A lead-in time of approximately 9 months has been allowed since the publication of Circular 01/2016 was published. This has allowed contracting authorities to avail of a limited derogation up until 8 January 2017, which permitted the use of the latest versions of the conditions of the Public Works Contracts (PW-CF1 – PW-CF5 inclusive), their associated Instructions to Tenderers and Forms of Tender and Schedule with a cited revision reference commencing with v1. published under Pillar 1 of the CWMF on www.constructionprocurement.gov.ie in the circumstances set out under 6 (a) of Circular 01/2016.
However this phased implementation will end on 8th January. It will be mandatory for contracting authorities to use the amended forms of Public Works Contracts with a cited revision reference commencing with v2 on all works procurements commencing from 9thJanuary 2017.
Where the deadline for receipt of tenders for works is after 8 January 2017, sanction must be formally applied for and obtained from the Government Contracts Committee for Construction (GCCC) for use of the latest versions of the conditions of the Public Works Contracts (PW-CF1 – PW-CF5 inclusive), their associated Instructions to Tenderers and Forms of Tender and Schedule with a cited revision reference commencing with v1. published under Pillar 1 of the CWMF on www.constructionprocurement.gov.ie.
Please note that some formatting errors occurred under Clause 14. Termination – sub-clause 14.2 in earlier versions of PW-CF7: Investigation Contract.
Separate sub-clause references were applied to 4 paragraphs that should have been included under sub-clause 14.2. Sub-clause 14.3 – 14.6 inclusive should have read as part of sub-clause 14.2 rather than being given separate sub-clause references. This has now been rectified in version 1.2 (dated 05/09/2016).
Appendix F was not included in the suite of documents associated with Reserved Specialists pre-qualification published on 3 May 2016. In error a duplicate of Appendix E was provided under the link for Appendix F. This has now been rectified.
Minor revisions have been made to the ITTW1 (versions 1.7 and v2.0); ITTW1a (version 1.0); and ITTW2 (versions 1.4 and 2.0) to provide clarification to Award Criteria. Where the award criterion is the Most Economically Advantageous Tender meeting the specified minimum criteria (if any) as stated in the Particulars; the formulae to be used must be provided in Section 9.6 Assessment of Other Criteria.
The Department of Public Expenditure and Reform published the Construction Contracts Act, 2013 on the 29th of July 2013. The Act is available to view at http://www.irishstatutebook.ie/eli/2013/act/34/enacted/en/html
On the 13th of April 2016 the Minister for Business and Employment signed the ‘Construction Contracts Act, 2013 (Appointed Day) Order 2016’ which gave legal effect to the provisions of the Act. The Order states that the ‘25th July, 2016 is appointed pursuant to section 12(2) of the Construction Contracts Act 2013 (No. 34 of 2013) and that Act shall apply in relation to construction contracts entered into after that date.’
The provisions of the Act have effect on all construction contracts, as defined in the Act and will apply to all construction contracts awarded after the 25th July 2016. The main provisions of the Act are:
• Payment: The Act requires that all construction contracts, as defined under the Act, shall provide for the amount of interim payment and amount of final payment or an adequate mechanism for determining those amounts. The Act also requires that that all construction contracts, as defined under the Act, shall provide for a payment claim dateor an adequate mechanism for establishing the date for each amount due, and the period between payment claim date and the date the payment is due.
• Suspension: The Act confers on the executing party under all construction contracts, as defined by the Act, the right of suspension for failure by the other party to pay an amount due in full by the date on which the amount is due. In addition the executing party is conferred with the right to suspend for failure of the other party to pay, in full, an amount due pursuant to the decision of an Adjudicator.
• Adjudication: A party to a construction Contract, as defined under the Act, has the right to refer for adjudication any dispute relating to payment arising under the construction contract.
To reflect the provisions of the Act, amendments have been made to all the Public Works Contracts (versions 1 and 2), Schedules to the Contracts (versions 1 & 2), both Conditions of Engagement, Schedules to the Conditions of Engagement, and associated Guidance Notes.
