Project Administration Handbook for Civil Engineering Works, Study Guides, Projects, Research of Civil Engineering

Download Project Administration Handbook for Civil Engineering Works and more Study Guides, Projects, Research Civil Engineering in PDF only on Docsity! Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 1 CHAPTER 5 CONTRACT DOCUMENTS Rev Issue Date Amendment Incorporated First Issue December 2016 NA The parts of the PAH shown in blue and bold should only be updated by Works Branch of Development Bureau. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 2 SYNOPSIS This Chapter provides a handy reference to the various standard documents, forms and information that are regularly used in the preparation of contract documents for civil engineering works. In some cases, standard forms and exact wording to be included in contract documents are reproduced in the Chapter. However, where a printed version of a standard document is available or where the information is contained in a well-known document, the Chapter makes reference to such documents or source rather than reproducing them. Standard documents referred to in this Chapter should be of the latest editions of the General Conditions of Contract for Civil Engineering Works, Standard Method of Measurement for Civil Engineering Works, General Specification for Civil Engineering Works, Sub-contract Articles of Agreement and Conditions for Civil Engineering Works, Contractor Management Handbook and Construction Site Safety Manual. The information in this Chapter would also be useful in the preparation of documents for term contracts. A contract for civil engineering construction is a very complex legal document containing several inter-related documents each of which plays an important role in defining the obligations and responsibilities of the parties concerned or in providing information on the works to be constructed. It is therefore essential that the contract documents for each contract are prepared with great care and by an experienced professional who has thorough knowledge of the works to be constructed. The documents forming a contract must be scrutinized for comprehensive coverage, accuracy and consistency with one another before tenders are invited. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 5 9.8 SUPPLY OF MATERIALS BY GOVERNMENT ......................................... 54 9.9 SUB-CONTRACTS FOR SPECIALIST WORKS ......................................... 54 9.10 DISPOSAL OF EXCAVATED MATERIALS ............................................... 55 9.11 CONTRACT MEASURES TO PREVENT NON-PAYMENT OF WAGES ........................................................................................................... 56 9.12 SITE CRUSHERS ........................................................................................... 56 9.12.1 Policy for Setting up Site Crushers .................................................... 56 9.12.2 Procedures .......................................................................................... 56 9.12.3 Crushed Rock and Recycled Products Produced by Site Crushers for Project Use .................................................................... 57 9.12.4 Regulating Conditions ....................................................................... 57 9.13 RESOLUTION OF DISPUTES BY MEDIATION / ADJUDICATION / ARBITRATION .............................................................................................. 57 9.14 COMPUTER FACILITIES FOR WORKS CONTRACTS ............................ 59 9.15 SITE SAFETY AND ENVIRONMENTAL MANAGEMENT ...................... 59 9.16 SECTIONAL COMMENCEMENT OF THE WORKS.................................. 61 9.16.1 General ............................................................................................... 61 9.16.2 Procedures .......................................................................................... 62 9.17 ENVIRONMENTAL PERMIT ....................................................................... 62 9.18 DELETION OF EXTENSIONS OF TIME FOR INCLEMENT WEATHER ...................................................................................................... 63 9.19 TIME-CRITICAL PROJECTS ........................................................................ 64 9.20 CONTRACTS AFFECTED BY CONDITIONS OF LAND GRANT............ 64 9.21 CONTRACTUAL PROVISIONS TO REDUCE THE RISK OF CONTRACT FORFEITURE ........................................................................... 64 9.22 RESTRICTED-HOUR LOCATIONS ............................................................. 65 9.23 ADDITIONAL WORKS AREA AND EXTENSION OF WORKS AREA ............................................................................................................... 65 9.24 TUNNEL WORKS .......................................................................................... 65 9.25 PERMITS FOR EXCAVATION WORKS UNDER LAND (MISCELLANEOUS PROVISIONS) ORDINANCE CAP.28 ....................... 66 9.26 MEASURES TO PREVENT ILLEGAL EXTRACTION OR IMPORTATION OF BOULDERS/COBBLES/PEBBLES ............................ 66 9.27 ADOPTION OF NON-CONTRACTUAL PARTNERING IN PUBLIC WORKS CONTRACTS .................................................................................. 66 9.27.1 Guidelines for selection of contracts for adoption of non-contractual partnering ................................................................. 67 9.28 CONTROL OF OFF-SITE FABRICATIOIN OF CONSTRUCTION COMPONENTS .............................................................................................. 67 9.29 SAFETY PRECAUTIONARY MEASURES RELATING TO EXTRACTION OF SAND FROM SEABED WITH POTENTIAL PRESENCE OF UNEXPLODED ORDNANCE ............................................ 68 9.30 DRAINAGE IMPACT ASSESSMENT PROCESS FOR PUBLIC SECTOR PROJECTS ...................................................................................... 69 9.31 ENGAGEMENT OF SUB-CONTRACTORS REGISTERED FROM SUBCONTRACTOR REGISTRATION SCHEME ....................................... 69 Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 6 9.32 CONTRACT MEASURES TO LIMIT THE NUMBER OF TIERS OF SUB-CONTRACTING .................................................................................... 69 9.33 ENHANCEMENT MEASURES FOR SUB-CONTRACTOR MANAGEMENT PLAN (SMP)...................................................................... 70 9.34 CONTRACT MEASURES FOR IMPLEMENTATION OF EMERGENCY COMMAND SYSTEM.......................................................... 71 9.35 INDEPENDENT CHECKING OF THE DESIGN, ERECTION, USE AND REMOVAL OF TEMPORARY WORKS ............................................. 71 9.36 QUALITY MANAGEMENT SYSTEM CERTIFICATION OF CONTRACTORS FOR PUBLIC WORKS ADMINISTERED BY THE WORKS GROUP OF DEPARTMENTS ........................................................ 73 9.37 USE OF RECYCLED AGGREGATES IN CONCRETE PRODUCTION AND IN ROAD SUB-BASE CONSTRUCTION ................ 74 9.38 METALLIC SITE HOARDINGS AND SIGNBOARDS ............................... 75 9.39 EMPLOYMENT OF TECHNICIAN APPRENTICES AND BUILDING & CIVIL ENGINEERING GRADUATES BY CONTRACTORS OF PUBLIC WORKS CONTRACTS ................................................................... 75 9.39.1 Technician Apprentices ..................................................................... 75 9.39.2 Building and Civil Engineering Graduates ........................................ 75 9.39.3 Implementation .................................................................................. 76 9.40 SPECIAL CONDITIONS OF CONTRACT FOR USE IN MEGA PROJECT CONTRACTS ................................................................................ 76 9.41 SECTIONS SUBJECT TO EXCISION ............................................................ 78 9.42 ANTI-COLLUSION ........................................................................................ 80 9.43 FINANCIAL RELIEF MEASURES TO ASSIST THE CONSTRUCTION INDUSTRY ..................................................................... 80 9.43.1 Interim Payment ................................................................................. 80 9.43.2 Retention Money ............................................................................... 81 9.43.3 Payment Level for Term Contracts .................................................... 81 9.44 EMPLOYER’S POWER TO REDUCE THE AMOUNT OF THE CONTINGENCY SUM PRIOR TO AWARD OF CONTRACT ................... 81 9.45 PROVISION OF UNIFORM FOR PERSONNEL WORKING ON PUBLIC WORKS SITES ................................................................................ 83 9.45.1 Purpose .............................................................................................. 83 9.45.2 Policy ................................................................................................. 84 9.45.3 Design and Provision of Uniform ...................................................... 84 9.45.4 Provision of Associated Facilities ..................................................... 84 9.45.5 Payment and Control ......................................................................... 85 9.45.6 Implementation Guidelines ................................................................ 85 9.46 IMPLEMENTATION OF MANDATORY CONTRACTOR COOPERATIVE TRAINING SCHEME (CCTS) IN PUBLIC WORKS CONTRACTS .................................................................................................. 85 9.46.1 Purpose .............................................................................................. 85 9.46.2 The CCTS .......................................................................................... 86 9.46.3 Implementation .................................................................................. 86 9.46.4 Implementation Guidelines ................................................................ 87 9.47 IMPLEMENTATION IN PUBLIC WORKS CONTRACTS OF THE MANDATORY EMPLOYMENT OF GRADUATES OF THE Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 7 ENHANCED CONSTRUCTION MANPOWER TRAINING SCHEME (ECMTS).......................................................................................................... 87 9.47.1 Purpose .............................................................................................. 87 9.47.2 Background ........................................................................................ 87 9.48 INDEPENDENT SAFETY AUDIT SCHEME FOR MEGA CAPITAL WORKS CONTRACTS OR CAPITAL WORKS CONTRACTS INVOLVING UNCONVENTIONAL CONSTRUCTION METHOD ........... 88 9.49 EMISSIONS CONTROL OF NON-ROAD MOBILE MACHINERY IN CAPITAL WORKS CONTRACTS OF PUBLIC WORKS ............................ 88 10. LUMP SUM CONTRACTS WITH FIRM BILLS OF QUANTITIES ....................... 90 11. MISCELLANEOUS .................................................................................................... 92 11.1 CONTRACT NUMBER .................................................................................. 92 11.2 NOTES TO TENDERERS .............................................................................. 92 11.3 BINDING OF TENDER DOCUMENTS ........................................................ 93 11.4 ELECTRONIC DISSEMINATION OF TENDER DOCUMENTS .................. 93 11.5 REPRESENTATIONS AT PRE-CONTRACT STAGE ................................. 93 11.6 DECLARATION AND UNDERTAKING BY OFFICERS INVOLVED IN PREPARING TENDER DOCUMENTATION INCLUDING TENDER SPECIFICATIONS ......................................................................... 94 12. REFERENCES ............................................................................................................ 96 APPENDICES ....................................................................................................................... 106 APPENDIX 5.1 FORM OF TENDER ................................................................ 107 APPENDIX 5.2 GUIDELINES FOR COMPLETING THE FORM OF TENDER ................................................................................... 115 APPENDIX 5.3 SCHEDULE OF PROPORTIONS ........................................... 118 APPENDIX 5.4 GUIDELINES FOR PREPARING THE SCHEDULE OF PROPORTIONS ....................................................................... 120 APPENDIX 5.5 FORMAT OF THE GRAND SUMMARY TO THE BILLS OF QUANTITIES ..................................................................... 121 APPENDIX 5.6 NOTE TO TENDERERS AND SPECIAL CONDITION OF CONTRACT FOR ENGAGEMENT OF SUB-CONTRACTORS REGISTERED FROM SUBCONTRACTOR REGISTRATION SCHEME ................ 123 APPENDIX 5.7 UNDERTAKINGS BY CONTRACTOR ON THE USE OF GOVERNMENT DIGITAL MAP DATA ......................... 125 APPENDIX 5.8 CHECK-LIST FOR TENDERS DEPOSITED IN THE *GOVERNMENT SECRETARIAT TENDER BOX / *PUBLIC WORKS TENDER BOX ......................................... 126 APPENDIX 5.9 CONTROL OF ALKALI SILICA REACTION IN CONCRETE ............................................................................. 128 APPENDIX 5.10 CONFIRMATION BY CONTRACTOR ON CESSATION OF THE USE OF GOVERNMENT DIGITAL MAP DATA ....................................................................................... 130 APPENDIX 5.11 PARTICULAR SPECIFICATION FOR INDEPENDENT CHECKING OF THE DESIGN, ERECTION, USE AND REMOVAL OF TEMPORARY WORKS ............................... 131 Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 10 I. ABBREVIATION I.01 The meaning of the abbreviations assigned in this Chapter of the Project Administration Handbook for Civil Engineering Works shall only apply to this Chapter. I.02 The following list shows the meaning of the abbreviations for the common terms used in this Chapter of the Project Administration Handbook for Civil Engineering Works Abbreviation Term AAR Alkali-Aggregate Reaction BQ Bills of Quantities CCC Conditions of Contract Committee CCGO Central Cyber Government Office CCIP Contractor Controlled Insurance Programme CEDD Civil Engineering and Development Department CPFS Contract Price Fluctuation System C&D Construction and Demolition DCED Director of Civil Engineering and Development DEVB Development Bureau DEVB TCW No. DEVB Technical Circular (Works) No. DLO District Lands Office DRA Dispute Resolution Adviser EDP Electronic Dissemination Package EIA Environmental Impact Assessment E&M Electrical and Mechanical EMSD Electrical and Mechanical Services Department EP Environmental Permit EPD Environmental Protection Department ER Employer’s Requirements ETWB Environment, Transport and Works Bureau ETWB TCW No. ETWB Technical Circular (Works) No. FoT Form of Tender FC No. Financial Circular No. GCC General Conditions of Contract for Civil Engineering Works (1999 Edition) CGE/S&T Chief Geotechnical Engineer/Standards and Testing GCT General Conditions of Tender GEO Geotechnical Engineering Office GS General Specification for Civil Engineering Works (2006 Edition) HATS Harbour Area Treatment Scheme HIA Hazard Identification Activity Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 11 Abbreviation Term HyD Highways Department LAD(Works)/DEVB Legal Advisory Division (Works) of Development Bureau LandsD Lands Department LD’s Liquidated Damages LWBTC No. Lands and Works Branch Technical Circular No. MM Method of Measurement NTT Notes to Tenderers OCIP Owner Controlled Insurance Programme OGCIO Office of the Government Chief Information Officer PAH Project Administration Handbook for Civil Engineering Works PES Pre-work Exercise and Safety PFC Public Fill Committee PPF Price Fluctuation Factor PFSES Pay for Safety and Environment Scheme PFSS Pay for Safety Scheme PII Professional Indemnity Insurance PRC People’s Republic of China PP Particular Preamble PS Particular Specifications PWP Public Works Programme PWL Public Works Laboratory QPME Quality Powered Mechanical Equipment SCC Special Conditions of Contract SCCT Standing Committee on Concrete Technology SCT Special Conditions of Tender SDEV Secretary for Development SETW Secretary for Environment, Transport and Works SFST Secretary for Financial Services and the Treasury S for W Secretary for Works SMM Standard Method of Measurement for Civil Engineering Works (1992 Edition) SMP Sub-contractor Management Plan SoR Schedule of Rates SPID Standard Phraseology of [Bill of Quantities] Item Descriptions SPR Stores and Procurement Regulations SRM Systematic Risk Management SSC Site Safety Cycle WBTC No. Works Bureau Technical Circular No. or Works Branch Technical Circular No. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 12 Abbreviation Term WTO GPA Agreement on Government Procurement of the World Trade Organization Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 15 (h) General Specification (GS) (see Paragraph 6.1), (i) Particular Specification (PS) (see Paragraph 6.2), (j) Standard Method of Measurement (SMM), (k) Particular Preambles (if any), (l) Bills of Quantities (BQ) (see Paragraph 7.1) (m) Drawings (see Paragraph 8.1), and (n) Any relevant pre-contract correspondence with the Contractor (e.g. tender addendum, circular letters to tenderers) (see Paragraphs 5.2, 6.14.4, 7.2.1, 7.3, 7.6 & 8.1.1 of PAH Chapter 6). Usually, only documents (d) to (n) listed above, the letter of acceptance of the tender and the Articles of Agreement form the contract documents (see Paragraph 8.1.1 of PAH Chapter 6). The type or edition of document used shall be the current version as promulgated by DEVB TCWs or other appropriate circular. Reference should also be made to the current corrigenda issued to the GS and the SMM (see Paragraph 5.2 of PAH Chapter 6). 