General Conditions NLM 

10 E
for the Supply and Erection of Machinery and other Mechanical,
Electrical and Electronic Equipment.

Issued in 2010 by the organisations for the engineering industries in Denmark, Finland,
Norway and Sweden (DI, Denmark; Teknologiateollisuus, Finland; Norsk Industri,
Norway; Teknikföretagen, Sweden)

Preamble   Contractor Software, computer software to which the

1. These General Conditions shall apply when the parties Contractor holds the copyright, and
agree in writing or otherwise thereto. Modifications of or   Sublicensed Software, computer software to which a
deviations from the conditions shall not apply unless agreed third party holds the copyright and for which the Contractor
in writing. transfers the right of use with the permission of the right
holder.
Definitions
Product Information
2. In these General Conditions the following terms shall
3. Data contained in marketing material, price lists and
have the meaning herein assigned to them:
other product information are binding only to the extent that
Contract: The written agreement between the parties they are by reference expressly included in the Contract.
concerning performance of the Works, and all appendices,
including amendments and additions to the said documents Technical Documentation and Information
agreed in writing
4. All technical documentation regarding the Works sub-
Plant: All machinery, apparatus, Software, materials, docu- mitted by one party to the other, prior or subsequent to the
mentation and other articles to be supplied by the Contractor formation of the Contract, shall remain the property of the
under the Contract. submitting party.
Works: The Plant and the result of the work to be performed Technical documentation or other technical information
by the Contractor under the Contract. received by one party may not, without the consent of the
If the Works according to the Contract shall be taken other party, be used for any other purpose than that for
over by separate sections intended to be used independently which it was submitted. It may not be copied without the
from each other, these General Conditions shall apply to consent of the other party.
each section separately. The term “Works” shall then refer 5. The Contractor shall, not later than at taking over of
to the section in question. the Works, free of charge provide the Purchaser with one
Site: The place where the Works are to be erected, inclu- set, or the larger number that has been agreed, of such
ding adjacent areas necessary for transport, unloading and technical documentation, which is sufficiently detailed to
storage of the Plant and necessary erection equipment. enable the Purchaser to carry out commissioning, operation
Contract Price: The sum, excluding value added tax, to and maintenance, including running repairs, of the Works.
Distribution: LAMANICA Logistikservice AB. Best nr V080161

be paid for the Works. The Contractor shall not, however, be obliged to supply
  If erection is paid for on a time basis and is not yet documentation for manufacturing of the Plant or spare
completed, the Contract Price for the purposes of Clauses parts.
23, 27, 49 and 50 shall be the price of the Plant with the
addition of 10 per cent or such other percentage as the Software
parties may have agreed. 6. Unless otherwise agreed, the Purchaser may use the
Written Notice: All documents signed by one of the parties Software on the following terms and conditions:
and received by the other party, and notices received by the 6.1. The Purchaser acquires the right to use the Contrac-
Copyright: Teknikföretagen

other party by letter, fax, electronic mail or other means tor Software in the use of the Works. The Purchaser may
of communication agreed by the parties. The contents of transfer this right to subsequent owners of the Works. The
minutes from a meeting signed or approved by both parties Contractor retains the copyright to Contractor Software
shall also constitute a Written Notice. even when it has been produced specially for the Purchaser.
Software: The computer software which is included in the The Purchaser is entitled to make changes in the Contractor
Works and which consists of Software which are consistent with the general purpose of
the Works.
  Unless otherwise agreed the Contractor is not obliged to Confidentiality
provide the source code of the Contractor Software 9. Neither party shall, without the consent of the other,
6.2 Subject to the limitations that may be agreed between be entitled to disclose to any third party technical or com-
the right holder and the Contractor, the Purchaser acquires mercial information which either party, at the formation
the right to use Sub-licensed Software in the use of the of the Contract or later, has stated to be confidential. This
Works and to transfer this right of use to subsequent owners does not apply to the extent that the disclosure is necessary
of the Works. The Contractor shall inform the Purchaser to enable a party to fulfil its obligations under the Contract
by Written Notice of such limitations no later than when or for operation and maintenance of the Works.
entering into the Contract. Each party is obliged to prevent that such confidential
6.3  Unless otherwise agreed the Contractor is not obli- information is disclosed to or used to a greater extent than
ged to provide updated versions of the Software to the permitted by the first paragraph of this Clause by its em-
Purchaser. ployees, consultants, subcontractors and other contractors
or others who through that party have or may obtain access
7. The Contractor shall, in accordance with sub-clauses
to such information.