The notable amendments to the documents include:
• Adoption of certain terms defined in the Act, such as ‘Payment Claim Date’ and ‘Payment Claim Notice’
• The change of units of measurement of time from ‘Working Days’ to ‘Days’ under all payment clauses to facilitate compliance with the Act.
• Amendment to the Suspension by the Contractor clause in PW-CF1 to PW-CF5 to comply with the Act.
• Introduction of statutory Adjudication as an alternative dispute resolution method and the effects a referral to statutory Adjudication has on the existing contractual dispute resolution methods.
• The removal from the Schedules the option for the Contracting Authority to specify payment periods other than ‘monthly’. (The only exception is PW-CF 6 & 7 where the extent of the Works may not extend beyond a single payment.)
The formula in Section 3 of Appendix 3: Award criteria has been amended to:
ITTW6 v1.1 12/12/2013 and ITTW7 v1.0 12/12/2013 have been archived under Archives/Pillar 1.
A new ITTW2 v2.0 – Instruction to Tenderers for use with the Open Procedure for Works Contractors has been published as part of the revision of arrangements for the procurement of public works projects (Circular 01/16: ‘Construction procurement – revision of arrangements for the procurement of public works projects’ refers).
It should be noted that ITTW2 v2.0 has application only to PW-CF1 to PW-CF5 with the cited versions 2.0 and later. ITTW2 v2.0 is available via the link to Circular Documents here.
Note: EU Directives 2014/23/EU, 2014/24/EU and 2014/25/EU came into effect on 18 April 2016. The directives set out the procurement rules applicable to the award of public contracts. A new document titled the ‘European Single Procurement Document’ (ESPD) has been introduced as part of the new rules and, for procurements governed by the directives, contracting authorities must accept an ESPD completed in accordance with EU Regulation 2016/7
The revised QW1 and the new QW4 have been updated to facilitate the submission of the ESPD but the suite of suitability assessment questionnaires will be further amended in the coming weeks to take into account the new directives/transposing regulations and to enhance compatibility with the ESPD in the coming weeks.
A number of amendments have been undertaken to QW1 – Restricted Procedure for Works Contractors, the following are the key amendments:
Section 1.0 has been amended to include a new Section 1.9 Specialist Works Reserved by the Contracting Authority to reflect the new procedure for Reserved Specialists. Existing sections 1.6 – 1.8 inclusive have been amended to restrict certain procedures to the appropriate form of public works contract.
Section 2.0 has been amended to request more detailed information from applicants so as to uniquely identify their business.
Section 3.0 has been amended to permit qualitative assessment of 3.3b and 3.3d and for certain criteria in Specialist Services and Specialist Works. Supplements 3.4.3 and 3.4.4 have been removed and, where a PSDP or Contractor as Designer appointment is necessary (typically for a Design and Build contract), the service provider suitability assessment questionnaire for the restricted procedure – QC1 should be used.
Criterion 3.3a has been amended to focus on turnover related to the business area that is the subject of the procurement.
A new Appendix J is provided to give contracting authorities the option to seek more detailed information from the applicant’s principal banker where this is appropriate.
A new Appendix K which is a template letter to be provided by the applicant’s Professional Indemnity Insurance provider stating that they can provide PII to the levels required.
A new suitability assessment questionnaire for the procurement of Reserved Specialists (See guidance note GN2.3.3) has been published. The restricted procedure must be used when procuring Reserved Specialists and the format and structure of section 2.0 and 3.0 mirrors the revised QW1 v2.0 as set out above. Section 1.0 provides information that is pertinent to the procurement of Reserved Specialists.
A separate Instructions to Tenderer has been developed for Reserved Specialist’s tenders.
A separate Form of Tender and Appendix has been developed in conjunction with the Construction Industry Federation (CIF) for use with the Conditions of Sub-Contract (NN) published by the CIF. The term ‘appendix’ is used in place of ‘schedule’ in this case because this is the term used throughout the form of sub-contract. The document reference ‘FTS’ has been adopted to retain its classification as one of the suite of Forms of Tender and Schedule under Pillar 1 of the CWMF.