1.3 CONSISTENCY AMONGST DOCUMENTS Care should be taken to avoid any ambiguities or discrepancies in the documents which form a contract as contractual claims and disputes are often caused by inconsistencies in or between the documents. If any ambiguities or discrepancies exist, it should be noted that the provisions of the SCC prevail over those of the GCC, which in turn prevail over the PS and the Drawings, which in turn prevail over the GS. GCC Clause 5(1) and GS Clause 1.01 are relevant in this aspect. In the drafting of SCC or PS clauses, reference should be made whenever appropriate to the GCC and the GS, using phrases such as: (a) “Pursuant to General Conditions of Contract Clause .......”, or (b) “GS Clause ....... is deleted and replaced by ........” etc. 1.4 COMMENTS ON DOCUMENTS BY CONTRACT ADVISERS The responsibility for ensuring that tender documents are properly prepared rests with the professional officers handling the project. They may however seek advice from Contract Advisers on tender documents when genuine doubts emerge. When seeking such advice the officer concerned shall inform the Contract Adviser of the doubts he has and the aspects of the case on which he wants advice (see Paragraph 1.5.1 of this Chapter). Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 16 1.5 LEGAL VETTING OF TENDER DOCUMENTS 1.5.1 Contracts Estimated to Exceed $300M All tender documents for contracts estimated to exceed $300M in value must be submitted through the appropriate Contract Adviser to the Legal Advisory Division (Works) of DEVB (LAD(Works)/DEVB) for legal vetting prior to calling for tenders. Before submission to LAD(Works)/DEVB, it is advisable to request the relevant Contract Adviser to comment on the documents. Comments made by the relevant Contract Adviser on the draft should be attached for LAD(Works)/DEVB’s information. The tender documents to be submitted shall include the following: (a) Special Conditions of Tender, (b) Form of Tender and Appendix thereto (if these have been altered from the standard version shown at Appendix 5.1), (c) Articles of Agreement (if these have been altered from the standard printed version), (d) Special Conditions of Contract, (e) Particular Specification, and (f) Bills of Quantities, including General and Particular Preambles. A memo shall accompany the tender documents, drawing attention to the following: (a) SCT clauses and SCC clauses together with reasons for their incorporation, (b) alterations, if any, to the standard versions of the Articles of Agreement and the Form of Tender and Appendix thereto, and (c) any clause in the PS, any item in the BQ, or any other matter relating to the tender documents or to the Contract which may have significant contractual or financial implications. LAD(Works)/DEVB will consider these documents (retaining a copy for future reference) and may recommend amendments they consider advisable to the works division/regional office concerned, who should incorporate such amendments as necessary into the documents before calling for tenders. The vetting by LAD(Works)/DEVB will take at least three weeks and provision should be made in the programme for tender preparation. If owing to urgency, or some other reasons, the documents cannot be submitted through Contract Adviser then the reason for the same should be explained in the covering memo to LAD(Works)/DEVB. However, action should then be taken to forward the comments made by Contract Adviser as soon as they are received. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 17 1.5.2 Design and Build Contract The Administrative Procedures issued under DEVB TCW No. 4/2015 should be followed as closely as possible. In particular, the procedures laid down in the “Guidance Notes on the Preparation of the Employer’s Requirements” (Appendix C of the Administrative Procedures) should be followed in order to avoid any unnecessary design changes after the contract is awarded. Prior approval of DEVB shall be obtained if the Procedures are not to be followed because of special consideration given to individual cases. The legal vetting requirement as described in Paragraph 1.5.1 applies equally to design and build contracts. The Administrative Procedures can be found on the DEVB website (under Publications and Press Releases\Publications\Standard Contract Documents\). Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 20 3. FORM OF TENDER AND SCHEDULE OF PROPORTIONS 3.1 STANDARD FORM OF TENDER For capital works contracts, the standard Form of Tender as shown at Appendix 5.1 should be used. Guidelines for completing the Form of Tender are given at Appendix 5.2. Regarding Form of Tender for term contracts, reference should be made to PAH Chapter 8. 3.2 SCHEDULE OF PROPORTIONS A Contract Price Fluctuation System (CPFS) is used in all civil engineering contracts to cover changes in the cost of labour and materials between the time of tender submission and the time of payment is made for Works completed. A description of the system and guidelines for the preparation and administration of contracts using the CPFS are provided in ETWB TCW No. 21/2003. The CPFS requires the inclusion of a Schedule of Proportions in the contract documents, which will be used to calculate a Price Fluctuation Factor for adjusting payments to the Contractor for items valued at tendered rates. The standard format for the Schedule of Proportions and guidelines on its preparation are given at Appendix 5.3 and Appendix 5.4 respectively. According to ETWB TCW No. 21/2003, the CPFS should not be applied to contracts where the time for completion of the Works (excluding Establishment Works period, if any) or Contract Period (for term contracts) is 21 months or less. Nevertheless, SDEV made amendment to this requirement via his memo ref. DEVB(PS) 107/3 dated 18.7.2008 that all government capital works contracts should apply the CPFS regardless of the contract duration. However, the Head of Department has discretion not to apply the CPFS if it is considered impractical or undesirable to do so due to reasons such as for contracts involving predominant use of proprietary products/systems and/or there are no suitable cost indices for price fluctuation computation. Please see SDEV’s memo ref. DEVB(PS) 107/3 dated 18.7.2008 for details. SDEV promulgated a pilot scheme, commencing on 1 February 2014, introducing an additional index on Composite Selected Labour Trades for all public works contracts having a contract period of 48 months or less, including term contracts. The standard format for the Schedule of Proportions should be amended accordingly. Please see SDEV’s memo ref. DEVB(PS) 107/3 dated 20.1.2014 for details. 3.3 LIQUIDATED DAMAGES (Ref.: ETWB TCW No. 4/2003) 3.3.1 General Principle Liquidated damages (LD's) is a sum agreed by the Employer and the Contractor in advance as the amount to be paid by or deducted from payments to the Contractor as damages if the Contractor breaches the contract by failing to complete the work in time. A provision for LD's is enforceable if the amount fixed is a genuine Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 21 pre-estimate, judged at the time the contract is entered into, of the loss likely to arise from the anticipated breach. The Employer does not need to prove actual damages but LD's are not enforceable if imposed as a penalty. Guidelines for distinguishing between liquidated damages and a penalty are stated in the leading case of Dunlop Pneumatic Tyre Company Limited v New Garage and Motor Company Limited [1914-15] All ER 739. Reference may also be made to the judgement of the Privy Council in Philips Hong Kong Limited v The Attorney General of Hong Kong delivered on 9 February 1993. If the courts find the agreed sum to be "extravagant or unconscionable in amount in comparison with the greatest loss which could conceivably be proved to have followed from the breach" it will be held to be a penalty. 3.3.2 Calculation of Liquidated Damages The LD's formula to be entered in the Appendix to the Form of Tender should be a genuine pre-estimate of the likely loss to the Employer resulting from delay in completion of the Works, or any Section of the Works, as the case may be. The General Conditions of Contract Clause 52 has been drafted on the basis that if any part of the Works is designated as a Section, the remainder of the Works must also be designated as a Section. If a contract contains Sections, LD's should be calculated for each Section instead of for the whole of the Works. If it is possible to carry out a cost-benefit analysis, LD's shall be calculated using the daily rate of economic benefit likely to be generated by the project after completion and those additional costs due to the delay in completion of the Works, if any. Where such analysis is not possible, as is usually the case in public sector construction contracts, an amount being a genuine pre-estimate of the likely loss to the Employer may be stipulated as the LD's. In estimating the likely loss to the Employer, there is a widely accepted formula method which includes the following components: (a) loss of revenue or interest on the capital invested in the project; (b) supervisory costs during the delay period; (c) the additional sum payable to the Contractor in respect of fluctuations in the cost of labour and materials; and (d) any special damages specific to the particular project. Adopting this, the empirical formulae given in Appendix 5.34 may be used to calculate the components of LD's to be specified in the Contract unless an alternative, more accurate assessment can be made. 3.3.3 Special Damages There may be situations where the Employer will suffer some special losses as a result of a project not being completed on time. For example, where a contract is on the critical path any delay may result in an ultimate delay to the completion of another contract (e.g. a separate demolition or piling contract can delay the completion of the whole project). The Employer will suffer a loss on the following contract(s) if delayed by the late completion of the contract in respect of which the calculation is being made. LD's for special damages cannot be imposed if there is a float period between contracts, because there cannot be any genuine pre-estimate of the special damages. However, in Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 22 many cases contracts are programmed so that there is no float. This should be confirmed before a calculation is made. There may be other categories of loss caused by delay in meeting key dates. For example, there may be a special loss of running a less cost efficient facility until the replacement facility is available; the opening of a school or offices may depend on the completion of a road access; or the loss of interest on capital invested in an adjoining sewage treatment plant which cannot be commissioned until the sewer tunnel is completed. There may also be occasions where Government is liable to a third party for losses caused by delay in completion of the Works. For example, Government undertakes the site formation of a leased land and is liable to damages for delay. Another example is that Government may have to pay its consultants additional fees and expenses arising from delay in completion of the Works. If any such special damages can be identified at the project planning stage, it is essential that the rationale behind the calculation (but not the calculation itself), is clearly stated in the tender documents as a Special Condition of Tender and the appropriate sum representing the special damages included as part of the genuine pre-estimate of loss in the event of late completion of the Works or, as the case may be, the relevant Section. 3.3.4 Minimum Amount of Liquidated Damages The amount of LD's is subject to proportional reduction under General Conditions of Contract Clause 52(2), due to the completion or handing over of a part of the Works or part of a Section in advance of the whole. Under certain circumstances, this proportional reduction may not reflect the real effect of delay. For example, a partial completion of the Works would not help in reducing the special damages. Also, in practice, there is a limit on the minimum size of the site supervisory staff beyond that no further reduction is possible. Under such circumstances, a SCC specifying the minimum amount of LD's should be incorporated in the contract by adding a sub-clause (5) to General Conditions of Contract Clause 52 as follows: "General Conditions of Contract Clause 52 is amended by adding the following as sub-clause (5): (5) Notwithstanding the proviso to General Conditions of Contract Clause 52(2) the resulting rate per day of liquidated damages for the Works or any Section after reduction in accordance with that sub-clause shall not be less than the minimum rate per day of liquidated damages for the Works or, as the case may be, the relevant Section as stated in the Appendix to the Form of Tender." and the sum calculated in respect of the special damages and the minimum supervisory staff costs shall be inserted in the Appendix to the Form of Tender as the "Minimum amount of liquidated damages (per day)". It should be noted that the concept of minimum site staff establishment may not be applicable to Sections, other than the last Section, as the supervision can be carried out Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 25 (b) If the rate of LD's calculated in accordance with the Formula is lower than the latest estimate of the likely loss, the procuring department should follow the procedures in sub-paragraph (a) above to revise the rate of LD's. If as a result of negotiation the revised rate of LD's is at a level below the genuine pre-estimated loss i.e. the latest estimated loss in this case, the procuring department must seek DEVB's endorsement and the approval of Secretary for Financial Services and the Treasury. 3.3.11 Record Full record of any review of LD's together with all related calculations should be kept on file. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 26 4. ARTICLES OF AGREEMENT Standard Articles of Agreement attached to the respective editions of the GCCs shall be used, namely, GF 548 for capital works contracts for Civil Engineering Works as modified by Appendix A of WBTC No. 20/2000, GF 546 for term contracts for Civil Engineering Works, GF 549 for Design and Build Contracts, GF 541 for Building Works, and GF 550 for Electrical & Mechanical Works. Appropriate modification to the attestation clauses should be made in accordance with DEVB TCW No. 7/2014. For Nominated Sub-contracts, the Articles of Agreement in the “The Government of the Hong Kong Special Administrative Region, Sub-contract Articles of Agreement and Conditions for Civil Engineering Works” (GF 543) shall be used for all Nominated Sub-contracts to capital works contracts. Where a contract is awarded to an unincorporated joint venture, the revised Articles of Agreement at Appendix E of ETWB TCW No. 50/2002 shall be used. Appropriate modification to the attestation clauses should be made in accordance with DEVB TCW No. 7/2014. Where the contractor is an incorporated joint venture, the ordinary form of Articles of Agreement shall be used. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 27 5. CONDITIONS OF CONTRACT 5.1 GENERAL CONDITIONS OF CONTRACT The following standard documents are available: (a) The Government of the Hong Kong Special Administrative Region, General Conditions of Contract for Civil Engineering Works (1999 Edition) (b) The Government of the Hong Kong Special Administrative Region, General Conditions of Contract for Term Contracts for Civil Engineering Works (2002 Edition) (c) The Government of the Hong Kong Special Administrative Region, General Conditions of Contract for Building Works (1999 Edition ) (d) The Government of the Hong Kong Special Administrative Region, General Conditions of Contract for Term Contracts for Building Works (2004 Edition) (e) The Government of the Hong Kong Special Administrative Region, General Conditions of Contract for Electrical and Mechanical Engineering Works (1999 Edition); (f) The Government of the Hong Kong Special Administrative Region, General Conditions of Contracts for Term Contracts for Electrical and Mechanical Engineering Works (2007 Edition); and (g) The Government of the Hong Kong Special Administrative Region, General Conditions of Contract for Design and Build Contracts (1999 Edition) The GCCs have been uploaded to the DEVB website (under standard contract documents in the publications section and they will be updated from time to time when new editions are promulgated which may affect the library content. (http://www.devb.gov.hk/en/publications_and_press_releases/publications/standard_contract _documents/index.html) 5.2 SPECIAL CONDITIONS OF CONTRACT 5.2.1 General Consideration Any amendments, additions, deletions and amplifications to the GCC should be effected by the inclusion of SCC clauses. However, SCC clauses should only be included when there is a genuine need to alter or supplement the GCC. Matters concerning materials or workmanship standards or detailed arrangement for the execution of Works should not in general be stipulated in the form of SCC. Such matters, if not adequately covered by the GS, should be dealt with in the PS. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 30 the discretion of Head of Department/Office, be referred to the Works Group Directors’ Meeting for consideration. