Construction challenges in France (International construction market survey 2018)
One of the most common and significant challenges in delivering a project for international clients in France is to find the best procurement route.
It is a key factor to deliver a project successfully as the chosen route will exert considerable influence over the project team's ability to achieve a successful balance between the objectives of time, cost and quality.
In France, civil construction contracts are usually bespoke contracts. However, some of those contracts are derived from standard forms that have been issued for both private and public works.
These include Voluntary Association Française de Normalisation (AFNOR) standards, which are widely used for both public and private procurements and identified by the abbreviation NF, the General Administrative Conditions of Contract (cahier des clauses administratives generals) (CCAG) and the Special Administrative Conditions of Contract (cahier des clauses administratives particulières) (CCAP). The latter two are used in private and public contracts and contain contractual provisions to be referred to by the parties.
Contractors are understandably keen to proceed with a familiar and tested contract structure, as this ensures all parties have all clauses completely covered with French law. Clients, however, are often looking to use international contracts.
Parties to international projects usually refer to standard forms of contracts provided by the international federation of consulting engineers, FIDIC (Fédération Internationale des Ingénieurs-Conseils).
The French bespoke and FIDIC contracts approach the projects differently. This presents issues when using international contracts, such as limited knowledge of the contracts among French contractors, fewer contractors willing to compete, or contractors seeking increased margins to mitigate the risk of dealing with a contract that does not perfectly fit with the French regulations.
Our experience of delivering projects under international contracts has taught us to advise clients on key issues. This advice includes defining the procurement strategy early and providing guidance on whether to adapt a French contract to incorporate the client’s requirements or how to select the best form of international contract.
For those who choose to adopt international contracts, the guidance would be to anticipate those clauses that would be contentious with contractors and propose appropriate mitigations, naturally these would need to be validated by the client’s legal advisors.
Importantly, too, the advice would include engaging in early discussions with contractors to explain and discuss any potentially contentious areas within the contract.
This approach, we have found, allows our clients that want to use international contracts in France to be protected as much as possible with a limited cost impact on their projects.
This content is part of the International construction market survey 2018