7.1–7.5, hold the Purchaser harmless against claims from
third parties based on infringement of copyright or other
intellectual property rights caused by the Purchaser’s use Scope of the Works. Laws and Regulations
of the Software. 10. The scope of the Works shall be as set out in the Cont-
7.1 The Contractor shall not, however, be liable for claims ract.
based on:   The Works shall be in accordance with the laws and other
– use of the Software in a manner or in a place not official regulations which were in force at the date of the
agreed or which the Contractor should not have tender in the country where the Site is located. The Purcha-
foreseen, or ser shall, at the Contractor’s request, provide information on
– changes in the Software by the Purchaser. such laws and regulations which apply to the Works.
7.2  Defence against claims as referred to in Clause 7 shall 11. The Contractor shall perform such variations as are
be for the Contractor’s account. He shall indemnify the required due to amendments in laws and other official
Purchaser against such amounts as the latter is obliged to regulations which apply to the Works, or in their generally
pay under a final judgment or a settlement approved by accepted interpretation, where such change occurs after
the Contractor. the date of the tender and before taking over of the Works.
  The Contractor shall only be liable, however, on con- The provisions of Clauses 37 and 38 shall apply to such
dition that the Purchaser informs the Contractor without variations.
delay by Written Notice of any claims received, and that the
Pur­chaser allows the Contractor to decide how such claims Working Conditions
shall be dealt with in litigation and out of court. 12. The Purchaser shall be responsible to the Contractor
7.3 If an infringement of copyright or other intellectual for ensuring that erection is carried out under conditions
property right occurs and the conditions of sub-clause 7.2, which comply with the applicable laws and regulations for
second paragraph are fulfilled, the Contractor shall within working conditions at the Site. The Purchaser shall inform
a reasonable time at his own option: the Contractor by Written Notice of the safety regulations
– secure the right for the Purchaser to continue to to be observed by personnel on the Site.
use the Software, The Purchaser shall further at his own expense, on or
– change the Software so that the infringement near the Site, provide satisfactory facilities for the erection
ceases, or personnel for changing of clothes, washing and eating. The
– replace the Software with non-infringing software Purchaser shall also ensure that the Contractor’s personnel
with the equivalent function. have access to board and lodging in the vicinity of the Site
in accordance with the applicable collective labour agre-
7.4  If the Contractor fails to rectify the infringement as
ements, regulations or as specified in the Contract. Unless
described in sub-clause 7.3, the provisions of Clause 65
otherwise agreed the Contractor shall bear all expenses for
shall apply.
board and lodging.
7.5  Except as specified in this Clause 7, the Contractor shall
have no liability towards the Purchaser for in­fringement of
Preparatory Work
third parties’ rights resulting from the Pur­chaser’s use of
the Software. This limitation of the Con­tractor’s liability 13. The Contractor shall at the time agreed or, if no time
shall not apply if the Contractor has been guilty of gross has been agreed, in good time before erection starts provide
negligence. to the Purchaser drawings and descriptions showing how
the Plant is to be erected. The Contractor shall at the same
8. For other defects in the Software than that it causes
time provide all information necessary for preparing pro-
infringement of intellectual property rights the provisions
per foundations and beddings required for the Works, for
of Clauses 54–67 shall apply.
enabling unhindered transport of the Plant and necessary
erection equipment to and on the Site and for preparing all
necessary connections to the Plant.


 The Contractor shall bear any expense incurred by inspect the manufacture of the Plant during normal working
reason of errors or omissions which appear before taking hours.
over in the drawings, descriptions or information mentioned 21. Unless otherwise agreed, the Contractor shall bear
in the preceding paragraph. If such errors or omissions ap- all costs for tests carried out where the Plant is manufac-
pear after taking over, the provision of Clauses 54-67 shall tured. The Purchaser shall, however, at such tests and at
apply. inspections referred to in Clause 20 bear all costs for his
14. The Contractor shall inform the Purchaser by Written representatives, including travel- and subsistence costs.
Notice of the time when the Plant will be ready for erection
in sufficient time to enable the Purchaser to carry out in
Purchaser’s Delay, etc.
