pagebreak---                                    - 114 -
6.3 For the purpose of Article 6.2, the approval of an assignment by the
    Contracting authority shall not relieve the Supplier of his obliga-
    tions for the part of the Contract already performed or the part not
    assigned.
6.4 If the Supplier has assigned his Contract without authorisation, the
    Contracting Authority may, without giving formal motice thereof, ap-
    ply as of right the sanctions for breach of Contract provided for in
    Articles 43 and 44.
6.5 Assignees must satisfy the eligibility criteria applicable for the
    award of the Contract.
                                ARTICLE 7
                             Sub-contracting
7.1 A sub-contract shall be valid only if it is a written agreement by
    which the Supplier entrusts performance of a part of his Contract to
    a third party.
7.2 The Supplier shall not sub-contract without the prior written autho-
    rization of the Contracting Authority. The elements of the Contract
     to be sub-contracted and the identity of the sub-contractors shall be
    notified to the Contracting Authority. The Contracting Authority
     shall, with due regard to the provisions of Article 4.3, within 30
    days of receipt of the notification, notify the Supplier of his deci-
    sion, stating reasons should he withhold such authorization.
7.3  In the selection of sub-contractors preference shall be given by the
    Supplier to natural persons, companies or firms of the State of the
    Contracting Authority capable of providing the Supplies required on
    similar terms.
7.4 Sub-contractors must satisfy the eligibility criteria applicable for
    the award of the Contract.
7.5 The Contracting Authority shall have no contractual relations with
    the sub-contractors.
7.6 The Supplier shall be responsible for the acts, defaults and negli-
    gence of his sub-contractors and their agents or employees, as if
    they were the acts, defaults or negligence of the Supplier, his
    agents or employees. The approval by the Contracting Authority of
    the sub-contracting of any part of the Contract or of the sub-
    contractor shall not relieve the Supplier of any of his obligations
    under the Contract.
 ---pagebreak---                                   - 115 -
7.7  If a sub-contractor has undertaken any continuing obligation extend-
     ing for a period exceeding that of the Warranty period under the Con-
     tract towards the Supplier in respect of the Supplies provided by the
     sub-contractor, the Supplier shall, at any time after the expiration
    of the Warranty Period, transfer immediately to the Contracting Au-
     thority, at the Contracting Authority's request and cost, the benefit
    of such obligation for the unexpired duration thereof.
7.8  If the Supplier enters into a sub-contract without approval, the Con-
     tracting Authority may, without giving formal notice thereof, apply
    as of right the sanctions for breach of Contract provided for in
    Articles 43 and 44.
                OBLIGATIONS OP THE CONTRACTING AUTTCRITY
                                ARTICLE 8
                           Supply of Documents
8.1 Within 30 days of the establishment of the performance guarantee pro-
    vided for in Article 11, the Supervisor shall provide to the Suppli-
     er, free of charge, a copy of the Drawings prepared for the perfor-
    mance of the Contract as well as two copies of the specifications and
     other Contract documents. The Supplier may purchase additional cop-
     ies of these Drawings, specifications and other documents, insofar as
     they are available. Upon the issue of the warranty certificate or
    upon final acceptance, the Supplier shall return to the Supervisor
     all Drawings, specifications and other Contract documents.
8.2 Unless it is necessary for the purposes of the Contract, the Draw-
     ings, specifications and other documents provided by the Contracting
    Authority shall not be used or communicated to a third party by the
    Supplier without the prior consent of the Supervisor.
8.3 The Supervisor shall have authority to issue to the Supplier, Admini-
     strative Orders incorporating such supplementary Drawings and in-
     structions as shall be necessary for the proper and adequate execu-
     tion of the Contract and the remedying of any defects therein.
 ---pagebreak---                                   - 116 -
                                ARTICLE 9
                    Assistance with Local Regulations
9.1  The Supplier may request the assistance of the Contracting Authority
     in obtaining copies of laws, regulations, and information on local
     customs, orders or bye laws of the country to which the Supplies are
     to be delivered, Which may affect the Supplier in the performance of
     his obligations under the Contract. The Contracting Authority may
     provide the assistance requested to the Supplier at the Supplier's
     cost.
9.2  The Supplier shall submit to the Contracting Authority in good time
     such details of the Supplies as will enable the Contracting Authority
     to obtain all necessary import permits or licenses.
9.3  The Contracting Authority shall obtain all import permits or licenses
     required for the Supplies, or any part thereof, in reasonable time
     having regard to the time for delivery of the Supplies and completion
     of the Contract.
9.4  Subject to the provisions of the laws and regulations on foreign
     labour of the State in Which the Supplies are to be delivered, the
     Contracting Authority shall make all efforts necessary, to facilitate
     the procurement by the Supplier of all required visas and permits,
     including work and residence permits, for the personnel whose service
     the Supplier and the Contracting Authority consider necessary as well
     as residence permits for their families.
                       OBLIGATIONS OP THE SUPPLIER
                                ARTICLE 10
                           General Obligations
10.1 The Supplier shall perform the Contract with due care and diligence
     including, where specified, the design, manufacture, delivery to
     site, erecting, testing and commissioning of the Supplies and carry-
     ing out any other work including the remedying of any defects in the
     Supplies. The Supplier shall also provide all necessary equipment,
     superintendence, labour and facilities required for the performance
     of the Contract.
10.2 The Supplier shall comply with Administrative Orders given by the
     Supervisor. Where the Supplier considers that the requirements of an
     Administrative Order go beyond the authority of the Supervisor or the
     scope of the Contract he shall, on pain of being time-barred, give
     notice, with reasons, to the Supervisor within 30 days after receipt
     thereof. Execution of the Administrative Order shall not be suspend-
     ed because of this notice.
 ---pagebreak---                                  - 117 -
10.3 The Supplier shall respect and abide by all laws and regulations in
     force in the State of the Contracting Authority and shall ensure that
     his personnel, their dependents, and his local employees also respect
     and abide by all such laws and regulations. The Supplier shall in-
     demnify the Contracting Authority against any claims and proceedings
     arising from any infringement by the Supplier, his employees and
     their dependents of such laws and regulations.
10.4 If the Supplier or any of his sub-contractors, agents or servants of-
     fers to give or agrees to offer or to give or gives to any person,
     any bribe, gift, gratuity or commission as an inducement or reward
     for doing or forbearing to do any act in relation to the Contract or
     any other Contract with the Contracting Authority, or for showing
     favour or disfavour to any person in relation to the Contract or any
     other Contract with the Contracting Authority, then the Contracting
     Authority may, without prejudice to any accrued rights of the Suppli-
     er under the Contract, terminate the Contract in which case the pro-
     visions of Articles 43 and 44 hereof shall apply.
10.5 The Supplier shall treat all documents and information received in
     connection with the Contract as private and confidential, and shall
     not, save insofar as may be necessary for the purposes of the execu-
     tion thereof, publish or disclose any particulars of the Contract
     without the prior consent in writing of the Contracting Authority or
     the Supervisor after consultation with the Contracting Authority. If
     any disagreement arises as to the necessity for any publication or
     disclosure for the purpose of the Contract, the decision of the Con-
     tracting Authority shall be final.
10.6 If the Supplier is a joint venture or consortium of two or more per-
     sons, all such persons shall be jointly and severally bound to fulfil
     the terms of the Contract according to the law of the State of the
     Contracting Authority and shall, at the request of the Contracting
     Authority, designate one of such persons to act as leader with au-
     thority to bind the joint venture or consortium. The composition or
     the constitution of the joint venture or consortium shall not be al-
     tered without the prior consent of the Contracting Authority.
                               ARTICLE 11
                          Performance Guarantee
11.1 The Supplier shall, within 30 days after the receipt of the notifica-
     tion of the award of Contract, furnish to the Contracting Authority a
     guarantee for the full and proper performance of the Contract. The
     amount of the guarantee shall be as specified in the Special Condi-
     tions and shall not exceed 109b of the Contract Price including any
     amounts stipulated in riders to the Contract, save Where the Special
     Conditions provide otherwise; however, it may in no case exceed 20%
     of such price.
 ---pagebreak---                                   - 118 -
11.2 The performance guarantee shall be held against payment to the Con-
     tracting Authority for any loss resulting from the Supplier's failure
     to fully and properly perform his obligations under the Contract.
11.3 The performance guarantee shall be in the format given in the Special
     Conditions and may be provided in the form of a bank guarantee, a
     banker's draft, a certified cheque, a bond provided by an insurance
     and/or bonding company, an irrevocable letter of credit or a cash de-
     posit made with the Contracting Authority. If the performance guar-
     antee is to be provided in the form of a bank guarantee, a banker's
     draft, a certified cheque or a bond, it shall be issued by a bank or
     bonding and/or    insurance company approved by the Contracting
     Authority in accordance with the eligibility criteria applicable for
     the award of the Contract.
11.4 Unless stated otherwise in the Special Conditions, the performance
     guarantee shall be denominated in the types and proportions of cur-
     rencies in which the Contract is payable.
11.5 No payments shall be made in favour of the Supplier prior to the pro-
     vision of the guarantee. The guarantee shall continue to remain
     valid until the Contract has been fully and properly performed.
11.6 During the performance of the Contract, if the natural or legal per-
     son providing the guarantee is not able to abide by his commitments,
     the guarantee shall cease to be valid. The Contracting Authority
     shall give formal notice to the Supplier to provide a new guarantee
     on the same terms as the previous one. Should the Supplier fail to
     provide a new guarantee, the Contracting Authority may terminate the
     Contract.
11.7 The Contracting Authority shall demand payment from the guarantee of
     all sums for which the guarantor is liable under the guarantee due to
     the Supplier's default under the Contract, in accordance with the
     terms of the guarantee and up to the value thereof. The guarantor
     shall, without delay, pay those sums upon demand from the Contracting
     Authority and may not raise any objection for any reason Whatsoever.
     Prior to making any claim under the performance guarantee, the
     Contracting Authority shall notify the Supplier stating the nature of
     the default in respect of which the claim is to be made.
11.8 Except for such part as may be specified in the Special Conditions in
     respect of after-sales service, the performance guarantee shall be
     released within 30 days of the issue of the signed final statement of
     account referred to in Article 33.
 ---pagebreak---                                    - 119
                                ARTICLE 12
                                 Insurance
12.1 Without prejudice to Article 37 the Special Conditions may require
      that the carriage of Supplies shall be covered by an insurance policy
      the terms of which may be laid down therein. The Special Conditions
     may also make provision for other types of insurance to be borne by
      the Supplier.
12.2 Notwithstanding the obligations of the Supplier to insure in accor-
     dance with Article 12.1, the Supplier shall be solely liable and
     shall indemnify the Contracting Authority and the Supervisor against
     any claims by third parties for damage to property or personal inju-
     ries arising from the execution of the Contract by the Supplier, his
      sub-contractors and employees in connection with the Contract.
                                ARTICLE 13
                           Performance Programme
13.1  If the Special Conditions so require, the Supplier shall submit for
      the approval of the Supervisor a programme of performance of the Con-
      tract. The programme shall contain at least the following :-
     a) the order in Which the Supplier proposes to execute the Contract
         including design, manufacture, delivery to place of acceptance,
         installation, testing and commissioning;
     b) the Time Limits within Which submission and approval of the Draw-
         ings are required;
      c) a general description of the methods Which the Supplier proposes
         to adopt for executing the Contract; and
     d) such further details and information as the Supervisor may reason-
         ably require.
13.2 The approval of the programme by the Supervisor shall not relieve the
     Supplier from any of his obligations under the Contract.
13.3 No material alteration to the programme shall be made without the ap-
     proval of the Supervisor. If, however, the progress of the perfor-
     mance of the Contract does not conform to the programme, the Super-
     visor may instruct the Supplier to revise the programme and submit
     the revised programme to him for approval.
 ---pagebreak---                                      - 120 -
                                 ARTICLE 14
                       Detailed Breakdown of Prices
14.1 Where appropriate and within a period of not more than 20 days fol-
      lowing the Supervisor's reasoned request, the Supplier shall provide
     a detailed breakdown of his rates and prices, where such breakdown is
      required for any purpose under the Contract.
14.2 After the notification of award of Contract, the Supplier shall,
     Where appropriate and within the Time Limits stated in the Special
     Conditions, provide to the Supervisor for his information only, a de-
      tailed cash flow estimate, in quarterly periods, of all payments
     which may be due to the Supplier under the Contract. The Supplier
     shall subsequently supply revised cash flow estimates at quarterly
      intervals, if so required by the Supervisor. The Communication shall
     not impose any liability whatsoever on the Contracting Authority or
      the Supervisor
                                ARTICLE 15
                            Supplier's Drawings
15.1  If the Special Conditions so provide, the Supplier shall submit to
      the Supervisor for approval:-
     a) such drawings, documents, samples, and/or models as may be speci-
         fied in the Contract within the Time Limits laid down therein or
         in the programme of performance;
     b) such drawings as the Supervisor may reasonably require for the
         performance of the Contract.
15.2  If the Supervisor fails to notify his decision of approval referred
      to in Article 15.1 within the Time Limits required by the Contract or
      the approved programme of performance, such drawings, documents, sam-
     ples or models shall be deemed to be approved at the end of the Time
     Limit specified. If no Time Limit is specified they shall be deemed
      to be approved 30 days after receipt.
15.3 Approved Drawings, documents, samples and models shall be signed or
     otherwise identified by the Supervisor and shall not be departed from
     except as otherwise instructed by the Supervisor. Any Supplier's
     drawings, documents, samples or models Which the Supervisor fails to
     approve, shall be forthwith modified to meet the requirements of the
     Supervisor and resubmitted by the Supplier for approval.
15.4 The Supplier shall supply additional copies of approved Drawings in
     the form and numbers stated in the Contract or in subsequent Admini-
     strative Orders.
 ---pagebreak---                                    - 121 -
15.5 The approval of the Drawings, documents, samples or models shall not
     relieve the Supplier from any of his obligations under the Contract.
15.6 The Supervisor shall have the right at all reasonable times to in-
     spect all Contract Drawings, documents, samples or models at the Sup-
     plier's premises.
15.7 Before provisional acceptance of the Supplies, the Supplier shall
     supply operation and maintenance manuals together with drawings,
     which shall be in such detail as will enable the Contracting Authori-
     ty to operate, maintain, adjust and repair all parts of the Supplies.
     Unless otherwise stated in the Special Conditions, the manuals and
     drawings shall be in the language of the Contract and in such forms
     and numbers as stated in the Contract. The Supplies shall not be
     considered to be completed for the purpose of provisional acceptance
     until such manuals and drawings have been supplied to the Contracting
     Authority.
                                ARTICLE 16
                       Sufficiency of Tender Prices
16.1 Subject to any additional provisions which may be laid down in the
     Special Conditions, the Supplier shall be deemed to have satisfied
     himself before submitting his tender as to the correctness and suffi-
     ciency of the tender and to have taken account of all that is re-
     quired for the full and proper performance of the Contract and to
     have included in his rates and prices all costs related to the Sup-
     plies, in particular:-
     a) the costs of transport;
     b) the costs of handling, packing, loading, unloading, transit, de-
        livery, unpacking, checking, insurance, and other administrative
        costs in connection with the Supplies. The packaging shall be the
        property of the Contracting Authority unless the Special Condi-
        tions provide otherwise;
     c) the cost of documents relating to the Supplies Where such docu-
        ments are required by the Contracting Authority;
     d) performance and supervision of on-site assembly and/or start up of
        the delivered Supplies;
     e) furnishing of tools required for assembly and/or maintenance of
        the delivered Supplies;
     f) furnishing of detailed operation and maintenance manual for each
        unit of the delivered Supplies, as specified in the Contract;
 ---pagebreak---                                       - 122 -
     g) supervision or maintenance and/or repair of the Supplies, for a
        period of time stated in the Contract, provided that this service
        shall not relieve the Supplier of any warranty obligations under
        the Contract; and
     h) training of the Contracting Authority's personnel, at the Suppli-
        er's factory and/or elsewhere as specified in the Contract.
16.2 Since the Supplier is deemed to have determined his prices on the ba-
     sis of his own calculations, operations and estimates, he shall carry
     out without additional charge any work which is the subject of any
     item Whatsoever in his tender for Which he neither indicates a unit
     price nor a firm sum.
                                  ARTICLE 17
                           Patents and Licenses
     Save Where otherwise provided in the Special Conditions, the Supplier
     shall indemnify the Contracting Authority and the Supervisor against
     any claim resulting from the use, as specified in the Contract, of
     patents, licences, Drawings, designs, models, or brand or trade
     marks, except Where such infringement results from compliance with
     the design or specifications provided by the Contracting Authority
     and/or the Supervisor.
                         Œ M d E N C M N r AND DELAYS
                                  ARTICLE 18
                            Commencement Orders
18.1 The Contracting Authority shall fix the date on Which performance of
     the Contract is to commence, and advise the Supplier either in the
     notification of award of Contract or by Administrative Order issued
     by the Supervisor.
18.2 The date for commencing performance shall be no later than 180 days
     following notification of award of Contract unless agreed otherwise
     by the parties.
 ---pagebreak---                                     - 123 -
                                ARTICLE 19
                          Period of Performance
19.1 The period of performance shall commence on the date fixed in accor-
     dance with Article 18.1 and shall be as stated in the Contract, with-
     out prejudice to extensions of the period Which may be granted under
     Article 20.
19.2 If provision is made for separate periods of performance for supply
     in separate lots, such periods shall not be aggregated in cases where
     one Supplier is allocated more than one lot.
                                ARTICLE 20
                    Extension of Period of Performance
20.1 The Supplier may request an extension to the period of performance if
     he is or will be delayed in completing the Contract by any of the
     following causes:-
     a) extra or additional Supplies ordered by the Contracting Authority.
     b) exceptional weather conditions in the State of the Contracting Au-
        thority which may affect installation or erection of the Supplies;
     c) physical obstructions or conditions Which may affect delivery of
        the Supplies, Which could not reasonably have been foreseen by a
        competent Supplier;
     d) Administrative Orders affecting the date of completion other than
        those arising from the Supplier's default;
     e) failure of the Contracting Authority to fulfil his obligations
        under the Contract;
     f) any suspension of the delivery and/or installation of the Supplies
        which is not due to the Supplier's default;
     g) force majeure;
     h) any other causes referred to in these General Conditions which are
        not due to the Supplier's default.
20.2 The Supplier shall, within 15 days of becoming aware that delay may
     occur, notify the Supervisor of his intention to make a request for
     extension of the period of performance to which he considers himself
     entitled, and shall within 60 days thereafter, except where otherwise
     agreed between the Supplier and the Supervisor, deliver to the Super-
     visor full and detailed particulars of the request, in order that
     such request may be investigated at the time.
 ---pagebreak---                                     - 124 -
20.3 The Supervisor shall, by written notice to the Supplier after due
     consultation with the Contracting Authority and where approriate, the
     Supplier, grant such extension of the period of performance as may be
      justified, either prospectively or retrospectively or, inform the
     Supplier that he is not entitled to an extension.
                                 ARTICLE 21
                           Delays in Performance
21.1  If the Supplier fails to deliver any or all of the goods or perform
      the services within the time period(s) specified in the Contract, the
     Contracting Authority shall, without formal notice and without preju-
     dice to his other remedies under the Contract, be entitled to Liqui-
     dated Damages for every day or part thereof which shall elapse be-
      tween the end of the period specified for performance, or extended
     performance under Article 20, and the actual date of completion, at
      the rate and up to the maximum amount specified in the Special Con-
     ditions.
21.2  If the Contracting Authority has become entitled to the maximum claim
     under Article 21.1 he may, after giving notice to the Supplier:-
     a) seize the performance guarantee; and/or
     b) terminate the Contract; and
     c) enter into a contract with a third party at the Supplier's cost
         for the provision of the balance of the Supplies.
                                ARTICLES 22
                                 Variations
22.1 The Supervisor shall have power to order any variation to any part of
     the Supplies necessary for the proper completion and/or functioning
     of the Supplies. Such variations may include additions, omissions,
     substitutions, changes in quality, quantity, form, character, kind,as
     well as Drawings, designs or specifications where the Supplies are to
     be specifically manufactured for the Contracting Authority, method of
     shipment or packing, place of delivery, and in the specified se-
     quence, method or timing of execution of the Supplies. No order for
     a variation shall have the effect of invalidating the Contract, but
     the financial effect, if any, of all such variations shall be valued
      in accordance with Article 22.5 and 22.7.
 ---pagebreak---                                    - 125 -
22.2 No variation shall be made except by Administrative Order, provided
     that:-
     a) if for any reason, the Supervisor shall find it necessary to give
        an order orally, he shall as soon as possible thereafter confirm
        the order by an Administrative Order;
     b) if the Supplier shall confirm in writing an oral order given for
        the purpose of Article 22.2 (a) and the confirmation shall not be
        contradicted in writing forthwith by the Supervisor, an Admini-
        strative Order shall be deemed to have been issued for the varia-
        tion.
     c) an Administrative Order for variation shall not be required for
        increase or decrease in the quantity of any work Where such in-
        crease or decrease is the result of the quantity exceeding or
        being less than that stated in the Bill of Quantities or Price
        Schedule.
22.3 Save as provided by Article 22.2, prior to any Administrative Order
     for variation, the Supervisor shall notify the Supplier of the nature
     and form of such variation. As soon as possible, after receiving
     such notice, the Supplier shall submit to the Supervisor a proposal
     containing:-
     a) a description of the tasks, if any, to be performed or the mea-
        sures to be taken and a programme for execution; and
     b) any necessary modifications to the programme of performance or to
        any of the Supplier's obligations under the Contract; and
     c) any adjustment to the Contract Price in accordance with the rules
        as set out in Article 22.
