Signing a FIDIC contract does not mean that the standard FIDIC terms are the only rules governing a project.

FIDIC is not Kenyan legislation. When the parties incorporate a FIDIC form into their agreement, its terms operate as contractual obligations alongside the Kenyan laws and regulatory requirements that apply to the project.

Signing the contract is therefore only the starting point. The particular contract determines what each party is required to do, which responsibilities and risks each party accepts, and which Kenyan legal and regulatory requirements continue to apply.

What Does Signing a FIDIC Contract Actually Involve?

FIDIC publishes different contract forms for different project arrangements. The FIDIC Red Book, for example, is intended for building and engineering works designed by the Employer. The 2017 edition uses General Conditions together with Particular Conditions and other contract documents to establish the contractual framework.

The General Conditions contain the standard contractual terms. The Particular Conditions address project-specific requirements and agreed amendments.

The parties are agreeing to the complete contractual framework that determines their obligations, entitlement to payment or additional time, how variations are handled and how risks are allocated.

Those documents can include specifications, drawings, bills of quantities, Contract Data and Particular Conditions. Their order of priority also matters. If two contract documents deal with the same issue differently, the order of priority can determine which requirement governs.

The contract therefore needs to be read as a whole. A provision that appears straightforward on its own can have a different effect when read alongside the Particular Conditions, other contract documents and the order of priority between them.

Which Risks Does Each Party Take On?

Each party takes on the responsibilities and risks allocated to it by the contract. The contract should also make clear which risks remain with the other party and what happens if those risks arise.

The FIDIC form alone does not establish the complete risk allocation. The edition, Particular Conditions, amendments and other project documents all need to be considered.

For example, the 1999 Red Book addresses risk and responsibility under Clause 17 and identifies specific Employer’s Risks. The exact provisions depend on the edition and contract used.

Before signing, a Contractor should establish:

  • Which FIDIC form and edition applies?

  • What do the Particular Conditions amend, replace or add to the standard terms?

  • Which document takes priority if there is a conflict?

  • Which risks remain with the Employer, and which risks is the Contractor expected to carry?

  • What can be claimed if an allocated risk occurs?

A Developer acting as Employer should carry out the same review. The Employer also needs to understand the obligations it retains, including matters relating to information, instructions, payment, access to the site and other matters allocated to it under the contract.

What Does FIDIC Not Protect Against?

A FIDIC contract does not remove other legal obligations.

This includes the applicable National Construction Authority requirements for contractors. The National Construction Authority Act, Cap. 118 provides the statutory framework for the Authority and contractor regulation. Understanding contractor obligations in Kenya therefore requires consideration of both the contractual obligations under the FIDIC agreement and the statutory requirements that apply to the project.

Environmental requirements also continue to apply where they are relevant to the project. Depending on the nature of the project, environmental assessment, approvals and compliance requirements can affect what must be done before construction starts and during implementation.

Publicly funded projects have another layer to consider. The Public Procurement Regulatory Authority issues Standard Tender Documents that can incorporate FIDIC conditions. Where they do, the tender and contract documents should be reviewed together with the relevant Kenyan procurement requirements.

For donor-funded projects, the financing agreement may also impose procurement requirements that need to be considered alongside the contract.

A FIDIC contract therefore does not replace the Kenyan legal and regulatory requirements applicable to the project. Those requirements need to be considered alongside the FIDIC terms and project documents.

What Can Affect a Contractor’s Right to Payment or Extra Time?

Carrying out additional work or experiencing a delay does not automatically entitle a Contractor to more money or more time.

The contract may set out specific procedures for notices, claims, variations, programmes and payment certification. Failing to follow those procedures can affect entitlement.

Consider a Contractor instructed to carry out additional work at the Employer’s request. Whether that work becomes a payable variation depends on what the contract requires beforehand, including any requirements for a particular instruction, approval, valuation or notice.

A Kenyan High Court decision illustrates why this matters. In Westcon Contractors Limited v Kenya Airways Authority [2023] KEHC 24142 (KLR), the contract incorporated FIDIC conditions, and the Court considered the contractual provisions governing variations. The Court found that the additional work had not gone through the variation and approval procedure the contract required, so the payment claim failed.

The case illustrates why a Contractor should not assume that additional work will automatically result in additional payment simply because the Employer requested or allowed the work to be carried out.

Similar issues can arise with claims for additional time. Before carrying out additional work or assuming entitlement to extra time, the applicable contract procedures and notice requirements should be checked first.

What Should Be Checked Before Signing?

Before signing a FIDIC contract in Kenya, contractors and developers should establish:

  • Exactly which FIDIC form and edition is being used

  • What the Particular Conditions amend, replace or add to the standard terms

  • Which document takes priority if there is a conflict

  • What notices, claims and contractual time limits apply

  • How variations, instructions and payment certification are handled

  • Which risks, including Employer’s Risks, remain with each party

  • What Kenyan licensing, environmental, tax and other regulatory requirements apply

  • Whether public procurement or donor-specific requirements apply

  • How disputes will be resolved

A legal review should identify clauses that conflict with other contract documents, problematic amendments and risks that are not immediately obvious from the standard wording. It should also consider how those provisions work together, particularly where the Particular Conditions, notice requirements, payment rules or order of priority change the effect of the standard wording.

The value of that review lies in understanding how the contract allocates risk and what those provisions mean for the parties’ obligations, payment, time and ability to respond when problems arise.

Review the Contract Before the Project Starts

A contract problem is usually easier to address before the contract is signed than after the project is underway. Once construction has started, an unclear risk allocation, missed notice or problematic amendment can become harder and more expensive to address.

If you are entering into or reviewing a FIDIC construction contract in Kenya, our Construction Law team can review the contract, identify problematic amendments, assess how risks are allocated, and advise on the Kenyan legal and regulatory requirements that apply to the project.

Frequently Asked Questions

Are FIDIC Contracts Legally Enforceable in Kenya?

FIDIC is not Kenyan legislation. Where FIDIC conditions are incorporated into a contract, they can form part of the parties’ binding contractual obligations, subject to the governing law and any applicable mandatory legal requirements.

Is FIDIC a Form of Kenyan Law?

No. FIDIC publishes international standard forms of construction contracts. A FIDIC contract used in Kenya operates alongside the Kenyan legislation, regulations and other requirements that apply to the project.

Does a FIDIC Contract Remove the Need to Comply With NCA Requirements?

No. FIDIC does not replace statutory requirements such as contractor registration and licensing under the National Construction Authority framework.

Can a Contractor Claim Payment for Additional Work Without Following the FIDIC Variation Procedure?

Entitlement depends on the particular contract. Where the contract requires additional work to be instructed, approved or valued through a specified procedure, failing to follow it can affect the Contractor’s ability to recover payment.