GN 2.3.3 Specialists and the Public Works Contracts v1.0 dated 22 January 2016has been amended as follows:
• New Appendix IV added providing a link to the Conditions of Sub-Contract (NN) published by the Construction Industry Federation
• Section 1.6.2 – Item 3. Line added to clarify that the Reserved Specialist’s Works Requirements may be issued to main contract candidates after the bulk of the main contract tender documents where the Reserved Specialist’s Works Requirements are not finalised at the commencement of the main contract tender.
• Section 1.7.1 – Clarification that the outline programme submitted by a main contract tenderer as part of their Works Proposals must be compliant with the requirements set out in the Form of Tender and Schedule, part 1G.
MF 1.19 Reserved Specialist Performance Bond
A separate model form Performance Bond has been developed for Reserved Specialist’s tenders.
MF 1.20 Notification to named Specialists of amounts included in Main Contract Payment Certificate for named Specialist works
A separate model form has been developed to meet the requirements of the amended sub-clause 11.1.3 in PW-CF 1, PW-CF3 & PW-CF5.
Conditions of Sub-Contract (NN) published by the Construction Industry Federation
A link to the above conditions of sub-contract has been provided via the Circular Documents Page here.
A new Model Form MF1.18 – Appointment of Standing Conciliator (dated 21 March 2016) has been published as part of the revision of arrangements for the procurement of public works projects (Circular 01/2016 refers). The Model Form details the terms and conditions that the Standing Conciliator shall be engaged upon by the Parties to the Contract.
It should be noted that the Standing Conciliator has application only to PW-CF1 to PW-CF4 with the cited versions 2.0 and later. MF1.18 is available via the link to Circular Documents here.
Model Forms MF1.16 Appointment of Conciliator (pre-21 March 2016) has been amended as follows:
• The reference clauses for Contract forms PW-CF6, PW-CF10 and PW-CF11 have been added.
• An explanatory note has been added to Clause 3 of the form which deals with fees and expenses. The explanatory note cross references the new Model Form MF1.18 Appointment of Standing Conciliator.
MF1.16 21/03/2016 is available under Pillar 1 Model Forms.
Model Form MF1.17 Bond – Conciliator’s Recommendation (pre-21 March 2016) has been amended as follows:
• The reference clauses for Contract forms PW-CF1 to PW-CF5 have been added, and amended where necessary for cited versions v2.0 or later.
Model Form MF1.17 21/03/2016 is available under Pillar 1 Model Forms.
The following changes have been made to GN 1.5.3 v1.0 22/01/2016:
• Section 5.1, Introduction, text in the second and third paragraph consolidated:
• Section 5.2, Amendments required when using CESMM3, has been added to the document.
The Department of Public Expenditure and Reform published Circular 01/16: ‘Construction procurement – revision of arrangements for the procurement of public works projects’ on 18 January 2016.
A review of the performance of the Public Works Contract was undertaken by the Government Contracts Committee for Construction (GCCC) in 2014. The ‘Report on the Performance Review of the Public Works Contracts’ was published by the Office of Government Procurement in December 2014, setting out a series of interim recommendations and a framework for engagement of a medium term strategy for the procurement of public works projects.
Extensive consultation was undertaken throughout 2015 by the Office of Government Procurement following the publication of its proposals to implement the interim recommendations. Work on the interim recommendations which amend the Public Works Contracts is now complete and the conditions of contract for Public Works Contracts PW-CF1 – PW-CF5, inclusive, their associated tender documents and guidance have been published.
The interim measures introduced to amend the Public Works Contracts are as follows:
1. Mandatory production of a fully measured Bill of Quantities to an approved method of measurement, and inconsistencies between the Bill of Quantities and the Works Requirements, for projects using Public Works Contracts forms PW-CF1, PW-CF3 and PW-CF5, will be a Compensation Event.