22.4 Following the receipt of the Supplier's submission referred to in
     Article 22.3, the Supervisor shall, after due consultation with the
     Contracting Authority and, where appropriate, the Supplier, decide as
     soon as possible whether or not the variation shall be carried out.
     If the Supervisor decides that the variation shall be carried out he
     shall issue the Administrative Order stating that the variation shall
     be carried out at the prices and under the conditions given in the
     Supplier's submission referred to in Article 22.3 or as modified by
     the Supervisor in accordance with Article 22.5.
22.5 The prices for all variations ordered by the Supervisor in accor-
     dance with Articles 22.2 and 22.4 shall be ascertained by the Super-
     visor in accordance with the following principles:-
     a) Where the task is of similar character and executed under similar
        conditions to an item priced in the Bill of Quantities or Price
        Schedule it shall be valued at such rates and prices contained
        therein;
 ---pagebreak---                                     - 126 -
     b) Where the task is not of a similar character or is not executed
         under similar conditions, the rates and prices in the Contract
         shall be used as the basis for valuation so far as is reasonable,
         failing which, a fair valuation shall be made by the Supervisor;
     c) if the nature or amount of any variation relative to the nature or
         amount of the Whole of the Contract or to any part thereof shall
         be such that in the opinion of the Supervisor any rate or price
         contained in the Contract for any item of work is by reason of
         such variation rendered unreasonable, then the Supervisor shall
         fix such rate or price as in the circumstances he shall think rea-
         sonable and proper;
     d) Where a variation is necessitated by default or breach of Contract
         by the Supplier, any additional cost attributable to such varia-
         tion shall be borne by the Supplier.
22.6 On receipt of the Administrative Order requesting the variation, the
     Supplier shall proceed to carry out the variation and be bound by
      these General Conditions in so doing as if such variation were stated
      in the Contract. The Supplies shall not be delayed pending the
     granting of any extension of time for completion or adjustment to the
     Contract Price. Where the order for a variation precedes the adjust-
     ment to the Contract Price, the Supplier shall keep records of the
      costs of undertaking the variation and of time expended thereon.
     Such records shall be open to inspection by the Supervisor at all
      reasonable times.
22.7 Where on provisional acceptance, an increase or reduction in the
      total value of supplies required under the Contract resulting from an
     Administrative Order, or from some other circumstance Which is not
      caused by the Supplier's default, exceeds 15% of the Contract price,
      the Supervisor shall, after consultation with the Contracting Author-
      ity and the Supplier determine any additions to or reduction from the
     Contract Price as a consequence of the application of Article 22.5.
     The sum so determined shall be based on the amount by which the in-
      crease or decrease in value of the Supplies exceeds 15%. The sum
      shall be notified by the Supervisor to the Contracting Authority and
      the Supplier and the Contract Price adjusted accordingly.
                                ARTICLE 23
                                 Suspension
23.1 The Supervisor may, by Administrative Order, at any time, instruct
     the Supplier to suspend:-
     a) progress of the manufacture of the Supplies; or
     b) delivery of Supplies to the place of acceptance at the time speci-
         fied for delivery in the performance programme or, if no time is
         specified, at the time appropriate for it to be delivered; or
 ---pagebreak---                                   - 127
     c) the installation of the Supplies which have been delivered to the
        place of acceptance.
23.2 The Supplier shall, during suspension, protect and secure the Sup-
     plies affected at the Supplier's warehouse or elsewhere, against any
     deterioration, loss or damage to the extent possible and as instruct-
     ed by the Supervisor, even if the Supplies have been delivered to the
     place of acceptance in accordance with the Contract but Whose instal-
     lation has been suspended by the Supervisor.
23.3 Additional expenses incurred in connection with such protective mea-
     sure shall be added to the Contract Price. The Supplier shall not be
     entitled to be paid any additional expenses if the suspension is:-
     a) otherwise provided for in the Contract; or
     b) necessary by reason of normal climatic conditions at the place of
        acceptance; or
     c) necessary by reason of some default of the Supplier; or
     d) necessary for the safety or the proper execution of the Contract
        or any part thereof insofar as such necessity does not arise from
        any act or default by the Supervisor or the Contracting Authority.
23.4 The Supplier shall not be entitled to such additions to the Contract
     Price unless he notifies the Supervisor, within 30 days after receipt
     of the order to suspend progress or delivery.of his intention to make
     a claim for them.
23.5 The Supervisor, after consultation with the Contracting Authority and
     the Supplier, shall determine such extra payment and/or extension of
     the period of performance to be made to the Supplier in respect of
     such claim as shall, in the opinion of the Supervisor, be fair and
     reasonable.
23.6 If the period of suspension exceeds 180 days, and the suspension is
     not due to the Supplier's default, the Supplier may, by notice to the
     Supervisor, request permission to proceed with the Supplies within 30
     days, or terminate the Contract.
 ---pagebreak---                                     - 128 -
                         MATERIALS AT© WORKMANSHIP
                                 ARTICLE 24
                            Quality of Supplies
24.1 The Supplies must in all respects satisfy the technical specifica-
      tions laid down in the Special Conditions and conform in all respects
     with the Drawings, surveys, models, samples, patterns, and other re-
     quirements in the Contract which shall be held at the disposal of the
     Contracting Authority or the Supervisor for the purposes of iden-
      tification throughout the period of performance.
24.2 Any preliminary technical acceptance stipulated in the Special Condi-
      tions shall be the subject of a request sent by the Supplier to the
     Supervisor. The request shall indicate the specification of the ma-
      terials, items and samples submitted for such acceptance according to
      the Contract, the lot number and the place Where acceptance is to
      take place, as appropriate. The materials, items and samples speci-
     fied in the request must be certified by the Supervisor as meeting
     the requirements for such acceptance prior to their incorporation in
     the Supplies.
24.3 Even if materials or items to be incorporated in the Supplies or in
     the manufacture of components to be supplied have been technically
     accepted in this way, they may still be rejected and must be replaced
     immediately by the Supplier if a further examination reveals defects
     or faults. The Supplier may be given the opportunity to repair and
     make good materials and items Which have been rejected, but such ma-
     terials and items will be accepted for incorporation in the Supplies
     only if they have been repaired and made good to the satisfaction of
     the Supervisor.
                                 ARTICLE 25
                           Inspection and Testing
25.1 The Supplier shall ensure that the Supplies are delivered to the
     place of acceptance in time to allow the Supervisor to proceed with
     acceptance of the Supplies. The Supplier is deemed to have fully ap-
     preciated the difficulties Which he might encounter in this respect,
     and he shall not be permitted to advance any grounds for delay in
     fulfilling his obligations.
25.2 The Supervisor shall be entitled either by himself or his agent, from
     time to time, to inspect, examine, measure and test the components,
     materials and workmanship, and check the progress of preparation,
     fabrication or manufacture of anything being prepared, fabricated or
     manufactured for delivery under the Contract in order to establish
 ---pagebreak---                                     - 129 -
      whether the components, materials and workmanship are of the requi-
       site quality and quantity. This shall take place at the place of man-
      ufacture, fabrication or preparation or at the place of acceptance or
       at such other places as may be specified in the Contract.
25.3   For the purposes of such tests and inspections, the Supplier shall:-
  •-—•-a) provide to the Supervisor, temporarily and free of charge, such
          assistance, test samples or parts, machines, equipment, tools,
          labour, materials, Drawings and production data as are normally
          required for inspection and testing;
       b) agree, with the Supervisor, on the time and place for tests;
       c) provide access for the Supervisor at all reasonable times to the
          place where the tests are to be carried out.
25.4   If the Supervisor is not present on the date agreed for tests, the
       Supplier may, unless otherwise instructed by the Supervisor, proceed
      with the tests, Which shall be deemed to have been made in the Super-
       visor's presence. The Supplier shall forthwith forward duly certi-
       fied copies of the test results to the Supervisor, Who shall, if he
       has not attended the test, be bound by the test results.
25.5 When components and materials have passed the tests referred to in
      Article 25, the Supervisor shall notify the Supplier or endorse the
       Supplier's certificate to that effect.
25.6   If the Supervisor and the Supplier disagree on the test results, each
       shall give a statement of his views to the other within 15 days after
       such disagreement arises. The Supervisor or the Supplier may require
       such tests to be repeated on the same terms and conditions or, if
       either party so requests, by an expert to be selected by common con-
       sent. All test reports shall be submitted to the Supervisor who
       shall communicate the results of these tests without delay to the
       Supplier. The results of the retesting shall be conclusive. The
       cost of retesting shall be borne by the party Whose views are proved
      wrong by the retesting.
25.7   In the performance of his duties, the Supervisor and all persons au-
       thorized by him shall disclose only to those persons Who are entitled
       to know of it information Which he has obtained by reason of his in-
       spection and testing of the methods of manufacture and operation of
       the undertaking.
                                  ARTICLE 26
                           Property in the Supplies
26.1   The Special Conditions may provide that the Supplier, for the purpose
       of securing payment under Article 32 in respect of any part of the
       Supplies before delivery to the place of acceptance, shall:-
 ---pagebreak---                                     - 130 -
     a) vest that part of the Supplies in the Contracting Authority; or
     b) make that part of the Supplies subject to a lien in favour of the
        Contracting Authority; or
     c) make that part of the Supplies subject to any other arrangement
        regarding priority interest or security.
26.2 Upon termination of the Contract before completion, the Supplier
     shall deliver to the Contracting Authority any part of the Supplies
     the property in Which has vested in the Contracting Authority or been
     made subject to a lien by virtue of Article 26.1. If he fails to do
     so the Contracting Authority may take such appropriate action as it
     deems fit in order to obtain possession of such Supplies, and recover
     the cost of so doing from the Supplier.
                                 PAYMENTS
                                ARTICLE 27
                            General Provisions
27.1 Payments shall be made in the National Currency except as otherwise
     stipulated in the Contract.
27.2 The administrative or technical conditions to Which the payment of
     advances, interim and/or final payments made in accordance with
     Articles 28 to 36 are subject, shall be as stated in the Special Con-
     ditions.
                                ARTICLE 28
                       Provisional Price Contracts
28.1 In exceptional cases, where all the prices cannot be predetermined, a
     provisional price contract may be awarded after consultation and
     agreement between the Contracting Authority and the Supplier. The
     amount of the Contract shall be determined initially on the basisof
     provisional prices and, after the conditions for performance of the
     Contract are known, by the procedure specified in the Special
     Conditions.
28.2 The Supplier shall supply such information as the Contracting Author-
     ity or the Supervisor may reasonably require in respect of any matter
     relating to the Contract for the purpose of the calculation. Where
     agreement cannot be reached on the valuation of the Supplies, the
     amounts payable shall be determined by the Supervisor.
 ---pagebreak---                                    - 131 -
                                ARTICLE 29
                                 Advances
29.1 Unless otherwise provided in the Special Conditions, advances shall
     be granted to the Supplier, at his request, for operations connected
     with the provision of the Supplies as a lump-sum advance.
29.2 Subject to the provisions of the Special Conditions, the total amount
     of the advances shall not exceed 6 0 % of the Contract Price.
29.3 No advance shall be granted until:-
     a) the conclusion of the Contract;
     b) provision to the Contracting Authority by the Supplier of the per-
         formance guarantee in accordance with Article 11; and
     c) provision to the Contracting Authority by the Supplier of a sepa-
         rate directly liable guarantee for the full amount of the advance
         by the institutions referred to in Article 11.3, Which shall re-
         main effective for at least 60 days after provisional acceptance
         of the Supplies.
29.4 The Supplier shall use the advance exclusively for operations con-
     nected with the provision of the Supplies. Should the Supplier misuse
     any portion of the advance, it shall become due and repayable immedi-
     ately and no further advance payment shall be made to him.
29.5 Should the advance guarantee cease to be valid and the Supplier fail
     to re-validate it, either a deduction equal to the amount of the ad-
     vance may be made by the Contracting Authority from future payments
     due to the Supplier under the Contract, or the Contracting Authority
     may apply the provisions of Article 11.6
29.6  If the Contract is terminated for any reason Whatsoever, the guaran-
     tees securing the advances may be invoked forthwith in order to repay
      the balance of the advances still owed by the Supplier, and the guar-
     antor shall not delay payment or raise objection for any reason
     whatever.
29.7 The advance guarantee provided for in Article 29 shall not be re-
      leased before provisional acceptance of the Supplies but shall be re-
     leased within 60 days thereafter.
29.8 Further conditions and procedures for granting and repaying advances
     shall be as laid down in the Special Conditions.
 ---pagebreak---                                   - 132 -
                                ARTICLE 30
                              Retention Sums
30.1 The sum which shall be retained from interim payments byway of guar-
     antee to meet the Supplier's obligations during the Warranty Period,
     and the detailed rules governing that guarantee, shall be as stipu-
     lated in the Special Conditions, provided that it shall, in no case
     exceed 10% of the Contract Price.
30.2 Subject to the approval of the Contracting Authority, the Supplier
     may, if he so wishes, substitute, not later than the provisional ac-
     ceptance of the Supplies, these retention sums by a retention guaran-
     tee issued in accordance with Article 11.3.
30.3 The sum retained or the retention guarantee shall be released within
     90 days of the date of final acceptance of the Supplies.
                                ARTICLE 31
                            Revision of Prices
31.1 Unless otherwise stipulated in the Special Conditions, and except as
     provided in Article 31.4, Contracts shall be at fixed prices which
      shall not be revised.
31.2 Where prices may be revised under the Contract, such revision shall
      take into account variations in the prices of significant local or
      external elements which served as a basis for the calculation of the
      tender price, such as manpower, services, materials and supplies, as
     well as charges laid down by law or regulation. The detailed rules
     for the revision shall be as laid down in the Special Conditions.
31.3 Prices contained in the Supplier's tender shall be deemed:-
     a) to have been arrived at on the basis of the conditions in force 30
         days prior to the latest date fixed for submission of tenders or,
         in the case of direct agreement Contracts, on the date the Con-
         tract.
     b) to have taken account of the legislation and the relevant tax ar-
         rangements applicable at the reference date fixed in Article 31.3
         (a).
 ---pagebreak---                                    - 133 -
31.4 In the event of changes to, or introduction of, any national or State
     statute, ordinance, decree or other law, or any regulation or bye-law
     of any local or other public authority, after the date stated in
     Article 31.3 which causes a change in the contractual relationship
     between parties to the Contract, the Contracting Authority and the
     Supplier shall consult on how best to proceed further under the Con-
     tract, and may as a result of such consultation decide:-
     a) to modify the Contract; or
     b) on payment of compensation for the resulting      imbalance by one
         party to the other; or
     c) to terminate the Contract by mutual agreement.
31.5 In the event of a delay in the execution of the Contract for which
     the Supplier is responsible or at the end of the period of perfor-
     mance revised as necessary in accordance with the Contract, there
     shall be no further revision of prices within the 30 days before pro-
     visional acceptance except for the application of new price index-
     ation, if this is to the benefit of the Contracting Authority.
                                 ARTICLE 32
                              Interim Payments
32.1 Unless otherwise specified in the Special Conditions, the Supplier
     shall submit an application for interim payment to the Supervisor at
      the end of each period referred to in Article 32.7 in a form approved
     by the Supervisor. The application shall include the following
      items, as applicable:-
     a) the estimated Contract value of the Supplies delivered up to the
         end of the period in question;
     b) an amount reflecting any revision of prices pursuant to Article
         31;
     c) an amount to be withheld as retention sum under Article 30;
     d) any credit and/or debit for the period in question in respect of
         Supplies delivered under the Contract, but not yet installed or
         commissioned in the amount and under the conditions set out in
         Article 32.2;
     e) any other sum to which the Supplier may be entitled under the Con-
         tract.
 ---pagebreak---                                    - 134 -
32.2 The Supplier shall be entitled to such sums as the Supervisor may
      consider proper in respect of Supplies delivered under the Contract,
     but not yet installed or commissioned, provided that:-
     a) the Supplies conform to the specification of the Contract and are
         set out in batches in a way that they may be recognised by the
         Supervisor;
     b) such Supplies have been delivered to the place of acceptance, and
         are properly stored and protected against loss, damage or deterio-
         ration to the satisfaction of the Supervisor;
     c) the Supplier's record of requirements, orders, receipts and use of
         goods and materials under the Contract are kept in a form approved
         by the Supervisor and such records are available for inspection by
         the Supervisor;
     d) the Supplier submits with his statement, the estimated value of
         the Supplies at the place of acceptance, together with such docu-
         ments as may be required by the Supervisor for the purpose of val-
         uation of the Supplies and providing evidence of ownership and
         payment therefor; and
      e) where the Special Conditions so provide, ownership of the Supplies
         shall be deemed to be vested in the Contracting Authority;
32.3 Approval by the Supervisor of any interim payment certified by him in
      respect of goods and materials pursuant to Article 32 shall be with-
      out prejudice to the exercise of any power of the Supervisor under
      the Contract to reject any goods and materials which are not in ac-
      cordance with the provisions of the Contract. Where the Special Con-
     ditions so provide, upon any such rejection the property in the re-
      jected goods and materials shall immediately revert to the Supplier.
32.4 The Supplier shall be responsible for any loss or damage to and for
      the cost of storing, handling of and removing from the place of ac-
      ceptance, such goods and materials which have been rejected and shall
      effect such additional insurance as may be necessary to cover the
      risk of such loss or damage from any cause.
32.5 Within 30 days of receipt of the said application for interim pay-
     ment, it shall be approved or amended in such manner that, in the
     Supervisor's opinion, it reflects the amount due to the Supplier in
     accordance with the Contract. In cases where there is a difference of
     opinion as to the value of an item, the Supervisor's view shall pre-
     vail. On determination of the amount due to the Supplier, the Super-
     visor shall issue to the Contracting Authority and the Supplier, an
     interim payment certificate for the amount due to the Supplier and
     shall inform the Supplier of the Supplies for which payment is being
     made.
 ---pagebreak---                                     - 135 -
32.6 The Supervisor may, by an interim payment certificate, make any cor-
     rections or modifications to any previous certificate issued by him
     and shall have power to modify the valuation in or withhold the issu-
     ing of any interim payment certificate if the Contract, or any part
     thereof, has not been executed to his satisfaction.
32.7 The frequency of interim payments shall be laid down in the Special
     Conditions in accordance with the characteristics of the Supplies.
32.8 The Special Conditions may require certain interim payments to be
     fully secured by a guarantee approved in accordance with Article 11.
                                ARTICLE 33
                        Final Statement of Account
33.1 Not later than 60 days after the issue of the Final Acceptance cer-
     tificate referred to in Article 41, the Supplier shall submit to the
     Supervisor a draft final statement of account with supporting docu-
     ments showing in detail the value of the Supplies provided in accor-
     dance with the Contract, together with all further sums which the
     Supplier considers to be due to him under the Contract in order to
     enable the Supervisor to prepare the final statement of account. The
     Special Conditions may, however, in accordance with Article 33.6,
      state that the draft final statement of account and further proceed-
      ings related thereto, be dealt with before the issue of the provi-
      sional acceptance certificate.
33.2 Within 60 days after receipt of this draft final statement of account
     and of all information reasonably required for its verification, the
     Supervisor shall prepare the final statement of account, which de-
      termines :-
     a) the amount which in his opinion is finally due under the Contract;
         and
     b) after establishing the amounts previously paid by the Contracting
         Authority and all sums to which the Contracting Authority is enti-
         tled under the Contract, the balance, if any, due from the Con-
         tracting Authority to the Supplier, or from the Supplier to the
         Contracting Authority, as the case may be.
33.3 The Supervisor shall issue to the Contracting Authority or its duly
     authorised representative, and to the Supplier, the final statement
     of account showing the final amount to which the Supplier is entitled
     under the Contract. The Contracting Authority or its duly authorised
     representative and the Supplier shall sign the final statement of ac-
     count as an acknowledgement of the full and final value of the Sup-
     plies provided under the Contract and shall promptly submit the
     signed copy to the Supervisor. However, the final statement of ac-
     count shall not include amounts in dispute which are the subject of
     negotiations, conciliation, arbitration or litigation.
 ---pagebreak---                                       - 136 -
33.4 The final statement of account signed by the Supplier shall consti-
     tute a written discharge of the Contracting Authority confirming that
     the total of the final statement of account represents full and final
     settlement of all monies due to the Supplier underthe Contract, other
     than those amounts which are the subject of amicable settlement, ar-
     bitration or litigation. However, such discharge shall become effec-
     tive only after any payment due in accordance with the final state-
     ment of account has been made and the performance guarantee referred
     to in Article 11, has been returned to the Supplier.
33.5 Thee Contracting Authority shall not be liable to the Supplier for any
     ma tter or thing whatsoever arising out of, or in connection with, the
     Contract or provision of the Supplies, unless the Supplier shall have
     included a claim in respect thereof in his draft final statement of
     account.
33.6 The provisions of Article 33 may be varied by the Special Conditions
     having regard to the practices in the State of the Contracting Au-
     thority.
                                 ARTICLE 34
                          Payment to Third Parties
34.1 All orders for payment to third parties may be carried out only after
     an assignment made in accordance with Article 6. The assignment
     shall be notified to the Contracting Authority.
34.2 Notification of beneficiaries of the assignment shall be the sole re-
     sponsibility of the Supplier.
34.3 In the event of a legally binding attachment of the property of the
     Supplier affecting payments due to him under the Contract, and with-
     out prejudice to the Time Limit laid down in Article 35, the Con-
     tracting Authority shall have 30 days, starting from the day when it
     receives notification of the definitive lifting of the obstacle to
     payment, to resume payments to the Supplier.
