by Sachin Kerur

With construction activity in India now worth $50 billion per annum and accounting for around 6% of Indian GDP, India is an attractive market for contractors.

[Read more…]

by James Bremen

The use of joint ventures or consortiums are attractive because they allow contractors, consultants and financiers to team up and offer owners a single interface for all needs of a project.

Owners are increasingly requiring that consortiums be formed to provide a single point responsibility and to ensure bidders have the ability to perform the scope of work.

In light of this development, this article seeks to highlight some of the key legal and practical issues, which should be considered when entering into a joint venture or consortium agreement. The term “consortium” is used throughout the article to refer to both “consortium” and “joint venture.” [Read more…]

The construction industry in Dubai has no chance of recovery in 2010 and the emirate’s real estate operators too were likely to face difficulties over the coming months, said an industry expert.

Those construction companies which are solely operating in the Dubai are in for big trouble, Khaldoun Tabari, vice chairman and CEO of  Dubai-based engineering contractor Drake & Scull International, was quoted as saying in Arabian Business. [Read more…]

In the current economic climate, there is growing interest in whether a contract can be cancelled, if one party is no longer able to fulfil its obligations due to financial difficulties.

A basic principle of contract law is that the contracting parties must perform their obligations with good faith and in a manner consistent with the contract. However, subject to this basic principle, a party to a contract that is subject to UAE law, can seek to end the contract in one of three ways: [Read more…]

The larger your project gets, the more you will find that the issues you encounter are more and more political in nature. The issues have to do with the use of resources, project direction, project deliverables, how the project should be run, how the project impacts people, etc. The resolution of these issues requires you to gain consensus among people that have differences of opinion. In other words, the resolution requires you to recognize and work in office politics. [Read more…]

Abu Dhabi will make sustainability compulsory from 1 January. The argument that the Gulf doesn’t care about the environment is false. Abu Dhabi’s new building code, regulations that make sustainability compulsory in all buildings and major retro-fits throughout the emirate, come into force on 1 January 2010.

They will set a minimum standard for all the elements involved in project delivery, from the design of new buildings to the way redundant structures are demolished. This encompasses energy efficiency, water use and the wider environmental impact of construction. [Read more…]

On demand’ guarantee bonds are a typical form of contractual security in the UAE construction industry, particularly on large projects. Their use in theory, is to afford the employer with secured funds from a surety, in the event the defaulting party does not perform under a contract or becomes insolvent.

Prior to the onset of the liquidity crisis last year, the general attitude of an employer (as a beneficiary) would have been to threaten the encashment of a bond to impose commercial pressure on a contractor to perform. A call upon an on-demand bond would have been made if strictly necessary e.g. in the event of material or persistent default. [Read more…]

It is undeniable that UAE is now facing the onslaught of the global financial crisis. Although UAE’s oil revenue has cushioned the impact of the crisis to some extent, the speed in which the impact of the crisis is spreading across the real estate and construction industries, particularly in Dubai, is unprecedented.
The number of construction projects being scaled back or even suspended is on the rise. Consequently, we have been receiving an increasing number of enquiries and instructions from employers and contractors involving suspension and termination issues. Inevitably, some projects will fall into dispute whenever a party decides to suspend or terminate the contract. A dispute or a chain of disputes may occur at any level, be it between the master developers and sub-developers, sub-developers and its consultants or contractors, or down to the level between the contractors and its sub-contractors and suppliers. [Read more…]

by Dennis Brand

I think it is fair to say that occasionally some thought is given as to enforcement of the arbitration award, but rarely if any real thought is given to the jurisdiction of the local courts, either as to any challenge to an arbitration award or its enforcement.

Unlike many jurisdictions, the UAE does not have an arbitration law; in 2008, a draft arbitration law was in circulation, but as of today it is still in draft form. [Read more…]

WHEN used as a construction system, precast concrete offers several advantages that range from improved quality to safer, long-lasting structures, says the Riyadh-based Al Rashid-Abetong (ARA), which has been serving the Saudi market for more than three decades.

The advantages of precast construction, coupled with the inherent benefits of concrete, provide a superior building material that has been proven the world over for several decades.

“Precast systems offer significant savings in construction, thanks to earlier completion dates, inbuilt fireproofing, reduced formwork, scaffolding, reduced wet trades and increased budget control,” says Munir Sultan, assistant sales and marketing manager. [Read more…]