time his obligations under Clauses 15 and 16, which are
necessary for carrying out the erection. 22. If the Purchaser finds that he will not be able to carry
out his obligations required for performance of the Works,
15. The Purchaser shall carry out the necessary preparatory
hereunder his obligations according to Clauses 12, 15 and
work in accordance with the drawings, descriptions and in-
16, within the agreed time, or if such delay on his part seems
formation referred to in Clause 13. If the parties have failed
likely, he shall without delay give Written Notice thereof
to agree when the Purchaser’s work shall be completed,
to the Contractor. The notice shall state the reason for the
it shall be completed at least one week before erection is
delay and, if possible, how long the delay will last.
due to commence and so that foundations and beddings are
If the Purchaser is in delay as referred to in the first
ready to bear the Plant at the agreed time. The Purchaser
paragraph, he shall nevertheless make any payment depen-
shall inform the Contractor by Written Notice when the
dent on the Contractor’s progress as if such delay had not
preparatory work has been completed.
occurred.
16. The Purchaser shall before erection is due to commence
23. If the Purchaser is in delay or otherwise fails to perform
ensure that water and power, including compressed air and
his obligations as referred to in Clause 22, first paragraph,
electric power, is available to the Contractor on the Site to
he shall reimburse any additional costs for the performance
the extent necessary or as specified in the Contract. These
of the Works which may be incurred by the Contractor in
facilities shall be provided without cost to the Contractor.
addition to any claims under Clause 26, second paragraph.
Nor shall the Contractor be obliged to pay for the use of
The Contractor shall be entitled to a reasonable postpo-
such water and power.
nement of the time for taking over due to the Purchaser’s
  The Purchaser shall also on or near the Site place at the
default. If the Contractor wishes to claim postponement he
Contractor’s disposal lockable or otherwise secured premi-
shall without undue delay inform the Purchaser thereof by
ses or storage facilities, which are suitable for pro­tecting
Written Notice.
the Plant and the Contractor’s tools and equipment against
If the Purchaser’s failure to perform his obligations
theft and damage.
correctly and in time is of substantial importance, the
Contractor may suspend his performance of the Contract
Testing of the Plant in Connection with until the default has been remedied. The Contractor may
Manufacture. Inspection further terminate the Contract by Written Notice to the
17. If the Contract provides for the Plant to be tested in con- Purchaser provided that the Contractor has informed the
nection with its manufacture, such test shall, unless otherwise Purchaser by Written Notice of his intention to terminate
agreed, be carried out where the Plant is manufactured. If and the Purchaser has failed to remedy the default within
the technical requirements for the test have not been agreed, one month after receipt of that notice. At such termination
it shall be carried out in accordance with general practice the Contractor shall be entitled to compensation for the
in the industry concerned in the country of manufacture. loss he has suffered due to the Purchaser’s default. The
compensation shall not exceed the Contract Price.
18. The Contractor shall inform the Purchaser by Written
Notice of such test as referred to in Clause 17 in sufficient
time to permit the Purchaser to be present at the test. If the Payment
Purchaser has received such notice, the test may be carried 24. Unless otherwise agreed payment shall be made against
out in the Purchaser’s absence. invoice 30 days after the date of the invoice. Invoicing shall
The Contractor shall record the test. The test report be as follows:
shall be sent to the Purchaser. Unless the Purchaser proves
24.1. Where erection is carried out for a lump sum included
otherwise, the test report shall be considered to correctly
in the Contract Price, the Contract Price shall be invoiced
describe how the test was carried out and its result.
with 30% at the formation of the Contract, 30% at Written
19. If, at a test referred to in Clause 17, the Plant is found Notice that the Plant is ready for dispatch from the place
not to comply with the Contract, the Contractor shall wit- of manufacture and 30% when the Plant has arrived at
hout delay ensure that the Plant complies with the Contract. the Site. The remaining part of the Contract Price shall be
At the Purchaser’s request a new test shall then be carried invoiced at taking over.
out unless the defect was insignificant.