 ---pagebreak---                                  - 137 -
                                ARTICLE 35
                             Delayed Payments
35.1 Payment to the Supplier of the amounts due under each of the interim
     payment certificates and the final statement of account issued by the
     Supervisor shall be made by the Contracting Authority within 90 days
     of such certificate or statement being delivered to the Contracting
     Authority. If the period laid down for payment has been exceeded,the
     Supplier shall qualify for interest calculated pro rata on the basis
     of the number of days delay at the rate specified in the Special Con-
     ditions subject to a maximum period, also specified therein. The
     Supplier shall be entitled to such payment without prejudice to any
     other right or remedy under the Contract. In the case of the final
     statement of account, the interest for the delayed payment shall be
     calculated on a daily basis at the rate specified in the Special Con-
     ditions.
35.2 Any default in payment of more than 120 days from the expiry of the
     period laid down in Article 35.1 shall entitle the Supplier either
     not to perform the Contract or to terminate it.
                                ARTICLE 36
                       Payments in Foreign Currency
     Where under the Contract the Supplier is entitled to payments in For-
      eign Currency, the rates of exchange for calculating the payments
      shall be those prevailing, as determined by the Central Bank of the
     State of the Contracting Authority, 30 days prior to the latest date
     fixed for the submission of tenders for the Contract. Such rates of
      exchange shall not be varied.
                        ACCEPTANCE AND MMNIENANCE
                                ARTICLE 37
                                 Delivery
37.1 The Supplier shall deliver the Supplies in accordance with the terms
     specified in the Contract and the Supplies shall remain at the risk
     of the Supplier until provisional acceptance.
 ---pagebreak---                                   - 138 -
37.2 The Supplier shall provide such packaging of the Supplies as is re-
     quired to prevent their damage or deterioration in transit to their
     final destination as indicated in the Contract. The packaging shall
     be sufficient to withstand, without limitation, rough handling, expo-
     sure to extreme temperatures, salt and precipitation during transit
     and open storage. Package size and weights shall take into consid-
     eration, Where appropriate, the remoteness of the final destination
     of the Supplies, and the possible absence of heavy handling facili-
     ties at all points in transit.
37.3 The packaging, marking and documentation within and outside the pack-
     ages shall comply with such special requirements as shall be ex-
     pressly provided for in the Contract, subject to any variations sub-
     sequently ordered by the Supervisor.
37.4 No Supplies shall be shipped or delivered to the place of acceptance
     until a confirmation in writing has been obtained by the Supplier
     from the Supervisor that the Supplies may be delivered. The Supplier
     shall be responsible for the delivery at the place of acceptance of
     all Supplies and Supplier's equipment required for the purpose of the
     Contract.
37.5 Each delivery must be accompanied by a statement drawn up by the Sup-
     plier. This statement, the form of which shall be as prescribed by
     the Special Conditions, shall contain, in particular:-
     - the date of delivery;
     - the reference number of the Contract;
     - the identification of the Supplier;
     - particulars of the goods supplied and, where appropriate, details
       of how they were divided for packing.
37.6 Each package must be clearly marked with its order number as shown on
     the statement referred to in Article 37.5; in the absence of indica-
     tions to the contrary, this statement shall contain a list of its
     contents.
37.7 Delivery shall be deemed to have been made when there is written evi-
     dence available to both parties that delivery of the Supplies has
     taken place in accordance with the terms of the Contract and the in-
     voice(s) and all such other documentation as specified in the Special
     Conditions, have been submitted to the Contracting Authority. Where
     the Supplies are delivered to an establishment of the Contracting Au-
     thority, the latter shall bear the responsibility of bailee, in ac-
     cordance with the requirements of the law of the Contract, during the
     time which elapses between delivery for storage and acceptance.
 ---pagebreak---                                   - 139 -
37.8 All materials and goods supplied under the Contract shall be fully
     insured, with the Contracting Authority as beneficiary, against loss
     or damage incidental to manufacture or acquisition, transportation,
     storage and delivery in the manner specified in the Special Condi-
     tions.
                               ARTICLE 38
                         Verification Operations
38.1 The Supplies shall not be accepted until the prescribed verifications
     and tests have been carried out at the expense of the Supplier. The
     inspections and tests may be conducted at the point of delivery
     and/or at the final destination of the goods.
38.2 The Supervisor shall, during the progress of the delivery of the Sup-
     plies and before the Supplies are taken over, have the power to order
     or decide:-
     a) the removal from the place of acceptance, within such time or
        times as may be specified in the order, of any Supplies which, in
        the opinion of the Supervisor, are not in accordance with the Con-
        tract;
     b) the substitution by proper and suitable Supplies;
     c) the removal and proper re-installation, notwithstanding any previ-
        ous test thereof or interim payment therefor, of any installation
        which in respect of materials, workmanship or design by the Sup-
        plier for which he is responsible, is not, in the opinion of the
        Supervisor, in accordance with the Contract;
     d) that any work done or goods supplied or materials used by the Sup-
        plier is or are not in accordance with the Contract, or that the
        Supplies or any portion thereof do not fulfil the requirements of
         the Contract.
38.3 The Supplier shall, with all speed and at his own expense, make good
     the defects so specified. In case of default on the part of the Sup-
     plier in carrying out such order, the Contracting Authority shall be
     entitled to employ other persons to carry out the orders and all ex-
     penses consequent thereon or incidental thereto shall be recoverable
     from the Supplier by the Contracting Authority, or may be deducted by
     the Contracting Authority from any monies due or Which may become due
     to the Supplier.
 ---pagebreak---                                    - 140 -
38.4 Supplies which are not of the required quality shall be rejected. A
     special mark may be applied to the rejected Supplies. This shall not
     be such as to alter them or affect their commercial value. Rejected
     Supplies shall be removed by the Supplier from the place of accep-
     tance, if the Supervisor so requires, within a period which the
     Supervisor shall specify, failing which they shall be removed as of
     right at the expense and risk of the Supplier. Any work incorporat-
     ing rejected materials shall be rejected.
38.5 The provisions of Article 38 shall not affect the right of the Con-
     tracting Authority to claim under Article 21, nor shall it in anyway
     release the Supplier from any warranty or other obligations under the
     Contract.
                                ARTICLE 39
                          Provisional Acceptance
39.1 The Supplies shall be taken over by the Contracting Authority when
     they have been delivered in accordance with the Contract, have satis-
     factorily passed the required tests, or have been commissioned, as
     the case may be, and a certificate of provisional acceptance has been
     issued or is deemed to have been issued.
39.2 The Supplier may apply, by notice to the Supervisor, for a certifi-
     cate of provisional acceptance not earlier than 15 days before the
     Supplies, in the Supplier's opinion, are complete and ready for pro-
     visional acceptance. The Supervisor shall within 30 days after the
     receipt of the Supplier's application either:
     a) issue the certificate of provisional acceptance to the Supplier
        with a copy to the Contracting Authority stating, where appropri-
        ate, his reservations and, inter-alia, the date on which, in his
        opinion, the Supplies were completed in accordance with the Con-
        tract and ready for provisional acceptance; or
     b) reject the application giving his reasons and specifying the ac-
        tion which, in his opinion, are required of the Supplier for the
        certificate to be issued.
39.3 Should exceptional circumstances make it impossible to proceed with
     the acceptance of the Supplies during the period fixed for provi-
     sional or final acceptance, a statement certifying such impossibility
     shall be drawn up by the Supervisor after consultation, where possi-
     ble, with the Supplier. The certificate of acceptance or rejection
     shall be drawn up within 30 days following the date on which such im-
     possibility ceases to exist. The Supplier shall not invoke these
     circumstances in order to avoid the obligation of presenting the Sup-
     plies in a state suitable for acceptance.
 ---pagebreak---                                   - 141 -
39.4 If the Supervisor fails either to issue the certificate of provi-
     sional acceptance or to reject the Supplies within the period of 30
     days, he shall be deemed to have issued the certificate on the last
     day of that period. The certificate of provisional acceptance shall
     not be deemed to be an admission that the Supplies have been deliv-
     ered in every respect. If the Supplies are divided by the Contract
     into lots, the Supplier shall be entitled to apply for separate cer-
     tificates for each of the lots.
39.5 Upon provisional acceptance of the Supplies, the Supplier shall dis-
     mantle and remove temporary structures as well as materials no longer
     required for use in connection with the performance of the Contract.
     He shall also remove any litter or obstruction and redress any change
     in the condition of the place of acceptance as required by the Con-
     tract.
                               ARTICLE 40
                          Warranty Obligations
40.1 The Supplier shall warrant that the Supplies are new, unused, of the
     most recent models and incorporate all recent improvements in design
     and materials, unless otherwise provided in the Contract. The Sup-
     plier shall further warrant that all Supplies shall have no defect
     arising from design, materials or workmanship, except insofar as the
     design or materials are required by the specifications, or from any
     act or omission of the Contracting Authority, that may develop under
     use of the Supplies in the conditions obtaining in the State of the
     Contracting Authority.
40.2 Unless otherwise specified in the Special Conditions, this warranty
     shall remain valid for 360 days after the Supplies or any portion
     thereof, as the case may be, have been delivered and commissioned at
     the final destination indicated in the Contract, or for 540 days
     after the date of shipment from the port of loading in the country of
     origin, whichever period ends earlier. The obligation to maintain
     the Supplies shall be subject to any stipulations in the Special Con-
     ditions and specifications which shall determine the period and con-
     ditions thereof.
40.3 The Supplier shall be responsible for making good any defect in or
     damage to any part of the Supplies which may appear or occur during
     the Warranty Period, or within 30 days after its expiration and which
     arise either:-
     a) from the use of defective materials, faulty workmanship or design
        of the Supplier; or
     b) from any act or omission of the Supplier during the Warranty Pe-
        riod; or
 ---pagebreak---                                    - 142 -
     c) in the course of an inspection made by, or on behalf of, the Con-
        tracting Authority.
40.4 The Supplier shall at his own cost make good the defect or damage as
     soon as practicable. The Warranty Period for all items replaced or
     repaired shall recommence from the date when the replacement or re-
     pair was made to the satisfaction of the Supervisor. If the Contract
     provides for partial acceptance, the Warranty Period shall be ex-
     tended only for the part of the Supplies affected by the replace-
     ment or repair.
40.5 If any such defects appear or such damage occurs during the period
     referred to in Article 40.3, the Contracting Authority or the Super-
     visor shall notify the Supplier. If the Supplier fails to remedy a
     defect or damage within the Time Limit stipulated in the notifica-
     tion, the Contracting Authority may:-
     a) remedy the defect or the damage itself, or employ someone else to
        carry out the work at the Supplier's risk and cost, in Which case
        the costs incurred by the Contracting Authority shall be deducted
        from monies due to or from guarantees held against the Supplier or
        from both; or
     b) terminate the Contract.
40.6 In case of emergency, where the Supplier cannot be reached immediate-
     ly or, having been reached, is unable to take the measures required,
     the Contracting Authority or the Supervisor may have the work carried
     out at the expense of the Supplier. The Contracting Authority or the
     Supervisor shall as soon as practicable inform the Supplier of the
     action taken.
                                ARTICLE 41
                           After Sales Service
     An after sales service, if required by the Contract, shall be provid-
     ed in accordance with the details stipulated in the Special Condi-
     tions. The Supplier shall undertake to carry out or have carried out
     the maintenance and repair of Supplies and to provide a rapid supply
     of spare parts. The Special Conditions may specify that the Supplier
     shall be required to provide any or all of the following materials,
     notifications and documents pertaining to spare parts manufactured or
     distributed by the Supplier:-
     a) such spare parts as the Contracting Authority may elect to pur-
        chase from the Supplier, provided that this election shall not re-
        lieve the Supplier of any warranty obligations under the Contract;
        and
 ---pagebreak---                                     - 143 -
     b) in the event of termination of production of the spare parts ad-
         vance notification to the Contracting Authority to procure needed
         requirements; and following such termination, furnishing at no
         cost to the Contracting Authority, the blueprints, Drawings and
         specifications of the spare parts, if and when requested.
                                ARTICLE 42
                             Final Acceptance
42.1 Upon the expiration of the Warranty Period or Where there is more
      than one such period, upon the expiration of the latest period and
     when all defects or damage have been rectified, the Supervisor shall
      issue to the Supplier a Final Acceptance Certificate and a
      copythereof to the Contracting Authority stating the date on which
      the Supplier completed his obligations under the Contract to the
     Supervisor's satisfaction. The Final Acceptance Certificate shall be
     given by the Supervisor within 30 days after the expiration of the
     Warranty Period, or as soon thereafter as any rectifications in-
      structed, pursuant to Article 40, have been completed to the satis-
     faction of the Supervisor.
42.2 The Contract shall not be considered to be fully executed until the
     Final Acceptance Certificate has been signed by the Supervisor and
     delivered to the Contracting Authority, with a copy to the Contrac-
     tor.
42.3 Notwithstanding the issue of the Final Acceptance Certificate, the
     Supplier and the Contracting Authority shall remain liable for the
     fulfillment of any obligation incurred under the Contract prior to
      the issue of the Final Acceptance Certificate, Which remains
     unperformed at the time such Final Acceptance Certificate is issued.
     The nature and extent of any such obligation shall be determined by
     reference to the provisions of the Contract.
                    BREACH OP OONTRACr AND TERMINATION
                                ARTICLE 43
                            Breach of Contract
43.1 Either party commits a breach of Contract where he fails to discharge
      any of his obligations under the Contract.
 ---pagebreak---                                       - 144 -
43.2 Where a breach of Contract occurs, the party injured by the breach
      shall be entitled to the following remedies :-
     a) damages; and/or.
     b) termination of the Contract.
43.3 Damages may be:-
      a) General Damages; or
     b) Liquidated Damages.
43.4 In any case where the Contracting Authority is entitled to damages,
      it may deduct such damages from any sums due to the Supplier or from
      the appropriate guarantee.
                                 ARTICLE 44
                  Termination by the Contracting Authority
44.1 The Contracting Authority may, at any time and with immediate effect,
      terminate the Contract, except as provided for in Article 44.2.
44.2 Except as otherwise provided in these General Conditions, the Con-
      tracting Authority may, after giving 7 days notice to the Supplier,
      terminate the Contract in any of the following cases where:-
      a) the Supplier fails to provide the Supplies in strict accordance
         with the provisions of the Contract;
     b) the Supplier fails to comply within a reasonable time with a no-
         tice given by the Supervisor requiring him to make good any
         neglect or failure to perform his obligations under the Contract
         Which seriously affect the proper and timely performance of the
         Contract;
      c) the Supplier refuses or neglects to carry out Administrative Or-
         ders given by the Supervisor;
     d) the Supplier assigns the Contract or sub-contracts without the
         authorisation of the Contracting Authority;
     e) the Supplier becomes bankrupt or insolvent, or has a receiving or-
         der made against him, or compounds with his creditors, or carries
         on business under a receiver, trustee or manager for the benefit
         of his creditors, or goes into liquidation;
     f) any adverse final judgment is made in respect of an offence re-
         lating to the professional conduct of the Supplier;
 ---pagebreak---                                     - 145 -
     g) any other legal disability hindering performance of the Contract
         occurs;
     h) any organizational modification occurs involving a change in the
         legal personality, nature or control of the Supplier, unless such
        modification is recorded in an endorsement to the Contract;
     i) the Supplier fails to provide the required guarantee or insurance,
         or if the person providing the earlier guarantee or insurance is
        not able to abide by his commitments.
44.3 Termination shall be without prejudice to any other rights or powers
     under the Contract of the Contracting Authority and the Supplier.
     The Contracting Authority may, thereafter, conclude any other con-
     tract with a third party for the account of the Supplier. The Sup-
     plier's liability for delay in completion shall immediately cease
     upon termination without prejudice to any liability thereunder that
     may have already occurred.
44.4 The  Supervisor shall, upon the issue of the notice of termination of
     the  Contract, instruct the Supplier to take immediate steps to bring
     the  execution of the Supplies to a close in a prompt and orderly man-
     ner  and to reduce expenditure to a minimum.
44.5 The Supervisor shall, as soon as possible after termination, certify
     the value of the Supplies and all sums due to the Supplier as at the
     date of termination.
44.6 In the event of termination:-
     a) the Supplier or his representatives     being present or duly sum-
        moned, a report of Supplies delivered   and the work performed shall
         be drawn up by the Supervisor as soon  as possible, and inventories
         taken of the materials supplied and     unused. A statement shall
         also be drawn up of sums owed by the   Supplier to the Contracting
        Authority;
     b) the Contracting Authority may purchase, at market prices, the ma-
         terials and items supplied or ordered by the Supplier and not al-
         ready paid for by the Contracting Authority on such conditions as
         the Supervisor considers appropriate.
44.7 The Contracting   Authority shall not be obliged to make any further
     payments to the   Supplier until the Supplies are completed, whereupon
     the Contracting  Authority shall be entitled to recover from the Sup-
     plier the extra    costs, if any, of providing the Supplies, or shall
     pay any balance  due to the Supplier prior to termination of the Con-
     tract.
 ---pagebreak---                                     - 146
44.8  If the Contracting Authority terminates the Contract, it shall be en-
      titled to recover from the Supplier any loss it has suffered up to
      the maximum amount stated in the Contract. If no maximum amount is
      stated, the Contracting Authority shall not be entitled to recover
     more than the part of the Contract Price corresponding to the value
     of that part of the Supplies which cannot, by reason of the Suppli-
      er's failure, be put to the intended use.
44.9 Where the termination is not due to an act or omission of the Suppli-
      er, the latter shall be entitled to claim, in addition to sums owing
      to him for work already performed, an indemnity for loss suffered.
                                 ARTICLE 45
                        Termination by the Supplier
45.1 The Supplier may, giving 14 days notice to the Contracting Authority,
      terminate the Contract if the Contracting Authority:-
      a) fails to pay the Supplier the amounts due under any certificate
         issued by the Supervisor after the expiry of the Time Limit stated
         in Article 35.2;
      b) consistently fails to meet his obligations after repeated remind-
         ers; or
      c) suspends the progress of the delivery of the Supplies, or any part
         thereof, for more than 180 days, for reasons not specified in the
         Contract, or not due to the Supplier's default;
45.2  Such termination shall be without prejudice to any other rights of
      the Contracting Authority or the Supplier acquired under the Con-
      tract.
45.3  In the event of such termination, the Contracting Authority shall pay
      the Supplier for any loss or damage the Supplier may have suffered.
      Such additional payment shall not exceed a limit which has to be
      specified in the Contract.
                                 ARTICLE 46
                               Force Majeure
46.1 Neither party shall be considered to be in default or     in breach of
     his obligations under the Contract if the performance of   such obliga-
      tions is prevented by any circumstances of force majeure which arises
     after the date of notification of award or the date when   the Contract
     becomes effective, whichever is the earlier.
 ---pagebreak---                                     - 147 -
46.2 The term "force majeure", as used herein shall mean acts of God,
     strikes, lock-outs or other industrial disturbances, acts of the pub-
     lic enemy, wars whether declared or not, blockades, insurrection, ri-
     ots, epidemics, landslides, earthquakes, storms, lightning, floods,
     washouts, civil disturbances, explosions, and any other similar un-
     foreseeable events, not within the control of either party and which
     by the exercise of due diligence neither party is able to overcome.
46.3 Notwithstanding the provisions of Articles 21 and 44, the Supplier
     shall not be liable to forfeiture of his performance guarantee, liq-
     uidated damages or termination for default if, and to the extent
      that, his delay in performance or other failure to perform his obli-
     gations under the Contract is the result of an event of force
     majeure. The Contracting Authority shall similarly not be liable,
     notwithstanding the provisions of Articles 35 and 45, to payment of
     interest on delayed payments, for non-performance or for termination
     by the Supplier for default, if, and to the extent that, the Con-
     tracting Authority's delay or other failure to perform its obliga-
     tions is the result of force majeure.
46.4  If either party considers that any circumstances of force majeure
     have occurred which may affect performance of his obligations, he
     shall promptly notify the other party and the Supervisor, giving de-
     tails of the nature, the probable duration and the likely effect
     ofthe circumstances.   Unless otherwise directed by the Supervisor in
     writing, the Supplier shall continue to perform his obligations under
     the Contract as far as is reasonably practicable, and shall seek all
     reasonable alternative means for performance of his obligations which
     are not prevented by the force majeure event. The Supplier shall not
     put into effect such alternative means unless directed so to do by
     the Supervisor.
46.5 If the Supplier incurs additional costs in complying with the Super-
     visor's directions or using alternative means under Article 46.4, the
     amount thereof shall be certified by the Supervisor.
46.6 If circumstances of force majeure have occurred and continue for a
     period of 180 days then, notwithstanding any extension of time for
     completion of the Contract that the Supplier may by reason thereof
     have been granted, either party shall be entitled to serve upon the
     other 30 days' notice to terminate the Contract. If at the expiry of
     the period of 30 days, force majeure still continues, the Contract
     shall terminate and, in consequence thereof under the law governing
     the Contract, the parties shall be released from further performance
     of the Contract.
 ---pagebreak---                                     - 148 -
                                 ARTICLE 47
                                  Decease
47.1 Where the Supplier is a natural person, the Contract shall be auto-
     matically terminated if that person dies. However, the Contracting
     Authority shall examine any proposal made by the heirs or beneficia-
      ries if they have notified their wish to continue the Contract. The
     decision of the Contracting Authority shall be notified to those con-
      cerned within 30 days of receipt of such proposal.
47.2 Where the Supplier consists of natural persons and one or more of
      them die, a report shall be agreed between the parties on the
      progress of the Contract and the Contracting Authority shall decide
     whether to terminate or continue the Contract in accordance with the
      undertaking given by the survivors and by the heirs or beneficiaries,
      as the case may be.
47.3  In the cases provided for in Articles 47.1 and 47.2, persons offering
      to continue to perform the Contract shall notify the Contracting Au-
      thority thereof within 15 days of the date of decease.
