In a globalizing world, the construction sector is one of the sectors where technology and financing flows are most common. The construction sector is also known as the locomotive sector due to its importance in the development of countries and the high number of sectors it affects. The construction sector is most affected by economic crises and the sector where government investments are activated to support the economy is the construction sector (1).
According to 2022 Public Procurement Authority statistical data, 65.52% of the total public procurement expenditures made according to the procedures under the Public Procurement Law No. 4734 were realized as construction works (2).
In international commercial practice, various standard rules are used for construction contracts. The regulations in the FIDIC rules, which are one of these rules, are the most preferred rules by the parties in international construction activities and therefore the rules that find the most application area (3).
FIDIC, which stands for “Federation Internationale des Ingenieurs Conceils” in French, can be translated as “International Federation of Consulting Engineers”. FIDIC, an international federation of national consulting engineering associations of Consultants and Engineers, was founded in 1913 in Lausanne, Switzerland, by three national independent consulting engineering associations in Europe to serve the common professional interests of the members of the national associations forming the federation, to protect their professional interests and to keep members informed of developments (4).
Legal Nature of FIDIC Rules
International trade law is a set of rules, conventions, agreements and commercial customs and traditions that are internationally accepted and widely applied in this trade. This branch of law has become distinct and unique from other laws with the establishment of many commercial organizations and organizations, international conventions and model laws with the effect of globalization, and continues to develop.
Efforts to develop a common commercial language aim to minimize disputes by putting the customary law in writing in accordance with the conditions of the day (5). FIDIC has prepared different books by taking into account the differences in projects, responsibilities and designs and put them into the service of practitioners.
EPC Contracts and Silver Book
Silver Book is preferred to be used in Build-Operate-Transfer, Build-Operate etc. projects where the contractor will also operate for a period of time after the completion of the project and therefore the suitability of the design for many years is also important for itself. It is used in projects such as wastewater plants, power plants, factories, sewage plants, and water networks, transportation systems, which require large financing and are related to infrastructure and where public resources are particularly insufficient (6).
EPC contracts, which stands for engineering, procurement and construction, translates as “turnkey” in Turkish.
The turnkey construction contract is a type of construction contract and has various definitions. This contract is defined in Black's Law Dictionary, the most widely used dictionary in the US, as follows “A fixed-fee, schedule-intensive construction contract, used particularly in the construction of single-purpose projects such as power plants, where the contractor undertakes a wide range of responsibilities, including providing the design, engineering, procurement and construction of the plant; preparing plant operating procedures; conducting performance tests; preparing manuals for the operation of the plant; and training those who will operate the plant” (7).
In the broadest sense, the concept of turnkey can be defined as a contractor's ultimate responsibility for the design and construction of a construction project, in return for a fee to be paid by the owner, such that after the completion and delivery of the construction, the owner can start operating the facility by simply turning the key (8).
In these types of contracts, there is no need to investigate whether the defect is due to the project or to the construction of the building, as the responsibility for the whole project is placed on the contractor. As a general rule, the contractor is responsible for any defects, deficiencies and errors that fall within the scope and scope of the work. This broad liability of the contractor makes the turnkey construction contract attractive for business owners. With the implementation of this contract, the intervention of the owner in the design and construction of the project is minimized compared to other types of contracts (9).
SOURCE :
- Aydın, Yakup, “FIDIC Sözleşmeleri”, Sayıştay Denetçileri Derneği Dış Denetim Dergisi, y. 2010, s.230.
- Public Procurement Authority, Public Procurement Monitoring Report, 2022, p.3.
- Aydın, s.233.
- Aydın, s.233.
- Aydın, s. 235.
- Aydın, s.236.
- Şekerci, Sena, “Turnkey Construction Contract”, Başkent University Institute of Social Sciences, Department of Private Law, Master's Program in Private Law, Master's Thesis, Ankara, 2010, p. 4.
- Şekerci, s. 5
- Şekerci, s. 5