The Pricing Document for Public Works Contract Forms PW-CF1, PW-CF3 and PW-CF5 shall be a Bill of Quantities to an approved method of measurement for use with the Public Works Contracts. No other document is to be included in the Pricing Document for these forms of Contract. The Schedule to the Contract will define which approved method of measurement the Bill of Quantities must be completed in accordance with and the option to transfer, to the Contractor, the risk of quantities under Schedule Part 1K(17) has been removed. (Please refer to Guidance Note GN 1.5.3 – The Pricing Document, for full details of this interim amendment)
2. The direct tendering of Specialist works packages, by the Employer, whereupon the Contractor will enter into a sub-contract with the respective successful Specialist tenderer
For all projects designed by the Contracting Authority and carried out under PW-CF1, PW-CF3 and PW-CF5 this process allows for Specialists to tender for defined Works packages directly to the Contracting Authority, and following completion of evaluation of the tender, by the Contracting Authority, the successful Specialist and the Contractor shall enter a sub-contract for a Specialist Contract Sum, which will form part of the Contract Sum with the Contractor. The Contractor will be entitled to tender, in their tender, a percentage addition for each Specialist which will form part of their Contract with the Employer. (Please refer to Guidance Note GN 2.3.3 – Specialists and the Public Works Contract, for full details of this interim amendment)
3. (i) The introduction of an informal dispute resolution process at senior management level within the respective organisations that are Parties to the Contract.
For all projects carried out under Public Works Contract forms PW-CF1 to PW-CF4, inclusive, the Parties to the Contract may engage, without prejudice, in a dispute resolution process on certain disputes prior to reference to conciliation. The Conditions of Contract detail the Dispute Management Procedure for resolution of disputed Employer’s Representative Determinations. The procedure shall consist of meetings of the Project Board, for the purpose of reviewing disputes referred thereto with the intent of reaching a resolution. (Please refer to Guidance Note GN 3.1.1 – Dispute Resolution, for full details of this interim amendment).
3. (ii) The introduction of a Standing Conciliator for pre-dispute management purposes
For all Contracts carried out using Public Works Contract form PW-CF1 to PW-CF4, inclusive, where the anticipated Contract Sum will be in excess of €10million, a Standing Conciliator must be appointed by the Parties. Where the anticipated Contract Sum will be less than €10million, the Employer will have the option of requiring a Standing Conciliator to be appointed by the Parties. The Standing Conciliator shall fulfil the role of the Conciliator in all cases, should a dispute be referred to conciliation under sub-clause 13.2. The intention behind the introduction of the Standing Conciliator is to encourage proper engagement between the Parties to assist the Parties in the avoidance of disputes, to assist the Parties in avoidance of costly and lengthy formal dispute resolution procedures, and to assist the Parties to establish agreement upon issues before they crystallise into a dispute. (Please refer to Guidance Note GN 3.1.1 – Dispute Resolution, for full details of this interim amendment).
The arrangements to be undertaken by contracting authorities are the subject of Circular 01/16. The revised arrangements are being put in place with effect from 4 April 2016 for the procurement of public works projects using the Public Works Contracts PW-CF1 – PW-CF5, inclusive.
Contracting authorities are encouraged to adopt the amended conditions of Public Works Contract from the date of their publication, however it is recognised that the extent to which they can be adopted will depend on the scope of service under which the design team has been engaged [on Employer designed contracts].
In recognition of this the Circular sets out a derogation for projects where the design team has been engaged prior to 4 April 2016 and their scope of service does not reflect the service provision required to meet the requirements of the amended forms of contract. This derogation is available for a limited period – up to 8 January 2017 – thereafter the amended forms must be used unless written sanction is given by the GCCC following an application from the Contracting Authority concerned.
The EU Commission has revised the Public Procurement Directive’s thresholds resulting in an increase in the thresholds for advertising in the Official Journal of the EU which comes into effect on 1 January 2016.
The thresholds will apply from 1 January 2016. The details are set out in the attached table. EU Thresholds for advertising in the Official Journal of the EU applicable from 1 January 2016