24.2. When erection is carried out on a time basis, the
20. Additionally, the Purchaser may, to a reasonable ex- agreed price for the Plant shall be invoiced with one third
tent or as specified in the Contract, at three days’ notice at the formation of the Contract, one third at Written No-


tice that the Plant is ready for dispatch from the place of 26.4  Additional costs for journeys and for board, lodging
manufacture and one third when the Plant has arrived at and living expenses for the Contractor’s personnel.
the Site. Payment for the erection shall be made against 26.5  Any other costs and expenses documented by the
monthly invoices. Contractor to have been incurred by him as a result of the
25. When erection is carried out on a time basis the fol- alteration of the erection programme.
lowing items shall be charged separately: 27. If the Purchaser fails to pay in time, the Contractor
25.1  All travel expenses for the Contractor’s personnel shall be entitled to interest from the due date at the rate
(including local transports), and all expenses for transport of interest determined by the law on late payments in the
of their equipment and personal effects. Contractor’s country. If the Purchaser fails to pay by the
25.2. The cost of board and lodging and other living expen- due date, the Contractor may also, after having given the
ses for the Contractor’s personnel for each day’s absence Purchaser Written Notice thereof, suspend his performance
from home, including non-working days and holidays. of the Contract until payment is made.
Unless otherwise agreed, such costs shall be reimbursed If the Purchaser has failed to pay the amount due
at the highest rates payable for similar expenses to public within three months after the due date, the Contractor may
employees in the Contractor’s country when travelling to terminate the Contract by Written Notice to the Purchaser.
the country where erection is carried out. The Contractor shall then, in addition to interest on late
payment, be entitled to compensation for the loss he has
25.3  Payment for work during normal working hours based
suffered. The compensation shall not exceed the Contract
on the number of hours certified by the Purchaser.
Price.
25.4  Payment for overtime work based on the number of
hours certified by the Purchaser. Retention of Title
25.5  Payment according to the rate for normal working 28. The Plant shall remain the property of the Contractor
hours for time spent on: until the Works have been paid for in full, to the extent that
a) necessary preparations for outward and homeward such retention of title is valid.
journeys,
b) outward and homeward journeys and other jour- Erection
neys to which the personnel are entitled according
29. The parties shall, no later than when the Contractor
to law, regulation or collective agreement in the
gives notice that the Plant is ready for dispatch from the
Contractor’s country, and
place of manufacture, each by Written Notice appoint a
c) daily travel between the lodgings and the Site if the
representative to act on their behalf during the work on
time exceeds 30 minutes per day or the time limit
Site.
that may be specified in the applicable collective
The representatives shall be present on or near the Site
agreement in the Contractor’s country.
during working hours. Unless otherwise specified in the
25.6  Costs incurred by the Contractor for supplying equip-
Contract, the representatives shall be authorized to act on
ment in accordance with the Contract, including payment
behalf of their respective party in all matters concerning the
for use of the Contractor’s own erection equipment.
erection work. Wherever these General Conditions stipulate
25.7. Payment for waiting time according to the rates for that Written Notice shall be given, the representative shall
normal working hours when work is held up by circum- always be authorized to receive such notice on behalf of
stances for which the Contractor is not responsible ac- the party he represents.
cording to these General Conditions or otherwise under
30. Unless otherwise agreed, the Purchaser shall free of
the Contract.
charge provide the Contractor with cranes, lifting equip-
25.8  Taxes and dues levied on the amount of the invoice ment, scaffolding and equipment for transport on the Site
and to be paid by the Contractor. to the extent necessary for carrying out erection. The
26. When the parties have agreed that erection shall be Contractor shall specify his requirements in this respect by
carried out for a lump sum all items under sub-clauses 25.1. Written Notice no later than one month before the start of
through 25.6. are included in the price for the erection. Value the erection work.
added tax and similar dues shall be added. 31. The Contractor shall ensure that his personnel observe
If the erection work is altered, delayed or temporarily the safety regulations in force on the Site. This does not
must be suspended due to any circumstances for which reduce the Purchaser’s obligations under Clause 12.
the Purchaser or his other contractors are responsible, the The Purchaser may demand that any of the Contractor’s
Contractor shall, in addition to the agreed price for erection, personnel who fails to comply with these safety regulations
be entitled to payment for: is denied access to the Site.
26.1  Waiting time and time spent on extra journeys. 32. The Contractor shall inform the Purchaser by Written
26.2  Extra work, including removing, securing and re­ Notice of any special dangers for the immediate environ-
instating erection equipment. ment which erection of the Works may entail.
