The Hong Kong construction industry can expect a period of
uncertainty and change, as the Government has adopted the use of
the NEC3 forms of contract over more traditional forms of
construction contracts.
Traditional Form of Construction Contract
The traditional construction contract serves one principle
purpose, and that is to allocate risks between the employer and the
contractor. A traditional contract determines the rights and
liabilities of the parties when there is a problem. As a result,
most people put the contract into the drawer after it is signed,
only to be taken out if a dispute arises.
NEC3 Contract
The NEC3 contract is conceptually very different. The purpose of
the contract is to set out procedures for parties to identify risks
as early as possible, and to resolve problems together. The
fundamental basis of the NEC3 contract is that the parties work
together in the spirit of 'mutual trust and cooperation,'
and it is envisaged that the contract
