FIDIC Yellow Book | كتاب فيديك الأصفر

FIDIC (Fédération Internationale des Ingénieurs-Conseils) is the International Federation of Consulting Engineers, founded in 1913. FIDIC publishes standard forms of contract used worldwide on infrastructure, building, and industrial projects. The "Rainbow Suite" balances risk between the Employer and the Contractor and provides a consistent, internationally recognized structure for administering contracts, valuing work, handling changes, and resolving disputes.

The Yellow Book is used where the Contractor designs and constructs the Works — typically electrical/mechanical Plant, and/or building/engineering works — based on the Employer's Requirements. The Contractor takes on far more design risk and responsibility than under the Red Book.

• First published 1999; a fully revised Second Edition was published in 2017.
• Payment basis: usually a lump sum, paid against a Schedule of Payments (milestone-based) rather than remeasured BOQ quantities — though a BOQ-priced lump sum variant is also possible.
• Design responsibility: primarily with the Contractor, who must design the Works to be fit for the purposes stated in the Employer's Requirements.
• Independent certifier: the Engineer, as in the Red Book — appointed and paid by the Employer, required to act fairly in certification and determination.
• Common uses: power plants, process/industrial plants, mechanical/electrical installations, and design-build infrastructure where the Employer wants a single point of design-and-construct responsibility.

The Employer

Prepares the Employer's Requirements, provides Site access and permits within its control, and pays per the Schedule of Payments against the Engineer's certifications.

The Engineer

Administers the Contract, reviews Contractor's Documents (a review, not an approval that shifts design liability), certifies payments, and must act neutrally when agreeing or determining matters — the same dual role as in the Red Book.

The Contractor

Designs and constructs the Works to be fit for purpose per the Employer's Requirements; carries far greater design-related risk and warranty exposure than under the Red Book.

Same structural function as the Red Book: defined terms, communications, priority of documents, governing law and language. Note the Yellow Book's document priority typically places the Employer's Requirements and Contractor's Proposal in the stack alongside Specification/Drawings.

Employer's obligations: right of access to and possession of the Site, permits/licences the Employer must assist with, Employer's personnel, and financial arrangements evidencing the Employer's ability to pay.

Defines the Engineer's duties and authority, delegation, instructions, replacement, and the duty to act neutrally when agreeing or determining matters — including reviews of Contractor's Documents under Clause 5.

General obligations: the Contractor warrants it has scrutinized the Employer's Requirements and takes responsibility for their adequacy insofar as it relates to design (subject to the Sub-Clause 5.1 exceptions), performance security, sufficiency of the Tender, safety, quality/environmental management, and cooperation.

The heart of the Yellow Book. Requires the Contractor to design the Works in accordance with the Employer's Requirements, employ suitably qualified designers, submit Contractor's Documents for the Engineer's review, and (unless stated otherwise) train the Employer's personnel and provide as-built documents and operation/maintenance manuals.

Covers recruitment, wages, working hours, health and safety, records of personnel and equipment, and prevention of unlawful or disorderly conduct — substantively the same as the Red Book.

Manner of execution, sampling, inspection, testing, and rejection of defective work — with particular relevance here to manufactured/fabricated Plant items produced off-Site before delivery and installation.

Commencement Date, Time for Completion, programme (which in Yellow Book projects must reflect design, procurement, manufacture, delivery, and installation activities — not just civil works), rate of progress, Delay Damages, and suspension.

Pre-Taking-Over tests confirming the Works meet contractual requirements — for Plant, this often includes functional/commissioning tests before the Works can be considered ready for the Employer's use.

The Works (or a Section) are taken over once substantially complete and Tests on Completion are passed. Note: passing Tests on Completion does not necessarily mean the Works have met their performance guarantees — that is confirmed later, under Clause 12.

Equivalent to the Red Book's Defects Liability clause: the Contractor must remedy defects notified during the Defects Notification Period; the Engineer issues the Performance Certificate once remedial works are complete and (where applicable) once Tests after Completion have concluded.