26.3  Additional costs incurred by the Contractor in having 33. The Purchaser may not, without the Contractor’s pre-
to keep his equipment on the Site for a longer period than vious consent by Written Notice, order the Contractor’s
anticipated. personnel to carry out any work.


Contractor’s Right to Inspect report shall be sent to the Purchaser. Unless the Purchaser
34. The Contractor shall have the right at any time during proves otherwise, the report shall be considered to correctly
working hours on the Site to inspect the Works at his own describe how the test was carried out and its result.
expense. This right applies until the Works are taken over 40. The Purchaser shall, free of charge, provide any power,
and during any work pursuant to the provisions of Clauses fuel, lubricants, water, raw materials and other materials
54–67. required for the taking-over test in accordance with Clauses
39 and 42, and for final adjustments in connection with such
tests. He shall further, free of charge, install the apparatus
Variations
and provide the labour required for the taking-over test.
35. The Purchaser may until the Works have been ta-
41. If the Purchaser is prevented from attending the taking-
ken over, subject to the limitations in Clause 38, require
over test at the agreed time or fails to perform his obligations
vari­ations in the originally agreed scope, design and con­
under Clauses 39 and 40 or otherwise prevents the test from
struction of the Works.
being carried out, the Contractor shall by Written Notice
  A request for a variation shall be made by Written Notice
to the Purchaser specify a new time for such test. The
to the Contractor with a precise description of the variation
Purchaser shall be given a reasonable notice before such
required.
test is carried out.
36. Until taking over, the Contractor may by Written Notice If the Purchaser fails to attend the test at the new time
propose such variations as referred to in Clause 35, first specified, the taking-over test may, if possible, be carried
paragraph. out in the Purchaser’s absence. The Contractor may then at
37. The Contractor shall, as soon as possible after receipt of the Purchaser’s expense engage an independent competent
a request for a variation or after having himself proposed a person to witness the test.
variation, by Written Notice inform the Purchaser whether If the taking-over test cannot be carried out due to a
and how the variation can be carried out, stating the effects continued failure by the Purchaser to perform his obliga-
of the variation on the Contract Price, the time for taking tions under Clauses 39 and 40 after having received the
over and other terms of the Contract. Contractor’s notice under the first paragraph of this Clause,
The Contractor shall also give such notice when a or if the Purchaser otherwise prevents the taking over test
variation is required by reason of changes in laws and from being carried out, then the taking-over test shall be
regulations as referred to in Clause 11. deemed to have been satisfactorily completed at the expiry
38. Save as provided in Clause 11, the Contractor shall of the time limit specified in the Contractor’s notice.
not be obliged to carry out a variation before the parties 42. If a taking-over test shows that the Works are not in
have agreed in writing on how the variation will affect the accordance with the Contract, the Contractor shall as soon
Contract Price, the time for taking over and other terms of as possible remedy such deficiencies. Thereafter a new test
the Contract. shall be carried out unless the parties agree otherwise or
  If the parties are unable to agree on the effects of a the deficiency does not affect the operation of the Works.
variation as referred to in Clause 11, the Contractor shall Clause 39 shall apply to such new test.
carry out the variation on a time basis pending agreement
or solution of the dispute in accordance with Clause 72.
Taking Over
43. When the Works are as specified for taking over in the
Taking-over Test Contract the Purchaser shall be deemed to have taken over
39. When erection is completed the Works shall, unless the Works,
otherwise agreed, undergo a taking-over test in order to a) when the taking-over test has been completed or is
determine whether the Works are in accordance with the deemed to have been completed under the Clauses
Contract. 39-42, or
The technical requirements for the taking-over test b) if the parties have agreed that a taking over test
shall be as specified in the Contract. If the technical requi- shall not be carried out, when the Purchaser recei-
rements have not been agreed, the test shall be carried out ves the Contractor’s notice under Clause 39, third
in accordance with normal practice and generally applied paragraph, first sentence.
standards in the country where the Site is located.   Taking over shall however not be prevented by any
The Contractor shall inform the Purchaser by Written remaining minor adjustments or additions which do not
Notice that the Works are ready for taking over. He shall affect the operation of the Works.
thereby specify a reasonable time within which the taking   The Purchaser shall without undue delay by Written
over test shall be carried out. Thereafter the parties shall Notice confirm to the Contractor that the Works are taken
jointly decide on when the test shall be carried out. Unless over and the time for taking over. Failure by the Purchaser
otherwise agreed the taking-over test shall be carried out to give such confirmation shall not affect the judgment
during the Purchaser’s normal working hours. whether the Works have been taken over.