47.4 Such persons shall be jointly and severally liable, or as otherwise
      stated in the Special Conditions for the proper performance of the
     Contract to the same extent as the original Supplier. Continuation of
      the Contract shall be subject to the rules relating to establishment
      of the guarantee provided for in Article 11.
                           SETTLEMENT OP DISPUTES
                                 ARTICLE 48
                           Settlement of disputes
48.1 The Contracting Authority and the Supplier shall make every effort to
      amicably settle any dispute relating to the Contract which may arise
      between them, or between the Supervisor and the Supplier.
48.2 The Special Conditions shall prescribe:-
      a) the procedure for the amicable settlement of disputes;
      b) the Time Limits within which the amicable settlement procedure may
         be invoked after the time that the dispute is notified to the
         other party and the maximum Time Limit within which such settle-
         ment may be reached, Which may not exceed 120 days from the com-
         mencement of the adopted procedure;
 ---pagebreak---                                    - 149 -
     c) the Time Limits for responding in writing to a request for amica-
        ble settlement or to other requests permitted during the course of
        that procedure and the consequence of failure to comply with those
        Time Limits.
48.3 The parties may agree to the settlement of the dispute by concilia-
     tion within a specific Time Limit by a third party after the amicable
     settlement procedure adopted has failed.
48.4 The amicable settlement or conciliation procedure adopted shall in
     all cases involve a procedure in which complaints and responses are
     notified to the other party.
48.5 In the absence of an amicable settlement or settlement by concilia-
     tion within the maximum Time Limits specified, the dispute shall:-
     a) in the case of a national contract, be settled in accordance with
        the national legislation of the State of the Contracting
        Authority; and
     b) in the case of a transnational Contract, be settled by arbitration
        in accordance with the procedural rules adopted by the EBC
        Council.
 ---pagebreak---               - 150 -
                       ANNEX IV
     GENERAL CONDITIONS
    FOR SERVICE CONTRACTS
         FINANCED BY
THE EUROPEAN DEVELOPMENT FUND
          IN THE OCT
 ---pagebreak---                               TABLE OF ŒNTEOTS
                                                                %
                           PRELIMINARY PROVISIONS
                                                           Page
Article 1  Definitions                                      153
Article 2  Law and Language of the Contract                 155
Article 3  Order of Precedence of Contract Documents        156
Article 4  Notices and "Writ ten Comnuni cat ions           156
Article 5  Supervisor and Supervisor's Representative       156
Article 6  Assignment                                       157
Article 7  Sub-contracting                                 158
                 OBLIGATIONS OF THE CONTRACTING ALTOERTTY
Article 8  Supply of Information                           159
Article 9  Assistance with Local Regulations               159
                      OBLIGATIONS OF THE CONSULTANT
Article 10 General Obligations                             160
Article 11 Code of Conduct                                 161
Article 12 Independence                                    162
Article 13 Specifications and Designs                      162
Article 14 Indemnification....                             163
Article 15 Medical and Insurance Arrangements              164
Article 16 Proprietary Rights in Reports and Documents     165
                          NATURE OF THE SERVICES
Article 17 The Scope of the Services                      165
Article 18 Provision of Personnel                         167
Article 19 Staff and Equipment                            168
Article 20 Trainees                                       169
                        PERFORMANCE OF THE ŒNTRACT
Article 21 Commencement Orders                            169
Article 22 Period of Performance                          170
Article 23 Extension of Period of Performance             170
Article 24 Delays in Performance                          171
Article 25 Suspension                                     172
 ---pagebreak---                                      - 152 -
                                                        Page
Article 26 Variations                                    172
Article 27 W>rking Hours                                 174
Article 28 Leave Entitlement.                            174
Article 29  Information                                  175
Article 30 Records                                       175
Article 31 Submission of Reports                         175
Article 32 Approval of Reports and Documents             176
                                  PAYMENTS
Article 33 General Provisions                            176
Article 34 Advances                                      177
Article 35 Payment Procedure                             178
Article 36 Travel and Transport                          179
Article 37 Revision of Prices                            180
Article 38 Delayed Payments                              181
Article 39 Payment to Third Parties                      181
                     BREACH OF CONTRACT AND TERMINATION
Article 40 Breach of Contract                            182
Article 41 Termination by the Contracting Authority      182
Article 42 Termination by the Consultant                 184
Article 43 Force Majeure                                 185
Article 44 Decease                                       186
                           SETILMOT OF DISPUTES
Article 45 Settlement of Disputes                        186
 ---pagebreak---                                    - 153 -
                         PRELIMINARY PROVISIONS
                               ARTICLE 1
                              Definitions
1.1 The following definitions apply to these General Conditions and to
    the Contract.
    EBC: the European Economic Community.
    OCT: the association of the Overseas Countries and Territories with
            the EBC.
    Contract: the signed agreement entered into by the parties for the
            performance of the Services, including all attachments
            thereto and all documents incorporated therein.
    Consultant: the party with whom the Contracting Authority concludes
            the Contract.
    Contracting Authority: the State or the legal person governed by pub-
            lic or private law which concludes the Contract, or on behalf
            of which the Contract is concluded, with the Consultant.
    The State of the Contracting Authority: the OCT on whose territory
            the Service Contract is to be executed.
    Supervisor: the government department, legal person governed by pub-
            lic law or the natural or legal person designated by the
            Contracting Authority in accordance with the law of the State
            of the Contracting Authority, who is responsible for direct-
            ing and/or monitoring the execution of the Service Contract,
            or to whom the Contracting Authority may delegate rights
            and/or powers under the Contract.
    Supervisor's Representative: any natural or legal person, designated
            by the Supervisor as such under the Contract, and empowered
            to represent the Supervisor in the performance of his func-
            tions, and in exercising such rights and/or powers as have
            been delegated to him. Accordingly, where functions, rights
            and/or powers of the Supervisor have been delegated to the
            Supervisor's Representative, references to the Supervisor in-
            clude the Supervisor's Representative.
    Services: tasks to be performed by the Consultant under the contract
            such as studies, designs, provision of technical assistance
            and training.
 ---pagebreak---                               - 154 -
Terms of Reference: the statement issued by the Contracting Authority
        giving the definition of his requirements and/or the objec-
        tives of the Services, including, where applicable, the
        methods and means to be used by the Consultant and/or the re-
        sults to be achieved by him.
Day:    calendar day.
Time Limits: those periods in the Contract Which shall begin to run
        from the day following the act or event which serves as the
        starting point for those periods. Should the last day of the
        period fall upon a non-working day, the period shall expire
        at the end of the first working day following the last day of
        the period.
Contract Price: the sum stated in the Contract representing the init-
         ial estimate payable for the provision of the Services or
        such other sum as ascertained at the end of the Contract as
        due to the Consultant under the Contract.
Project: the project in relation to which the Services are to be pro-
        vided under the Contract.
Price Schedule: the completed schedule of prices, including the
        breakdown of the overall price submitted by the Consultant
        with his tender, modified as necessary, and forming a part of
        the unit price Contract.
Breakdown of the Overall Price: the itemised list of rates and prices
        showing the build-up of the price in a lump sum Contract, but
        not forming part of the Contract.
Drawings: drawings provided by the Contracting Authority and/or the
        Supervisor, and/or drawings provided by the Consultant and
        approved by the Supervisor, for the performance of the Ser-
        vices.
Writing: any handwritten, typewritten or printed communication, in-
        cluding telex, cable and facsimile transmission.
Administrative Order: any instruction or order issued by the Super-
        visor to the Consultant in writing regarding the performance
        of the Services.
Communications: certificates, notices, orders and instructions issued
        under the Contract.
National Currency: the currency of the State of the Contracting
        Authority.
Foreign Currency: any permissible currency which is not the National
        Currency and which is indicated in the Contract.
 ---pagebreak---                                       - 155 -
    General Damages: the sum, not stated beforehand in the Contract,
             which is awarded by a court or arbitration tribunal, or
             agreed between the parties, as compensation payable to an in-
             jured party for a breach of the Contract by the other party.
    Liquidated Damages: the sum stated in the Contract as compensation
             payable by the Consultant to the Contracting Authority for
             failure to perform the Contract or part thereof within the
             periods under the Contract, or as payable by either party to
             the other for any other specific breach identified in the
             Contract.
    Special Conditions: the Special Conditions issued by the Contracting
             Authority as part of the invitation to tender, as amended
             where necessary, and incorporated into the Contract, consist-
              ing of:
             a)        amendments to these General Conditions;
             b)        special contractual clauses;
              c)       technical specifications; and
             d)        any other matter related to the Contract.
1.2 The headings and titles in these General Conditions shall not be
     taken as part thereof or be taken into consideration in the interpre-
     tation of the Contract.
1.3 "Where the context so permits words importing the singular shall be
    deemed to include the plural and vice versa and words importing the
    masculine shall be deemed to include the feminine and vice versa.
1.4 Vfords importing persons or parties shall include firms and companies
     and any organization having legal capacity.
                                  ARTICLE 2
                      Law and Language of the Contract
2.1 The law of the Contract shall be the law of the State of the
    Contracting Authority unless otherwise stated in the Special Condi-
     tions.
2.2  In all matters which are not covered by these General Conditions, the
    law of the Contract shall apply.
 ---pagebreak---                                     - 156 -
2.3 The language of the Contract and of all Ccmmuni cat ions between the
    Consultant, Contracting Authority and Supervisor or their representa-
     tives shall be as stated in the Special Conditions. All reports, rec-
    ommendations and dossiers prepared by the Consultant under the Con-
     tract shall also be in the language stated in the Special Conditions.
                                 ARTICLE 3
                Order of Precedence of Contract Documents
    Unless otherwise stipulated in the Contract, the order of precedence
    of the Contract documents shall be as stated in the Special Condi-
    tions.
                                 ARTICLE 4
                    Notices and Written Communications
4.1 Unless otherwise specified in the Special Conditions, Communicat ions
    between the Contracting Authority and/or the Supervisor on the one
    hand, and the Consultant on the other hand, shall be sent by post,
    cable, telex facsimile transmission or personal delivery, to the ap-
    propriate addresses designated by these parties for that purpose.
4.2  If the sender requires evidence of receipt, he shall state such re-
    quirement in his Communication and, Whenever there is a deadline for
     the receipt of the Communication, he shall demand evidence of receipt
     of his Communication. In any event, the sender shall take all the
    necessary measures to ensure receipt of the Communication.
4.3 Wherever in the Contract provision is made for the giving or issue of
     any notice, consent, approval, certificate or decision by any person,
    unless otherwise specified, such notice, consent, approval, certifi-
     cate or decision shall be in writing and the words "notify"
     "certify", "approve" or "decide" shall be construed accordingly. Any
     such consent, approval, certificate or decision shall not unreason-
     ably be withheld or delayed.
                                 ARTICLE 5
                Supervisor and Supervisor's Representative
5.1 The Supervisor shall carry out the duties specified in the Contract.
    Except as expressly stated in the Contract, the Supervisor shall not
    have authority to relieve the Consultant of any of his obligations
    under the Contract.
 ---pagebreak---                                   - 157 -
5.2 The Supervisor may, from time to time, while retaining ultimate re-
    sponsibility, delegate to the Supervisor's Representative any of the
    duties and authority vested in the Supervisor and he may at any time
    revoke such delegation or replace the representative. Any such dele-
    gation, revocation or replacement shall be in writing and shall not
    take effect until a copy thereof has been delivered to the Con-
    sultant.
5.3 Any Communication given by the Supervisor's Representative to the
    Consultant in accordance with the terms of such delegation shall have
    the same effect as though it had been given by the Supervisor
    himself, provided that:-
    a) any failure on the part of the Supervisor's Representative to dis-
       approve any report or part of the Services shall not prejudice the
       authority of the Supervisor to disapprove such report or Services
       and to give the instructions necessary for the rectification
       thereof;
    b) the Supervisor shall be at liberty to reverse or vary the content
       of such Communication.
5.4 Instructions and/or orders issued by the Supervisor shall be by way
    of Administrative Orders. Where applicable, such orders shall be
    dated, numbered and entered in a register, and copies thereof, de-
    livered by hand, where appropriate, to the Consultant's representa-
    tive.
                               ARTICLE 6
                              Assignment
6.1 An assignment shall be valid only if it is a written agreement by
    which the Consultant transfers his Contract, or part of thereof to a
    third party.
6.2 The Consultant, shall not, without the prior written consent of the
    Contracting Authority, assign the Contract or any part thereof, or
    any benefit or interest thereunder, except in the following cases:-
    a) by a charge in favour of the Consultant's bankers of any monies
       due or to become due under the Contract; or
    b) by assignment to the Consultant's insurers of the Consultant's
       right to obtain relief against any other person liable in cases
       where the insurers have discharged the Consultant's loss or lia-
       bility.
6.3 For the purpose of Article 6.2, the approval of an assignment by the
    Contracting Authority shall not relieve the Consultant of his obliga-
    tions for the part of the Contract already performed or the part not
    assigned.
 ---pagebreak---                                     - 158 -
6.4 If the Consultant has assigned his Contract without authorization,
    the Contracting Authority may, without giving formal notice thereof,
    apply as of right the sanctions for breach of Contract provided for
    in Articles 40 and 41.
6.5 Assignees must satisfy the eligibility criteria applicable for the
    award of the Contract.
                                ARTICLE 7
                             Sub-contracting
7.1 A sub-contract shall be valid only if it is a written agreement by
    which the Consultant entrusts performance of a part of his Contract
    to a third party.
7.2 The Consultant shall not sub-contract to nor engage another indepen-
    dent consultant to perform any part of the Services without the prior
    written authorization of the Contracting Authority. The services to
    be sub-contracted and the identity of the independent consultant
     shall be notified to the Contracting Authority. The Contracting
    Authority shall, with due regard to the provisions of Article 4.3,
    within 30 days of receipt of the notification, notify the Consultant
    of his decision, stating reasons, should he withhold such authoriza-
     tion.
7.3  In the selection of sub-contractors and/or other independent con-
     sultants, preference shall be given to natural persons, companies or
    firms of the State of the Contracting Authority capable of providing
     the services required on equivalent terms.
7.4 Sub-contractors and/or independent consultants must satisfy the eli-
    gibility criteria applicable for the award of the Contract.
7.5 The Contracting Authority shall have no contractual relations with
     the sub-contractors and/or independent consultants.
7.6 The Consultant shall be responsible for the acts, defaults and negli-
    gence of his sub-contractors and/or other independent consultants and
    their agents or employees, as if they were the acts, defaults or neg-
    ligence of the Consultant, his agents or employees. The approval by
    the Contracting Authority of the sub-contracting of any part of the
    Contract or of the engagement by the Consultant of other independent
    consultants or sub-contractors to perform any part of the Services
    shall not relieve the Consultant of any of his obligations under the
    Contract.
 ---pagebreak---                                    - 159 -
7.7  If a sub-contractor or independent consultant is found by the
    Contracting Authority or the Supervisor to be incompetent in dis-
    charging his duties, the Contracting Authority or the Supervisor may
    request the Consultant forthwith, either to provide an independent
    consultant or sub-contractor with qualifications and experience ac-
    ceptable to the Contracting Authority as a replacement, or to resume
    the performance of the Services himself.
7.8 If the Consultant enters into a sub-contract or engages another inde-
    pendent Consultant without prior approval, the Contracting Authority
    may, without giving formal notice thereof, apply as of right the
    sanctions for breach of Contract provided for in Articles 40 and 41
                OBLIGATIONS OF THE CONTRACTING ALTHERITY
                               ARTICLE 8
                         Supply of Information
8.1 The Contracting Authority shall supply the Consultant as soon as pos-
    sible with any information and/or documentation at its disposal which
    may be relevant to the performance of the Contract. Such documents
    shall be returned to the Contracting Authority at the completion of
    the Services.
8.2 The Contracting Authority shall as far as possible provide the Con-
    sultant with any assistance in obtaining information relevant to the
    Contract that the latter may reasonably request in order to perform
    the Contract.
                               ARTICLE 9
                   Assistance with Local Regulations
9.1 The Consultant may request the assistance of the Contracting
    Authority in obtaining copies of laws, regulations, and information
    on local customs, orders or bye laws of the country where the Ser-
    vices are to be performed, which may affect the Consultant in the
    performance of his obligations under the Contract. The Contracting
    Authority may provide the assistance requested to the Consultant at
    the Consultant's cost.
9.2 Subject to the provisions of the laws and regulations on foreign
    labour of the State in which the Services are to be performed, the
    Contracting Authority shall make all efforts necessary, to facilitate
    the procurement by the Consultant of all required visas and permits,
    including work and residence permits, for the personnel whose ser-
    vices the Consultant and the Contracting Authority consider necessary
    as well as residence permits for their families.
 ---pagebreak---                                     - 160 -
9.3  The Contracting Authority shall issue to its officials, agents and
     representatives all such instructions as may be necessary or appro-
     priate to facilitate the prompt and effective implementation of the
     Services.
                      OBLIGATIONS OF THE CONSULTANT
                               ARTICLE 10
                           General Obligations
10.1 The Consultant shall respect and abide by all laws and regulations in
     force in the State of the Contracting Authority and shall ensure that
     his personnel, their dependents, and his local employees also respect
     and abide by all such laws and regulations. The Consultant shall in-
     demnify the Contracting Authority against any claims and proceedings
     arising from any infringement by the Consultant, his employees and
     the dependents of such laws and regulations.
10.2 The Consultant shall perform the Services with due care, efficiency
     and diligence, in accordance with the best professional practices and
      in compliance with these General Conditions, the Terms of Reference
     and the instructions of the Supervisor.
10.3 The Consultant shall comply with Administrative Orders given by the
     Supervisor. Where the Consultant considers that the requirements of
     an Administrative Order go beyond the authority of the Supervisor or
     of the scope of the Contract, he shall, on pain of being time-barred,
     give notice, with reasons, to the Supervisor within 30 days after re-
     ceipt thereof. Execution of the Administrative Order shall not be
     suspended because of this notice.
10.4 If the Consultant or any of his sub-contractors, independent con-
     sultants, agents or servants offers to give or agrees to offer or to
     give or gives to any person, any bribe, gift, gratuity or commission
     as an inducement or reward for doing or forbearing to do any act in
     relation to the Contract or any other Contract with the Contracting
     Authority, or for showing favour or disfavour to any person in rela-
     tion to the Contract or any other Contract with the Contracting
     Authority, then the Contracting Authority may, without prejudice to
     any accrued rights of the Consultant under the Contract, terminate
     the Contract, in which case the provisions of Articles 40 and 41
     shall apply.
 ---pagebreak---                                     - 161 -
10.5 The Consultant shall treat all documents and information received in
      connection with the Contract as private and confidential, and shall
     not, save in so far as may be necessary for the purposes of the per-
      formance thereof, publish or disclose any particulars of the Contract
     without the prior consent in writing of the Contracting Authority or
      the Supervisor after consultation with the Contracting Authority. If
      any disagreement arises as to the necessity for any publication or
     disclosure for the purpose of the Contract, the decision of the
     Contracting Authority shall be final.
10.6  If the Consultant is a joint venture or consortium of two or more
     persons, all such persons shall be jointly and severally bound to
     fulfil the terms of the Contract according to the law of the State of
      the Contracting Authority and shall, at the request of the
     Contracting Authority, designate one of such persons to act as leader
     with authority to bind the joint venture or consortium. The composi-
      tion or the constitution of the joint venture or consortium shall not
     be altered without the prior consent in writing of the Contracting
     Authority.
                                ARTICLE 11
                              Code of Conduct
11.1 The Consultant shall at all times act loyally and impartially and as
     a faithful adviser to the Contracting Authority in accordance with
      the rules and/or code of conduct of his profession as well as with
     appropriate discretion. He shall, in particular, refrain from making
     any public statements concerning the Project or the Services without
      the prior approval of the Contracting Authority, and from engaging in
     any activity which conflicts with his obligations towards the
     Contracting Authority under the Contract. He shall not commit the
     Contracting Authority in any way whatsoever without its prior consent
     in writing, and shall, where appropriate, make this obligation clear
     to third parties.
11.2 For the duration of the Contract, the Consultant and his employees
     shall respect the political, cultural and religious practices pre-
     vailing in the State of the Contracting Authority.
11.3 The remuneration of the Consultant under the Contract shall consti-
     tute his only remuneration in connection with the Contract and
     neither he nor his personnel shall accept any commission, discount,
     allowance, indirect payment or other consideration in connection
     with, or in relation to, or in discharge of, his obligations under
     the Contract.
11.4 The Consultant shall not have the benefit, whether directly or indi-
     rectly, of any royalty or of any gratuity or commission in respect of
     any patented or protected article or process used in or for the pur-
     poses of the Contract or the Project, unless it is agreed by the
     Contracting Authority in writing that he may.
 ---pagebreak---                                     - 162 -
11.5 The Consultant and his staff shall maintain professional secrecy, for
     the duration of the Contract and after completion thereof. In this
     connection, except with the prior written consent of the Contracting
     Authority, neither the Consultant nor the personnel employed or en-
     gaged by him shall at any time communicate to any person or entity
     any confidential information disclosed to them or discovered by them,
     or make public any information as to the recommendations formulated
     in the course of or as a result of the Services. Furthermore, they
     shall not make any use prejudicial to the Contracting Authority, of
     information supplied to them and of the results of studies, tests and
     research carried out in the course and for the purpose of performing
     the Contract.
                                ARTICLE 12
                               Independence
12.1 The Consultant shall refrain from any relationship which would com-
     promise his independence or that of his staff. If the Consultant
     fails to maintain such independence, the Contracting Authority may,
     without prejudice to compensation for any damage which he may have
     suffered on this account, terminate the Contract forthwith, without
     giving formal notice thereof.