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 31 6. SPECIFICATION 6.1 GENERAL SPECIFICATION (Subsumed from WBTC No. 18/92; Ref.: DEVB TCW No. 7/2007) The General Specification for Civil Engineering Works (GS) covers general requirements and may need varying degrees of amplification and modification to suit individual contracts, e.g. on the general description (major items only) of the Works, the list of Drawings, works by other contractors on the Site running concurrently with the Works under the contract. Amplifications and modifications to the GS should be made in the Particular Specification (PS). In supplementing the GS by a PS, compatibility of all changes must be ensured by the department preparing the tender documents. If changes are considered necessary, the revised items together with the reasons for the changes shall be submitted to the D1 (or higher) level officer administering the contract for approval. Furthermore, it is essential to ensure that the PS does not conflict with other parts of the tender documents. The GS, 2006 Edition can be found on the CEDD website (http://www.cedd.gov.hk/eng/publications/standards_handbooks_cost/stan_gs_2006.htm). It has incorporated, among other changes, the use of “green” construction materials including recycled aggregates and reclaimed asphalt material to further promote environmentally friendly construction practices in public works projects. It has included two new sections on “Environmental Protection” and “Preservation and Protection of Trees”. As the latest edition of the GS is publicly available and can be purchased at the Publications Sales Unit of the Information Services Department, it is therefore not necessary to bind the GS into the tender or contract documents. However, this should be reflected in the Conditions of Tender by stating that the GS is not issued as part of the tender documents. 6.2 PARTICULAR SPECIFICATION Each contract will require a different set of PS clauses to suit its own circumstances (See Paragraph 6.1). Standard clauses/guidelines may be available from DEVB TCWs for the following subjects: (i) For capital works or maintenance works (including tree planting) within or adjacent to the Kowloon-Canton Railway (Hong Kong) Section, Tsim Sha Tsui Extension, Ma On Shan Rail and Lok Ma Chau Spur Line, reference should be made to ETWB TCW No. 2/2005 and DEVB’s emails dated 3.9.2007 and 25.9.2007; (ii) For public works to be carried out within the Railway Protection Area for the completed facilities of the West Rail, reference should be made to ETWB TCW No. 33/2003; (iii) For public works to be carried out within the protection boundary for completed facilities of the MTR Corporation Limited, reference should be Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 32 made to WBTC No. 19/2002; (iv) For contracts involving permanent prestressed ground anchors, reference should be made to ETWB TCW No. 16/2004; (v) For reclamation contracts involving public filling, reference should be made to WBTC Nos. 10/92, 2/93, 2/93B, 16/96, 4/98 & 4/98A and subsequent revisions; (vi) For contracts including computer facilities as an item to be provided by the Contractor, reference should be made to ETWB TCW No. 12/2004; (vii) For construction site safety, reference should be made to WBTC No. 30/2000 and the Construction Site Safety Manual (ref. http://www.devb.gov.hk/en/publications_and_press_releases/publications/c onstruction_site_safety_manual/index.html); (viii) Not used; (ix) For the control of Alkali Aggregate Reaction (AAR) in concrete, the particular specification given at Appendix A of WBTC No. 5/94 shall no longer be used. The requirements were incorporated into GS. For guidelines of the AAR control, reference should be made to Appendix 5.9; (x) For contracts involving importation of sand from the mainland China by barges, reference should be made to WBTC Nos. 10/95 & 10/95A; (xi) For the Pay for Safety and Environment Scheme and Pay for Safety Performance Merit Scheme, reference should be made to WBTC No. 30/2000, the Construction Site Safety Manual, ETWB TCW No. 19/2005, the Interim Guidance Note on Administration of Environmental Management and Pay for Safety and Environment Scheme for Public Works Contracts promulgated under SETW’s memo ref. (014G7-01-1) in ETWB(W) 517/91/01 dated 19.6.2006 and SDEV’s memo ref. (02LSV-01-1) in DEVB(W) 516/70/03 dated 22.11.2013; (xii) For contracts including contract transport, reference should be made to LWBTC No. 11/84 and Paragraph 6.3.2(c); (xiii) For independent checking of the Design, Erection, Use and Removal of Temporary Works, reference should be made to Paragraph 9.35; (xiv) For contract measures to prevent non-payment of wages, reference should be made to Paragraph 9.11. (xv) Not used; (xvi) For contracts requiring employment of qualified tradesmen and intermediate tradesmen, reference should be made to WBTC No. 13/2002 Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 35 (xli) For contract involving procurement of arboricultural service for tree risk assessment, reference should be made to ‘Service Specifications on Tree Risk Assessment and Mitigation Measures’ in the Tree Planting and Management section of the Cyber Manual for Greening or the direct link (http://devb.host.ccgo.hksarg/); (xlii) For contract involving preservation of existing trees, reference should be made to ‘Contract Provision for Preservation of Existing Trees’ in the Tree Planting and Management section of the Cyber Manual for Greening and the Particular Specification given in Appendix D of DEVB TCW No. 7/2015. The Tree Management Guidelines promulgated by DEVB (see Paragraph 12 “References”) also contain considerations that should be taken into account in the contract provision; (xliii) For adoption of green site offices of the public works projects with sustainable designs and features, reference should be made to the SDEV’s memo ref. () in DEVB(W) 810/17/02 dated 17.10.2014; (xliv) For contracts involving the use of chainsaw in tree pruning works, reference should be made to the SDEV’s memo ref. (36) in L/M to DEVB(GLTM) 302/5/1 dated 17.12.2014; (xlv) For promoting green procurement, it is encouraged to adopt the mandatory/desirable requirements as specified in the green specifications in Annexes II and IX of Environment Bureau Circular Memorandum No. 6/2015 in contracts as far as possible; (xlvi) For public works contracts with tenders to be invited on or after 1 March 2016, the use of B5 diesel for all non-road based construction machinery is mandatory. Reference should be made to the SDEV’s memo ref. () in DEVB(W) 810/17/02 dated 8.1.2016; (xlvii) For contracts incorporating the Independent Safety Audit Scheme, reference should be made to Paragraph 9.48. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 36 6.3 SPECIFICATION REGARDING CONTRACT PRELIMINARIES AND EQUIPMENT 6.3.1 General Principles (a) Specification in Terms of Performance In the drafting of any PS clause, it should be noted that according to Paragraph 9 of DEVB TCW No. 2/2014, technical specifications shall, where appropriate, be in terms of performance rather than design or descriptive characteristics and be based on international standards where such exist. The same principle applies regardless of whether or not the tendering procedures are governed by the Agreement on Government Procurement of the World Trade Organization (WTO GPA). There shall be no requirement for or reference to a particular trademark or trade name or patent or origin unless there is no sufficiently precise or intelligible way of describing the procurement requirements and provided that “products having equivalent functions or performance” shall always be permitted and indicated in the tender documentation. (See S for W’s memo ref. WB(W) 272/31/02D dated 4.4.2002) In the project offices there should exist a three-tier checking/approval mechanism whereby design drawings/tender documents are prepared by one group of officers, checked by officers of other ranks and finally approved by officers of higher ranks. If brand named products are to be specified, they should also be subject to the same scrutiny mechanism. (b) Used Preliminaries To accord with the green policy of the Government, used preliminaries can be accepted if they are in good working and serviceable condition and if they can comply with the requirements of the contract. In the preparation of tender documents, project offices are encouraged to specify, as far as reasonable and practicable and as much as possible, used preliminaries which are to be supplied by the Contractor for use of the Engineer during the contract period. In warranted cases, works departments could specify clearly preliminary items as “used, but in a condition acceptable to the Engineer” (or where appropriate, another more definitive specification such as “not more than 2 years old” for land transport, etc) to save costs for the government. Moreover, on the requirement of providing a temporary accommodation for the Engineer, the project offices, before considering erection of a new office, should first investigate the feasibility of using any existing site office. In the event that a new office is required to be erected, preference should be given to the used prefabricated units which are in good working and serviceable conditions, and such preference should be stated in the tender documents. 6.3.2 Specification regarding Contract Preliminaries (a) Central Acceptance and Distribution of Contract Preliminary Items The following PS clause should be included in the tender documents for the provisioning of contract preliminaries: “All contract preliminary items shall be provided to the office of the Engineer’s Representative for central acceptance and distribution. The Engineer’s Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 37 Representative should inform the Contractor of the name of the officers responsible for accepting these items. The Contractor shall not provide the items directly to an individual member of the site supervisory staff.” (b) Avoid Over-provision of Preliminary Items The following PS clause should be included in the tender documents for works contracts with estimated contract sum exceeding $15M: “Any equipment or facilities to be provided for the use of the Engineer’s staff are only required to meet the minimum requirements stipulated in the Contract. Where this is impracticable (e.g. when the model just satisfying the minimum requirements is outdated or out of stock), the Contractor may provide at his own cost equipment or facilities slightly exceeding the minimum requirements. Extravagant or out-of-the norm over-provision is unnecessary and should be avoided. In the event that a much higher quality than that stipulated shall be provided for legitimate reasons, the Contractor shall give prior notification to the Employer of such an over-provision.” (c) Identification on Contract Transport The contract transport for the Engineer should be properly painted or affixed by adhesive plastic labels with the contract number, Contractor name, Department name, Department logo, Department complaint hotline (or other suitable identifications) and the phrase “For Official Use Only” “只供公務用途” in good size letters for easy identification. (d) Intellectual Property Rights In addition, it is necessary to include the following PS clause in accordance with S for W’s memo ref. WB(W) 209/32/110 Pt. 12 dated 9.1.2001: “Please note that if the Contractor intends to use the intellectual property rights of another party in performing his obligations under the Contract, appropriate licences should be obtained from the relevant owners.” Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 40 contained in Part IV of the SMM. Any amendments or alterations to the SMM to be adopted in the preparation of the BQ shall have the prior approval of an officer at D1 rank or above administering the Contract and shall be included as Particular Preambles to the Bills of Quantities. The Preambles should also contain any other information which is considered to be necessary for the pricing of the BQ but is not included elsewhere in the contract documents. Standard Particular Preambles for various subjects set out in DEVB TCWs should be adopted where applicable. 7.4 PROVISIONAL ITEM 7.4.1 Provisional Items Provisional Item means an item describing work, the requirement for which is uncertain at the time the tender documents are issued and which can only be carried out on the instruction of the Engineer for the Contract. All works described by a Provisional Item should be clearly specified and the provisional nature clearly explained in the PS and BQ. The use of Provisional Items in the BQ should be avoided as far as possible. They should not be included if it is impossible for the tenderer to provide a realistic tender price for the work, taking into account its provisional nature and the manner in which the works may be described. If the requirement for the work is very remote, issuing variations during the contract is generally more advisable than trying to cover the work by inclusion of Provisional Items. 7.4.2 Provisional Quantities under a Lump Sum Contract with Firm BQ Any item or part of work which cannot be accurately measured is covered by a provisional quantity or sum and measured as executed on completion of the item or part of work i.e. the value of these item(s) or part(s) of work(s) in the Bills is/are deducted from the Contract Sum and the value of the works executed is added. For details, refer to Paragraph 10. 7.5 PROVISIONAL SUM/CONTINGENCY SUM/PRIME COST SUM Provisional Sum means a sum provided for work(s) or expenditure which has not been quantified or detailed at the time the tender documents are issued. Contingency Sum means the sum provided for work(s) or expenditure which cannot be foreseen at the time the tender documents are issued. Prime Cost Sum means the sum provided for works to be executed or for materials or services to be supplied by a Nominated Sub-contractor, after deducting any trade or other discount. However, according to GCC Clause 1(1), both Provisional Sum and Contingency Sum may include provision for works to be executed or for materials or services to be supplied by a Nominated Sub-contractor. Provisional Sums for specific purposes should be included in the relevant bills of the BQ. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 41 Under the GCC for Term Contracts (2002 Edition), Contingency Sum may also be specified in a works order in term contracts for work or services or expenditure which cannot be foreseen at the time such works order is issued. 7.6 DAYWORK (Subsumed from ETWB TCW No. 31/2002) The HKCA Schedules For Plant Used in Dayworks Carried Out Incidental to Contract Work (“the Schedules”) published by the Hong Kong Construction Association (HKCA) have been developed to meet the absence of a developed plant hire market in Hong Kong. The Schedules are drawn up in broad categories thus enabling contractors, when tendering, to price the adjusting percentage on the various provisional sums included for dayworks plant in a manner suited to their particular plant holdings. In these circumstances the relativity of rates within an individual plant category assumes equal, if not greater, importance than the basic pricing level adopted in the Schedules. Clause 27.03 in Part V of the SMM specifies that the rates contained in the Schedules current at the date for return of Tender shall be used for plant employed on dayworks. To provide certainty on the edition of the Schedules to be used under a contract, project officer shall check the homepage of HKCA for the current edition of the Schedules to be adopted and include the sample Particular Preamble given at Appendix 5.14 in the BQ. 7.7 SITE CLEANLINESS AND TIDINESS In order to enhance site cleanliness and tidiness, payment provision shall be incorporated into all works contracts including term contracts and design and build contracts. The item on site cleanliness for works contracts that are BQ based are to be marked ‘Quantity Provisional’ to cater for Contractors over-running the time for completion of Contracts. Payment will continue to be made (if justified) throughout the construction period even if the Contractor is in culpable delay. The purpose of continuing the payment is to ensure that the Contractor shall continue the cleaning and tidying up of the Site irrespective of the work progress. Sample BQ, method of measurement and guidelines for preparing the section on site cleanliness are given in DEVB TCW No. 8/2010. 7.8 SITE SAFETY AND ENVIRONMENTAL MANAGEMENT 7.8.1 Pay for Safety and Environment Scheme (PFSES) With the promulgation of ETWB TCW No. 19/2005, all appropriate tenders included in the Pay for Safety and Environment Scheme (PFSES) shall include a separate “Site Safety and Environmental Management” section in the BQ. A number of sample BQ and guidelines for preparing the “Site Safety and Environmental Management” Section of BQ are given in ETWB TCW No. 19/2005, the Interim Guidance Note on Administration of Environmental Management and Pay for Safety and Environment Scheme for Public Works Contracts Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 42 promulgated under SETW’s memo ref. (014G7-01-1) in ETWB(W) 517/91/01 dated 19.6.2006. Please also see Paragraph 9.15. 7.8.2 Site Safety Cycle (SSC) Payment for Site Safety Cycle (SSC) shall be made under the PFSES by including appropriate sections in the Method of Measurement and appropriate items in the BQ. The main item to be included for payment is collectively referred to as ‘Pre-work Activities’ which comprise the following activities on one day: (a) Pre-work Exercise and Safety (PES) meetings; (b) Hazard Identification Activity (HIA) meetings; and (c) Pre-work Safety Checks. Another payment item under the SSC is the provision of ‘Safety Bulletin Board’. Guidelines for the SSC are given in ETWB TCW No. 30/2002. The updated sample BQ is incorporated into Appendix E to ETWB TCW No. 19/2005, the Interim Guidance Note on Administration of Environmental Management and Pay for Safety and Environment Scheme for Public Works Contracts promulgated under SETW’s memo ref. (014G7-01-1) in ETWB(W) 517/91/01 dated 19.6.2006. 