In construction contracts, disputes are extremely  frequent  especially in international projects. The claiming is almost inevitable and controversies concerning extra works,  extension  of time, liquidated damages for (alleged or actual) delay of the Contractor, or for the calling of the bonds issued by the Contractor for (alleged or actual) default from the Contractor itself are almost the ordinary course of a project.

Bonds in construction contracts are often a pain point for Contractors. Especially in international construction projects they are frequent and are used to protect in a way or another the Employer from various breaches and non-performance of the Contractor.

Construction bonds are however rather risky for the Contractor especially if they are issued in the form of an on-demand bond. 

In international construction projects, it is standard practice for the Employer to request guarantees to secure the performance of the Contractor. The most frequent guarantees are the bid bond, the advance payment bond, the performance bond and the warranty bond. Let’s see the features of each of them and then the form that they usually have in the practice. 

The construction industry has always been characterised by a high volume of disputes for several reasons. The 2017 Arcadis report highlights some interesting findings based on their engagements in the Middle East over the previous twelve months. Arcadis (the well-known and authoritative consultancy firm) observed an increase in the number of disputes in the Middle East, which has certainly been influenced by the current economic situation in GCC countries. 

According to the most recent report issued by Deloitte, infrastructure investment in the GCC has remained high in the last three consecutive years and registered a record number in 2014 at US$171 billion.

There is a realization from governments of the dependence of their economies on public spending on projects and the necessity to maintain a certain level of spending and activity so as not to undermine future growth.

The third Annual General Meeting of WLA took place in Dubai from 13 to 14 April 2017.

Three years ago a small number of independent Law Firms (including BDA Studio Legale) decided to establish a Network different from the thousands of Lawyers' Network already existing.