The Client/Consultant Model Services Agreement (FIDIC White Book) from 2017 represents the basic form of a contract between a client and its consultant. FIDIC White Book is aimed at international projects. However, according to the Federation International des Ingenieurs-Conseils (FIDIC), the terms may equally be used on domestic projects.
When preparing a project in Denmark with both local and foreign aspects, this gives rise to the following question in the relation between the client and consultant: Should I choose FIDIC White Book or the locally used general conditions for consultancy services for building and construction works (ABR 18)?
Are you aiming for the standard package or tailored terms?
The FIDIC White Book sets out the basic minimum requirements for the contract between the client and consultant. The FIDIC White Book is less comprehensive than ABR 18 and has a lesser level of detail. More specifically, the FIDIC White Book’s general conditions consist of 10 clauses.
Consequently, more room is made for individual clauses in particular conditions. These conditions are supposed to address particular projects and commercial issues between the parties.
With its 63 clauses, ABR 18 sets out in greater detail the responsibilities and duties of the parties compared to the FIDIC White Book. In addition, deviations from these terms are not expected. If any deviations are made, they must be clear and explicit.
Choice of law of matters
If Danish law is chosen as the governing law of the contract, it should be considered that the ABR 18 terms (and its predecessors) have been tried and tested within Danish case law. This allows for more predictability in case of a dispute between the client and consultant. In contrast, case law regarding FIDIC White Book is scarce and may leave more room open to interpretation and uncertainty.
Choosing the ABR 18 terms will – unless explicitly deviated from – be a choice of arbitration at the Danish Building and Construction Arbitration Board (VBA). On the other hand, FIDIC White Book allows for arbitration at the International Chamber of Commerce (ICC).
In general, arbitration at VBA is expected to be faster and less costly than arbitration at ICC. However, should the parties choose that the governing law should not be Danish, arbitration at ICC may be more sensible as ICC is more experienced in dealing with various types of governing law.
When choosing the right set of terms several considerations should be made. Some of these could be:
- Which terms are preferable in order to attract the best suitable bidders?
- How do the terms aligned with the rest of the contract basis for the project?
- What are the main differences in terms of liability?
- What is the preferred venue and choice of law?
If you want to know more about how we can help you with your choice of consultancy terms or in general, feel free to reach out to Steffen Hebsgaard Muff at firstname.lastname@example.org.