FIDIC Contracts: Applicability in UAE & COVID-19 Impact

Abstract

The law on construction in U.A.E. is not distinguished by a separate legislation from the law which is applicable to contracts as disputes generally; i.e. the U.A.E. Civil Code provides for a trifling set of provisions regarding the same. Albeit, there exists the FIDIC provisions – an internationally recognized and accepted set of principles and rules governing construction contracts. This paper aims to comment on the applicability of FIDIC provisions in the U.A.E., the issues that ordinarily arise from the FIDIC conditions against the backdrop of construction law in the U.A.E., along with a remark on the COVID-19 impact regarding the same. The study finds that FIDIC contracts are indeed applicable in the U.A.E. although not to a great extent i.e. not many construction projects are governed by the FIDIC provisions in U.A.E., as there are clauses within the U.A.E. Civil Code (Muqaawala) which briefly fend for the law on construction contracts. With that being said, the FIDIC Red, Pink, Yellow & Silver books amongst the rainbow suite of books are most applicable in the U.A.E. In regards to the existing law on construction contracts in the U.A.E., the study notes areas of contrast such as provisions regarding interest and delay damages as well as areas which blend in against the backdrop of FIDIC provisions such as suspension & termination clauses. This study further examines and interprets the engineer’s role in construction contracts as no specific mention has been made regarding the same in the provisions of the civil code. Moreover, COVID-19 may perhaps be considered a Force Majeure event provided it renders performance of contract impossible and matters affected by COVID can be claimed only upon the discretionary power of the U.A.E. courts to declare the same. In conclusion, the FIDIC contracts can very well be included in construction contracts in the U.A.E. provided, they be drafted with care, keeping in mind the nature of functionality of U.A.E.