"Project Management is what you are forced to do when you don’t Plan and Schedule!" - who said this? Read more...

Contract Price - Variation under FIDIC

1 reply [Last post]
Mithun Rawale
User offline. Last seen 1 year 39 weeks ago. Offline
Joined: 30 Nov 2007
Posts: 6

I need guidance on following,
1. Contractor has initiated claim for rate change anticipating variation in the contract price as per the contract conditions.
2. Contract is being executred under FIDIC MDB edition 2005.
3. There are lot of extra items & also price variation clause applicable.
4. Till now No amendment for increase & decease in contract price has been issued to the contractor.
5. whether Variation should be calculated with respect to the original contract value against the (Executed BOQ item+extra items)
or variation should be calculated wrt revised contract price against the (Executed BOQ item+extra items)
or variation should be calculated wrt to original contract price againt the executed BOQ items only.
Above are the three cases and which one to be referred and under which clause.
6. In above scinario the price variation applicable to materials (such as cement, reinforcement steel,structural steel) will stand while calculating the variation against contract price.


Dear Mithun,

We have two issues here: 1) Compensation 2) Variations.

After confirming that your Contract Conditions allows you to claim for both, then you an proceed with the following:

1) Notifying the Engineer as soon as the variation or the rise in prices occur.

2) Supporting the claim with all possible documents as soon as possible.

3) In case you have new items, then the price can be derived from similar items in the BOQ. Or, if it is a totally new item, then you an do proper Price Analysis with all necessary supporting data.

The Conditions of Contract supported with the FIDIC documents should be clear enough to judge what you are entitled to.

Best Regards,