The taking-over test shall be conducted by the Cont-   The Purchaser is not entitled to take the Works or any part
ractor in the presence of representatives of both parties. of them into operation before taking over. If the Purchaser
The Contractor shall record the taking-over test. The test takes any part of the Works into operation without the


Contractor’s consent by Written Notice, the Purchaser shall by Written Notice demand that the Works be made ready
then be deemed thereby to have taken over the Works. The for taking-over test within a final reasonable period which
Contractor shall then be relieved of his obligation to carry shall not be less than one week.
out the taking-over test. If the Contractor fails to complete the Works within
44. Unless otherwise agreed, the risk of loss of or damage such final period and this is not due to any circumstance
to the Works shall pass to the Purchaser on taking over. for which the Purchaser or any other contractor engaged by
  If it is agreed that the Purchaser shall receive the Plant him is responsible, then the Purchaser may terminate the
at the Site, he shall inspect the Plant on arrival and im- Contract by Written Notice to the Contractor.
mediately inform the Contractor by Written Notice of any In case of such termination the Purchaser shall also be
transport damage. entitled to compensation for the loss he suffers because of
the Contractor’s delay to the extent that the loss exceeds
the maximum of liquidated damages to which the Purchaser
Time for Delivery. Delay has become entitled under Clause 49. This compensation
45. Delivery of the Works shall be regarded as having shall not exceed ten per cent of the Contract Price.
been completed on the day when the Works are taken over The Purchaser shall also have the right to terminate the
according to Clause 43. Contract by Written Notice to the Contractor if it is clear
46. If, instead of a fixed time for taking over, the parties from the circumstances that a delay will occur which under
have agreed on a period of time within which the Works Clause 49 would entitle the Purchaser to maximum liqui-
shall be taken over, such period shall start to run at the dated damages. In case of such termination the Purchaser
formation of the Contract. shall be entitled to both maximum liquidated damages and
compensation under the third paragraph of this Clause.
47. If the Contractor finds that he will not be able to com-
plete the Works in time or if delay on his part seems likely, 51. Except for liquidated damages under Clause 49 and
he shall without undue delay inform the Purchaser thereof termination with limited compensation under Clause 50
by Written Notice stating the reason for the delay and, if all claims in respect of the Contractor’s delay shall be
possible, the time when the Works are expected to be ready excluded. This limitation of the Contractor’s liability shall
for taking over. If the Contractor fails to give such notice, not apply, however, where the Contractor has been guilty
he shall, regardless of the provisions of Clauses 49 and 50, of gross negligence.
reimburse the Purchaser for any additional expenses incur-
red and which would have been avoided, had the Purchaser Liability for Damage to Property Before Taking
received notice in time. Over
48. If taking over is delayed by a circumstance which under 52. The Contractor shall be liable for any damage to
Clause 69 constitutes ground for relief, by an act or omission the Works which occurs before the risk has passed to
on the part of the Purchaser or his other contractors, such the Purchaser. This applies irrespective of the cause of
as the Contractor’s suspension under Clauses 23 and 27, or the damage, unless the damage has been caused by the
as a result of a variation under Clause 11 and Clauses 35- Purchaser or anyone for whom he is responsible. Even if
38, the time for taking over shall be postponed by a period the Contractor is not liable for damage to the Works under
which is reasonable with regard to the circumstances in the this Clause, the Purchaser may require the Contractor to
case. The time for taking over shall be postponed even if remedy the damage at the Purchaser’s cost.
the reason for delay occurs after the originally agreed time
53. The Contractor shall be liable for damage to the
for taking over.