12.2 The Consultant shall after the conclusion or termination of the Con-
     tract, limit his role in connection with the Project to the provision
     of the Services. Except with the written permission of the
     Contracting Authority, the Consultant and any other contractor, con-
     sultant or supplier with whom the Consultant is associated or affili-
     ated shall be disqualified from the execution of works, supplies or
     other services for the Project in any capacity, including tendering
     for any part of the Project.
                                ARTICLE 13
                        Specifications and Designs
13.1 The Consultant shall prepare all specifications and designs using ac-
     cepted and generally recognized systems acceptable to the Contracting
     Authority and taking into account the latest design criteria.
13.2 The Consultant shall ensure that the specifications and designs and
     all documentation relating to procurement of goods and services for
     the Project are prepared on an impartial basis so as to promote com-
     petitive tendering.
 ---pagebreak---                                    - 163 -
                               ARTICLE 14
                             Indemnification
14.1 The Consultant shall indemnify, protect and defend, at his expense,
     the Contracting Authority, its agents and employees, from and against
     all actions, claims, losses or damage arising from any act or omis-
     sion by the Consultant in the performance of the Services, including
     any violation of any legal provisions, or rights of third parties, in
     respect of patents, trade marks and other forms of intellectual pro-
     perty such as copyrights.
14.2 The Consultant shall indemnify, protect and defend, at his expense,
     the Contracting Authority, its agents and employees, from and against
     all actions, claims, losses or damages arising out of the Consult-
     ant's failure to perform his obligations under Article 10 provided
     that:-
     a) the Consultant is notified of such actions, claims, losses or dam-
        ages not later than 30 days after the Contracting Authority be-
        comes aware of them;
     b) the ceiling on the Consultant's liability under Article 14 shall
        be limited to the amount stated in the Special Conditions, and
        that such ceiling shall not apply to actions, claims, losses or
        damages caused by the Consultant's wilful misconduct;
     c) the Consultant's liability under Article 14 shall be limited to
        actions, claims, losses or damages directly caused by such failure
        to perform his obligations under the Contract and shall not in-
        clude liability arising from unforeseeable occurrences incidental
        or indirectly consequential to such failure.
14.3 The Consultant shall, at his expense, upon request of the Contracting
     Authority, remedy any defect in the performance of the Services in
     the event of the Consultant's failure to perform his obligation under
     the Contract.
14.4 Notwithstanding any contrary provisions in Article 14, the Consultant
     shall have no liability whatsoever for actions, claims, losses or
     damages occasioned by:-
     a) the Contracting Authority omitting to act on any recommendation,
        or overriding any act, decision or recommendation, of the Con-
        sultant, or requiring the Consultant to implement a decision or
        recommendation with which the Consultant disagrees or on which he
        expresses a serious reservation; or
     b) the improper execution of the Consultant's instructions by agents,
        employees or independent contractors of the Contracting Authority.
 ---pagebreak---                                     - 164 -
14.5 The Consultant shall remain responsible for any breach of his obliga-
     tions under the Contract for such period after the service have been
     completed as may be determined by the law of the Contract.
                                 ARTICLE IS
                    Medical and Insurance Arrangements
15.1 The engagement by the Contracting Authority of the Consultant shall
     be conditional upon the provision of evidence satisfactory to the
     Contracting Authority that the Consultant and/or his personnel are in
     good health and are not subject to any disability Which may interfere
     with the performance of the Services. The Contracting Authority may
     request the Consultant and/or his personnel performing the Services
     to undergo a medical examination by a qualified medical practitioner
     before leaving his or their usual place of residence and shall as
     soon as is practicable furnish the Contracting Authority with the
     medical report resulting therefrom.
15.2 For the duration of the Contract, the Consultant shall  obtain medical
      insurance for himself and other persons employed by    him under the
     Contract. Except as may be specified          in the   Contract, the
     Contracting Authority shall be under no liability in    respect of the
     medical expenses of the Consultant.
15.3 The Contracting Authority shall undertake no responsibility in re-
      spect of any life, health, accident, travel and other insurance Which
     may be necessary or desirable for the personnel of the Consultant or
     of his sub-contractors or other independent consultants for the pur-
     poses of the Services, nor for any members of the families of such
     persons.
15.4 Within 20 days of notification of approval of the Contract the Con-
      sultant shall take out and maintain a full indemnity insurance policy
      in a sum up to the limit stated in the Special Conditions and cover-
      ing, from the start of performance of the Contract and throughout its
     duration, the following aspects:-
      a) the Consultant's liability in respect of sickness or industrial
         accident affecting his employees, including the cost of repatria-
         tion on health grounds;
     b) loss of, or damage to, the Contracting Authority's equipment used
         to perform the Contract;
     c) civil liability in the event of accidents caused to third parties
         or to the Contracting Authority and any employee of that Authority
         arising out of the performance of the contract.
     d) accidental death or permanent disability resulting from bodily in-
         jury incurred during the Contract; and
 ---pagebreak---                                   - 165 -
     e) such other insurance as may be specified in the Special Conditions
         as required by the laws of the State of the Contracting Authority.
15.5 The Special Conditions may also require the Consultant to insure
     against loss or damage to the personal effects of his employees and
     their families located in the State of the Contracting Authority.
15.6 The Consultant shall furnish proof of the insurance policy and of
     regular payment of premiums without delay whenever required to do so
     by the Contracting Authority or the Supervisor.
                                 ARTICLE 16
                Proprietary Rights in Reports and Documents
16.1 All reports and data such as maps, diagrams, Drawings, specifica-
     tions, plans, statistics, calculations and supporting records or ma-
     terials acquired, compiled or prepared by the Consultant in the per-
     formance of the Contract shall be confidential and shall be the abso-
     lute property of the Contracting Authority. The Consultant shall,
     upon completion of the Contract, deliver all such documents and data
     to the Contracting Authority. The Consultant may retain copies of
     such documents and data, but shall not use them for purposes unre-
     lated to his Contract without prior written approval of the
     Contracting Authority.
16.2 The Consultant shall not publish articles relating to the Services or
     refer to them when carrying out any services for others, or divulge
      information obtained front the Contracting Authority, without the
     written consent of the Contracting Authority.
                           NATURE OF THE SERVICES
                                 ARTICLE 17
                         The Scope of the Services
17.1 The Consultant shall perform the Services under the Contract in ac-
     cordance with the Terms of Reference.
17.2 The Contract may consist of one or more of the following missions:-
     -   project identification and definition study;
     -   economic or market study;
     -   pre-feasibility and/or feasibility study;
 ---pagebreak---                                     - 166 -
                                                                             /
      -   project execution study (preliminary or detailed design, and Where
         appropriate final design for execution, preparation of tender dos-
         sier);
      -   supervision of the Project;
      - management of the execution of the Project;
      -  provision of personnel;
      -   other forms of technical assistance.
17.3 The Special Conditions shall     state  the Terms  of Reference, which
      shall include, inter alia:-
     a) the object and scope of the Contract;
     b) the degree of accuracy to be attained and the different stages or
         parts of the Services; and
      c) the type and content of reports, statements, plans, calculations,
         measurements, specifications, estimates and any other document
         that the Consultant is to draw up on completion of each phase or
         part of the study and on completion of the study itself.
17.4 Where the Contract is for technical assistance to the Contracting
     Authority and/or Supervisor, the Consultant is entrusted with an ad-
     visory function for the benefit of the Contracting Authority and/or
     Supervisor in respect of all the technical aspects of the Project
     which may arise out of its execution. The Consultant shall not have
     decision-making responsibility.
17.5 Where the Contract is for management of the execution of the Project,
      the Consultant shall assume, in accordance with the laws of the State
      of the Contracting Authority and, subject to the Supervisor's au-
      thority, all the duties of management inherent in supervising the ex-
      ecution of a Project.
17.6  If under the Special Conditions the Consultant is required to prepare
      a tender dossier, the dossier shall contain all documents necessary
      for consulting suitable contractors, manufacturers and suppliers, and
      for preparing tenders with a view to carrying out the Wbrks or pro-
     viding the supplies or services covered by an invitation to tender.
     The Contracting Authority shall provide the Consultant with the in-
      formation necessary for drawing up the administrative part of the
      tender dossier.
17.7 Where the Contract is for supervision of a Project, the Consultant is
      entrusted with the direction of the execution stage of the Project.
 ---pagebreak---                                    - 167 -
17.8 Notwithstanding Article 12.2, the Consultant responsible for the
      study and/or design stages of the Project may be entrusted with fur-
      ther services in the management and supervision of the Project in-
     cluding the provision of technical assistants.
                                 ARTICLE 18
                           Provision of Personnel
18.1 Where the Contract is for the provision of personnel for the execu-
      tion of a project, the Consultant shall provide such personnel in
      specific fields relating to the execution of the Project, in the form
     of technical assistance in an advisory and/or managerial role. Such
     personnel shall be under the direct authority of the Supervisor.
18.2 The Services shall be carried out by the personnel specified in the
     Contract for the periods of time indicated therein. The Consultant
     may, with the prior approval of the Contracting Authority, make minor
     adjustments to such periods as may be appropriate to ensure the effi-
     cient performance of the Services, provided that such adjustments
     will not cause payments made under the Contract to exceed the Con-
     tract Price.
18.3 The Consultant shall be responsible for the quality of the staff
     which he places at the disposal of the Contracting Authority.
18.4 The Consultant shall not make changes in the personnel without the
     prior approval of the Contracting Authority. However, the Consultant
     shall provide a replacement with at least equivalent qualifications
     and experience and acceptable to the Contracting Authority if:-
     a) on account of sickness or accident, a member of staff is unable to
         continue providing his services;
     b) any person specified in the Contract is found by the Contracting
         Authority to be incompetent in discharging or unsuitable for the
         performance of his duties under the Contract;
     c) for any other reasons beyond the control of the Consultant, it be-
         comes necessary to replace any of his personnel.
18.5 The remuneration to be paid for a person provided as a replacement
     shall not exceed the remuneration which would have been payable to
     the person replaced.
 ---pagebreak---                                    - 168 -
18.6 Except in the case of replacement resulting from death or where the
     Contracting Authority requests a replacement not provided for by the
     Contract, the Consultant shall bear all the additional costs arising
     out of or incidental to such replacement. Such costs shall include
     the cost of the return journey of the replaced member of staff and
     his family and, if necessary, the expenses arising from the need to
     maintain simultaneously at the place of work the member of staff to
     be replaced and his replacement.
                                ARTICLE 19
                            Staff and Equipment
19.1 The staff which the Consultant uses for the implementation of the
     Contract shall be approved by the Contracting Authority. The Special
     Conditions shall specify the minumum level of training, qualifica-
     tions and experience of the Consultant's personnel and, Where appro-
     priate, the specializations required.
19.2 References and/or curriculum vitae of each member of the Consultant's
     staff to be employed under the Contract shall be submitted to the
     Contracting Authority for approval either with the Consultant's ten-
     der in the case of a tender procedure or, in other cases, before the
     conclusion of the Contract.
19.3 The Contracting Authority shall notify his approval or refusal within
     30 days of the appointment of the Consultant or the submission under
     Article 19.2, as the case may be.
19.4 Staff approved by the Contracting Authority shall commence their du-
     ties on the date or within the period laid down in the Special Con-
     ditions or, failing this, on the date or within the periods notified
     to the Consultant by the Contracting Authority.
19.5 Save as otherwise provided in the Special Conditions, the staff of
     the Consultant shall reside close to their place of work. Where part
     of the Services is to be performed outside the State of the
     Contracting Authority, the Consultant shall keep the Supervisor in-
     formed of the names and qualifications of staff assigned to that part
     of the Services and of the equipment used.
19.6 The Consultant shall:-
     a) forward to the Supervisor within 15 days of the award of the Con-
        tract, the timetable proposed for placement of the staff, specifi-
        cation of their duties and a list of the equipment he intends to
        use for the Services;
     b) inform the Supervisor in sufficient time of the date of arrival
        and departure of each member of staff;
 ---pagebreak---                                      - 169 -
     c) submit to the Supervisor for his approval a timely request for any
        change of staff and for any alteration to the original timetable
        or change of equipment.
19.7 The Consultant shall adopt all measures necessary to provide and con-
     tinue to provide his staff with the equipment required to enable them
     to carry out their specified duties under conditions which are most
     conducive to efficiency.
                                ARTICLE 20
                                 Trainees
20.1 The Consultant shall provide training for the duration of the Con-
     tract for trainees assigned to him by the Contracting Authority under
     the terms of the Contract.
20.2 Instruction by the Consultant of such trainees shall not confer on
     them the status of employees of the Consultant. However, they must
     comply with the Consultant's instructions, and with the provisions of
     Article 11, as if they were employees of the Consultant. The Con-
     sultant may on reasoned request in writing obtain the replacement of
     any trainee whose work or conduct is unsatisfactory.
20.3 Unless otherwise provided in the Contract, remuneration for trainees
     and travel, accommodation and all other expenses incurred by the
     trainees, shall be borne by the Contracting Authority.
20.4 The Consultant shall report at quarterly intervals to the Contracting
     Authority on the training assignment. Immediately prior to the com-
     pletion of the Services, the Consultant shall draw up a report on the
     result of the training and an assessment of the qualifications ob-
     tained by the trainees with a view to their future employment. The
     form of such reports and the procedure for presenting them shall be
     as laid down in the Special Conditions.
                       PERFORMANCE OF THE CONTRACT
                                ARTICLE 21
                           Commencement Orders
21.1 The Contracting Authority shall fix the date on which performance of
     the Contract is to commence, and advise the Consultant either in the
     notification of award of Contract or by Administrative Order issued
     by the Supervisor.
 ---pagebreak---                                      - 170 -
21.2 The date for commencing performance shall be not later than 180 days
      following notification of award of the Contract unless agreed other-
     wise by the parties.
21.3 Where provision is made for Services to be performed outside the
     State of the Contracting Authority, the Contract shall commence, in-
      sofar as such Services are concerned, on the actual date of their
     performance, which shall not precede the date fixed by the
     Contracting Authority.
                                 ARTICLE 22
                            Period of Performance
22.1 The period of performance shall commence on the date fixed in accor-
     dance with Article 21.1 and shall be as stated in the Contract with-
     out prejudice to extensions of the period which may be granted under
     Article 23.
22.2  If provision is made for separate periods of performance for separate
     lots, such periods shall not be aggregated in cases where one Con-
      sultant is allocated more than one lot.
22.3  If in the case of technical co-operation projects covering a number
     of years, the Special Conditions make provision for several contrac-
      tual periods, the period of performance shall be fixed taking into
     consideration the provisions of Article 31 and the parties shall be
     bound only for the first period. Save Where one of the parties
     wishes to terminate the Contract on the expiry of a Contract period,
      the Contract shall be renewed by means of successive riders at the
     end of each period, specifying the measures to be taken by the Con-
      sultant. The remuneration for the new period shall be fixed by the
     principles established in the Contract.
22.4 Any intention not to renew the Contract for a further contractual pe-
      riod must be notified to the other party not later than 90 days prior
      to the expiry of the current contractual period.
                                 ARTICLE 23
                     Extension of Period of Performance
23.1 The Consultant may request an extension to the period of performance
      if he is or will be delayed in completing the Contract by any of the
      following causes:-
     a) extra or additional Services ordered by the Supervisor;
     b) Administrative Orders affecting the date of completion other than
         those arising from the Consultant's default;
 ---pagebreak---                                     - 171 -
     c) failure of the Contracting Authority to fulfil his obligations
        under the Contract;
     d) any suspension of the Services which is not due to the Con-
        sultant's default;
     e) force majeure;
     f) any other causes of delay referred to in these General Conditions
        which are not due to the Consultant's default.
23.2 The Consultant shall, within 15 days of becoming aware that delay may
     occur, notify the Supervisor of his intention to make a request for
     extension of the period of performance to which he considers himself
     entitled and shall within 60 days thereafter, except where otherwise
     agreed between the Consultant and Supervisor, deliver to the Super-
     visor full and detailed particulars of the request, in order that
     such request may be investigated at the time.
23.3 The Supervisor shall, by written notice to the Consultant after due
     consultation with the Contracting Authority and, where appropriate,
     the Consultant, grant such an extension of the period of performance
     as may be justified, either prospectively or retrospectively or in-
     form the Consultant that he is not entitled to an extension.
                               ARTICLE 24
                          Delays in Performance
24.1 If the Consultant does not perform the Services within the period(s)
     of performance specified in the Contract, the Contracting Authority
     shall, without formal notice and without prejudice to his other reme-
     dies under the Contract, be entitled to Liquidated Damages for every
     day, or part thereof, which shall elapse between the end of the pe-
     riod specified for performance or extended period of performance
     under Article 23 and the actual date of completion, at the rate and
     up to the maximum amount specified in the Special Conditions.
24.2 If the Contracting Authority has become entitled to the maximum claim
     under Article 24.1 he may after giving notice to the Consultant:-
     a) terminate the Contract; and
     b) complete the Services at the Consultant's cost.
 ---pagebreak---                                     - 172 -
                                ARTICLE 25
                                 Suspension
25.1 The Consultant shall, on the order of the Supervisor, suspend the
     performance of the Services or any part thereof for such time and in
     such manner as the Supervisor may consider necessary.
25.2 The Supervisor, after consultation with the Contracting Authority and
     the Consultant, shall determine such extension of the period of per-
     formance to be made to the Consultant in respect of such claim as
     shall, in the opinion of the Supervisor, be fair and reasonable.
25.3  If the period of suspension exceeds 180 days and the suspension is
     not due to the Consultant's default, the Consultant may, by notice to
     the Supervisor, request permission to resume performance of the Ser-
     vices within 30 days or terminate the Contract.
                                 ARTICLE 26
                                 Variations
26.1 The Supervisor shall have power, without changing the object or scope
     of the Contract, to order any variation to any part of the Services
     necessary for the proper completion of the Services. Such variations
     may include additions, omissions, substitutions, changes in quality,
     quantity and changes in the specified sequence, method or timing of
     execution of the Services. No order for a variation shall have the
     effect of invalidating the Contract, but the financial effect, if
     any, of all such variations shall be valued in accordance with
     Article 26.5 and 26.7.
26.2 No variation shall be made except by Administrative Order, provided
     that : -
     a) if for any reason, the Supervisor shall find it necessary to give
         an order orally, he shall as soon as possible thereafter confirm
         the order by an Administrative Order;
     b) if the Consultant shall confirm in writing an oral order given for
         the purpose of Article 26.2(a) and the confirmation shall not be
         contradicted in writing forthwith by the Supervisor, an Admin-
         istrative Order shall be deemed to have been issued for the varia-
         tion.
26.3 Save as provided by Article 26.2, prior to any Administrative Order
     for variation, the Supervisor shall notify the Consultant of the na-
     ture and form of such variation. As soon as possible, after receiv-
     ing such notice, the Consultant shall submit to the Supervisor a pro-
     posal containing:-
 ---pagebreak---                                     - 173 -
     a) a description of the service to be performed or the measures to be
        taken and a programme for execution; and
     b) any necessary modifications to the programme of performance or to
        any of the Consultant's obligations under the Contract; and
     c) any adjustment to the Contract Price in accordance with the rules
        as set out in Article 26.
26.4 Following the receipt of the Consultant's submission referred to in
     Article 26.3, the Supervisor shall, after due consultation with the
     Contracting Authority, and where appropriate the Consultant, decide
     as soon as possible whether or not the variation shall be carried
     out. If the Supervisor decides that the variation shall be carried
     out he shall issue the Administrative Order stating that the varia-
     tion shall be carried out at the prices and under the conditions
     given in the Consultant's submission referred to in Article 26.3 or
     as modified by the Supervisor in accordance with Article 26.5.
26.5 The prices for all variations ordered by the Supervisor in accordance
     with Articles 26.2 and 26.4 shall be ascertained by the Supervisor in
     accordance with the following principles:-
     a) where the task is of similar character and executed under similar
        conditions to an item priced in the Price Schedule it shall be
        valued at such rates and prices contained therein;
     b) where the task is not of a similar character or is not executed
        under similar conditions, the rates and prices in the Contract
         shall be used as the basis for valuation so far as is reasonable,
        failing which, a fair valuation shall be made by the Supervisor;
     c) if the nature or amount of any variation relative to the nature or
        amount of the whole of the Contract or to any part thereof shall
        be such that in the opinion of the Supervisor any rate or price
         contained in the Contract for any task is by reason of such varia-
         tion rendered unreasonable, then the Supervisor shall fix such
         rate or price as in the circumstances he shall think reasonable
        and proper;
     d) where a variation is necessitated by default or breach of Contract
        by the Consultant, any additional cost attributable to such varia-
         tion shall be borne by the Consultant.
 ---pagebreak---                                       174 -
26.6 On receipt of the Administrative Order requesting the variation, the
     Consultant shall proceed to carry out the variation and be bound by
      these General Conditions in so doing as if such variation were stated
      in the Contract. The Service shall not be delayed pending the grant-
      ing of any extension of time for completion or adjustment to the Con-
      tract Price. Where the order for a variation precedes the adjustment
      to the Contract Price, the Consultant shall keep records of the costs
      of undertaking the variation and of time expended thereon. Such
      records shall be open to inspection by the Supervisor at all reason-
      able times.
26.7 Where on provisional acceptance, an increase or reduction in the
      total value of the Services required under the Contract resulting
     from an Administrative Order, or from some other circumstance Which
      is not caused by the Consultant's default, exceeds 15% of the Con-
      tract Price, the Supervisor shall, after consultation with the
     Contracting Authority and the Consultant determine any additions to
     or reduction from the Contract Price as a consequence of the appli-
     cation of Article 26.5. The sum so determined shall be based on the
     amount by which the increase or decrease in value of the Service ex-
     ceeds 15%. The sum shall be notified by the Supervisor to the
     Contracting Authority and the Consultant and the Contract Price
     adjusted accordingly.
