No. | Subject | Traditional contract | Alliance contract | Material difference and trade-off between traditional contract and alliance contract |
8 | Changes in Statutory Requirements | The Contractor must satisfy all Statutory Requirements in completing the work under the Contract. If there is a change in a Statutory Requirement, the Contractor must comply with it. A change in Statutory Requirement is a qualifying cause of delay entitling the Contractor to an extension of time under the contract. In addition, any additional costs incurred by the Contractor as a result of a change in Statutory Requirement will be reflected in an adjustment to the Contract Sum. The additional costs will be valued as a variation under the contract. | If the Participants become aware of a change in Statutory Requirement, the Participants will be jointly responsible for complying with the changed requirements as part of the performance of the Works. The Participants will not be entitled to any time or cost allowance for a change in Statutory Requirement as the Risk & Contingency Provisions in the TOC will include the cost of complying with changes in Statutory Requirements and any delays associated with complying with changes in Statutory Requirements. However, please note that, in some instances, changes in Statutory Requirements will not be included as Risk & Contingency Provisions in the TOC. Rather, they will be subject to an 'adjustment event' regime under which the occurrence of any 'adjustment event' (which events will be workshopped and agreed between the Participants prior to entry into the alliance contract) will entitle the ALT to recommend an adjustment to any part of the Commercial Framework for the Owner's approval. | Unlike under a traditional contract, the Participants will not be entitled to a time or cost allowance (i.e. extension of time or adjustment to the TOC) for changes in Statutory Requirements under an alliance contract. However, allowance for the cost of complying with changes in Statutory Requirements and any delays associated with complying with changes in Statutory Requirements will be made by the Participants when setting the TOC (which is approved by the Owner). Given that the allowance will be made as Risk & Contingency Provisions, the Participants will make a gain or loss in the Risk or Reward* regime depending on whether or not the Reimbursable Costs incurred for changes in Statutory Requirements are less than or exceed those Risk & Contingency Provisions. These gains or losses will be shared equally between the Owner and the NOPs under the Risk or Reward* regime. |