7.8.3 Management of Contaminated Soil Tender documents should indicate restrictions, if any, on disposal of contaminated soil from a project based on the agreed arrangements with EPD where appropriate (See Paragraph 3.1.2(g) of Chapter 3). Tenderers should be reminded that permission for disposal of contaminated soil at landfills needs to be obtained from EPD prior to the delivery of the contaminated soil to landfills. In case the treatment or disposal arrangement of contaminated soil is subject to further assessment during contract stage, appropriate contract provisions should be provided to draw the tenderers attention and to allow for the possible variances in handling of contaminated soil. 7.8.4 Welfare Facilities for Workers To take care of the needs and welfare of workers and to promote site cleanliness and hygiene, the Contractor is required to provide storage compartments, drinking water facilities, toilet facilities, hand-wash facilities and rubbish bins. Showering facilities may also be required depending on the number of workers on site. These provisions shall be included in the Preliminary Items ‘Temporary Accommodation for the Contractor’ or ‘Contractor’s Site Accommodation in the Preliminaries’ as appropriate by incorporating the sample Particular Preamble stipulated in ETWB TCW No. 30/2002. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 45 (b) Material Charge Material Unit Charge (HK$) (i) 700MB CD-ROM $1.1 (ii) 4.7GB DVD+/-R $1.3 The electronic drawings should only include the data files. They should not include any executable programmes. Before electronic drawings are issued, the tenderers/contractors should be asked to confirm their acceptance of the following terms of use on electronic drawings. (a) When electronic drawings are issued, the Engineer designate or the Engineer should advise the tenderer/contractor in writing that while every care has been taken to check the integrity of the electronic drawings, no guarantee can be given that the electronic drawings are free from computer viruses and that neither he nor the Employer will be responsible for any direct or consequential damage or losses resulting from any computer viruses that may be contained in the electronic drawings. (b) The tenderer/contractor should also be advised that electronic drawings are issued only for the convenience of the tenderer/contractor and they do not form part of the tender/contract documents. There may be a loss of fidelity when the drawings are displayed on the tenderers/contractors system because the preservation of fidelity will depend on proper system settings. If there are discrepancies between the electronic drawings and the tender/contract drawings in hard copy format, the latter should prevail. The Employer and the Engineer or the Engineer designate will not accept any liability arising from any discrepancies between the electronic drawings and the tender/contract drawings. Furthermore, If the electronic drawings contain digital map data supplied by the Lands Department, the Engineer designate or the Engineer shall require the tenderer or, as the case may be, the contractor to provide a duly signed undertaking in the form set out in Appendix 5.7 before these electronic drawings are issued. To assure authenticity, the Engineer designate or the Engineer shall digitally sign electronic drawings with the digital certificates issued by Certification Authorities approved by the Office of the Government Chief Information Officer (OGCIO) under the Electronic Transactions Ordinance (Cap. 553). If the tenderer/contractor has provided an undertaking on the use of Government digital map data, the Engineer designate or the Engineer shall check that the tenderer/contractor has executed and returned the "Confirmation by contractor on cessation of the use of Government digital map data" set out in Appendix 5.10 on the tenderer submitting its tender or the contractor having completed the relevant work. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 46 9. SPECIAL TOPICS 9.1 MULTI-CONTRACT AND SINGLE CONTRACT ARRANGEMENTS Where the required financial and manpower resources are available, the contracts of a multi-contract project are normally carried out in parallel to enable the completion of the project in the shortest possible time. Some of the issues that need to be considered and provided for in a multi-contract project would include: (a) Site access, (b) Facilities (provided by the Contractor) for other contractors, (c) Works areas, (d) Staged possession and handing over of site, and (e) Consequence of delay in any one of the contracts on other contracts. Suitable provisions should be made in the constituent contracts to cover these and other relevant issues. Such provisions should be made in the SCC, PS and Drawings, where appropriate. For projects (i) involving sequential handling-over of the project site among contractors of concurrent contracts and/or (ii) in which the work progress of one contractor is dependent on that of another contractor in the same project, the compatibility of the multi-contract arrangement with the preferred contract forms of the project should be carefully assessed. For instance, before adopting the arrangement of implementing a conventional contract for civil works and a design-and-build contract for E&M works at the same time, the pros and cons of such arrangement should be thoroughly compared with that of combining the civil and the E&M works into a single contract. For projects involving substantial underground works, and hence with a relatively high degree of uncertainty, consideration should be given to reducing risks by carrying out works at different locations under separate contracts to be undertaken by different contractors. However, before deciding on adopting this approach, its benefits would have to be balanced against possible demerits such as the reduction in economy of scale and the need for greater management effort to deal with contract interface problems. For time-critical projects, whilst it may be desirable to adopt advance contracts to capture programming benefits, demerits of such arrangement such as introduction of additional contract interfaces should be carefully assessed (also see Paragraph 9.19 on time-critical projects). It is important that all the merits and demerits of using multi-contract arrangement in a project should be thoroughly assessed before deciding on the most appropriate number and form of contracts in a project. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 47 For multi-contract projects, those parts of tender documents delineating the split of the works, particularly the drawings and bills of quantities, should be carefully checked to ensure consistency and that there is no omission or duplication of works at the interface. 9.2 COMPLETION IN SECTIONS For contracts to be completed in Sections, the tender documents, i.e. the Form of Tender, SCC, PS and Drawings, where appropriate, should explicitly define the extent of the various Sections and their respective time for completion. Separate amounts of liquidated damages and minimum amounts of liquidated damages, if any, should be set for each Section of the Works in the Appendix to the Form of Tender. Each Section should preferably be a self-contained package of work. Great care should be taken in defining the extent of each Section to avoid any possibility of ambiguity. There should be no overlapping between Sections and all the Sections should add up to be the Works. 9.3 CONTRACTOR’S DESIGNS AND ALTERNATIVE DESIGNS Departments shall invite alternative designs and specify in the tender documents the part of the Works for which alternative designs are invited in situations where there is potential for better value for money or for enhancing buildability. The justifications for not inviting tenderers to submit alternative designs should be properly documented for future reference and auditing purposes. Departments may require tenderers to submit tenderer’s design for part of the Works not covered by the Engineer/Architect’s design in the following circumstances: (a) Where the part of the Works is in a specialist or developing field; (b) Where the part of the Works involves materials and construction methods, the design of which requires the specialist experience of contractors or suppliers; (c) Exceptionally, where the detailed design of the part of the Works is insufficiently advanced and the completion of the Works is urgent; (d) For piling works where several solutions are available; and (e) For works of a short limited lifespan or temporary in nature. For all tenders, departments shall include provisions to allow the Contractor to submit and the Employer to accept Cost Savings Designs to provide opportunities for achieving better value for money. The resultant saving in cost, if any, shall be shared between the Employer and the Contractor. The contractual provisions to be incorporated into the tender documents for tenders inviting alternative designs and tenders requiring tenderer’s designs are given in DEVB TCW No. 3/2014. Particular attention is drawn to the following Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 50 made. (g) Procurement of insurances should be considered on the following basis for each category: - Category I – Consideration should be given to procurement on an OCIP basis. The insurance clauses within the contract conditions for the contract works and third party liability coverage should state that the Employer will procure the insurance. These clauses are contract-specific and the project department should seek LAD(Works)/DEVB’s assistance in drafting these provisions. The procurement may be taken to cover a number of concurrent or inter-related contracts. The engagement of a specialist construction insurance adviser is recommended in the structuring of the programme. The insurance adviser shall have a sound understanding of construction risk, SRM and shall familiarise themselves with the specific risk profile of the project at hand. Departments may consider the inclusion of the service of an insurance adviser as part of the main consultancy. The insurance adviser can advise on the coverage, policy wording and the method of procurement either by OCIP or CCIP. The service of the insurance adviser can be retained up to the tender stage of the construction contract or continued throughout the construction stage depending on the actual requirements. If CCIP is adopted and specified, the standard policy as described in Appendix B of ETWB TCW No. 7/2005, suitably modified and extended may be considered together with the special contract clause in Appendix A of ETWB TCW No. 7/2005. Category II – The insurance clauses within the contract conditions should state that the contract works insurance should be procured by the contractor together with a primary HK$10M limit of indemnity for third party liability insurance i.e. a CCIP arrangement for the primary layer of liability. This limit should be for any one occurrence. Above the HK$10M limit of indemnity for third party liability, project departments should arrange an excess liability policy for all minor works and term contracts within the department for HK$XM (exact sum determined via the SRM process) any one occurrence in excess of the contractor’s primary HK$10M any one occurrence policy, providing a total limit of liability of HK$(10 + X)M any one occurrence. The arrangement will effectively be a multi-layer placement with a combination of a CCIP placement for the primary layer and an OCIP placement for the secondary layer. Again, the engagement of a specialist construction insurance adviser is recommended in the structuring of the OCIP placement for the secondary layer. Multi-layer insurance placement may also be suitable for Category I projects subject to the result of the SRM taking into consideration the recommendation of the insurance adviser and having regard to the prevailing market conditions. Category III – The insurance clauses within the contract conditions should state what insurance(s) the contractor is required to procure, i.e. the contract works insurance, or the third party liability insurance, or both. This is a Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 51 traditional approach and the placement is solely on the basis of a CCIP arrangement. Standard contract provisions for use in term contracts (primary layer) and capital works contracts and a standard policy are available for a CCIP placement and these are given in Appendix A and Appendix B of ETWB TCW No. 7/2005. Risk assessment may show that additional coverage or different policy wordings to those contained in the standard policy are required and in such case, the department may look for the advice of an insurance adviser, either employed independently or under the main consultancy as suggested above. (h) Other key factors to consider in procuring construction related insurance should refer to ETWB TCW No. 7/2005. 9.4.2 Professional Indemnity Insurance (PII) For works contracts involving contractors’ designs or independent checking of contractors’ designs including design and build contracts, a risk management approach shall be adopted in assessing whether PII is required to be procured, and if required, the amount of cover required so as to associate the PII requirements with the anticipated risk exposure. In respect of contractors’ design and alternative design invited during the pre-contract stage, DEVB TCW No. 9/2007 promulgated the revised requirements of PII to be taken out by the relevant parties including consultants, contractors, their designers and independent checking engineers. In line with the changes brought about by DEVB TCW No. 9/2007, SDEV via his memo ref. (02245-01-13) in DEVB(W) 510/34/01 dated 6.10.2009 made the following amendment to the contractual provisions in respect of PII requirements for works contracts involving Contractor’s Design or Independent Checking Engineer’s Services: DEVB TCW No. 9/2007 (a) SCC(A) at Appendix E is to be replaced by the revised SCC(A). 9.4.3 Insurance for works within or adjacent to Railway When carrying out any work within the Railway Protection Area, which could affect the operation of the railway in any way whatsoever, the Engineer shall, in consultation with MTRCL, consider providing for third party insurance in the Contract, in accordance with the provisions of ETWB TCW No. 7/2005. 9.4.4 Provision of BQ items for construction related insurance Where insurance against damage to the Works or third party risks is required under the Contract, separate items should be provided in the BQ for the Contractor to price the cost of such insurance pursuant to Standard Method of Measurement for Civil Engineering Works (1992 Edition). Where PII is required to be procured, a separate item should be provided in the BQ for the Contractor to price the cost of such insurance pursuant to DEVB TCW No. 9/2007. 9.5 CONTRACTOR’S SUPERINTENDENCE The requirement for the Contractor to be represented at all times on the Site by a Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 52 competent and authorized English speaking agent is stipulated in GCC Clause 17. The Engineer’s authority to withdraw his approval of the Contractor’s agent, thus causing this agent to be removed from the Site, is also stated in GCC Clause 17. See also the GS and the Guidance Notes on the GS. The qualifications of the Contractor’s surveyor responsible for the setting out of the Works are not particularly specified either in the GCC or the GS. However, it may be inferred from GCC Clauses 18 and 19 that he should be skilled and experienced. It should be noted that any person employed by the Contractor who is considered incompetent may be objected to by the Engineer, and thus removed from the Works, in accordance with GCC Clause 18. 9.6 CONTRACT TRANSPORT (Ref.: D of Audit’s memo ref. (1) in UI/GLD/GEN/0-1 dated 9.8.2004, Value for money audit: Management of the government vehicle fleet) Contract transport refers to land or marine transport provided for use by the Engineer (and his staff) and the Employer (and his employees) under the Contract. See LWBTC No. 11/84 and the GS for more details. Contract transport should only be included under the Contract where it has been established that such transportation is essential to the supervisory staff for the adequate and proper supervision of the Works and for the discharge of other related duties. Critical examination for justifications to provide contract transport shall be made with due regard to meeting the operational need. The possibility of shared use of contract transport with other relevant on-going contracts shall also be taken into account in the critical examination. In particular, the adequacy of public transport for accessing the site direct shall be assessed in determination of the quantity of contract transport. In making such determination, the project office should not take into account the need to provide contract transport to serve the site staff to and from the site if the site is adequately served by public transport. The prior approval of an officer at D2 rank (D3 for HyD according to HyD’s internal procedures) or above is required for the provision of contract transport. The specification should be less restrictive so that there may be scope for savings. Paragraph 7.1 of the LWBTC No. 11/84 states that a new motor vehicle will not always be required; however, where a used motor vehicle will suffice, it is suggested that it should not be more than 2 years old when first brought to Site. 9.7 MATERIALS TESTING ARRANGEMENT 9.7.1 General Considerations Unless Chief Geotechnical Engineer/Standards and Testing of GEO (CGE/S&T) advises otherwise, all materials compliance testing required by the Contract or by the Engineer must be done through Public Works Laboratories (PWL). CGE/S&T may also advise on whether an additional Regional Laboratory should be established to meet the testing demand. On such occasion, the project office should liaise with CGE/S&T regarding the preparation of detailed layout plans, equipment lists and other contract requirements for incorporation into suitable works contracts. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 55 Documents for Nominated Sub-contracts should be prepared following the guidelines set out in Paragraphs 2 to 8 of this chapter using a separate set of Conditions of Tender, Articles of Agreement and Conditions of Sub-contract. (c) Sub-contracts with Specialist Contractors on the Approved List This method is commonly used in requiring the employment of specialist contractors for works such as piling, bridge bearings, permanent prestressed ground anchors, landscaping, planting, supply and installation of machinery for sewage treatment works and asbestos abatement works. WBTC No. 25/94 introduces the Standard Form of Domestic Sub-contract for specialist works (1994 Edition). The form has been drafted to suit the GCC for Building Works only and may not suit the GCC for Civil Engineering Works. Advice should be sought from Contract Advisers if it is proposed to incorporate the form into an engineering contract. (d) Sub-contracts with Contractors on the Approved List in the Waterworks category See WBTC No. 29/93 for details. (e) Sub-contracts with Contractors on the Specialist Contractors List of Supply of Bituminous Pavement Materials and Construction of Special Bituminous Surfacing See WBTC No. 17/96 for details. 9.10 DISPOSAL OF EXCAVATED MATERIALS If excavated materials are to be disposed of off Site, the specifying of particular disposal areas in the Contract should be made. Reference should be made to paragraph 4.1.3 of Chapter 4 of the PAH, WBTC Nos. 2/93, 2/93B, 16/96, 4/98, 4/98A, ETWB TCW Nos. 34/2002, 19/2005 and DEVB TCW No. 6/2010 and the Interim Guidance Note on Administration of Environmental Management and Pay for Safety and Environment Scheme for Public Works Contracts promulgated under SETW’s memo ref. (014G7-01-1) in ETWB(W) 517/91/01 dated 19.6.2006. The project engineer should estimate the timing and the quantities of excavated materials (the secretary of the Marine Fill Committee and the Public Fill Committee should be kept fully informed of anticipated volumes of excess fill in accordance with WBTC No. 12/2000) and confirm with the managing office of the disposal areas as to their availability. The PS should require the Contractor to dispose of excavated materials at the specific locations and make provision for checking that he complies with this requirement. The relevant BQ items should be provided accordingly. This procedure should also be followed when it is considered desirable for the Contractor to dispose of excavated materials at a specific location irrespective of the quantities of excavated materials. The Construction Waste Disposal Charging Scheme came into operation on 1 December 2005. A standard Note to Tenderers is given in SETW’s memo ref. (00W45-01-9) in ETWB (W) 810/72/01 dated 21.11.2005. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 56 9.11 CONTRACT MEASURES TO PREVENT NON-PAYMENT OF WAGES (Ref.: SDEV's memo ref. (027RU-01-3) in DEVB(W) 510/17/01 dated 16.7.2010, SDEV's memo ref. (02FYE-01-11) in DEVB(W) 510/17/01 dated 27.7.2012 and SDEV's memo ref. (02H25-01-1) in DEVB(W) 510/17/01 dated 8.11.2012) Since 2008, DEVB has promulgated a set of contract measures to prevent non-payment of wages for implementation in all works contracts except maintenance contracts and E&M supply and installation contracts. The contract measures for preventing non-payment of wages were promulgated under SDEV’s memo dated 16.7.2010. The revised contract provisions are available at the Annexes to the “Guidelines on Wage Payment Monitoring and Reimbursement of Contractor’s and Sub-contractors’ Contributions to the Mandatory Provident Fund for their Site Personnel” (Rev. 1) promulgated under SDEV's memo ref. (02H25-01-1) in DEVB(W) 510/17/01 dated 8.11.2012. The said Guidelines also serve as reference for project officers, site supervisory staff and Labour Relations Officers in the execution of the relevant contract provisions. The soft copy of the Guidelines, and any further amendments, is available at DEVB’s website. As promulgated under SDEV’s memo dated 16.7.2010, some maintenance contracts were selected for trial implementation of the contract measures to prevent non-payment of wages. DEVB had no plan for further trial and no plan to implement the contract measures in maintenance contracts after the trial. 9.12 SITE CRUSHERS (Subsumed from WBTC No. 11/2002) 9.12.1 Policy for Setting up Site Crushers The hard inert C&D material, such as concrete and broken rock including rock excavated from works projects, can be recycled into aggregates for reuse in construction works. In order to reduce the pressure on the demand for public filling and landfill capacity, it is essential that the reusable portion of the inert C&D material be recycled and put into good use. For projects requiring excavation in rock or processing of hard inert C&D material, the project office should consider setting up site crushers where it is technically feasible and environmentally acceptable. This Paragraph sets out the necessary procedures and requirement for setting up site crushers in Government projects. 9.12.2 Procedures At the planning stage of a project that includes the establishment of a site crusher, the project office should advise the Secretary of the Public Fill Committee (PFC) and seek approval in principle from the Director of Civil Engineering and Development (DCED). Approval from the Director of Environmental Protection (DEP) is also required for installation and operation of a site crusher in respect of the environmental requirements. In addition, the setting up of site crushers may be classified as a "designated" project under Schedule 2, G.5 of the Environmental Impact Assessment Ordinance. Where appropriate, DEP should be consulted on the environmental requirements for setting up a site crusher. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 57 9.12.3 Crushed Rock and Recycled Products Produced by Site Crushers for Project Use DCED should be informed in advance if a site crusher is to be included for use in a Government project to process hard inert C&D material including rock, which are generated from or imported to the site for use solely in the works. No royalty will be required by the Government in respect of the operation of a site crusher as described in this clause, provided its installation is permitted in the lease conditions. 9.12.4 Regulating Conditions In every project where a site crusher is to be included, the following special conditions, to be provided by DCED, shall be included in the tender documents: (a) The permitted uses, and royalty rate if sales are permitted; (b) If rock and hard inert C&D material may be imported to the site; (c) The permitted duration for the operation of the site crusher and its regular inspection by the Mines Division, CEDD; (d) The submission for approval of the details of the crushing plant and its dust control systems; and (e) The submission of monthly returns of production and declaration on sales, if permitted. If a site crusher is included in the Contract, the Pneumoconiosis Compensation Fund Board should be informed of the details. If approval has not been obtained to use a site crusher in a contract, a clause prohibiting the use of a site crusher should be included in the PS. 9.13 RESOLUTION OF DISPUTES BY MEDIATION / ADJUDICATION / ARBITRATION (Ref.: SDEV’s memos ref. (02BBG-01-4) in DEVB(W) 506/00/01, () in DEVB(W) 510/83/03 and DEVB(W) 510/10/01 dated 24.3.2011, 15.10.2014 and 4.12.2014 respectively) GCC Clause 86 (For term contract, GCC Clause 89) sets out the framework of dispute resolution procedures. In summary, a dispute may go through 3 distinct stages: a decision of the Engineer, mediation and arbitration. Where the Engineer makes a decision on the dispute, if either the Government or the Contractor is dissatisfied with such decision, either the Employer or the Contractor may, within 28 days after receiving the decision, request the matter be referred to mediation in accordance with the Government of HKSAR Construction Mediation Rules. Detailed guidelines are given in WBTC No. 4/99 and ETWB TCW No. 4/99A. Pursuant to WBTC No. 4/99, in all cases the merits of the dispute should be given careful consideration before deciding whether to agree to or to refuse mediation. Nonetheless, it is the Government’s policy that mediation should be implemented wherever is possible to Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 60 Environment Scheme (PFSES) as provided in ETWB TCW No. 19/2005. ETWB TCW No. 19/2005 sets out the policy and procedures requiring contractors to prepare an Environmental Management Plan and adopt unified standards on environmental nuisance abatement measures on sites, and expands the "pay for safety and environment scheme" to cover environmental nuisance. However, interim guidance notes on the ETWB TCW No. 19/2005 regarding the administration of "Environmental Management on Construction Sites" were issued via SETW’s memo ref. (014G7-01-1) in ETWB(W) 517/91/01 dated 19.6.2006. The guidance notes provide the following features: (a) The environmental management procedures and the "pay for safety and environment scheme" are to be implemented in capital works contracts, but not term contracts which will be dealt with separately due to their unique nature; and (b) in order to promote the use of quality powered mechanical equipment (QPME) plant, contractors using such plant in large public works contracts (i.e. those with contract sum ≥ $200M) will be entitled to an extra payment as an incentive under the "pay for safety and environment scheme". The sample contract provisions regarding the requirements on mechanical dump truck covers for application to capital works contracts with PFSES and term contracts with PFSS tendered on or after 1 November 2010 were promulgated under SDEV’s memo ref. DEVB(W) 810/83/09 dated 24.9.2010. The sample contract provisions include the following: (a) A set of revised clauses in the Particular Specification at Appendix 5.48; and (b) A new clause in the Notes to Tenderers at Appendix 5.49. All capital works contracts including design and build contracts that are included in PFSES, the contractual provisions on Site Safety Cycle given in ETWB TCW No. 30/2002 shall be incorporated into the contract documents. 9.15.1 Pay for Safety Performance Merit Scheme (PFSPMS) Under the current PFSES/PFSS, contractors are paid if they have completed the respective task-tied safety items, such as provision and updating of safety plan, attending safety meetings/walks, and provision of safety trainings, etc. The task-tied payment, however, is not linked to the safety performance of the contractors. To motivate contractors to strive for better safety performance, DEVB has promulgated a performance-tied payment scheme for public works contracts as an extension to the PFSES/PFSS, i.e. the Pay for Safety Performance Merit System (PFSPMS) via SDEV’s memo ref. (02LSV-01-1) in DEVB(W) 516/70/03 dated 22.11.2013. The PFSPMS shall be applicable to all capital works contracts including electrical and mechanical contracts and Design and Build contracts which adopt PFSS/PFSES. Under the PFSPMS, payment will be made under a set of pre-priced performance-tied payment items which are measured according to the contractors’ achievements in respect of the safety performance indicators specified in the contract. The total value of the performance-tied Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 61 payment items under the PFSPMS shall be about 1.7% of the estimated Contract Sum or total estimated expenditure as stipulated in Annex B to the Guidelines attached to SDEV’s memo ref. (02LSV-01-1) in DEVB(W) 516/70/03 dated 22.11.2013. The payment for PFSPMS is in addition to that for PFSES/PFSS. The eight safety performance indicators of the PFSPMS are as follows- (a) No reportable accident in a month; (b) No notice of safety or environmental prosecution received in a month; (c) Compliance of safety training (Silver Card) for workers of specified trades in a month; (d) Half-yearly review of safety performance – based on inspection / improvement / suspension notices received from the Labour Department; (e) 12-month rolling accident frequency rate for reportable accidents below 0.25 per 100,000 man-hours worked; (f) Yearly review of safety performance - no fatal accident in a year; (g) Achievement in safety campaign organized by Development Bureau, (i.e. Considerate Contractors Site Award Scheme); and (h) Final review of safety performance – overall safety performance based on fatal accident and cumulative accident frequency rate for reportable accidents under the contract (Annex E to the Guidelines). To implement the PFSPMS, DEVB have prepared a set of Guidelines and relevant contract provisions for inclusion in the tender/contract documents for capital works contracts. A copy of the Guidelines and contract provisions are enclosed at SDEV’s memo ref. (02LSV-01-1) in DEVB(W) 516/70/03 dated 22.11.2013. The PFSPMS for term contracts is under preparation and will be promulgated in due course. The Guidelines and the contract provisions have been posted on the DEVB website as an attachment to the ETWB TCW No. 19/2005 and incorporated in the Construction Site Safety Manual Chapter 12. The two documents could be accessed via the following links: - ETWB TCW No. 19/2005 http://www.devb.gov.hk/filemanager/technicalcirculars/en/upload/19/1/C-2005-19-0-1. pdf Construction Site Safety Manual Chapter 12 http://www.devb.gov.hk/filemanager/en/content_191/chapter12.pdf 9.16 SECTIONAL COMMENCEMENT OF THE WORKS (Subsumed from WBTC No. 12/93) 9.16.1 General The GCC defines “Section” as “a part of the Works for which a separate time Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 62 for completion is identified in the Contract”. GCC Clause 47 (Commencement of the Works) does not refer to a separate date for commencement of a Section. There are occasions when it is necessary to stipulate in the Contract commencement of a part of the Works designated as a Section in the Contract at a later date than the date for commencement notified by the Engineer in accordance with GCC Clause 47. This shall be referred to as “sectional commencement”. 9.16.2 Procedures Where sectional commencement is required, the SCC for ‘Sectional commencement’ given in the Library of standard SCC under SDEV’s memo ref. DEVB(W) 546/17/02 dated 9.2.2011 shall be included in the contract documents. Any requirement for phased possession of any Portion of the Site by the Contractor shall be prescribed in the contract documents taking into account the different dates for commencement of the Sections as stated or referred to in the Contract. It will not be necessary to invoke the said contractual arrangement in the following circumstances where delayed commencement of part(s) (whether designated as Section(s) or not) of the Works can be achieved by using the existing provisions in the GCC or the library of SCC. For example :- (a) where only phased possession of Portion(s) of the Site by the Contractor is required the necessary contractual arrangement is stipulated in GCC Clause 48; or (b) where a Section of the Works Subject to Excision is required in accordance with Paragraph 9.41 of this chapter, the necessary contractual arrangement is already catered for by the SCC for ‘Section Subject to Excision’ as given in the Library of standard SCC under SDEV’s memo ref. DEVB(W) 546/17/02 dated 9.2.2011. It is important to check whether or not the other contract documents contain any cross reference(s) to GCC Clause 47 and if so, consider whether or not such cross-reference(s) need to be amended by reason of the SCC on sectional commencement. 9.17 ENVIRONMENTAL PERMIT Departments shall observe the guidelines and procedures set out in ETWB TCW Nos. 13/2003 and 13/2003A for obtaining an environmental permit (EP) for Government projects and proposals. Depending on the nature of project and the recommendations in the EIA reports, project proponent may choose to apply for a single EP for a project or separate EPs for various stages of a project, such as construction, operation and decommissioning. To maintain overall programme control and continuity, it is recommended that the project proponent shall apply for the necessary EPs before the commencement of project construction and hold the EPs throughout the construction period. Such arrangement will ensure that the EP is in place immediately after the award of the contract and hence the Contractor can rely on the EP issued to the project proponent to commence works on the site without the need to apply for a further EP. Department should ensure that sufficient time is Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 65 9.22 RESTRICTED-HOUR LOCATIONS (Ref.: SETW’s memo ref. (008BT-01) in ETWB(W) 830/31/01 dated 12.7.2004, Audit Recommendations on Public Works Contracts) Under a works contract, some works may be required to be carried out within restricted hours. Experience has shown that during the construction stage, the Transport Department/the Hong Kong Police Force required the works at more locations to be carried out within restricted hours. This has led to claims and variations. With a view to minimizing claims for EOT and prolongation cost arising from works carried out within restricted hours, the project office should: (a) Strengthen consultation with the Transport Department/Hong Kong Police Force to ensure that all locations, which require works to be carried out within restricted hours, are identified before tendering; and (b) Consider improving the contractual provisions of main-laying contracts such as by incorporating provisional items so as to allow for addition of more restricted-hour locations subsequently found necessary. 