NEC4 IN SPANISH: A NEW HORIZONJ0r IN LATIN AMERICA
NEC4 IN SPANISH: A NEW HORIZONJ0r IN LATIN AMERICA NEC4 IN SPANISH: A NEW HORIZONJ0r Collaborative Contractinq IN LATIN AMERICA Juan Armando Vicuña Past President of the Cámara Chilena de la Construcción and president of CICA period 2025-2026 Qn Qn March 6th in Lima, the New Engineering Contracts (NEC) will launch Ihe official transiation ¡ nto Spanish of NEC4 contracts, contracts, starting with the Engineering Engineering and Construction Contract (ECC), as well as the accompanying guidance notes and training. The President President of the Confederation of International Contractors Associations (CICA), Juan Armando Vicuna from Chile, Chile, will attend the event.
We spoke with Rekha Thawrani, Global Head of the New Engineering Engineering Contracts (NEC), who explained: “Since NEC Contracts highly successful debut on the 2019 Pan American American Games, the NEC has been increasingly adopted in public sector procurement in Peru as an alternative to Thawrani also underlined that “the translations would help to create consistency and a body of knowledge in Spanish setting the foundations foundations for adoption of NEC in the rest of Latin America”. This major shift in the approach approach comes with the need to efficiently deliver the construction projects. Álvaro Beckdorf from Grupo Flesan Peru, highlighted that NEC contracts encourage teamwork and open communication. communication. Success lies in understanding that collaboration collaboration means meeting contractual contractual obligations together and achieving project objectives, objectives, rather tban simply following the instructions of one of the parties.
Grupo Grupo Flesan has an extensive Since their implementation at the 2019 Pan American Games, NEC contracts have demonstrated their ability to optimize the execution of works, facilitating risk management and promoting communication between the parties invol ved. Now, with the support of the Ministry of Economy and Finance of Peru, the possibility of extending this model to more projects opens, consolidating an approach based on quality and sustainability. traditional contracts.
To date, this has been limited to major infrastructure programmes carried out under Government Government to Government arrangements, arrangements, but the path is now open to use the NEC much more widely in public sector sector projects. ” Tbe Ministry of Economy and Fina nce of Peru is using NEC standard models of contracts in a context of Perus new Public Procurement Law. Rekha.
NEC4 IN SPANISH: A NEW HORIZONJ0r IN LATIN AMERICA experience of collaborative contracts ¡ n Peru and achieved achieved hydraulic infrastructure work and de-silting in the rivers Chico and Matagente, a tower with a LEED certification certification but also simpler projects gathered in packages like priority education projects including including elementary schools, a college or commercial malls. There is a broad spectrum with various options for collaborative collaborative contracting, from alliancing to partnering.
The main providers of contracts like NEC, The American Society of Civil Engineers (ASCE) or lawyers like David David Mosey with the FAC-1 UK, or FIDIC have developed developed or are currently working on standard forms to meet the demand. Among the key features there is an integrated integrated delivery team made of the Client, Project Manager, Contractors, Designers and Specialist Subcontractors to maximize the outcomes and achieve the jointly defined Key Performance Indicators. There is a shared management management of risks through early warnings and systems of joint decision-making. Target cost contracts with a painand-gain painand-gain mechanism can be implemented. Transparency and an open-book approach are encouraged. The introduction introduction of an agile on-site dispute resolution mechanism mechanism is encouraged even though it is also the case for traditional projects. One of the most appreciated characteristics is the possibility possibility of Early Contractor Involvement Involvement (ECI) which provides a development phase for complex projects.
In Brazil, the 167 million euros EPC contract awarded to improve the existing port infrastructure infrastructure in the Port of Navegantes follows a period of ECl during which Portonave, BESIX and Empresa Construtora Brasil Brasil worked collaboratively to determine the best technical solutions, develop the design and optimized prices by working working in an open book. The problem of the client was a technical problem rather than a budget issue and the ECl helped reassure the foreign foreign contractors on the taxes and currency fluctuations risks. Gabriel Armanet, Senior Director Director for the construction practice of FTI in Paris underlined underlined that “Achieving an appropriate level of design maturity before launching the ECl tender is essential. However, if the Client overdevelops overdevelops the design prematurely prematurely it may lead to lost efforts or limit the contractors ability ability to improve buildability and cost efficiency. ” Gabriel Armanet also explained that defining the adequate budget budget is a crucial step. There are different possibilities in sharing the cost risks. A pain/gain share motivates the contractors to minimise the costs for the Client, while when costs are simply reimbursed reimbursed there may be more risks of cost slippages.
Collaborative approaches may drive innovation and facilitate compliance with the requirements for the decarbonization decarbonization of the projects considering the whole lifecycle lifecycle of the infrastructure as sustainable design relies critically critically on knowledge found in construction supply chains. The Contractor exceeding the climate targets can be rewarded. Collaboration to adapt the quantities to the strict needs of the projects can limit wastage significantly. significantly.
While the gains from collaboration collaboration should also be checked against the costs of initiating and administrating the collaborative framework, it can be demonstrated that collaborative processes can benefit smaller projects by leveraging the multidisciplinary multidisciplinary expertise of alI the parties parties involved. Developing standard forms for collaborative contracting can save time and money and leave less room for disputes disputes if the standard forms are not amended and preserve preserve the initial and fair balance of risks. Moving from the lowest cost approach to quality quality would be a positive signal.
Choosing the right partners with the right skills from the outset remains a key driver of success and shall be a key step to attracting young and diverse talents to the construction construction industry and recruiting recruiting the next generation. N&C Comenta en cica.