                                 ARTICLE 27
                               Wforking Hours
     The days and hours of work of the Consultant in the State of the
     Contracting Authority shall be fixed on the basis of the laws, regu-
      lations and customs of the State of the Contracting Authority and the
      requirements of the Services.
                                 ARTICLE 28
                             Leave Entitlement
28.1 Where the Contract provides for annual leave, the Consultant shall,
     during the period of performance of the Contract, be entitled to take
     annual leave on the terms laid out in Article 28.
28.2 Entitlement to annual leave shall accrue at the rate stated in the
     Contract. Such leave shall be allowable for every full period of six
     months and any part of a month thereafter during Which the Consultant
      is performing the Services. Annual leave shall be taken during the
     period of performance of the Contract at a time approved by the
     Supervisor.
 ---pagebreak---                                      - 175 -
28.3 Entitlement to annual leave shall not be commuted into cash, unless
     in the opinion of the Supervisor the requirements of the Services are
     such that annual leave cannot be taken during the period of perfor-
     mance of the Contract.
28.4 The Consultant shall not be entitled to either sick or casual leave
     provided, however, that the Supervisor may, at his sole discretion
     Whether for compassionate reasons or otherwise, permit the Consultant
     to take unpaid leave during the period of performance of the Con-
     tract.
                                ARTICLE 29
                                Information
     The Consultant shall furnish the Supervisor with such information re-
      lating to the Services and the Project as the Supervisor may at any
      time request. In this respect, periodic reports, whose subject mat-
      ter and frequency shall be as laid down in the Special Conditions,
      shall be drawn up by the Consultant. Implementation difficulties or
      technical omissions in the Terms of Reference shall form the subject
     of special reports.
                                ARTICLE 30
                                  Records
30.1 The Consultant shall keep accurate and systematic records and ac-
      counts in respect of the Services in such form and detail as is cus-
      tomary in the profession and as shall be sufficient to establish ac-
      curately that the costs and expenditures which are referred to in
     Article 35 have been duly incurred for the performance of the Ser-
     vices.
30.2 The Consultant shall permit the Supervisor to inspect, at any reason-
     able time, the records and accounts relating to the Services and to
     make copies thereof and shall permit the Supervisor or any person au-
      thorized by the Supervisor, at any reasonable time, to audit such
     records and accounts both during and after provision of the Services.
                                ARTICLE 31
                           Submission of Reports
31.1 Immediately prior to the completion of the Services the Consultant
     shall draw up a confidential general report together, where appropri-
     ate, with a financial analysis of the Project and a critical study of
     any major problems which may have arisen during the performance of
     the Project.
 ---pagebreak---                                     - 176 -
31.2 The report referred to in Article 31.1 shall be forwarded to the
     Supervisor in the number of copies stated in the Special Conditions,
     not later than 60 days after the completion of the Services by the
     Consultant. Such report shall not bind the Contracting Authority.
31.3 Where the Contract is performed in phases, the execution of each
     phase shall give rise to the preparation of a report by the Con-
      sultant, save as otherwise provided in the Special Conditions.
31.4 The persons other than the Supervisor to Whom copies of the reports
     and documents referred to in Articles 29 and 31 are to be sent and
      the Time Limits within which the Consultant shall forward them shall
     be stated in the Special Conditions. Such Time Limits shall take ac-
      count of periods specified in the Special Conditions for examining
      and approving or rejecting reports and documents by the Contracting
     Authority.
                                ARTICLE 32
                     Approval of Reports and Documents
32.1 The approval by the Contracting Authority of reports and documents
     drawn up and forwarded by the Consultant shall certify that they com-
     ply with the terms of the Contract.
32.2 The Contracting Authority shall, within the Time Limits laid down in
      the Special Conditions, notify the Consultant of his decision con-
      cerning the documents or reports forwarded to him, giving reasons
      should he reject the reports or documents, or request amendments.
32.3 Where a report or document is approved by the Contracting Authority
      subject to amendments to be made by the Consultant, the Contracting
     Authority shall, prescribe a period for making the amendments re-
      quested.
32.4 Where the Contract is performed in phases, the execution of each
      phase shall be subject to the approval, by the Contracting Authority,
      of the preceding phase except where the phases are carried out con-
      currently.
                                 PAYMENTS
                                ARTICLE 33
                            General Provisions
33.1 The currency or currencies of payments shall be as stated in the Con-
     tract.
 ---pagebreak---                                     - 177 -
33.2 The administrative and technical conditions to which the payment of
     advances, interim payments or payment of balance are subject, in ac-
     cordance with Articles 34 to 39, shall be as stated in the Special
     Conditions.
                                 ARTICLE 34
                                  Advances
34.1  If the Special Conditions so provide, advances shall be granted to
      the Consultant, at his request, for operations connected with the ex-
     ecution of the Services, as a lump-sum advance enabling him to meet
     expenditure resulting from the commencement of the Contract.
34.2 Subject to the provisions of the Special Conditions, the total amount
     of the advances shall not exceed 20% of the original Contract Price.
34.3 No advance shall be granted until:-
     a) the conclusion of the Contract;
     b) provision to the Contracting Authority by the Consultant of a sep-
         arate directly liable guarantee for the full amount of the ad-
         vance, established in the form of a bank guarantee, a banker's
         draft, a certified cheque, a bond provided by an insurance and/or
         bonding company, an irrevocable letter of credit or a cash de-
         posit. If the guarantee is to be provided in the form of a bank
         guarantee, a banker's draft, a certified cheque or a bond, it
         shall be issued by a bank or bonding and/or insurance company ap-
         proved by the Contracting Authority in accordance with the eligi-
         bility criteria applicable for the award of the Contract. In any
         case, the guarantee shall be valid and remain effective for at
         least 60 days after acceptance of the final report.
34.4 The Consultant shall use the advance exclusively for operations con-
     nected with the performance of the Services. Should the Consultant
     misuse any portion of the advance, it shall become due and repayable
      immediately amd mo further advance payment shall be made to him.
34.5 Should the advance guarantee cease to be valid and the Consultant
     fail to re-validate it, either a deduction equal to the amount of the
     advance may be made by the Contracting Authority from future payments
     due to the Consultant under the Contract, or if in the opinion of the
     Contracting    Authority   such   deduction   is  impracticable,   the
     Contracting Authority may terminate the Contract.
34.6 If the Contract is terminated for any reason whatsoever, the guaran-
     tees securing the advances may be invoked forthwith in order to repay
     the balance of the advances still owed by the Consultant, and the
     guarantor shall not delay payment or raise objection for any reason
     whatever.
 ---pagebreak---                                     - 178 -
34.7 The advance guarantee provided for in Article 34 shall be released as
     and when advances are reimbursed.
34.8 Further conditions and procedures for granting and reimbursing ad-
     vances shall be as laid down in the Special Conditions.
                                ARTICLE 35
                             Payment Procedure
35.1 The Consultant shall be entitled to interim payments or to the pay-
     ment of the final balance in accordance with the procedures, sched-
     ules and Time Limits stipulated in the Contract as and when the Ser-
     vices are provided and accepted.
35.2 Remuneration for parts of a month shall be based on a daily rate of
     one thirtieth of the corresponding monthly unit price. Abatements
     for any incomplete provision of Services shall be made on the basis
     of the prices laid down in the Contract in respect of the part of the
     Services which were not provided.
35.3 For the part of the Contract which is based on overall and fixed
     prices or on unit prices, provision may be made for the payment of
     interim payments only in respect of Services rendered and, in the
     case of the part of a Contract based on the reimbursement of costs,
     on submission of the appropriate supporting documents.
35.4 The amount of an interim payment shall not exceed 9 0 % of the value of
      the Services to which it relates; the remaining 1 0 % thus withheld
     shall be paid as a final balance.
35.5 The frequency of interim payments shall be as laid down in the Spe-
     cial Conditions. As a general rule they shall be paid either on a
     monthly basis or as and When certain phases or parts of the Services
     are completed.
35.6 The conditions to which payments relating to other services entrusted
      to the Consultant shall be subject, shall be as laid down in the Spe-
     cial Conditions.
35.7 For each payment, the Consultant shall send the Contracting Authority
     four copies of a written request for payment together with itemized
     statements, accompanied by receipts, invoices, vouchers and other ap-
     propriate supporting materials, of the amounts payable for each month
     or period.
 ---pagebreak---                                       - 179 -
35.8  within 30 days of receipt of the said application for interim pay-
      ment, it shall be approved or amended in such manner that, in the
      Supervisor's opinion, the application reflects the amount due to the
      Consultant in accordance with the Contract. In cases where there is
      a difference of opinion as to the value of an item, the Supervisor's
      view shall prevail. On determination of the amount due to the Con-
      sultant, the Supervisor shall issue to the Contracting Authority and
      the Consultant an interim payment certificate for the amount due to
      the Consultant and shall inform the Consultant of the Service for
      which payment is being made.
35.9  The Supervisor may, by an interim payment certificate, make any cor-
      rections or modifications to any previous certificate issued by him
      and shall have power to modify the valuation in or withhold the issue
      of any interim payment certificate if the Services or any part
      thereof are not being carried out to his satisfaction.
35.10 Payment of the final balance shall be subject to performance by the
      Consultant of all his obligations relating to the execution of all
      phases or parts of the Services and to the approval by the
      Contracting Authority of the final phase or part of the Services.
      Final payment shall be made only after the final report and a final
      statement, identified as such, shall have been submitted by the Con-
      sultant and approved as satisfactory by the Contracting Authority.
      Any amount which the Contracting Authority has paid, or caused to be
      paid, in accordance with Article 35 in excess of the Consultant's en-
       titlement under the Contract, shall be reimbursed by the Consultant
       to the Contracting Authority within 30 days after receipt by the Con-
       sultant of notice thereof.
35.11 If any of the following events occurs and persists, the Contracting
      Authority may, by written notice to the Consultant, suspend in whole
      or in part, payments due to the Consultant under the Contract:-
      a) the Consultant defaults in the execution of the Contract;
      b) any other condition for which the Consultant is responsible under
          the Contract and which, in the opinion of the Contracting
          Authority, interferes, or threatens to interfere, with the suc-
          cessful completion of the Project or the Contract.
                                  ARTICLE 36
                            Travel and Transport
36.1  Unless the Special Conditions provide otherwise, the travel expenses
      for eligible staff of the Consultant and of their spouses and depen-
      dent children within the meaning of the law of the country in which
      the Consultant has his registered place of business, shall be borne
      by the Contracting Authority. These costs shall be limited to the
      cost of the most direct practicable route between the usual place of
      residence and the place where the Contract is to be performed.
 ---pagebreak---                                     - 180 -
36.2 Air travel shall be by economy class. Journeys necessitating travel
      by sea, rail or river shall be made first class. The cost of trans-
     porting the luggage of eligible staff between the usual place of res-
      idence and the place where the Contract is to be performed shall be
     borne by the Contracting Authority within the weight limits stipu-
      lated in the Special Conditions.
36.3 The conditions under Which transport cost of documents, equipment and
     materials may be borne by the Contracting Authority, shall be as
      stated in the Special Conditions.
36.4  In all cases, reimbursement will be subject to submission of support-
      ing documents.
                                 ARTICLE 37
                             Revision of Prices
37.1 Unless otherwise stipulated in the Special Conditions, and except as
     provided in Article 37.4, Contracts shall be at fixed prices which
      shall not be revised.
37.2 Where the prices may be revised under the Contract, such revision
      shall take into account variation in the prices of significant local
     or external elements which served as a basis for the calculation of
      the tender price, such as manpower and other services. The detailed
      rules for the revision shall be as laid down in the Special Condi-
      tions.
37.3 Prices contained in the Consultant's tender shall be deemed:-
      a) to have been arrived at on the basis of the conditions in force 30
         days prior to the latest date fixed for the submission of tenders,
         or in the case of direct agreement Contracts, on the date of the
         Contract; and
      b) to have taken account of the legislation and the relevant tax ar-
         rangements applicable at the reference date fixed in Article
         37.3(a).
37.4  In the event of changes to or introduction of any national or State
      statute, ordinance, decree, or other law, or any regulation or bye-
      law of any local or other public authority, after the date stated in
     Article 37.3 which causes a change in the contractual relationship
     between parties to the Contract, the Contracting Authority and the
     Consultant shall consult on how best to proceed further under the
     Contract, and may as a result of such consultation decide:-
     a) to modify the Contract;
 ---pagebreak---                                      - 181 -
     b) on payment of compensation for      the resulting imbalance by one
         party to the other; or
     c) to terminate the Contract by nu tua 1 agreement.
37.5 In the event of a delay in the performance of the Services for which
     the Consultant is responsible or at the end of the period of perfor-
     mance, revised as necessary in accordance with the Contract, there
     shall be no further revision of prices within the 30 days before com-
     pletion of the Services except for the application of new price in-
     dexation, if this is to the benefit of the Contracting Authority.
                                 ARTICLE 38
                              Delayed Payments
38.1 Payment to the Consultant of the amounts due under each of the inter-
      im payment certificates, and the certificate for the final balance
      issued by the Supervisor shall be made by the Contracting Authority
     within 90 days of such certificate being delivered to the Contracting
     Authority. If the period laid down for payment has been exceeded,
     the Consultant shall qualify for interest calculated pro rata on the
     basis of the number of days delay at the rate specified in the Spe-
     cial Conditions, subject to a maximum period also specified therein.
     The Consultant shall be entitled to such payment without formal no-
      tice and without prejudice to any other right or remedy under the
     Contract. In the case of the final statement of account, the inter-
      est for the delayed payment shall be calculated on a daily basis at
      the rate specified in the Special Conditions.
38.2 Any default in payment of more than 120 days from the expiry of the
     period laid down in Article 38.1 shall entitle the Consultant either
     not to perform the Contract or to terminate it.
                                 ARTICLE 39
                          Payment to Third Parties
39.1 All orders for payments to third parties may be carried out only
      after an assignment made in accordance with Article 6. The assign-
     ment shall be notified to the Contracting Authority.
39.2 Notification of beneficiaries of assignment shall be the sole respon-
      sibility of the Consultant.
39.3  In the event of a legally binding attachment of the property of the
     Consultant affecting payments due to him under the Contract and
     without prejudice to the Time Limit laid down in Article 38, the
     Contracting Authority shall have 30 days, starting from the day when
      it receives notification of the definitive lifting of the obstacle to
      payment, to resume payments to the Consultant.
 ---pagebreak---                                       182 -
                     BREACH OF OQNIRACT AM) TERMINATION
                                 ARTICLE 40
                             Breach of Contract
40.1 Either party commits a breach of Contract where he fails to discharge
     any of his obligations under the Contract.
40.2 Where a breach of Contract occurs, the party injured by the breach
      shall be entitled to the following remedies:-
      a) damages; and/or
     b) termination of the Contract.
40.3 Damages may be:-
      a) General Damages; or
      b) Liquidated Damages.
40.4  In any case where the Contracting Authority is entitled to damages,
      it may deduct such damages from any sums due to the Consultant or
      from the appropriate guarantee.
40.5  Subject to the law of the State of the Contracting Authority, the
     Contracting Authority shall be entitled to compensation for any dam-
      age which comes to light after the contract is completed.
                                 ARTICLE 41
                  Termination by the Contracting Authority
41.1 The Contracting Authority may, at any time and with immediate effect,
      terminate the Contract, except as provided for in Article 41.2.
41.2 Except as otherwise provided in these General Conditions, the Con-
      tracting Authority may, after giving 7 days notice to the Consultant,
      terminate the Contract in any of the following cases where:-
     a) the Consultant fails to carry out the Services substantially in
         accordance with the Contract;
     b) the Consultant continues to default for a period of 14 days after
         the Contracting Authority has given notice to him of suspension of
         payments under Article 35.11;
 ---pagebreak---                                      - 183 -
     c) the Consultant fails to comply within a reasonable time with the
        notice given by the Supervisor requiring him to make good the ne-
        glect or failure to perform his obligations under the Contract
        Which seriously affects the proper and timely performance of the
        Services;
     d) the Consultant refuses or neglects to carry out Administrative Or-
        ders given by the Supervisor;
     e) the Consultant assigns the Contract or sub-contracts without the
        authorization of the Contracting Authority;
     f) the Consultant becomes bankrupt or insolvent, or has a receiving
        order made against him, or compounds with his creditors, or car-
         ries on business under a receiver, trustee or manager for the ben-
         efit of his creditors, or goes into liquidation;
     g) any adverse final judgment is made in respect of an offence af-
        fecting the professional conduct of the Consultant;
     h) any other legal disability hindering performance of the Contract
         occurs;
     i) any organizational modification occurs involving a change in the
         legal personality, nature or control of the Consultant, unless
         such modification is recorded in an endorsement to the Contract;
     j) the Consultant fails to maintain his independence     in accordance
        with Article 12.1;
     k) the Consultant fails to provide the required guarantees or insur-
        ance, or if the person providing the earlier guarantee or insur-
        ance is not able to abide by his commitments.
41.3 Termination shall be without prejudice to any other rights or powers
     under the Contract of the Contracting Authority and the Consultant.
     The Contracting Authority may, thereafter, complete the Services
     itself, or conclude any other Contract with a third party, for the
     account of the Consultant. The Consultant's liability for delay in
     completion shall immediately cease When the Contracting Authority
     terminates the Contracts without prejudice to any liability there-
     under that may have already been incurred.
41.4 Upon termination of the Contract or when he has received notice
     thereof, the Consultant shall take immediate steps to bring the Ser-
     vices to a close in a prompt and orderly manner and to reduce expen-
     diture to a minimum.
41.5 The Supervisor shall, as soon as is possible after termination, cer-
     tify the value of the Services and all sums due to the Consultant as
     at the date of termination.
 ---pagebreak---                                     - 184 -
41.6 The Contracting Authority shall not be obliged to make any further
      payments to the Consultant until the Services are completed, where-
     upon the Contracting Authority shall be entitled to recover from the
     Consultant the extra costs, if any, of completing the Services, or
      shall pay any balance due to the Consultant.
41.7  If the Contracting Authority terminates the Contract, it shall be en-
      titled to recover from the Consultant any loss it has suffered up to
      the maximum amount stated in the Contract. If no maximum amount is
      stated, the Contracting Authority shall, without prejudice to its
      other remedies under the Contract, be entitled to recover that partof
      the Contract Price which is attributable to that part of the Ser-
     vices which has not, by reason of the Consultant's failure, been sat-
      isfactorily completed.
41.8 Where the termination is mot due to am act or omission of the Con-
      sultant, the Consultant shall be entitled to claim in addition to
      sums owing to him for work already performed, an indemnity for loss
      suffered.
                                 ARTICLE 42
                       Termination by the Consultant
42.1 The Consultant may, after giving 14 days notice to the Contracting
     Authority, terminate the Contract if the Contracting Authority:-
      a) fails to pay the Consultant the amounts due under any certificate
         of the Supervisor after the expiry of the Time Limit stated in
         Article 38.2; or
      b) consistently  fails  to meet his obligations   after  repeated re-
         minders; or
      c) suspends the progress of the Services or any part thereof for more
         than 180 days for reasons not specified in the Contract, or not
         due to the Consultant's default.
42.2  Such termination shall be without prejudice to any other rights of
      the Contracting Authority or the Consultant acquired under the Con-
      tract.
42.3  In the event of such termination, the Contracting Authority shall pay
      the Consultant for any loss or injury the Consultant may have suf-
      fered. Such additional payment may not exceed a limit which has to
      be specified in the Contract.
 ---pagebreak---                                    - 185 -
                                ARTICLE 43
                               Force Majeure
43.1 Neither party shall be considered to be in default or in breach of
     his obligations under the Contract if the performance of such obliga-
     tions is prevented by any circumstances of force majeure which arise
     after the date of notification of the award or the date when the Con-
     tract becomes effective, whichever is the earlier.
43.2 The term "force majeure", as used herein shall mean acts of God,
     strikes, lock-outs or other industrial disturbances, acts of the pub-
     lic enemy, wars, whether declared or not, blockades, insurrection,
     riots,   epidemics,   landslides,   earthquakes,  storms,   lightning,
     floods «washouts, civil disturbances, explosions, and any other
     similar unforeseeable events, not within the control of either party
     and Which by the exercise of due diligence neither party is able to
     overcome.
43.3 Notwithstanding the provisions of Articles 24 and 41, the Consultant
     shall not be liable for Liquidated Damages or termination for default
     if, and to the extent that, his delay in performance or other failure
     to perform his obligations under the Contract is the result of an
     event of force majeure. The Contracting Authority shall similarly
     not be liable, notwithstanding the provisions of Articles 38 and 42,
     to payment of interest on delayed payments, for non-performance or
     for termination by the Consultant for default, if, and to the extent
     that, the Contracting Authority's delay or other failure to perform
     its obligations is the result of force majeure.
43.4 If either party considers that any circumstances of force majeure
     have occurred which may affect performance of his obligations he
     shall promptly notify the other party and the Supervisor giving de-
     tails of the nature, the probable duration and likely effect of the
     circumstances. Unless otherwise directed by the Supervisor in writ-
     ing, the Consultant shall continue to perform his obligations under
     the Contract as far as is reasonably practicable, and shall seek all
     reasonable alternative means for performance of his obligations which
     are not prevented by the force majeure event. The Consultant shall
     not put into effect such alternative means unless directed so to do
     by the Supervisor.
43.5 If the Consultant incurs additional costs in complying with the
     Supervisor's directions or using alternative means under Article 43.4
     the amount thereof shall be certified by the Supervisor.
43.6 If circumstances of force majeure have occurred and persist for a pe-
     riod of 180 days then, notwithstanding any extension of the period of
     performance that the Consultant may by reason thereof have been
     granted, either party shall be entitled to serve upon the other 30
     days' notice to terminate the Contract. If at the expiry of the pe-
     riod of 30 days the situation of force majeure persists, the Contract
     shall terminate and in consequence thereof, the parties shall be re-
     leased from further performance of the Contract.