Purchaser’s property occurring before taking over of the
49. Should the Works not have been taken over in time in Works only if it can be shown that the damage was caused
accordance with Clause 43, the Purchaser shall be entitled by negligence on the part of the Contractor or anyone for
to liquidated damages from the date taking over should whom he is responsible in connection with the performance
have occurred. of the Contract. The Contractor shall under no circumstan-
The liquidated damages shall be payable at a rate of one ces be liable for loss of production, loss of profit or any
per cent of the Contract Price for each commenced week other consequential economic loss. This limitation of the
of delay. The liquidated damages shall not exceed ten per Contractor’s liability shall not apply, however, where he
cent of the Contract Price. has been guilty of gross negligence.
The liquidated damages become due at the Purchaser’s
demand by Written Notice, but not before the Works are
taken over or the Contract is terminated under Clause 50. Liability for Defects
The Purchaser shall forfeit his right to liquidated da- 54. The Contractor shall, in accordance with the provisions
mages if he fails to lodge a claim for liquidated damages of Clauses 56-67 below, by repair or replacement remedy
by Written Notice within six months after the date when any defect in the Works resulting from faulty design, ma-
taking over of the Works should have taken place. terials, workmanship or erection.
50. If the delay is such that the Purchaser has become   Where the Contractor is liable for a defect he shall also
entitled to maximum liquidated damages under Clause 49 be liable for damage to the Works that is caused by the
and the Works are still not taken over, the Purchaser may defect.


 The Contractor shall not be liable for defects resulting the Contractor has fulfilled his obligations in respect of the
from materials provided by the Purchaser, from a design defect when he delivers a duly repaired or replaced part to
stipulated or specified by the Purchaser, or from incorrect the Purchaser.
preparatory work carried out by the Purchaser as referred 60. When remedial work in accordance with Clause 59
to in Clause 15. shall be carried out where the Works are located, Clauses
55. The Contractor’s liability does not cover defects caused 12, 16 and 53 shall apply correspondingly.
by circumstances arising after taking over of the Works ac- 61. If remedy of the defect requires intervention in other
cording to Clause 43. The liability does not, for example, equipment than the Works, the Purchaser shall be respon-
cover defects due to the conditions of operation deviating sible for any work or costs caused thereby.
from those foreseen in the Contract or to incorrect use of
62. All transports in connection with remedying of defects
the Works. Nor does it cover defects due to faulty mainte-
shall be at the Contractor’s risk and expense. The Purchaser
nance or incorrect erection by the Purchaser, variations in
shall follow the Contractor’s instructions regarding how the
the Works carried out without the Contractor’s consent by
transport shall be carried out.
Written Notice, or faulty repairs by the Purchaser. Finally
If the Works are located elsewhere than on the Site, the
the liability does not cover normal wear and tear or dete-
Purchaser shall bear the additional costs for remedying a
rioration.
defect which the Contractor thereby incurs.
56. The Contractor’s liability is limited to defects which
63. Defective parts, which are replaced under Clause 54,
appear within one year after taking over of the Works ac-
shall be placed at the Contractor’s disposal and shall become
cording to Clause 43. If the Works are used more intensively
his property.
than agreed, the liability period shall be reduced proportio-
64. If the Purchaser gives such notice as referred to in
nately.
Clause 58, and no defect is found for which the Contractor
57. For parts of the Works which have been repaired or is liable, the Contractor shall be entitled to compensation
replaced according to Clause 54, the Contractor shall have for the work and costs which he has incurred as a result of
the same liability for defects as for the original Works for the notice.
one year. For other parts of the Works the liability period
65. If the Contractor fails to fulfil his obligations under
specified in Clause 56 shall only be extended by the period
Clause 59 within a reasonable time, the Purchaser may by
during which the Works could not be used due to a defect
Written Notice require him to do so within a final time. If
for which the Contractor is liable.
the Contractor fails to fulfil his obligations within that time
58. The Purchaser shall give the Contractor Written Notice limit, the Purchaser may at his option:
of a defect without undue delay after the defect has appeared a) at the Contractor’s risk and expense undertake or
and in no case later than two weeks after the expiry of the have undertaken necessary measures to remedy the
liability period defined in Clauses 56 and 57. The notice defect, provided that the Purchaser proceeds in a
shall contain a description of how the defect manifests itself. reasonable manner, or
If the Purchaser fails to give notice to the Contractor within b) demand a reduction of the Contract Price not ex-
the above time limits, he loses his right to make any claim ceeding 20 per cent thereof.
in respect of the defect. If the defect is substantial, the Purchaser may instead
If there is reason to believe that the defect may cause terminate the Contract by written notice to the Contractor.
