Although Clause 17 is titled ‘Risk and Responsibility’ it also sets out other provisions relating to indemnities, limitation of liability and, unusually, the specific topic of intellectual and industrial property rights. The clause provides that the Contractor assumes responsibility and bears the risk for the care of the works during execution and for remedying any defects during the Defects Notification Period. Risk transfers to the Employer on issue of the Taking–Over Certificate to the extent of works defined as being completed. Generally, in construction contracts ‘risk’ is understood to mean an event or circumstance which causes delay, loss or damage to the Works. A risk can be said to be Employer caused, Contractor caused or neutral. The purpose of risk allocation is to determine which party bears the risk for such events. The Contractor may be required to remediate the damage at his own cost or the Employer may be required to pay for the damaged works. It has been stated that the “FIDIC standard forms are generally recognised as being well balanced because both parties bear parts of the risks arising from the project.”
Click through to read Corbett & Co.'s helpful commentary on FIDIC Red Book 1999 book - Clause 7
The Contractor must now prepare a detailed test programme with timing and resources. The Engineer reviews it and the result is a NONO, deemed or actual, which permits the tests to begin. This should help to remove some of the uncertainties that often can surround tests on completion. Clause 9.2 deals with delayed tests, whether the delays are caused by the Employer or Contractor. If the tests are “unduly delayed” by the Employer or Engineer or by a cause for which the Employer is responsible, it says clause 10.3 “shall apply”.