9.23 ADDITIONAL WORKS AREA AND EXTENSION OF WORKS AREA (Ref.: Lands Department’s memo ref. (3) in LD TI 10/04/03 dated 16.6.2004, Provision of Land for Works Area) The project office should note that any request for additional works area after award of a contract will be subject to payment of rent by the Contractor and any request for extension of works area should be provided with justifications, or the DLO may charge a rental or may refuse the request. 9.24 TUNNEL WORKS For contracts involving tunnel works, the project office should include suitable clauses in the PS and, in the case of design and build contracts, the Employer’s Requirements (ER) to enable effective implementation of the ETWB TCW No. 15/2005. Where the GEO raises major geotechnical concerns on the public safety aspects of the geotechnical design or the related PS or the ER clauses, the project office must resolve such concerns before tenders are invited. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 66 9.25 PERMITS FOR EXCAVATION WORKS UNDER LAND (MISCELLANEOUS PROVISIONS) ORDINANCE CAP.28 (Ref.: SDEV’s memo ref. (0281L-01-5) in DEVB(W) 510/70/01 dated 1.11.2010) Standard Notes to Tenderers, Particular Specification and amendment to the Form of Tender for incorporation into civil engineering works contracts are given in SETW’s memo ref. ETWB (W) 249/38/02[TC13/2001] dated 29.3.2004. Standard Special Conditions of Contract for incorporation into civil engineering works contracts are given in SDEV’s memo ref. (0281L-01-5) in DEVB(W) 510/70/01 dated 1.11.2010. 9.26 MEASURES TO PREVENT ILLEGAL EXTRACTION OR IMPORTATION OF BOULDERS/COBBLES/PEBBLES For future public-works projects, if the design requires large quantities of natural boulders/cobbles/pebbles that are not readily available in the market, the project office should consider stipulating in the contract documents clauses requiring the Contractor to submit documentary proof that extraction or production of these materials by the material suppliers will not cause unacceptable environmental impacts (such as reports from independent environmental consultants) and also proof of the legality of the source of materials. For natural boulders/cobbles/pebbles that are to be obtained outside Hong Kong, the Contract should require the Contractor to submit export permits from the relevant authorities. These permits should have been verified by notary(ies) public of the originating place(s), where applicable, in order to demonstrate that such materials are supplied legally and without causing unacceptable environmental impacts to its source. The Engineer should be empowered to seek further information from the Contractor in case he has any doubt. The Contractor shall not be allowed to deliver natural boulders/cobbles/pebbles to site before submission of the above-mentioned proof to the Engineer for his agreement. The Engineer for the Contract and the Contractor should also enhance their site supervision respectively to avoid the taking of risk by the Contractor or the Sub-contractors to deliver these materials to site prior to approval. 9.27 ADOPTION OF NON-CONTRACTUAL PARTNERING IN PUBLIC WORKS CONTRACTS (Ref: SETW’s memo ref. (0117S-01-2) in ETWB (W) 506/30/02 dated 30.3.2006) The project offices and consultants should refer to the “Practice Note on Adoption of Non-contractual Partnering in Public Works Contracts” (included in Appendix 5.28) promulgated by DEVB in delivering public works contracts. The Practice Note sets out the guidelines for selection of contracts for adoption of non-contractual partnering and its implementation. Reference documents for the implementation of the non-contractual partnering that are provided include “Good Practices for Implementation of Non-contractual Partnering”; “Typical Partnering Charter”; “Standard notes for tenderers to communicate Government’s intent to partner/ Standard letter to the Contractor to communicate Government’s intent to partner and to invite him to participate in project partnering”; “Form of Tender” and “Client’s Brief to Service Providers for Designing and Facilitation Partnering Workshops and Related Services”. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 67 9.27.1 Guidelines for selection of contracts for adoption of non-contractual partnering In order to promote the wider use of the partnering approach in public works, the following criteria should be adopted as far as possible: (a) For building and civil engineering capital works contracts with contract sum equal or greater than $100M; or (b) For E&M contracts with contract sum equal of greater than $20M; or (c) For other contracts such as maintenance term contracts, an officer at D2 or above rank considers that the nature and complexity of the works warrant the incorporation of non-contractual partnering. The above requirements under (i) and (ii) may be waived for a particular contract with the approval of an officer at D2 or above rank. 9.28 CONTROL OF OFF-SITE FABRICATIOIN OF CONSTRUCTION COMPONENTS (Ref: SETW’s memo ref. (018RD-01-1) in ETWB (W) 925/50/01 dated 13.10.2006 - Assignment No. 04/2006 - Control of Off-site Fabrication of Construction Components) If the works under the Contract or any alternative design proposed by the Contractor involve fabrication of construction components outside Hong Kong, the project office should either arrange for the resident site staff of in-house projects or consultant-managed projects to supervise and inspect the works in the fabrication area or require the Contractor to employ an independent inspection agent (IIA)# to control the quality of the components fabricated in the fabrication area. In this situation, the project office should determine the most appropriate site supervision requirements, inspection arrangement and warranty from the manufacturer, and should stipulate them in the contract documents. If an IIA is employed by the Contractor to supervise and inspect the works in the fabrication area, the project office should specify in the contract documents the qualification requirements of the IIA and, where practicable, the IIA’s staff assigned for the supervision and inspection. If an IIA is required under the Contract, apart from the qualification requirements of the IIA and, where practicable, the IIA’s staff assigned for the supervision and inspection, the project office shall also stipulate in the contract documents the following requirements: (a) the qualifications of the IIA and the IIA’s staff shall be submitted to the Engineer for approval; # Note: project office is to decide the scope and extent of the IIA services (b) the Contractor shall require the IIA and his staff to submit declaration of no conflict of interest with the supplier/manufacturer/Contractor to the Employer upon employment of the IIA. The Contractor shall also ensure that the IIA and his staff declare any conflict of interest with the supplier/manufacturer/Contractor to the Employer via the Engineer as soon as such a conflict comes to the knowledge of the IIA, his staff or the Contractor. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 70 The Engineer for the contract may, subject to no objection from the Employer (who should be an officer at D2 rank or above in Works Departments), permit the contractor to introduce an extra tier of sub-contracting for a part of the Works or a Relevant Portion in case there is a genuine practical need for the extra tier of sub-contracting. Works Departments shall keep a record of such approvals and notify Works Branch of DEVB at 6-month intervals if permission is granted under this provision. The need for the Engineer for the contract to obtain no objection from the Employer is a constraint on the power of the Engineer rendering the action of the Engineer being subject to the Employer’s right of objection or direction. In accordance with Clause 2(1)(b) of GCC, the particulars of any such constraint on the Engineer imposed under the terms of his appointment by the Employer has to be set out in the Appendix to Form of Tender. In this regard, project offices including consultants should include the constraint clause in the Appendix to Form of Tender when the SCC clause at Appendix 5.19 for limiting the number of tiers of sub-contracting is incorporated. 9.33 ENHANCEMENT MEASURES FOR SUB-CONTRACTOR MANAGEMENT PLAN (SMP) (Subsumed from ETWB TCW No. 47/2002) Sub-contracting is a common practice in the construction industry. If properly managed by contractors, it will facilitate the execution of works in a cost-effective manner with efficient use of resources. However, in the absence of proper management, uncontrolled sub-contracting could have adverse impact on the progress and quality of works. To augment the existing provisions prohibiting contractors from sub-contracting the whole of the contracted works, special conditions are introduced in public works contracts to enhance the management of sub-contractors by contractors. A tenderer is required to submit with his tender a proposed outline SMP to show how he is going to manage his sub-contractors. The guidelines on scope and contents of the SMP given at appendix to the SCC for Management of Sub-contractors (Appendix 5.23) should be attached to the tender document to facilitate the tenderer to prepare his SMP. The following requirements should be specified in the form of a SCC: (a) The contractor will be required to ensure that his sub-contractors will not further sub-contract the whole of the works sub-contracted to them. (b) The contractor will be required to employ his own staff to manage and supervise his sub-contractors. To obtain a full picture of the contractor's sub-contracting arrangement, the term 'sub-contractor' described in this Paragraph means all types of sub-contractor including without limitation Nominated Sub-contractor and Specialist Sub-contractor. Nevertheless, the requirements stipulated in WBTC No. 25/94 and other technical circulars for domestic sub-contractors and nominated sub-contractors should still be Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 71 followed. These following contractual provisions should be included in tenders for all capital and maintenance works contracts: (a) NTT for Payment for Sub-contractor Management Plan (Appendix 5.22); (b) SCC for Management of Sub-contractors (Appendix 5.23); (c) SCC for Payment for Sub-contractor Management Plan (Appendix 5.24); (d) PS for Management of Sub-contractors (Appendix 5.25); (e) Method of Measurement for Payment for Sub-contractor Management Plan (Appendix 5.26); and (f) Sample BQ for Payment for Sub-contractor Management Plan (Appendix 5.27) 9.34 CONTRACT MEASURES FOR IMPLEMENTATION OF EMERGENCY COMMAND SYSTEM In August 2008, DEVB introduced the Emergency Command System (ECS) to deal with exceptional emergency incidents. To facilitate the implementation of the ECS, a set of contract measures was promulgated for incorporation into maintenance/term contracts. Please refer to Chapter 8 Paragraph 5.7 for the details of the ECS and the contract provisions. 9.35 INDEPENDENT CHECKING OF THE DESIGN, ERECTION, USE AND REMOVAL OF TEMPORARY WORKS (Subsumed from WBTC No. 3/97) A Special Condition of Tender (SCT 3 promulgated under ETWB TCW No. 26/2004), Special Condition of Contract (SCC 26 promulgated under SDEV’s memo ref. DEVB(W) 546/17/02 dated 9.2.2011), and a Particular Specification (PS) item (see Appendix 5.11) have been prepared to enable officers responsible for preparing tender documents to require the Contractor to provide for independent checking of the design, erection, use and removal of selected Temporary Works. SCC 26 promulgated under SDEV’s memo ref. DEVB(W) 546/17/02 dated 9.2.2011 clarifies the Engineers' duty. The Engineer is required to examine the Contractor's design details concerning the design, erection, use and removal of the Temporary Works and shall satisfy himself that it contains no obvious deficiency and that the independent checking engineer has carried out his duties with reasonable skill and care in certifying that the Temporary Works have been properly and safely designed. The responsibility for the Temporary Works remains with the Contractor but no work shall be commenced until the Engineer has issued his consent in writing upon making such verification. Under the revised SCC, the Contractor is additionally required to provide to Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 72 the Engineer certified method statements in connection with the erection, use and removal of the designed Temporary Works. The decision to incorporate any of the above documents i.e. SCT 3 promulgated under ETWB TCW No. 26/2004, SCC 26 promulgated under SDEV’s memo ref. DEVB(W) 546/17/02 dated 9.2.2011 and the PS item (Appendix 5.11) in tender documents is a matter for the professional judgement of the Engineer and it is recognised that the type and complexity of Temporary Works to be used by the Contractor cannot always be accurately foreseen at the design stage. The following guidelines may be of assistance at tender documentation stage : (a) The above documents shall only be used where the design of the Temporary Works is the responsibility of the Contractor, and not the Engineer. (b) Where no part of the Temporary Works is assessed as requiring the particular submission of drawings or calculations or design checking, none of the above documents need to be included in the tender documents. During construction the Engineer will be able to call for details under Clauses 7 and 16 of the General Conditions of Contract (GCC), but will have to pay for any additional independent checking, being beyond the scope of merely providing details. (c) If the project designer wishes to examine tenderers' proposals for undertaking more complex or extensive Temporary Works at tender assessment stage, then use of SCT 3 promulgated under ETWB TCW No. 26/2004 may be considered together with SCC 26 promulgated under SDEV’s memo ref. DEVB(W) 546/17/02 dated 9.2.2011. During construction, the Engineer will be able to call for more details under GCC 7 and 16. (d) Use of the SCC 26 promulgated under SDEV’s memo ref. DEVB(W) 546/17/02 dated 9.2.2011 and/or the PS item (Appendix 5.11) should be considered if it is thought likely the Temporary Works will be extremely complex or innovative, or the potential consequence of any failure is likely to be severe. (e) Temporary cut or filled slopes and excavations and access platforms may require method statements. These can be called for under GCC 16. (f) It is matter of judgement for the Engineer as when to require certificates for the erection, use or removal of Temporary Works. Many failures of Temporary Works have been the result of insufficient consideration of ground conditions. The design of Temporary Works must take this into account. SCT 3 promulgated under ETWB TCW No. 26/2004 may be used independently of the PS item (Appendix 5.11) and SCC 26 promulgated under SDEV’s memo ref. DEVB(W) 546/17/02 dated 9.2.2011. In respect to Temporary Works generally, designers may find the following Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 75 9.38 METALLIC SITE HOARDINGS AND SIGNBOARDS (Ref.: WBTC No. 19/2001) To reduce the amount of C&D waste generated from construction sites, all contracts shall specify the use of metal in all components of site hoardings and signboards. Furthermore, works departments shall specify a bolts and nuts jointing method in drawings and/or specifications for site hoardings and signboards where hoardings and signboards are to be erected, unless bolts and nuts jointing method are considered not feasible due to technical or safety reasons. 9.39 EMPLOYMENT OF TECHNICIAN APPRENTICES AND BUILDING & CIVIL ENGINEERING GRADUATES BY CONTRACTORS OF PUBLIC WORKS CONTRACTS (Ref.: ETWB TCW No. 12/2003) To achieve the Government’s objective to improve the quality and safety of public works projects, the contractors should employ, apart from qualified professionals, graduates and technicians for their works. The contractors of public works contracts are hence required to ensure that an adequate number of graduates and technicians are employed and provided with adequate training. 9.39.1 Technician Apprentices For all capital works contracts exceeding $50M, the contractor is required to employ for each such contract the corresponding minimum number of technician apprentices under a valid contract of apprenticeship, as set out in the following table: - (a) For a contract the contract sum of which exceeds $50 million but is not more than $100 million. - one (b) For a contract the contract sum of which exceeds $100 million but is not more than $200 million. - two (c) For a contract the contract sum of which exceeds $200 million. - three To improve the quality and safety of construction works in the long run, the contractor must ensure that training is given to all technician apprentices employed in all aspects of their trades, and to ensure that they attend a course of instruction at an approved technical institution leading to the award of either a Higher Certificate in Building Studies, Civil Engineering, Building Services or a comparable alternative qualification. 