 ---pagebreak---                                      - 186 -
                                 ARTICLE 44
                                   Decease
44.1 Where the Consultant is a natural person, the Contract shall be auto-
     matically terminated if that person dies. However, the Contracting
     Authority shall examine any proposal made by the heirs or bene-
     ficiaries if they have notified their wish to continue the Contract.
     The decision of the Contracting Authority shall be notified to those
      concerned within 30 days of receipt of such proposal.
44.2 Where the Consultant consists of natural persons and one or more of
      them die, a report shall be agreed between the parties on the
     progress of the Services and the Contracting Authority shall decide
     whether to terminate or continue the Contract in accordance with the
     undertaking given by the survivors and by the heirs or beneficiaries,
      as the case may be.
44.3  In the cases provided for in Article 44.1 and 44.2, persons offering
      to continue to perform the Contract shall notify the Contracting
     Authority thereof within 15 days of the date of decease.
44.4 Such persons shall be jointly and severally liable, or as otherwise
      stated in the Special Conditions, for the proper performance of the
     Contract to the same extent as the Consultant. Continuation of the
     Contract shall be subject to the rules relating to establishment of
     any guarantee provided for in these Conditions.
                           SETTLBdENT OF DISPUTES
                                 ARTICLE 45
                          Settlement of Disputes
45.1 The Contracting Authority and the Consultant shall make every effort
      to amicably settle any dispute relating to the Contract which may
     arise between them, or between the Supervisor and the Consultant.
45.2 The Special Conditions shall prescribe:-
     a) the procedure for the amicable settlement of disputes;
     b) the Time Limits within which the amicable settlement procedure may
         be invoked after the time that the dispute is notified to the
         other party and the maximum Time Limit within which such settle-
         ment may be reached, provided that the Time Limit prescribed for
         reaching such settlement does not exceed 120 days from the com-
         mencement of the adopted procedure;
 ---pagebreak---                                    - 187 -
     c) the Time Limits for responding in writing to a request for amica-
        ble settlement or to other requests permitted during the course of
        that procedure and the consequence of failure to comply with those
        Time Limits.
45.3 The parties may agree to the settlement of the dispute by concilia-
     tion within a specific Time Limit by a third party after the amicable
     settlement procedure adopted has failed.
45.4 The amicable settlement or conciliation procedure adopted shall in
     all cases involve a procedure in which complaints and responses are
     notified to the other party.
45.5 In the absence of an amicable settlement or settlement by concilia-
     tion within the maximum Time Limits specified, the dispute shall :-
     a) in the case of a national contract, be settled in accordance with
        the national    legislation of the State of the Contracting
        Authority; and
     b) in the case of a transnational Contract, be settled by arbitration
        in accordance with the procedural rules adopted by the EBC
        Counc i1.
 ---pagebreak---                 - 188 -
                         ANNEX V
PROCEDURAL RULES ON CONCILIATION
  AND ARBITRATION OF CONTRACTS
         FINANCED BY THE
    EUROPEAN DEVELOPMENT FUND
            IN THE OCT
 ---pagebreak---                                    - 189 -
                           TABLE OF CONTENTS
                            I - INIWDDUCTICN
                                                            Page
Article  1 Scope of application                             191
Article  2 Definitions                                      191
Article  3 Notice and Calculation of Time                   192
Article  4 Exhaustion of Internal Administrative Procedures 192
Article  5 Conciliation                                     193
                            II - THE TRIBUNAL
Article 6  Nationality of Arbitrators.                      194
Article 7  Number of Arbitrators                            194
Article 8  Appointment of Sole Arbitrator                   194
Article 9  Appointment of Three Arbitrators                 195
Article 10 Appointments by the Appointing Authority         196
Article 11 Challenge of Arbitrators                         197
Article 12 Replacement of Arbitrator                        198
                   III - THE ARBITRATION PROCEEDINGS
Article 13 General Provisions                               198
Article 14 Applicable Law and Procedural Rules              199
Article 15 Language of the Proceedings                      200
Article 16 Venue of the Proceedings                         200
Article 17 Representation and Assistance                    200
Article 18 Commencement of Arbitration Proceedings          201
Article 19  Statement of Claim                              202
Article 20  Statement of Defence                             202
Article 21 Amendments to the Claim or Defence                203
Article 22  Pleas to the Jurisdiction of the Tribunal        203
Article 23 Further "Written Statements                       203
Article 24 Time Limits                                       204
Article 25 Evidence                                          204
Article 26 Oral Proceedings                                  204
Article 27  Interim Measures of Protection                   205
Article 28 Experts                                           205
Article 29 Default                                           206
Article 30 Closure of Hearings                               206
Article 31 \teiver of Rules                                  207
 ---pagebreak---                                   - 190 -
                            I V - THE ./TORD           Page
Article 32 Decisions                                    20?
Article 33 Time, Scope, Form and Effect of the Avard    207
Article 34 Enforcement of the Award                     208
Article 35 Settlement or Other Grounds for Termination  20£
Article 36 Interpretation of the Award                  209
Article 37 Correction of the Award                      209
Article 38 Additional Avard                             21C
Article 39 Fees                                         210
Article 40 Costs                                        211
Article 41 Deposit of Costs                             212
 ---pagebreak---                                - 191 -
                      I - INIRCOUCIORY RULES
                             ARTICLE 1
                       Scope of Application
Disputes relating to a contract financed by the European Development
Fund (FDF) which, pursuant to the provisions of the General Conditi-
ons and the Special Conditions governing the contract, may be settled
by conciliation or by arbitration shall be settled in accordance with
these Procedural Rules.
                             ARTICLE 2
                            Definitions
In these Rules, unless the context otherwise requires, the following
words and expressions shall have the meaning here assigned to them:-
OCT:     the Overseas Countries and Territories who through the Coun-
         cil Decision have been associated with the European Economic
        Gxrmunity (EBC).
Council Decision: Decision - - / — / E B C of    by the Council of the
        European Communities on the association of the overseas coun-
         tries and territories with the EBC.
Member State: a Member State of the EBC.
Administrative Agency: the Agency in the OCT concerned given the
         function of settling by administrative methods disputes aris-
         ing under or in connection with Contracts to which the
        Contracting Authority is a party.
The Tribunal: the Arbitral Tribunal.
Appointing Authority: the authority agreed by the Parties to an
        arbitration, or in the absence of such agreement, identified
        by these Rules, as the authority to appoint an Arbitrator.
Contracting Authority: the State or the legal person governed by pub-
         lic or private law which concludes the contract or on behalf
        of Which the contract is concluded.
The Contract: an EDF Contract for works, supplies or services.
Claimant: the Party which commences arbitration proceedings by giving
        notice to the other Party requesting the arbitration and sub-
        mitting claims.
 ---pagebreak---                                       192 -
    Respondent: the Party to the arbitration against whom claims are
             made.
    Party: when used in connection with an arbitration, the Claimant or
              Respondent in the arbitration.
                                 ARTICLE 3
                      Notice and Calculation of Time
3.1 Any notice provided by these Rules shall be served by registered let-
    ter    or   physically   delivered with    a   request  for a    dated
    acknowledgement of receipt in either case. A notice shall be deemed
    to have been received on the day it is so delivered.
3.2 For the purposes of calculating a period of time under these Rules,
    such period shall begin to run on the day following the day When a
    notice, communication or proposal, is received. If the last day of
    such period is am official holiday or a non-working day, at the ad-
    dress mentioned in the notice, communication or proposal, the period
    shall be extended until the first working day which follows. How-
    ever, official holidays or non-working days occurring during the run-
    ning of the period of time shall be included in calculating the pe-
    riod.
                                 ARTICLE 4
             Exhaustion of Internal Administrative Procedures
4.1 A dispute shall not be referred to arbitration under these Rules un-
    less all internal administrative procedures provided by the OCT con-
    cerned for settlement of such disputes have been or are deemed to
    have been, exhausted. Recourse to administrative proceedings shall
    be deemed to have been exhausted if no final decision has been issued
    by the Administrative Agency within 120 days of the receipt of the
     initial application for settlement by it.
4.2 In cases where recourse to administrative procedures by an applicant
    is, due to the absence of such procedures in the OCT concerned, not
    possible, a dispute may be referred to arbitration under these Rules
    only after the applicant has given notice of his complaint to the
    other party, and no meaningful steps have been taken by that other
    party to remedy or correct the cause of complaint within 120 days
    after the receipt of the notice.
 ---pagebreak---                                     - 193 -
                                ARTICLE 5
                              Conciliation
5.1 At any time before a request for arbitration, a person with the right
     to request the arbitration may request the amicable intervention of
     the agency financing the contract or the settlement of the dispute by
     conciliation in accordance with these Rules.
5.2  If the parties to the dispute agree, the conciliation shall be con-
     ducted by a sole Conciliator, otherwise it shall be conducted by a
    Committee of three Conciliators.
5.3 To qualify for appointment as Conciliator, the person must be a na-
     tional of either the OCT or a Member State.
5.4 Wiere the conciliation is to be conducted by a sole Conciliator, the
     parties to the dispute shall agree on the Conciliator. Wiere the
    Conciliation is to be conducted by a Conciliation Committee, each of
     the parties to the dispute shall nominate one of the members of the
    Committee. The third member of the Committee who shall be Chairman,
     and who shall be of a nationality other than that of the parties in-
    volved, shall be chosen by the other members of the Committee.
5.5 The party making a request for conciliation shall notify the other
     party of the request.
    The request shall consist of a statement of the case of the applicant
     and shall be accompanied by copies of relevant papers and documents.
    The request shall also contain the name and address of the person
    proposed or nominated as a Conciliator.
5.6 Within 60 days of receipt of the notice of the request, the other
    party shall notify the applicant whether he is prepared to accept an
     attempt at conciliation, and in that event to submit to the applicant
     a reply to the applicant's case. The reply shall also contain the
    name and address of the person proposed or nominated by the other
    party as a Conciliator.
5.7 Within 30 days of the receipt of the reply, the members of the Con-
     ciliation Comnittee selected by the parties shall nominate the
    Chairman.
5.8 The proceedings of the Conciliator or Conciliation Committee shall be
    as informal and expeditious as is compatible with a just and objec-
     tive settlement of the dispute and shall be based on a fair hearing
    of each party.
    Each of the parties may appear in person or be represented by an
    agent of his choice.
5.9 After examining the case, the Conciliator or Conciliation Committee
     shall submit terms of settlement to the parties.
 ---pagebreak---                                    - 194 -
5.10 Should a settlement result, the Conciliator or Conciliation Committee
     shall draw up and sign a record of the settlement. The record shall
     be signed by the parties to signify their acceptance thereof. The
     record of the settlement so signed by the parties shall be binding
     upon them.
5.11 Copies of the record of settlement so signed shall be given to the
     parties.
5.12 Should a settlement not result, the parties shall be at liberty to
     refer their dispute to arbitration under these Rules, in which case,
     nothing that has transpired in connection with the proceedings before
     the Conciliator or Conciliation Committee shall in anyway affect the
     legal rights of any of the parties at the arbitration.
5.13 No person having sat as a Conciliator or a member of a Conciliation
     Committee for the settlement of a dispute may be appointed Arbitrator
     for the same matter.
                       II - T H E     TRIBUNAL
                                 ARTICLE 6
                        Nationality of Arbitrators
     To qualify for appointment as an Arbitrator, a person must be a na-
     tional of either the OCT or a Member State.
                                 ARTICLE 7
                          Number of Arbitrators
     If the Parties agree, the Tribunal shall be constituted by one Arbi-
     trator only. Such agreement must be reached by the Parties within 15
     days after receipt by the Respondent of the notice commencing the ar-
     bitration proceedings as provided for in Article 18. If the Parties
     fail to agree to arbitration by one Arbitrator within the time speci-
     fied, or if they otherwise agree, the Tribunal shall be constituted
     by three Arbitrators.
                                 ARTICLE 8
                     Appointment of Sole Arbitrator
8.1  If a sole Arbitrator is to be appointed, the Parties shall agree on
     that Arbitrator or upon the Appointing Authority for making the ap-
     pointment thereof within 60 days after the commencement of the arbi-
     tration proceedings as laid down in Article 18.
 ---pagebreak---                                     - 195 -
8.2 Where:-
    a) the Parties are unable to agree either on the Arbitrator or on
        the Appointing Authority within the specified 60 days, or
    b) the Appointing Authority agreed by the Parties refuses to act, or
        fails to appoint the Arbitrator, within 60 days of receipt of the
        Parties' request therefore,
     either Party may request the most senior in rank from amongst the
     judges of the International Court of Justice at the Hague who are na-
     tionals of the OCT and the Member States to exercise the powers of
     the Appointing Authority.
                                ARTICLE 9
                      Appointment of Three Arbitrators
9.1  If three Arbitrators are to be appointed, each Party shall appoint
     one Arbitrator. The two Arbitrators thus appointed shall choose the
     third Arbitrator who shall be the presiding Arbitrator of the Tribu-
    nal.
9.2 The appointment by each Party of an Arbitrator shall be made within
     60 days from the date of the agreement between the Parties that the
    Tribunal be constituted by three Arbitrators, or the date when the
     constitution of the Tribunal by a sole Arbitrator was, in terms of
    Article 7.1, excluded.
9.3 If:-
    a) within 30 days after the appointment by each Party of his Arbitra-
        tor, the two appointed Arbitrators have not chosen the third Arbi-
        trator, or
    b) within 30 days after the receipt of the notification of the ap-
        pointment by one Party of an Arbitrator the other Party has not
        notified the first Party of the Arbitrator he has appointed,
    the required Arbitrator shall upon request by either Party, be ap-
    pointed by the Appointing Authority.
9.4 The Appointing Authority shall be agreed by the Parties not later
    than 60 days after the particular failure which gives rise to the
    need to invoke that authority. If after the expiration of that pe-
    riod an Appointing Authority has not been agreed by the Parties,
    either Party may request the most senior in rank from amongst the
    judges of the International Court of Justice at the Hague who are na-
    tionals of the OCT and the Member States to exercise the powers of
    the Appointing Authority.
 ---pagebreak---                                      - 196 -
                                  ARTICLE 10
                   Appointments by the Appointing Authority
10.1 When an Appointing Authority is requested to appoint an Arbitrator,
      the Party which makes the request shall send to the Appointing
     Authority a copy of the notice of arbitration specified in Article
      18.1 and a copy of the Contract under or in connection with which the
     dispute has arisen. The Appointing Authority may require from either
     Party such information as he deems necessary to fulfil his function.
10.2 Either Party may propose names of persons suitable for appointment as
     Arbitrators to the Appointing Authority. Where such proposal is
     made, the full names, addresses and nationalities of the persons pro-
     posed shall be given, together with a description of their qualifica-
      tions.
10.3 The Appointing Authority shall appoint the Arbitrator or Arbitrators
     as promptly as possible. In making the appointment, the Appointing
     Authority shall:-
     a) have regard to such considerations as are likely to secure    the ap-
         pointment of an independent and impartial Arbitrator of a   nation-
         ality other than the nationalities of the Parties, and      of high
         moral    standing, who has      a recognised   competence   in the
         field of law, technical knowledge or finance applicable       to the
         matters in dispute; and
     b) unless both Parties agree otherwise, or the Appointing Authority
         decides in his discretion that the procedure is not appropriate
         for the particular case, use the following list-procedure:-
         i)    the Appointing Authority shall communicate to both Parties an
               identical list containing at least three names of persons
               qualified for appointment as arbitrators in terms of Articles
               6.1 and 10.3(a);
         ii) within 30 days after the receipt of this list, each Party may
               return the list to the Appointing Authority after deleting
               the name or names to which he objects, and numbering the re-
              maining names on the list in the order of his preference. If
               the list is not returned or no alteration is made in the
               order in which the names appear in the original list, the
               names on that list shall be deemed to have been approved by
               the Party concerned in the order in which they appear;
         iii) upon receipt of the list returned by both parties, or after
               the expiration of the time limit for the return, whichever is
               the earlier, the Appointing Authority shall within 30 days
               appoint the Arbitrator from among the names approved or
               deemed to be approved, on the list and in accordance with the
               order of preference indicated by the Parties;
 ---pagebreak---                                    - 197 -
         iv) if for any reason the appointment cannot be made according to
              this procedure, the Appointing Authority may appoint a suit-
              able Arbitrator, having due regard to the interest of the
              Parties, the nature of the dispute and, where applicable, the
              fact that one of the Parties is a State.
                                 ARTICLE 11
                          Challenge of Arbitrators
11.1 A prospective Arbitrator shall disclose to those who approach him in
      connection with his possible appointment any facts or circumstances
      likely to give rise to justifiable doubts or suspicion as to his im-
     partiality or independence. A person appointed Arbitrator shall
     disclose such facts or circumstances to the Parties unless they have
     already been informed by him of these circumstances.
11.2 Any Arbitrator may be challenged by a Party if facts or circumstances
      exist which give rise to justifiable doubts or suspicion as to his
      impartiality or competence. However a Party may challenge an Arbi-
      trator appointed by him, or in whose appointment he has participated,
     only for reasons of which he becomes aware after the appointment has
     been made.
11.3 A Party who intends to challenge an Arbitrator shall send a notice of
     his challenge in writing, stating the reasons therefor to the Tribu-
     nal, the challenged Arbitrator and the other Party. The notice shall
     be sent within 15 days of the constitution of the Tribunal or of the
     appointment of the challenged Arbitrator, whichever is later, or
     within 15 days after the circumstances justifying the challenge be-
      come known to the Party making the challenge.
11.4 Where a challenge made by one Party is agreed by the other Party, or
     where the challenged Arbitrator withdraws from office, the authority
     of that Arbitrator in the arbitration proceedings shall forthwith
      terminate. But neither the agreement of the Parties to the challenge,
     nor the withdrawal from office of the challenged Arbitrator, implies
     an acceptance of the validity of the grounds of the challenge issued.
11.5  If the other Party does not agree to the challenge, or if the chal-
      lenged Arbitrator does not withdraw, a decision on the challenge
      shall be made as follows :-
     a) where the appointment of the Arbitrator was made by an Appointing
         Authority, by that authority;
     b) where the appointment of the Arbitrator was not made by an Ap-
         pointing Authority, by the other members of the Tribunal, if there
         are such others;
 ---pagebreak---                                     - 198 -
     c) in all other cases, or in case of disagreement between the other
        members of the Tribunal, by an Appointing Authority designated or
        to be designated in accordance with the procedure provided in
        Article 9.4.
     The decision of the authority specified herein shall be final.
                                ARTICLE 12
                        Replacement of Arbitrator
12.1 In the following cases, a substitute Arbitrator shall be appointed in
     accordance with the procedure laid down in Articles 8, 9 and 10 Which
     is applicable to the appointment of the particular Arbitrator being
     replaced:-
     a) a challenge to an Arbitrator has been agreed to by the other
        Party; or
     b) a challenged Arbitrator has withdrawn from office; or
     c) notwithstanding the absence of agreement of the other Party, or a
        refusal by the challenged Arbitrator to withdraw, a challenge to
        an Arbitrator is sustained; or
     d) an Arbitrator dies during the course of the arbitration proceed-
        ings; or
     e) for any other reason, an Arbitrator fails to act or it becomes im-
        possible de jure or de facto for him to perform his functions.
12.2 If an Arbitrator is replaced, any hearing held previously may, at the
     discretion of the Tribunal, be repeated, and any decision or order
     made in the course of the proceedings may be set aside by the Tribu-
     nal.
       Ill - T H E   A R B I T R A T I O N     P R O C E E D I N G S
                                ARTICLE 13
                            General Provisions
13.1 Subject to these Rules, the Tribunal may conduct the arbitration in
     such manner as it considers appropriate.
 ---pagebreak---                                    - 199 -
13.2 The Tribunal shall conduct the arbitration as expeditiously and with
     such due regard for the saving of costs as is consistent with doing
     justice between the Parties. The Parties shall be treated with
     equality, and at any stage of the proceedings each of them shall
     be given a full opportunity of presenting his case.
13.3 If either Party so requests at any stage of the proceedings, the Tri-
     bunal shall hold hearings for presentation of evidence by witnesses,
     including expert witnesses, or for oral argument. In the absence of
     such a request, the Tribunal shall decide whether to hold such hear-
     ings or whether the proceedings shall be conducted on the basis of
     documents and other materials.
13.4 All documents or information supplied to the Tribunal by one Party
     shall at the same time be communicated by that Party to the other
     Party. No such document or information may be used in support of a
     Party's case unless there is proof that it has been communicated to
     the other Party.
                                ARTICLE 14
                    Applicable Law and Procedural Rules
14.1 The Tribunal shall apply the law of the State of the Contracting
     Authority to the matters in dispute, unless otherwise specified in
      the Contract, in which case the Tribunal shall apply the law so spe-
     cified. In all cases, the Tribunal shall decide in accordance with
      the terms of the Contract, and may take into account the usages of
      the trade applicable to the transaction.
14.2 Where the applicable law is silent on any specific point, the Tribu-
     nal shall apply the conflict of laws rules resulting from the law ap-
     plicable to the Contract. The Tribunal may not decline to make an
     award on the ground that the law is silent or obscure on the point.
14.3 Notwithstanding the provisions of Articles 5.1 and 14.1, if the Par-
      ties expressly so authorise the Tribunal in the course of the arbi-
      tration proceedings, it shall decide as Anicable Compositor or ex
     aequo et bono.
14.4 The entire arbitration proceedings shall be conducted in accordance
     with these Rules. In the absence of agreement between the Parties,
     any procedural matter which is not provided for in these Rules shall
     be decided by the Tribunal, which shall ensure in particular, in such
     a case, that the principle of equality between the Parties is ob-
     served.