This clause does not exist in the Red Book (which instead has Measurement and Evaluation). In the Yellow Book, Tests after Completion verify that the completed Plant/Works achieve their guaranteed operational performance (e.g., output, efficiency, capacity) under real operating conditions, typically conducted after Taking-Over once the facility is in service.

The Engineer may instruct Variations at any time before the Taking-Over Certificate. Because the Contractor owns the design, Variations here often carry significant design re-work implications, not just quantity/price changes.

Advance Payment, interim payment applications, IPCs, retention, Final Statement, and Final Payment Certificate — but valuation is against the Schedule of Payments (lump-sum milestones) rather than remeasured BOQ items, unless the Particular Conditions specify otherwise.

Lists Contractor default events entitling the Employer to terminate, and the valuation process following termination — including the treatment of partially completed design work and Contractor's Documents, which the Employer is normally entitled to use to complete the Works.

Right to suspend work (with notice) if the Employer fails to pay a certified amount or otherwise materially breaches, and — after continued failure — the right to terminate and recover loss of profit.

Allocates risk of loss or damage to the Works, sets indemnities between the Parties, and lists Employer's Risks. Given Contractor-designed Plant, indemnities for intellectual property (design/patent infringement) are especially relevant here.

An Exceptional Event is beyond a Party's control, could not reasonably have been provided against, and is not substantially attributable to the other Party. If it prevents performance, the affected Party may be entitled to EOT and, in limited circumstances, Cost.

Required insurances: Works and Contractor's Equipment, third-party injury/damage, and personnel insurance. Manufactured Plant in transit and during storage before installation often requires additional marine/transit cover not typically needed under the Red Book.

Strict notice and substantiation requirements for both Parties' claims (as in the 2017 Red Book split). The 28-day Notice of Claim rule applies equally here — including claims arising from design changes, Employer's Requirements errors, or performance test failures.

As in the 2017 Red Book, Clause 21 governs the standing DAAB, its dispute-avoidance function, referral of formal disputes, and the escalation to international arbitration once a Notice of Dissatisfaction is given. Yellow Book DAAB members are ideally selected for both legal/contractual and relevant engineering/technical (e.g., process, mechanical) expertise given the design content of disputes.

Contractor's Proposal — the Contractor's tendered design solution and methodology responding to the Employer's Requirements.

Contractor's Documents — calculations, drawings, models, software, and manuals produced by the Contractor as part of design/as-built delivery.

Defects Notification Period (DNP) — period after Taking-Over to remedy defects (commonly 365 days).

Employer's Requirements — the document setting the purpose, scope, and design/technical criteria for the Works.

Fitness for Purpose — the elevated design standard requiring the Works to suit the purposes stated in the Employer's Requirements.

Performance Certificate — the final certificate confirming acceptance of the Works, issued after the DNP and (where applicable) Tests after Completion are concluded.

Performance Damages — liquidated damages for shortfall against guaranteed performance levels, assessed under Clause 12.

Retention Money — amount withheld as security, released in two tranches.

Schedule of Payments — the agreed milestone-based payment schedule underpinning a lump-sum Yellow Book contract.

Taking-Over Certificate (TOC) — confirms the Works are complete and usable; starts the DNP.

Tests after Completion — performance testing (Clause 12) confirming guaranteed operational output/efficiency, usually after Taking-Over.

Tests on Completion — pre-Taking-Over functional testing (Clause 9) confirming the Works are ready for use.

Same standing-board mechanism as the Red Book: appointed early, offers a dispute-avoidance function, and issues binding-but-reviewable decisions on formal referrals.

1. Dispute arises — either Party refers it to the DAAB.
2. DAAB issues a decision, normally within 84 days.
3. The decision is binding immediately, unless revised in a settlement or arbitral award.
4. A dissatisfied Party issues a Notice of Dissatisfaction (NOD) within 28 days.
5. If no NOD is given, the decision becomes final and binding.
6. If NOD is given and settlement fails, the matter proceeds to international arbitration.

Scenario: A Contractor-designed pumping plant is guaranteed to deliver 1,000 m³/hr at a specified head. During the Tests after Completion, the measured output is 940 m³/hr — a 6% shortfall. The Contract states Performance Damages of $500 per 1% shortfall, capped at 10%.