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Copyright © International Chamber of Commerce (ICC). All rights reserved. ( Source of the document: ICC Digital Library )
by ICC PUBLISHING S.A.
The terms defined in this Article shall have the meanings indicated hereunder.
Battery Limit
means the borderline indicated as such on the Layout drawings.
Commencement Date
means the date on which the obligations to perform the work commence, according to Article 3.2.
Confidential Information
means confidential information as defined in Article 34.1.
Contract
means this document, together with the attachments and subsequent alterations and additions agreed in writing, as defined more precisely in Article 35.
Contract Price
means the price set out in Article 25.1 for the provision of the Plant (including the supply of all the goods and services which are indicated in Article 4.2 of this Contract), subject to such additions or deductions as may be made under the provisions of the Contract.
Country
means the country where the Plant is to be installed.
Defect
means any non-conformity of the Plant as defined in Article 31.
Equipment
means any or all of the items of equipment (machinery, materials, components, spare parts, etc.) which the Supplier undertakes to supply under this Contract as more particularly set out in Annex 2.
Erection
means all mechanical erection, electrical and instrumentation installation, insulation, etc. which is necessary for putting the Plant in a condition to perform Erection Testing.
Erection Certificate
means the certificate referred to in Article 20.1.
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Erection Equipment
means any machinery, tools and other equipment, lifting and transport equipment, power, water, raw materials, facilities and aids and any other matter reasonably necessary for the Erection, Start Up and Performance Testing and any other operations which are to be performed before Taking Over.
Erection Testing
means the running of every machine and/or group of machines of the Plant with or without raw materials (as appropriate) in order to check their correct erection and functioning.
Guaranteed Performance
means the production parameters of the Plant specified in Annex 1-B.
Incoterms
means the trade terms issued by the International Chamber of Commerce as in force at the date on which this Contract is signed.
Layout
means the layout of the Equipment constituting the Plant indicating the Battery Limits, as established by the Supplier according to Article 8.
Minimum Performance Levels
means the minimum performance parameters specified in Annex 1-C below which Taking Over shall not take place.
Party
means either the Supplier or the Purchaser, and together the Parties.
Performance Test Procedures
means the procedures and prescriptions to be observed during Performance Testing, as specified in Annex 9.
Performance Testing
means the operation of the Plant intended to demonstrate that the Plant, when used in production, reaches the performance and other characteristics as guaranteed in this Contract, according to Article 22.
Plant
means the production unit which is the subject-matter of this Contract.
Products
means the products to be manufactured with the Plant.
Project Representative
means the representative of either Party nominated in accordance with Article 6.4.
Site
means the premises where the Plant is to be installed in accordance with this Contract, as defined in Contract Schedule A.
Site Representative
means the person who represents either Party on the Site, the authority and functions of whom are described in Article 6.4.
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Start Up
means the stage during which the Plant is gradually put into production for the purpose of testing its correct operation, which stage ends with the completion of the Performance Testing.
Taking Over
means the moment when the Plant is deemed to be fully accepted by the Purchaser according to Article 23.1.
Taking Over Certificate
means the certificate referred to in Article 23.2.
Technical Documentation
means the documentation regarding the Equipment, Erection, operation and maintenance of the Plant, to be provided by the Supplier, which is listed in Annex 4.
Time Schedule
means the Time Schedule defined in Article 7.1, as may be altered according to Article 7.2.
2.1 Good faith in performing the Contract. In carrying out their obligations under this Contract the Parties will act in accordance with the principles of good faith and fair dealing.
2.2 Good faith in interpreting the Contract. The provisions of this Contract, as well as any statements made by the Parties in connection with it, shall be interpreted in good faith.
3.1 Entry into force. This Contract shall enter into force on the date of signature by both Parties.The Parties will undertake all necessary steps for facilitating the occurrence of the events indicated in Article 3.2.
3.2 Commencement Date. The Commencement Date shall be the date on which the latest of the events listed in Contract Schedule B has occurred. If no event has been listed in Contract Schedule B, the Commencement Date shall be the date of signature of this Contract.
3.3 Non-occurrence of the Commencement Date. If the Commencement Date has not occurred, according to Article 3.2, within six (6) months from the date of signature (or within such other term as may be agreed between the Parties: see Contract Schedule C), either Party may terminate the Contract by written communication to the other Party1 .
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4.1 Scope. The purpose and subject matter of this Contract is the supply, on a turnkey basis, of an industrial plant as described in Annex 1.
4.2 Supplier’s obligations. The turnkey supply of the Plant comprises the following:
4.3 Scope of Purchaser’s work. The Purchaser shall provide:
4.4 Guaranteed Performance. The Supplier guarantees that the Plant, once erected and started up in conformity with this Contract, will have the performance characteristics specified in Annex 1. It is agreed that the successful completion of the Performance Test in conformity with the requirements specified in this Contract, means that the Supplier has fulfilled its obligation to guarantee the performance, as indicated in this paragraph.