damage, notice shall be given forthwith. If notice is not The Purchaser shall also be entitled to such termination
given forthwith, the Purchaser loses the right to make any where the defect remains substantial after measures refer-
claim based on damage to the Works which occurs and red to in a). In case of termination, the Purchaser shall be
which would have been avoided if such notice had been entitled to compensation for the loss he has suffered. The
given. compensation shall not, however, exceed 20 per cent of the
59. After receipt of a Written Notice under Clause 58, the Contract Price.
Contractor shall remedy the defect without undue delay. 66. Regardless of the provisions of Clauses 54-65, the
Within this limit the time for remedial work shall be chosen Contractor shall have no liability for defects in any part of
in order not to interfere unnecessarily with the Purchaser’s the Works for more than two years after taking over of the
activities. The Contractor shall bear the costs as specified Works according to Clause 43.
in Clauses 54-66.
67. The Contractor shall have no liability for defects save
Remedial work shall be carried out where the Works
as stipulated in Clauses 54–66. This applies to any loss the
are located, even if this is not at the Site, unless the Cont-
defect may cause, such as loss of production, loss of profit
ractor, with regard to the interests of both parties, finds it
and other consequential economic loss. This limitation of
more suitable to have the Plant sent to him or to a place as
the Contractor’s liability shall not apply, however, if he has
instructed by him.
been guilty of gross negligence.
If the defect can be remedied by repair or replacement
of a defective part and dismantling and reinstallation of the
Liability for Damage to Property Caused by the
part does not require special knowledge, the Contractor may
Works After Taking Over
demand that the defective part is sent to him or to a place
as instructed by him for repair or replacement. In such case 68. The Contractor shall have no liability for damage cau-
sed by the Works to any immovable or movable property, or


for the consequences of such damage if the damage occures The above described circumstances shall constitute
while the Works are in the Purchaser’s possession. grounds for relief only if their effect on the performance of
The Purchaser shall indemnify and hold the Contractor the Contract could not be foreseen at the time of formation
harmless to the extent that the Contractor incurs liability of the Contract.
towards any third party in respect of loss or damage for 70. The party wishing to claim relief under Clause 69 shall
which the Contractor is not liable according to the first without delay give the other party Written Notice on the
paragraph of this Clause. intervention and on the cessation of such circumstance.
The above limitations of the Contractor’s liability shall   If grounds for relief prevent the Purchaser from fulfilling
not apply if he has been guilty of gross negligence. his obligations, he shall reimburse the expenses incurred by
If a third party lodges a claim for compensation against the Contractor in securing and protecting the Works. The
Contractor or Purchaser for loss or damage referred to in Purchaser shall further reimburse any costs incurred by
this Clause, the other party to the Contract shall forthwith the Contractor for personnel, subcontractors or equipment
be informed thereof by Written Notice. which, with the Purchaser’s consent, are held in readiness
The Contractor and the Purchaser shall be mutually to resume performance of the Works.
obliged to let themselves be summoned to the court or ar-
71. Notwithstanding other provisions of these General
bitral tribunal which examines claims against either of them
Conditions, either party shall be entitled to terminate the
based on damage or loss alleged to have been caused by
Contract by Written Notice to the other party, if performance
the Works. The liability as between the Contractor and the
of the Contract is delayed more than six months by reason
Purchaser shall, however, always be settled by arbitration
of a ground for relief as described in Clause 69.
in accordance with Clause 72.

Grounds for Relief (Force Majeure) Disputes. Applicable Law

69. The following circumstances shall constitute grounds 72. Disputes arising out of or in connection with the
for relief if they impede the performance of the Contract Contract shall not be brought before a court, but shall be
or makes performance unreasonably onerous: industrial finally settled by arbitration in accordance with the law on
disputes and any other circumstance beyond the control of arbitration in the Contractor’s country.
the parties, such as fire, natural disasters and other extreme 73. All disputes arising out of the Contract shall be judged
natural events, war, mobilization or military call up of a according to the law of the Contractor’s country.
comparable scope, requisition, seizure, trade and currency
restrictions, insurrection and civil commotion, shortage
of transport, general shortage of materials, restrictions in
the supply of power and defects or delays in deliveries by
sub-contractors caused by any such grounds for relief.