 ---pagebreak---                                     - 200 -
                                 ARTICLE 15
                        Language of the Proceedings
15.1 Arbitration proceedings shall be conducted and the arbitration award
     made in the language of the Contract, the terms or execution of Which
     gave rise to the dispute.
15.2 The Tribunal may order that any documents annexed to the statement of
     claim or statement of defence, and any other document or exhibit sub-
     mitted in the course of the proceedings, and which are not drawn up
     in the language of the proceedings, shall be accompanied by a certi-
     fied translation into the language of the proceedings.
                                 ARTICLE 16
                         Venue of the Proceedings
16.1 Arbitration proceedings shall be conducted in the OCT concerned in
     Which the Contract was awarded or performed. However, the Tribunal
     may, with the agreement of the Parties and for good cause, decide to
     conduct the arbitration in some other place. In deciding on such
     other place, the Tribunal shall have regard to the circumstances of
      the case, including the costs involved, the convenience of the Par-
      ties, and the potential adverse effect of the procedural rules of an
     alternative venue on the Parties and the proceedings.
16.2 Subject to Article 16.1, the Tribunal may hold some hearings and
     meetings at any place it deems appropriate, having regard to the
      circumstances of the case.
16.3 The Tribunal may meet at any place it deems appropriate for the in-
      spection of the works, goods, other property or documents. The Par-
      ties shall be given sufficient notice to enable them to be present at
      such inspection.
                                 ARTICLE 17
                       Representation and Assistance
     The Parties may be represented and/or assisted by persons of their
      choice. The names and addresses of such persons must be communicated
      in writing to the other Party and to the Tribunal. Such communica-
      tion must specify whether the person named is appointed for the pur-
     pose of representation or assistance.
 ---pagebreak---                                      - 201 -
                                 ARTICLE 18
                  Commencement of Arbitration Proceedings
18.1 The Claimant in an arbitration shall give to the Respondent a notice
     of arbitration. Such notice shall be time-barred unless it is given
     not later than 90 days after the receipt of the decision closing
      the final administrative proceedings taken in the OCT concerned, or,
     where no such administrative procedures are available, not later than
     90 days after the expiry of the 120 days provided for in Article 4.2
     for the remedy of a complaint notified to the other Party.
18.2 Arbitration proceedings shall be deemed to commence on the date on
     which the notice of arbitration is received by the Respondent.
18.3 The notice of arbitration shall include the following:-
     a) a demand that the dispute be referred to arbitration;
     b) the names and addresses of the Parties and their nationality at
         the time of the notice;
     c) a reference to the Contract out of or in relation to which the
         dispute arises, and the particular clause or clauses in the Con-
         tract being invoked or challenged;
     d) the general nature of the claim and the amount involved, if any;
     e) the relief or remedy sought;
     f) a brief statement, with dates, of any administrative proceedings
         or of the notice given of complaints, and the outcome of such
         steps;
     g) a proposal as to the number of Arbitrators (i.e., one or three).
18.4 The notice of arbitration may also include:-
     a) the name of the person and/or the authority proposed for appoint-
         ment as a sole Arbitrator and/or Appointing Authority referred to
         in Article 8.1;
     b) the notification of the appointment by the Claimant of an Arbi-
         trator referred to in Article 9.1;
     c) the statement of claim referred to in Article 19.
 ---pagebreak---                                     - 202 -
                                 ARTICLE 19
                             Statement of Claim
19.1 Unless the statement of claim was contained in the notice of arbitra-
      tion, within a time limit to be determined by the Tribunal, the
     Claimant shall communicate his statement of claim in writing to the
     Respondent and to each of the Arbitrators. A copy of the Contract
      shall be annexed thereto.
19.2 The statement of claim, signed and dated by the Claimant and/or his
     duly authorised representative, shall include the following particu-
      lars:-
     a) the names and addresses of the Parties;
     b) a statement of the facts supporting the claim;
     c) the points at issue;
     d) the relief or remedy sought.
     The Claimant shall either annex to his statement of claim all docu-
     ments he deems relevant or add a reference to the documents or other
      evidence he will submit.
                                 ARTICLE 20
                            Statement of Defence
20.1 Wftthin a time limit to be determined by the Tribunal, the Respondent
      shall communicate his statement of defence in writing to the Claimant
      and to each of the Arbitrators.
20.2 The statement of defence shall reply to the particulars of the state-
     ment of claim given in compliance with Article 19.2(b), (c) and (d).
     The Respondent shall either annex to his statement the documents on
     which he relies for his defence or add a reference to the documents
      or other evidence he will submit.
20.3  In his statement of defence, or at a later stage in the arbitration
      proceedings, if the Tribunal decides that the delay was justified un-
      der the circumstances, the Respondent may make a counter-claim aris-
      ing out of the same Contract, or rely on a claim arising out of the
      same Contract for the purpose of a set-off.
20.4 The provisions of Article 19.2 shall apply to a counter-claim and a
      claim relied on for the purpose of a set-off.
 ---pagebreak---                                      - 203 -
                                 ARTICLE 21
                    Amencknenta to the Claim or Defence
     During the course of the arbitration proceedings either Party may
     amend or supplement his claim or defence unless the Tribunal consid-
     ers it inappropriate to allow such amendment having regard to the
     delay in making it or the undue harm that it would cause to the other
     Party.
                                 ARTICLE 22
                Pleas to the Jurisdiction of the Tribunal
22.1 The Tribunal shall have the power to rule on objections to its juris-
     diction.
22.2 The Tribunal shall have the power to determine the existence or the
     validity of the Contract. A decision by the Tribunal that the Con-
     tract is null and void shall not affect the validity of the arbitra-
     tion clause in the Contract or the agreement to submit the dispute to
     arbitration, and therefore, shall not affect the application of these
     Rules.
22.3 A plea that the Tribunal does not have jurisdiction shall be raised
     not later than in the statement of defence or, with respect to a
     counter-claim, in the reply to the counter-claim. This provision
     shall also apply to new claims and counter-claims admitted in the
     course of the proceedings.
22.4 In general, the Tribunal should rule on a plea concerning its juris-
     diction as a preliminary question. However, the Tribunal may proceed
     with the arbitration and then rule on such a plea in its final award.
                                 ARTICLE 23
                        Further Wfritten Statements
     The Tribunal shall decide which further written statements, in addi-
     tion to the statement of claim and the statement of defence, shall be
     required from the Parties or may be presented by them and, if so, the
     manner in which they shall be presented, and shall fix the time lim-
     its for communicating such statements.
 ---pagebreak---                                     204 -
                                ARTICLE 24
                               Time Limits
     The time limits fixed by the Tribunal for the communication of writ-
     ten statements (including the statement of claim and statement of de-
     fence) shall not, in each case, exceed 45 days. However, the Tribu-
     nal may extend the time limits if it concludes that an extension is
     justified.
                                ARTICLE 25
                                 Evidence
25.1 Each Party shall bear the burden of proving the facts relied on to
     support his claim or defence.
25.2 The Tribunal may, if it considers it appropriate, require the Parties
     to deliver to the Tribunal and to the other Party, within such time
     limit as the Tribunal shall decide, a summary of the documents and
     other evidence which that Party offers to present in support of the
     facts in issue set out in his statement of claim or statement of de-
     fence.
25.3 At any time during the proceedings, the Tribunal may require the Par-
     ties to produce documents, exhibits or other evidence within such
     time limit as the Tribunal shall determine.
                                ARTICLE 26
                             Oral Proceedings
26.1 In the event of an oral hearing, the Tribunal shall give the Parties
     adequate advance notice of the date, time and place thereof.
26.2 If witnesses are to be heard, each Party shall commumicate to the
     Tribunal and to the other Party, at least 15 days before the hearing,
     the names and addresses of the witnesses he intends to call, the sub-
     jects upon and the languages in which such witnesses will give
     their testimony.
26.3 The Tribunal shall make arrangements for the translation of oral
     statements made at a hearing and for a record of the hearing if ei-
     ther is deemed necessary by the Tribunal under the circumstances of
     the case, or if the Parties have agreed thereto and have communicated
     such agreement to the Tribunal at least 15 days before the hearing.
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26.4 Hearings shall be held in camera unless the Parties agree otherwise.
     The Tribunal may require the retirement of any witness or witnesses
     during the testimony of other witnesses. The Tribunal is free to de-
      termine the manner in which witnesses are examined, without prejudice
      to the right of each Party, at its request, to question witnesses
     presented by the other Party.
26.5 Evidence of witnesses may also be presented in the form of sworn
     written statements signed by them. However, at the request of either
     Party and with the leave of the Tribunal, such witnesses may be heard
     at a hearing where the Parties shall have the opportunity to be
     present and to question the witnesses.
26.6 The Tribunal shall determine the admissibility, relevance, materi-
     ality and weight of the evidence offered.
                                 ARTICLE 27
                       Interim Measures of Protection
27.1 At the request of either Party, the Tribunal may take any interim
     measures it deems necessary in respect of the subject matter of the
     dispute, including measures for the conservation, preservation or
     safe-custody of the goods forming the subject matter in dispute, such
     as ordering their deposit with a third person or the sale of perish-
     able goods. The Tribunal may also order the deposit of a sum of
     money or the provision of a security to guarantee the whole or any
     part of the amounts in dispute. In the event of failure to do so,
      the Tribunal shall be entitled to draw such conclusions as may
     logically be imputed to such failure.
27.2 Such interim measures may be established in the form of an interim
     award. The Tribunal shall be entitled to require security for the
     costs of such measures.
                                 ARTICLE 28
                                   Experts
28.1 The Tribunal may appoint one or more independent experts to examine
     and report to it, in writing, on specific issues to be determined by
      the Tribunal. A Party shall have the right to object to an expert on
      the ground of competence and partiality and if such objection is
      sustained by the Tribunal that expert shall withdraw. A copy of the
     expert's terms of reference, established by the Tribunal, shall be
     communicated to the Parties.
 ---pagebreak---                                      206 -
28.2 The Parties shall give the expert any relevant information or produce
     for his inspection any relevant documents or goods that he may re-
     quire of them. Any dispute between a Party and such expert as to the
     relevance of the required information or production shall be referred
     to the Tribunal for decision.
28.3 Upon receipt of the expert's report, the Tribunal shall communicate a
     copy of the report to the Parties who shall be given the opportunity
     to express, in writing, their opinion on the report. A Party shall
     be entitled to examine any document on which the expert has relied in
     his report.
28.4 At the request of either Party, the expert, after delivery of the re-
     port, may be heard at a hearing where the Parties shall have the op-
     portunity to be present and to question him. At this hearing either
     Party may call expert witnesses in order to testify on the points at
     issue. The provisions of Article 26 shall apply to such proceedings.
                                ARTICLE 29
                                  Default
29.1 If, within the time limit fixed by the Tribunal, the Claimant has
     failed to communicate his statement of claim without showing suffi-
     cient cause for such failure, the Tribunal shall issue an order for
     the termination of the proceedings. If, within the time limit fixed
     by the Tribunal, the Respondent has failed to communicate his state-
     ment of defence without showing sufficient cause for such failure,
     the Tribunal shall, after allowing for the particular constraints ap-
     plying to the Respondent, order that the proceedings continue and may
     make an award even if a defence has by then not been submitted.
29.2 If one of the Parties, duly notified under these Rules, fails to ap-
     pear at a hearing, without shewing sufficient cause for such failure,
     the Tribunal may proceed with the arbitration.
29.3 If one of the Parties, duly invited to produce documentary evidence,
     fails to do so within the established time limit, without showing
     sufficient cause for such failure, the Tribunal may make the award
     on the evidence before it, taking due account of the failure and the
     bearing it has on the case.
                                ARTICLE 30
                            Closure of Hearings
30.1 The Tribunal may inquire of the Parties if they have any further evi-
     dence to offer or witnesses to be heard or submissions to make and,
      if there are none, it may declare the hearing closed.
 ---pagebreak---                                     - 207 -
30.2 The Tribunal may, if it considers it necessary owing to exceptional
     circumstances, decide, on its own motion or upon application of a
     Party, to reopen the hearings at any time before the award is made.
                                ARTICLE 31
                             Wfciver of Rules
     A Party who refrains from promptly raising an objection to any non-
     compliance with the provisions of or requirements under these Rules
     shall be deemed to have waived his right to object.
                              IV - T H E S A R D
                                ARTICLE 32
                                 Decisions
32.1 When there are three Arbitrators, an award or other decision of the
     Tribunal shall be made by a majority of the Arbitrators. However, if
      there is no majority, the presiding Arbitrator shall have a casting
     vote, but shall give reasons for exercising that vote.
32.2  In the case of questions of procedure, when there is no majority or
     when the Tribunal so authorizes, the presiding Arbitrator may decide
     on his own, subject to review, if any, by the Tribunal.
                                ARTICLE 33
                Time, Scope, Form and Effect of the Award
33.1 The arbitration award shall be made as soon as possible after the
     hearing or receipt of evidence or the material which the Parties wish
     to put before the Tribunal.
33.2 In addition to making a final award, the Tribunal shall be entitled
     to make interim, interlocutory, or partial awards.
33.3 The award shall be made in writing and shall be final and binding on
     the Parties. The Parties shall carry out the award without delay.
     Each OCT or Member State shall recognise as binding every award made
     pursuant to these Rules and shall ensure that it is enforced in its
     territory, as if it were a final judgment of one of its own courts or
     tribunals.
33.4 The Tribunal shall state the reasons upon which the award is based,
     unless the Parties have agreed that no reasons are to be given.
 ---pagebreak---                                      - 208 -
33.5 An award shall be signed and duly certified by the Arbitrators and it
     shall contain the date on which and the place where the award was
     made. Where there are three Arbitrators and one of them fails to
     sign, the award shall state the reason for the absence of the
     signature.
33.6 The award may be made public only with the consent of both Parties.
33.7 Copies of the award signed and certified by the Arbitrators shall be
     communicated to the Parties by the Tribunal.
                                 ARTICLE 34
                         Enforcement of the Award
34.1  In order to obtain the recognition and enforcement of the award in
     the territory of the OCT or a Member State, the Party concerned must
     present a certified copy of the award to the authority which that
     State has designated for the purpose. The order for enforcement
      shall be appended to the presented copy without any verification
     other than that of the authenticity of the copy.
34.2 Each signatory State shall, within 180 days from the entry into force
     of these Rules, inform the President of the Council of Ministers of
      the EBC of the authority Which it has designated for this purpose and
      shall keep him informed of any changes. The President of the Council
      of Ministers will transmit such information the President of the
     Commission without delay.
34.3 The enforcement of the award shall be regulated by the law relating
      to the enforcement of judgments which is in force in the State in
     whose territory the enforcement is to be carried out.
                                 ARTICLE 35
                Settlement or Other Grounds for Termination
35.1  If, before the award is made, the Parties agree on a settlement of
      the dispute by other means, the Tribunal shall either issue an order
      for the termination of the proceedings or, if requested by both Par-
      ties and accepted by the Tribunal, record the settlement in the form
      of am award on the agreed terms. The Tribunal is not obliged to give
      reasons for such an award.
 ---pagebreak---                                     - 209 -
35.2  If, before the award is made, the continuation of the proceedings be-
      comes unnecessary or impossible for any reason other than settlement
     under Article 35.1, the Tribunal shall inform the Parties that unless
      any objection is received within 30 days, it will issue an order ter-
     minating the proceedings. Should either Party object within the said
     30 days, the Tribunal shall not issue such an order until it has
     heard the Parties and determined that there are no justifiable
     grounds for objection.
35.3 Copies of the order for termination of the proceedings or of the
      award on the agreed terms, signed by the Arbitrators, shall be commu-
     nicated by the Tribunal to the Parties. Where an award on the agreed
      terms is made, the provisions of Articles 33.3 and 33.5 to 33.7 shall
     apply.
                                ARTICLE 36
                        Interpretation of the Award
36.1 Within 60 days after the receipt of the award, either Party, with
     notice to the other Party, may request that the Tribunal give an in-
      terpretation of the award. Where a new issue is discovered after the
      time limit provided has expired, the 60 days shall run from the date
      the new issue is discovered, provided that the maximum time limit for
     a request based on the discovery of a new issue shall not exceed 120
     days from the date of the award.
36.2 The interpretation shall be given in writing as soon as possible
     after the receipt of the request. The interpretation shall form part
     of the award and the provisions of Article 33.2 to 33.6 shall apply.
                                 ARTICLE 37
                          Correction of the Award
37.1 within 60 days after the receipt of the award, either Party, with
     notice to the other Party, may request the Tribunal to correct in the
      award any errors in computation, any clerical or typographical er-
      rors, or any errors of a similar nature. The Tribunal may within 30
     days after the communication of the award make such corrections on it
     own initiative.
37.2 Such corrections shall be in writing, and the provisions of Article
     33.2 to 33.6 shall apply.
 ---pagebreak---                                   - 210 -
                                 ARTICLE 38
                             Additional Award
38.1 Within 60 days after the receipt of the award, either Party, with
     notice to the other Party, may request the Tribunal to make an addi-
      tional award as to claims presented in the proceedings but omitted
      from the award.
38.2  If the Tribunal considers the request for an additional award to be
      justified and considers that the omission can be rectified without
     any further hearings or evidence, it shall complete its award within
     60 days after the receipt of the request.
38.3 When the additional award is made, the provisions of Article 33.2 to
     33.6 shall apply.
                                 ARTICLE 39
                                    Fees
39.1 The fees of the Tribunal shall be reasonable in amount, taking into
     account the complexity of the subject matter, the time spent by the
     Arbitrators and any other relevant circumstances of the case.
39.2  If an Appointing Authority has been agreed upon by the Parties or
     designated by these Rules, and if that authority has issued a sched-
     ule of fees for Arbitrators in international cases which it adminis-
      ters, the Tribunal in fixing its fees shall take that schedule of
      fees into account to the extent that it considers appropriate in the
      circumstances of the case.
39.3  If such Appointing Authority has not issued a schedule of fees for
     Arbitrators in international cases, any Party may at any time before
      the Tribunal issues any award fixing its costs request the Appointing
     Authority to furnish a statement setting forth the basis for estab-
      lishing fees which is customarily followed in international cases in
     which    the authority    appoints Arbitrators. If     the Appointing
     Authority consents to provide such a statement, the Tribunal in fix-
      ing its fees shall take such information into account to the extent
      that it considers appropriate in the circumstances of the case.
39.4  In the cases referred to in Articles 39.2 and 39.3, when a Party so
      requests and the Appointing Authority consents to draw up a proposal
      for fees, the Tribunal shall fix its fees only after consultation
     with the Appointing Authority which may make any comment it deems ap-
     propriate to the Tribunal concerning the fees.
 ---pagebreak---                                      - 211 -
                                ARTICLE 40
                                   Costs
40.1 The Tribunal shall fix the costs of arbitration in its award. The
      term "costs" includes only:-
     a) the fees of the Tribunal to be stated separately as to each Arbi-
         trator and to be fixed by the Tribunal itself in accordance with
         Article 39;
     b) the travel and other expenses incurred by the Arbitrators;
      c) the costs of expert advice and of other assistance required by the
         Tribunal;
     d) the travel and other expenses of witnesses to the extent such ex-
         penses are approved by the Tribunal;
      e) the costs for legal representation and assistance of the success-
         ful Party if such costs were claimed during the proceedings, and
         only to the extent that the Tribunal determines that the amount of
         such costs is reasonable;
      f) any fees and expenses of the Appointing Authority.
40.2 Except as provided in Article 40.3, the costs of arbitration shall in
     principle be borne by the unsuccessful Party. However, the Tribunal
     may apportion each of such costs between the Parties if it determines
      that apportionment is reasonable, taking into account the circum-
      stances of the case.
40.3 With respect to the costs of legal representation and assistance re-
     ferred to in Article 40.1(e), the Tribunal, taking into account the
      circumstances of the case, shall be free to determine which Party
      shall bear such costs or may apportion such costs between the
     Parties if it determines that apportionment is reasonable.
40.4 When the Tribunal issues an order for the termination of the proceed-
      ings or makes an award on the agreed terms, it shall fix the costs of
     arbitration referred to in Article 40.1 in the text of that order of
     award.
40.5 No additional fees may be charged by a Tribunal for interpretation or
     correction or completion of its award under Articles 36 to 38.
 ---pagebreak---                                    - 212 -
                                ARTICLE 41
                             Deposit of Costs
41.1 The Tribunal, on its establishment, may request each Party to deposit
     an equal amount as an advance for the costs referred to in Article
     40.1(a), (b) and (c).
41.2 During the course of the arbitration proceedings, the Tribunal may
     request supplementary deposits from the Parties for valid reasons.
41.3 If an Appointing Authority has been agreed upon by the Parties or
     designated by these Rules, and When a Party so requests and the Ap-
     pointing Authority consents to perform the function, the Tribunal
     shall fix the amounts of any deposits or supplementary deposits only
     after consultation with the Appointing Authority which may make com-
     ments to the Tribunal which it deems appropriate concerning the
     amount of such deposits and supplementary deposits.
41.4 If the required deposits are not paid in full within 30 days after
     receipt of the request, the Tribunal shall inform the Parties in or-
     der that one or other of them may make the required payment. If such
     payment is not made, the Tribunal may nevertheless decide to continue
     with, or order the suspension or termination of, the proceedings.
41.5 After the award has been made, the Tribunal shall render an account
     to the Parties of the deposits received and return any unexpended
     balance to the Parties.
 ---pagebreak---                                                                      ISSN 0254-1475
                                                              COM(91) 151 final
                                                      DOCUMENTS
EN                                                                              11
                                 Catalogue number : CB-CO-91-360-EN-C
                                                             ISBN 92-77-74999-7
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