9.39.2 Building and Civil Engineering Graduates For all capital works contracts exceeding $50M, the contractor is required to employ for each such contract the corresponding minimum number of full time building or civil engineering graduate with an academic qualification gained within the preceding three years, and recognized by an appropriate local or overseas professional Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 76 institution such as the Hong Kong Institute of Architects, the Hong Kong Institution of Engineers, the Institution of Civil Engineers, the Institution of Structural Engineers or the Chartered Institute of Building, as set out in the following table:- (a) For a contract the contract sum of which exceeds $50 million but is not more than $100 million. - one (b) For a contract the contract sum of which exceeds $100 million. - two To improve the quality and safety of construction works in the long run, the contractor must provide practical training on site to the employed graduates for a minimum of 12 months or 70% of the time for completion of the Works as stipulated in the Appendix to the Form of Tender, whichever is longer. The contractor should also follow established training guidelines for the various disciplines as far as possible. General guidelines on site practice are given at Appendix 5.31 for works departments’ information. The graduate(s) should be under the supervision of qualified professionals recognized by the relevant professional institutions mentioned in the first sub-paragraph of Paragraph 9.39.2. Unlike formal training, strict adherence to the guidelines and registration with the professional institutions mentioned are not required. 9.39.3 Implementation Where the requirement on employment of technician apprentices and building & civil engineering graduates by contractors of public works contracts as given in Paragraph 9.39 applies, the Special Condition of Contract and Particular Specification given at Appendix 5.32 should be incorporated into the relevant tender document. 9.40 SPECIAL CONDITIONS OF CONTRACT FOR USE IN MEGA PROJECT CONTRACTS (Ref.: WBTC No. 26/2002) A set of SCC, as given at Appendix 5.36, is devised for use in mega project contracts in conjunction with the GCC for Civil Engineering Works 1999 Edition. Mega project contracts have some or all of the following characteristics: (a) The contract sum is very large (normally exceeds $1 billion). During the construction period, there should be tight financial control because of the large sums of money involved. (b) There is a need to monitor the programme and control the progress closely because the contract itself or the project of which the subject contract forms an integral part has high social or economical implication (c) The contract works are extensive and cover large areas, thus likely to have a lot of interfaces with other major projects. Hence very good co-ordination by all the concerned parties is required. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 77 Project departments should have full regard to the “Guidelines for the Development of Major Infrastructure Projects” at Appendix 5.38. This set of SCC has been prepared on the basis that all the SCC clauses will be used as a package (other than those optional clauses). As such, the full set of these SCC clauses (other than those optional clauses) must be used when a project department decides to use these SCC clauses in its works contract(s) Project departments may adopt these SCC clauses including any modifications thereto on the approval of the Head of Department or his delegate. This delegation should not be down below the rank of D2 level. Any modifications to this set of SCC, including additions or omissions, should be vetted by LAD(Works)/DEVB. Project departments are reminded that satisfying some or all of the criteria above does not automatically imply that the use of these SCC clauses is warranted. In deciding whether or not to use this set of SCC, project departments should consider the resource implication in the administration of the contract. To facilitate the better management of the mega project contracts, the project department may wish to require the Engineer for the contract to obtain agreement of the Employer before making decisions on some of the following matters pursuant to Clause 2 of the GCC 1999 Edition in addition to those referred to in Paragraphs 7 and 8 of WBTC No. 20/2000, Paragraph 9.32 of this chapter. GCC Cl 16 Approval of the works programme and any revised version thereof. GCC Cl 34 Issuing instructions to afford facilities access and/or services to enable other parties to carry out their works. GCC Cl 48(5)(a) Deferral of a Portion handover date. GCC Cl 50 Granting extensions of key dates. GCC Cl 53 Issuing a Certificate of Completion in respect of the Works or of any part of the Works, any Section or any part of a Section or Certificate of Achievement for any Stage or any part of a Stage. GCC Cl 54 Ordering suspension of the works or any part thereof save and except when considered to be essential on grounds of safety or other emergency in circumstances when it is impractical to refer the matter to the Employer beforehand. GCC Cl 55 Recommencing work following suspension. GCC Cl 80 Issuing the Maintenance Certificate. GCC Cl 82(2) Authorizing remedial works to be carried out by persons other than the Contractor. GCC Cl 60(1) Omitting works on grounds of improved or more economic functioning of the works or aesthetic. For the purpose of Paragraph 9 of WBTC No. 20/2000, prior approval is deemed Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 80 9.42 ANTI-COLLUSION (Ref.: SDEV’s memo ref. (02B6J-01-6) in DEVB(W) 510/10/01 dated 24.3.2011) To strengthen the collusion prevention in the letting of works contracts, DEVB has reviewed the GCTs for anti-collusion as promulgated in ETWB TCW No. 26/2004 and decided to amend the relevant GCTs as well as introduce a new NTT. Under the revised anti-collusion clauses, the tenderer shall submit with his tender a duly signed and witnessed letter to signify his understanding of the anti-collusion clauses. The above submission should not be included as an essential requirement under GCT 21. SDEV promulgated via his memo ref. (02B6J-01-6) in DEVB(W) 510/10/01 dated 24.3.2011 a new NTT as shown in Appendix 5.42 and three revised GCTS on the provision for anti-collusion; GCT 1 on Definitions, GCT 25 on Submission of Further Information and GCT 26 on Anti-collusion as shown in Appendices 5.43, 5.44 and 5.45 respectively. 9.43 FINANCIAL RELIEF MEASURES TO ASSIST THE CONSTRUCTION INDUSTRY (Ref.: SDEV’s memo ref. (02APB-01-8) in DEVB(W) 510/83/08 dated 8.3.2011 and SDEV’s memo ref. () in DEVB(W) 510/83/08 dated 20.7.2012) In the immediate aftermath of the financial tsunami in late 2008, a package of interim financial relief measures were implemented via the promulgation of SDEV’s memo ref. (01WLR-01-7) in DEVB(W) 510/83/08 dated 8.12.2008 with a view to relieving contractors, especially small and medium-sized contractors, of the cash flow difficulties they encountered at that time. Originally intended for one year, these interim measures were subsequently rolled forward to 2010 via SDEV’s memo ref. (025QN-01-3) in DEVB(W) 510/83/08 dated 4.3.2010. A review of these interim measures was completed. It was decided to adopt these interim measures (together with some additional ones) as standing policies in public works contracts with immediate effect. Details are as follows. 9.43.1 Interim Payment (a) Interim payment should be instituted in all new public works contracts and existing public works contracts, which do not contain interim payment provision, including the quotation contracts of value less than $4 million. As the contracts without interim payment provision are in general small works contracts with different nature, works departments should prepare appropriate interim payment provisions specific to the contracts for incorporation; and (b) In order to further enhance cash flow in major public works contracts, interim payments in respect of major off-site pre-fabrication works should be made as a standard practice, subject to the relevant precedent conditions including among others the maintenance of an effective bond to Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 81 cover the pre-fabrication works. In this respect, the SCC in Appendix 5.46 shall be adopted for new public works contracts involving major off-site pre-fabrication works. The guidelines for adoption of the SCC in public works contract are attached at Appendix 5.55. 9.43.2 Retention Money For capital works contracts, the prevailing arrangement of releasing part of retention money after lapse of half of the maintenance period should be enhanced. It was decided to release retention money in stages in existing and new contracts viz. 50% of the retention money upon substantial completion of the works and the remaining 50% at expiry of the maintenance periods. Should there be minor outstanding works and defect rectification works remained, their estimated values at the material time should be taken into consideration in determining the amount of retention money to be released, making sure that these estimated values of works will be sufficiently covered by the remaining retention money after the first release of retention money upon substantial completion of the works and by retaining equivalent amount upon the second release at the expiry of the maintenance period until all minor outstanding works and defect rectification works are completed. The enhanced arrangement is to be applied to existing capital works contracts, of which completion certificates of the Works are yet to be issued and supplementary agreements for releasing parts of retention money as promulgated in SDEV’s memo ref (01WPS-01-4) in DEVB(W) 510/83/08 dated 11.12.2008 are yet to be signed. Please make reference to the samples in Annexes B1 and B2 attached to SDEV’s memo ref. (02APB-01-8) in DEVB(W) 510/83/08 dated 8.3.2011 for preparing the supplementary agreements of the existing contracts. As regards new capital works contracts, please adopt the SCC in Appendix 5.47 for preparing tender documents. 9.43.3 Payment Level for Term Contracts It was decided to raise the payment levels to not less than 90% of the estimated value of works upon completion of the works orders in existing and new term contracts. For existing term contracts, please make reference to the samples of supplementary agreements in Annex A3 and A4 attached to SDEV’s memo ref. (01WPS-01-4) in DEVB(W) 510/83/08 dated 11.12.2008 for raising the payment level. For new term contracts adopting General Conditions of Contract for Term Contracts for Building Works, please adopt the SCC in Annex D attached to SDEV’s memo ref. (02APB-01-8) in DEVB(W) 510/83/08 dated 8.3.2011. For new term contracts adopting other General Conditions of Contract, please specify the payment level to not less than 90% of the estimated value of works in the Appendix to the Form of Tender. 9.44 EMPLOYER’S POWER TO REDUCE THE AMOUNT OF THE CONTINGENCY SUM PRIOR TO AWARD OF CONTRACT (Ref.: SDEV’s memo ref. DEVB(W) 546/70/01 dated 8.8.2011) SDEV’s memo ref. DEVB(W) 546/70/01 dated 8.8.2011 promulgates a new tender provision to provide the Employer with the power to unilaterally reduce the Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 82 amount of the Contingency Sum stated in the tender documents prior to award of a works contract. There were submissions to the Central Tender Board where the original tender sums of the recommended tenders had exceeded the Approved Project Estimates (APE). In each of these cases, the procuring department discovered an over-estimation of the amount of Contingency Sum allowed in the contract. Since there was no tender provision for the Employer to unilaterally reduce this amount, the procuring department resorted to conduct tender negotiation with the recommended tenderer after obtaining approval from the relevant authority to have the amount reduced. This then enabled the procuring department to reduce the contract sum below the APE and award the contract without the need to apply for additional funding. Although no complication has occurred in the tender negotiations mentioned above, such a risk does exist since the tenderer may not accept the proposed reduction in the amount of the Contingency Sum which may open up an opportunity for the tenderer to retract his offer. In any event, tender negotiation will incur additional time and resources. To avoid the risk of tender complication and streamline the process under this circumstance, a new tender provision is introduced for (a) works contracts other than design and build (Non-D&B) contracts and (b) design and build (D&B) contracts, to provide the Employer with the aforesaid power. (a) Non-D&B Contracts The new tender provision is provided in the attached Special Conditions of Tender (SCT), special Form of Tender and Notes to Tenderers at Appendix 5.50. It should be noted that the inclusion of this provision is subject to an officer at D2 rank or above in the Project Office/Department being satisfied that the conditions given in the ‘Remarks/Guidelines’ provided alongside the SCT clause are met. The exercise of the power to reduce the amount of the Contingency Sum is also subject to meeting the requirements stated therein including the approval of the Vote Controller. The relevant parts of the Project Administration Handbook (i.e. Paragraph 7.2 of PAH Chapter 6 on “Checks prior to accepting tender”, Appendix 5.5 on “Format of the Grand Summary to the Bills of Quantities” and Appendix 6.17 on “Sample Letter of Acceptance to Successful Tenderer”) are revised accordingly. A sample letter for notifying the tenderer, whose tender is going to be recommended for contract award, of the reduction in the amount of the Contingency Sum, is also attached at Appendix 5.51. (b) D&B Contracts While the use of the new tender provision is discretionary for non-D&B contracts, it is mandatory for D&B contracts to include such a provision in view of the higher uncertainty in estimating the Contingency Sum in the absence of detailed design at the tendering stage. The new tender provision for D&B contracts is provided in the attached General Conditions of Tender (GCT) at Appendix 5.52. Departments shall make reference to the samples provided for non-D&B contracts above in Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 85 agreed with stakeholders that the provision of uniform washing and drying facilities will not be required. The provision of lockers for workers will however be enhanced as part of the enhancement of provision of welfare facilities for workers to be promulgated under a separate cover. The provision of uniform changing facilities on site is highly welcomed but it is not a mandatory requirement. A D2 rank or above officer of the department responsible for the contract may approve the inclusion of uniform changing facilities into the contract specifications after taking into consideration the practicality of providing these facilities in the contract and the availability of sufficient space on site to install the facilities. 9.45.5 Payment and Control Payment for the provision of uniform to contractor’s personnel working on site will be effected through a pre-priced lump sum item. However, the amount of actual payment is subject to the compliance audit on the wearing of site uniform to be conducted by the Engineer/ Architect/ Supervising Officer/ Surveyor as set out in the contract provisions. As the costs involved in the provision of uniform to consultants’ RSS are relatively minor, they are covered by the billed item for the Engineer’s Temporary Accommodation. Furthermore, a new aspect of performance on “Compliance with site uniform requirements” has been introduced in Section 7 (Industry awareness) of Part II of the Contractor’s Performance Report (CPR) for assessing the contractor’s performance in complying with the requirements related to the present initiative. 9.45.6 Implementation Guidelines Guidelines have been prepared to facilitate project officers to implement the uniform initiative. The guidelines for the pre-contract stage is at Appendix 5.54. The guidelines for the construction stage are given in Paragraph 21.26 of PAH Chapter 7. 9.46 IMPLEMENTATION OF MANDATORY CONTRACTOR COOPERATIVE TRAINING SCHEME (CCTS) IN PUBLIC WORKS CONTRACTS (Ref.: SDEV’s memo ref. DEVB(Trg) 133/4 (5) dated 30.12.2011, SDEV’s email dated 20.3.2012, SDEV’s memo ref. DEVB(Trg) 133/4 (9) dated 5.8.2013 and SDEV’s memo ref. DEVB(Trg) 133/4 (9) dated 16.8.2013) 9.46.1 Purpose SDEV’s memo ref. DEVB(Trg) 133/4 (5) dated 30.12.2011 promulgates the implementation of the CCTS in selected public works contracts to help boost the training capacity of the construction industry as an industry-wide drive to meet the construction manpower demands. With the support of Works Departments, the Works Policies Coordination Committee at its 21st meeting held on 24 April 2013 agreed that all relevant capital works contracts and term contracts as stated in paragraphs 9.46.3.1 to 9.46.3.3 shall incorporate the SCC into the tender document for the purpose of requiring the contractor to participate in the CCTS. