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International turnkey construction projects are often complex transactions, requiring correspondingly complex legal documentation. Many such major construction projects are an important element in international development and the arrangements put in place must be durable, clear and equitable.

ICC has prepared ICC Model Turnkey Contract for Major Projects to provide contractors and employers with a balanced platform that is fair to all parties. This has been achieved through the inclusion of a good faith concept, an explanation of the purpose of certain provisions to avoid misinterpretation, and the use of equal and mirrored obligations of the parties. The model also accommodates the desire of all parties for certainty on issues of price and scope, the need for swift and effective dispute resolution, and the need for complete and informed allocation of risks.

“As ICC represents all parties to international business transactions, the model turnkey form has to be fair to all parties. It achieves this balance, amongst other ways, by making obligations bilateral where it is sensible to do so,” said Robert Knutson, Chartered International Arbitrator and UK Solicitor.

The ICC Model Turnkey Contract for Major Projects also reflects the growing importance of information technology through inclusion of detailed provisions on software issues, and addresses bribery and corruption. It is intended for use in public and private contracts – whether tendered or individually negotiated, as a part of the “BOT” project documentation, and in externally financed projects.

The ICC model contract is designed to further the proper functioning of the construction industry, particularly within the context of international development. In setting out the parties’ obligations in a clear and succinct fashion, it is intended to minimize recourse to national law.

ICC NewsAlert, 4 December 2007