FIDIC has explained that the underlying philosophy and core purpose behind the updates to the Second Editions of the Rainbow Suite (Red, Yellow and Silver Books) is to achieve increased clarity, transparency, and certainty which should lead to fewer disputes, lower administrative costs and more successful projects. Subsequently, an important theme of the Second Edition is the increased emphasis on dispute avoidance.
FIDIC suggests a variety of dispute avoidance mechanisms, as demonstrated by the following changes.
In conclusion, the significant shift towards an early recognition of potential issues and subsequent dispute avoidance constitutes a massive cultural change on the part of public, the employer, and contractor. The benefits of dispute avoidance, or at least a fair and timely resolution of any disputes are measurable from a cost perspective and can be a competitive advantage in a highly-contested market. A good reason for everyone in the industry to take a closer look at the new updated Red, Yellow and Silver Books.
This article is the first one in a series of seven articles highlighting the main changes, the reasoning behind the changes and the effects thereof of the updated Red, Yellow and Silver Books.
The article does not constitute legal advice and has been drafted for information purposes only.