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 86 9.46.2 The CCTS Under the CCTS, either the main contractor or the first-tier/second-tier sub-contractors (where appropriate) are required to recruit trainees as employees and provide them with training in the relevant trade on site. The CIC will monitor the quality and progress of the training and provide training subsidy as appropriate during the training period to the main contractor and the first-tier/second-tier sub-contractors (where appropriate). At the end of the training, trainees are required to take the intermediate trade test or the like in the relevant trade conducted by the CIC. The training is completed when the trainees pass the test. Further, the main contractor or the first-tier/second-tier sub-contractors (where appropriate) are requested to continue to employ them for at least 12 months subject to the availability of sufficient relevant trade works under the relevant contracts to support such continuing employment. Detailed requirements of the CCTS can be found in CIC’s current CCTS Framework Document. This is a living document subject to updating from time to time. The latest CCTS Framework Document will be made available on CIC’s website at the following link : http://www.hkcic.org/eng/main.aspx 9.46.3 Implementation 9.46.3.1 CCTS for Building & Civil Engineering (B&C) Trades All B&C capital works contracts or term contracts (including Design and Build) with an estimated contract sum or estimated total expenditure of over $200 million and with a contract period of 2.5 years or longer, and (i) without E&M works or (ii) with E&M works of estimated total value of $50 million or below or estimated construction period for the E&M works of less than 6 months shall incorporate the NTT and SCC at Appendix 1 to SDEV’s memo ref. DEVB(Trg) 133/4 (9) dated 16.8.2013 for the implementation of mandatory participation in the CCTS for B&C trades only. 9.46.3.2 CCTS for both B&C Trades and E&M Trades All B&C capital works contracts and term contracts (including Design and Build) with an estimated contract sum or estimated total expenditure of over $200 million and with a contract period of 2.5 years or longer, and with E&M works of estimated value of over $50 million and an estimated construction period for the E&M works of 6 months or longer shall incorporate the NTT and SCC at Appendix 1 to SDEV’s memo ref. DEVB(Trg) 133/4 (9) dated 5.8.2013 for the implementation of mandatory participation in the CCTS for both B&C trades and E&M trades. 9.46.3.3 CCTS for E&M Trades All E&M supply and installation contracts and term contracts with an estimated contract sum or estimated total expenditure of over $50 million (for lift/ escalator maintenance term contracts, over $20 million) and with an estimated construction period for the E&M works of 6 months or longer shall incorporate the NTT and SCC at Appendix 2 to SDEV’s memo ref. DEVB(Trg) 133/4 (9) dated 5.8.2013 for the implementation of mandatory participation in the CCTS for E&M trades only. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 87 The soft copies of the SDEV’s memos ref. DEVB(Trg) 133/4 (9) dated 5.8.2013 and 16.8.2013 and the Appendices are available at DEVB’s Works Group Intranet Portal. 9.46.4 Implementation Guidelines The guidelines are given in Paragraph 21.27 of PAH Chapter 7 to facilitate project officers in implementing the CCTS in their contracts. 9.47 IMPLEMENTATION IN PUBLIC WORKS CONTRACTS OF THE MANDATORY EMPLOYMENT OF GRADUATES OF THE ENHANCED CONSTRUCTION MANPOWER TRAINING SCHEME (ECMTS) (Ref.: SDEV’s memo ref. DEVB(Trg) 133/4 (9) dated 7.12.2012) 9.47.1 Purpose SDEV’s memo ref. DEVB(Trg) 133/4 (9) dated 7.12.2012 promulgates the implementation of the mandatory employment of Enhanced Construction Manpower Training Scheme (ECMTS) Graduates in public works contracts to help enhance the attractiveness of the scheme and to provide better opportunities for ECMTS Graduates to further strengthen their skills. 9.47.2 Background The Construction Industry Council (CIC) provides placement services to ECMTS Graduates to help them secure employment in the construction industry. As a long-term measures to provide better employment opportunities for ECMTS Graduates and to maintain the attractiveness of the ECMTS in attracting new blood to join the industry, the Works Policies Coordination Committee endorsed at its meeting held on 9 July 2012 the proposal to implement the mandatory of ECMTS Graduates in public works contracts. 9.47.3 Implementation All B&C capital works contracts and term contracts (including Design and Build contracts) with an estimated contract sum or estimated total expenditure of over $200 million and with a construction period of 2 years or longer shall incorporate the SCC at Appendix 1 to SDEV’s memo ref. DEVB(Trg) 133/4 (9) dated 7.12.2012 for the mandatory employment of ECMTS Graduates. The soft copy of the Appendix is available at DEVB’s Works Group Intranet Portal. The mandatory employment of ECMTS Graduates is a separate scheme from the mandatory Contractor Cooperative Training Scheme (CCTS) promulgated on 30 December 2011 (refer to Paragraph 9.46 above). Where applicable, both schemes should be incorporated in the relevant public works contracts. In the current context, graduates from the CCTS trained by contractors are not regarded as ECMTS Graduates. This has been made clear at the end of sub-clause (1)(i) of the SCC. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 90 10. LUMP SUM CONTRACTS WITH FIRM BILLS OF QUANTITIES (Subsumed from WBTC Nos. 17/95 and 17/95A) The Works Group Directors Meeting of September 1992 had decided that, wherever it is appropriate and feasible, civil engineering works contracts shall be tendered lump sum, rather than the usual remeasurement basis. A lump sum contract means a contract where the quantities are substantially measured firm and the final price to be paid is ascertained by adding to/deducting from the contractor’s accepted tender price the value of variations and other specified items (e.g. provisional quantities and contingency items). It is also customary for contracts for plant and equipment and for small construction works to be awarded as lump sum based on specifications and drawings (rather than quantities). This is outside the scope of this Handbook. Traditionally all civil engineering works are contracted on an estimated quantities and remeasurement basis. Certain individual items are measured and priced lump sum, but overwhelmingly the tendered rates are treated as a preliminary schedule of rates. Good financial management demands as much certainty as possible over the final cost of a contract. A “lump sum” approach will increase that certainty compared to total remeasurement. With increasing pressure on the time of engineers both pre and post contract (e.g. the introduction of “Estimating using Risk Analysis” (ERA), more thorough programme planning and reporting, site safety management) it is necessary to find ways of saving time elsewhere in the project development process. For remeasurement contracts under the civil engineering General Conditions of Contract the whole of the Works is measured more than once i.e. quantities are estimated at the pre-tender stage, followed by interim/final accurate measurement as work proceeds. It is also noted that in many cases the design of the Works is well advanced at tender stage and that substantial parts of the Works are unlikely to change in quantity between tender and final account (unless there is an error in the measurement or a variation to the design is necessary). In the circumstances described in above paragraph, time and effort can be saved if such contracts are awarded lump sum, thereby eliminating the need for total post contract remeasurement. It is recognised that more pre-tender effort is necessary to produce an advanced detailed design and accurate quantities for the tender, which requires tight management control to avoid delay in the start on site for contracts now in the detailed design stage. Before any tender document is finalised, the project engineer shall aim to ensure that the design is sufficiently completed so that there is no necessity for substantial post contract design changes/additional information. Whenever a Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 91 substantial part of the Works is unlikely to change, the contract shall be prepared and awarded on the basis of lump sum (plus/minus variation etc.). For the purposes of the above paragraph, “substantial” is defined as when the value of the firm quantities exceeds 80% of the estimated value of the Works (not including Provisional, Contingency and Prime Cost Sums). Unless such circumstances exist, the tender shall not be called until the design work is so developed and finalised and the quantities that accurately represent that work are included in the Bills of Quantities. The quantities for those parts of the Works that cannot be fully designed shall be described as “provisional” and be remeasured in the usual way, as explained more fully in the attached Practice Note at Appendix 5.12. Contracts that fit the above paragraph situation but have to be “fast-tracked” for policy reasons, or the nature of the works/site precludes the design from reaching the required standard, can revert to remeasurement. Authority to “fast-track” is held by the Head of Department, whose written agreement shall be sought. Where given, the agreement to “fast track” or any other reason for not using lump sum, shall be attached to the tender report. The then Secretary for Works had directed that the responsibility for providing the quantities shall remain with Government. The quantities shall be measured in accordance with the appropriate SMM as required by GCC Clause 59, some requirements of which may not be appropriate for lump sum and shall be amended in accordance with Appendix 5.13. It is recognised that the change to quantities provided in accordance with the above paragraph has staffing implications and an appropriate lead-time for a substantial change-over to lump sum is necessary. Whenever the lump sum approach is used, an additional Note for Tenderers (see Standard Note to Tender (g) promulgated under ETWB TCW No. 26/2004) and a SCC (see standard SCC 21 promulgated under SDEV’s memo ref. DEVB(W) 546/17/02 dated 9.2.2011) and the standard amendments to the SMM (at Appendix 5.13) shall be included in the Contract. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 92 11. MISCELLANEOUS 11.1 CONTRACT NUMBER Contract numbers will be allocated by the headquarters of the office managing the Contract, notwithstanding that funds for the contract may be under the control of another office. For CEDD, each development office allocates its own contract numbers. 11.2 NOTES TO TENDERERS Information that is relevant to the submission of tenders and contract award, but not considered to be part of the tender documents, should be provided in the form of Notes to Tenderers (NTT). There should be a remark on the NTT that they do not form part of the Contract. The NTT should be bound separately from the tender documents and issued to tenderers at the same time as tender documents. Commonly used clauses to be included in the NTT for works contracts other than design and build contracts are given in the Library of Notes to Tenderers promulgated in ETWB TCW No. 26/2004. In addition, any NTT clauses promulgated by means of memos/respective technical circulars after promulgation of the Library shall be deemed to have been included in the Library. The project office may use the clauses promulgated selectively since not every item of the provisions is applicable to a particular contract. For the checklist for tenders deposited in the Government Secretariat Tender Box as referred to in NTT (d) of ETWB TCW No. 26/2004 (or Public Works Tender Box as the case may be), please refer to Appendix 5.8. The Notes to Tenderers promulgated under ETWB TCW No. 26/2004 has been uploaded to the DEVB website under standard contract documents in the publications section and they will be updated from time to time when new technical circulars are promulgated which may affect the library content. For the latest version, please refer to the DEVB website: http://www.devb.gov.hk/en/publications_and_press_releases/publications/standard_contract _documents/index.html The clause for noting the tenderers that the Waste Disposal (Charges for Disposal of Construction Waste) Regulation has come into operation on 1 December 2005 is promulgated in Attachment 5 of SETW’s memo ref. (00W45-01-9) in ETWB(W) 810/72/01 dated 21.11.2005, and should be included in NTT for tendering of contracts with value ≥ $1M. Where the value of a construction contract is less than $1M, the NTT promulgated in Annex B of SETW’s memo ref. (00XFX-01-4) in ETWB(W) 810/72/01 dated 21.12.2005 should be included. The clause for disclosing cashflow discount rates (CDR) for tender evaluation to tenderers is promulgated in SDEV’s memo ref. () in DEVB(W) 545/17/01 dated 19.4.2010, and should be included in NTT for invitation of works tenders from 3 May 2010. The CDR applicable for tender evaluation shall be the rates prevailing as on the first date of tender invitation, and CDR effective from 1 April 2016 is promulgated in SFST’s memo ref. (43) in TsyB MA 00/550/1 (C) Pt. 2 dated 14.3.2016. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 95 Secretary for Financial Services and the Treasury (ref. http://fb.host.ccgo.hksarg/spr/memos.htm). The specimen Declaration and Undertaking in Appendix I (A) of the latest version of SPR shall be used for the declaration. All declarations should be kept in file for record. Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 96 12. REFERENCES LWBTC No. 11/84 Contract Transport LWBTC No. 7/87 Minimum Amount of an Interim Payment WBTC No. 10/92 Provision of Refuse Containment Booms in Reclamation Contracts Involving Public Dumping WBTC No. 2/93 Public Dumps WBTC No. 2/93B Public Filling Facilities WBTC No. 21/93 Standard Phraseology of [Bills of Quantity] Item Descriptions WBTC No. 21/93A Standard Phraseology of [Bills of Quantity] Item Descriptions (SPID) WBTC No. 21/93B Standard Phraseology of [Bills of Quantity] Item Descriptions (SPID) WBTC No. 29/93 Procedure for Incorporation of Waterworks into other Capital Works Contracts WBTC No. 25/94 Standard Form of Domestic Sub-contract (for specialist works) WBTC No. 10/95 Importation of Sand from the People’s Republic of China by Barges WBTC No. 10/95A Additional Requirements Concerning Barge Routes and Third Party Insurance WBTC No. 16/96 Wet Soil in Public Dumps WBTC No. 17/96 List of Approved Suppliers of Materials and Specialist Contractors for Public Works - Supply of Bituminous Pavement Materials and Construction of Special Bituminous Surfacing WBTC No. 10/97 Use of Performance Bonds Security and Retention Moneys and Standard Form of Bond WBTC No. 10/97A Use of Performance Bonds Security and Retention Moneys and Standard Form of Bond WBTC No. 4/98 Use of Public Fill in Reclamation and Earth Filling Projects WBTC No. 4/98A Use of Public Fill in Reclamation and Earth Filling Projects WBTC No. 4/99 Construction Mediation Rules (1999 Edition) and Administrative Guidelines ETWB TCW No. 4/99A Construction Mediation Rules (1999 Edition) and Administrative Guidelines WBTC No. 32/99 Second Stage of the Independent Safety Audit Scheme (ISAS) WBTC No. 12/2000 Fill Management WBTC No. 14/2000 Usage of Public Works Laboratories in Public Works Projects Project Administration Handbook for Civil Engineering Works 2016 Edition Chapter 5 (Rev. 0) 97 WBTC No. 18/2000 Works Bureau Library of Standard Special Conditions of Contract for use with G.C.C. for Building Works, Civil Engineering Works and Electrical & Mechanical Engineering Works 1999 Editions ETWB TCW No. 18/2000A Works Bureau Library of Standard Special Conditions of Contract for use with G.C.C. for Building Works, Civil Engineering Works and Electrical & Mechanical Engineering Works 1999 Editions ETWB TCW No. 18/2000B Works Bureau Library of Standard Special Conditions of Contract for use with G.C.C. for Building Works, Civil Engineering Works and Electrical & Mechanical Engineering Works 1999 Editions WBTC No. 20/2000 General Conditions of Contract for Civil Engineering Works, 1999 Edition WBTC No. 30/2000 Construction Site Safety Manual Second Updating of Chapters 3 and 12 WBTC No. 13/2001 Quality Management System Certification of Consultants and Contractors for Public Works Administered by the Works Group of Departments ETWB TCW No. 13/2001A Quality Management System Certification of Consultants and Contractors for Public Works Administered by the Works Group of Departments WBTC No. 19/2001 Metallic Site Hoardings and Signboards WBTC No. 12/2002 Specifications Facilitating the Use of Recycled Aggregates WBTC No. 13/2002 Employment of Qualified Tradesmen and Intermediate Tradesmen by Contractors of Public Works Contracts WBTC No. 19/2002 Mass Transit Railway Protection WBTC No. 26/2002 Special Conditions of Contract for Use in Mega Project Contracts ETWB TCW No. 29/2002 Geotechnical Control for Slopes and Retaining Walls ETWB TCW No. 29/2002A Geotechnical Control for Slopes and Retaining Walls ETWB TCW No. 30/2002 Implementation of Site Safety Cycle and Provision of Welfare Facilities for Workers at Construction Sites ETWB TCW No. 34/2002 Management of Dredged/Excavated Sediment ETWB TCW No. 50/2002 Contractors’ Joint Ventures ETWB TCW No. 4/2003 Assessment of Liquidated Damages ETWB TCW No. 12/2003 Employment of Technician Apprentices and Building & Civil Engineering Graduates by Contractors of Public Works Contracts ETWB TCW No. 13/2003 Guidelines and Procedures for Environmental Impact Assessment of Government Projects and Proposals