The NEC has announced that the new NEC4 standard form contracts will be launched on 22 June 2017. The NEC is describing the NEC4 suite of contracts as an "evolution" of the ever popular NEC3 suite, building on the core principles and successes of the NEC3.
The NEC3 was first released in 2005 and is a suite of contracts designed for use on any construction or engineering project, and can probably be regarded as the most successful of the contract suites published by the NEC with an enviable reputation throughout the world.
The NEC3 is extremely popular within the public sector, and is being utilised for nearly all construction projects procured by national and local government bodies and agencies.
According to the NEC4 paper "The next generation; an explanation of changes and benefits", the new features of the NEC4 are a direct result of feedback from industry; aiming "to support methods and provide solutions which clients are demanding".
So what can we expect from the NEC4?
The NEC tells us that the NEC4 edition will use clear and professional language to promote fair dealing and greater certainty to help prevent litigation.
The new provisions will include:
- Changes in terminology (including renaming of the old favourite 'Risk Register' as the 'Early Warning Register')
- Early Contractor Involvement ("ECI")
- Building Information Modelling ("BIM").
Whilst the introduction of the new forms of contract inevitably involves a time and money commitment in learning about the new suite of contracts, if the NEC4 lives up to the promises of improved flexibility, clarity and ease of administration, the investment will have been worthwhile. Given how popular and widespread the NEC3 suite is, it is likely the NEC4 will continue to build on this success.
In addition, the NEC have taken this opportunity to introduce two new contracts: a new Design, Build and Operate Contract and an Alliance Contract.
(1) Design, Build and Operate Contract ("DBO")
This DBO has been designed to reflect "the increasing demand for clients who wish to procure the design, construction, operation and/or maintenance from a single contractor".
(2) Alliance Contract ("ALC")
The ALC "has been created to support clients wishing to fully integrate a multi-party delivery team for large complex projects". The ALC also aims to reduce the potential for disputes by emphasising a deeper collaboration between project partners and is due to be published in consultation form.
The NEC4 has been branded as an "evolution", and it will be fascinating to see if it is successful in streamlining the processes, supporting the changing requirements of users and providing greater clarity. Given the success of its predecessor, it is hard to imagine the NEC4 not being just as popular as the NEC3 form of contracts. Watch this space, exciting changes are yet to be unveiled!