4.5 Purchaser’s general obligation to observe Supplier’s instructions. The Guaranteed Performance and, more generally, all guarantees given by the Supplier with respect to performance and operation of the Plant are conditional upon the observance by the Purchaser of the following obligations:
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4.6 Complete Plant. The Supplier guarantees that the Plant has been designed with due care and that it includes everything which is patently necessary for the Plant to provide the operating characteristics as defined in the Contract and for obtaining the Guaranteed Performance. The Plant does not include items which are outside the Battery Limit.
4.7 Laws, regulations. The Plant shall be designed and manufactured in accordance with the legislative requirements in force in the Country at the date of signature of this Contract and in accordance with the standards specified, if any, in Annex 1. In case of a change of such legislative requirements after the date of signature of this Contract, and before Taking Over, the Supplier shall be obliged to conform to this change and the Purchaser shall be obliged to pay the additional costs related therewith and shall accept any consequent time extension.
4.8 Purchaser’s duty to cooperate. The Purchaser shall take all reasonable steps in order to assist the Supplier in performing its obligations under this Contract. The Purchaser shall obtain import permits and/or licenses required for any part of the Equipment in accordance with the applicable Incoterm and, to the extent applicable, building permits and operating permits. The Purchaser shall, at the Supplier’s request, assist the Supplier in obtaining (temporary) import permits and/ or licenses for Supplier’s Erection Equipment, visa and/or work permits required in the Country for Supplier’s personnel and any further authorisations, consents and/ or approvals necessary for the performance of this Contract in the Country. The Purchaser shall obtain such permits and licenses, or render such assistance within the time limits stated in the Time Schedule or, if not so stated, within reasonable time having regard to the time for delivery of the Equipment and the time for Erection and Start Up.
5.1 Non-substantial alterations. The Supplier is entitled until Taking Over to make any non-substantial alterations and additions to the Plant. Non-substantial alteration means any modification or addition which does not affect the characteristics of the Plant, its Guaranteed Performance and the time for completion of the Supplier’s obligations in accordance with the Time Schedule and which does not entail charges or costs for the Purchaser.The Supplier must notify the Purchaser in writing of the proposed modifications and shall be entitled to carry them out if the Purchaser does not object within fifteen (15) days from the date of receipt of such notification.The Purchaser shall not unreasonably withhold its consent.
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5.2 Alterations requested by the Purchaser. The Purchaser may at any moment before Taking Over request such alterations or additions to the Plant which he considers appropriate and which had not been considered when negotiating the Contract. In such case the Supplier shall submit an estimate of the cost variations and the possible implications with respect to the Time Schedule and the Guaranteed Performance, and the Purchaser will decide if it wants to accept such conditions. If the Purchaser does not accept the Supplier’s proposals, the Purchaser shall reimburse the Supplier the reasonable costs for preparing the estimate at its request.
6.1 Prohibition of assignment. Neither Party is entitled to assign this Contract without the previous written agreement of the other Party.
6.2 Sub-contractors and sub-suppliers. The Supplier has the right to sub-contract any part but not all of this Contract to sub-contractors and to purchase any Equipment from third parties. Sub-contractors or sub-suppliers mentioned in Annex 3 cannot be changed without the Purchaser’s approval, and such approval shall not be unreasonably withheld or delayed.
6.3 Liability for sub-contractors or sub-suppliers. The Supplier is liable to the Purchaser for goods, work and other undertakings as supplied by a sub-contractor or sub-supplier.
6.4 Project Representative and Site Representative. Each Party will nominate within thirty (30) days from the date of signature of this Contract a Project Representative and a Site Representative. Nominations of each Party must be notified to the other Party in writing.The Project Representative shall be authorised during the period up to Taking Over to take decisions on behalf of the respective Party with regard to the performance of the Contract.The Site Representative shall have the authority to take, on behalf of the respective party, all decisions of a technical nature regarding the activities to be performed on the Site.The Project Representative and the Site Representative must be fluent in English and/or other languages, as may be agreed upon between the Parties.
7.1 Time Schedule. The Time Schedule, which is attached hereto as Annex 5, specifies the dates for the performance by the Parties of the main obligations under this Contract.
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7.2 Alterations to the Time Schedules. Save for extensions of time due to force majeure under Article 33, it is agreed that, if either Party
the deadlines for performance by the other Party shall be automatically extended, to the extent they have been influenced by the above-mentioned circumstances. In such case, the Parties will agree as soon as possible upon the corrections to be made to the Time Schedule.
1 The right to terminate the contract does not of course prevent the Parties from renegotiating the contract terms (e.g. price, payment conditions, etc.).