Why FIDIC Contracts Matter in Bahraini Construction Projects
In Bahrain’s construction sector from large-scale infrastructure works to private real estate developments contracts are the backbone of project delivery. Among the many standard forms available worldwide, FIDIC contracts are one of the most widely used in Bahrain due to their clarity, international recognition, and balanced approach to risk allocation.
This blog explains why FIDIC contracts matter in Bahrain, how they benefit both employers and contractors, and the role they play in dispute prevention and resolution. A general illustrative example is also included to show how these contracts function in real-life scenarios.
What Are FIDIC Contracts?
FIDIC stands for the International Federation of Consulting Engineers (Fédération Internationale des Ingénieurs-Conseils). It produces a suite of standard form contracts used in construction and engineering projects worldwide.
Some commonly used FIDIC books include:
- Red Book – For building and engineering works designed by the employer
- Yellow Book – For plant and design-build contracts
- Silver Book – For turnkey/EPC projects
- Green Book – For short form contracts
Each book is tailored for different project structures but follows the same principles: clear roles, defined procedures, and fair risk allocation.
Why FIDIC Is Popular in Bahrain
- International
Recognition
FIDIC contracts are widely accepted in public and private sector projects, making them ideal for projects involving international contractors and consultants. - Balanced
Risk Allocation
The clauses distribute risks between the employer and contractor fairly, reducing the chance of one-sided terms. - Clear
Dispute Resolution Mechanisms
FIDIC includes structured dispute processes, often starting with a Dispute Adjudication/Avoidance Board (DAB/DAAB), followed by arbitration if needed. - Integration
with Bahraini Law
While based on international standards, FIDIC contracts can be adapted to comply with Bahrain’s civil and commercial laws. - Clarity
in Scope, Payment, and Variations
Well-defined procedures for variations, extensions of time, and claims help prevent misunderstandings.
Key Benefits for Bahraini Projects
- Transparency in obligations and deliverables
- Predictable timelines for approvals, payments, and dispute handling
- Standardized terms familiar to engineers, lawyers, and financiers
- Flexibility to adapt clauses for local regulations and specific project needs
- Reduced disputes through clear procedures and documentation requirements
Common Issues Without FIDIC Standards
When projects in Bahrain use non-standard or poorly drafted contracts, risks increase:
- Unclear scope of work or payment terms
- Disputes over responsibility for delays or defects
- No formal process for handling variations or unforeseen site conditions
- Costly and prolonged litigation due to vague terms
Example:
A developer in Bahrain awarded a major mixed-use development to an international contractor. Instead of using a standard FIDIC form, the parties agreed to a custom contract drafted without established templates.
Midway through construction, unexpected site conditions required significant design changes. The contract had no clear variation procedure, leading to disagreements over cost entitlement and time extensions. Work slowed, and tensions escalated.
The parties engaged a lawyer to help mediate. In reviewing the dispute, it became clear that if a FIDIC contract had been used, it would have:
- Defined a formal process for variation orders
- Set clear timelines for approval and cost submission
- Provided a dispute adjudication process before arbitration
The absence of these provisions meant resolution took months, with added cost and strained relationships. This scenario illustrates how FIDIC’s built-in procedures can save time, money, and reputation.
Best Practices for Using FIDIC in Bahrain
- Select the correct FIDIC book for the project type
- Adapt clauses to meet Bahraini legal requirements
- Ensure all parties understand their obligations under the contract
- Train project managers, engineers, and contract administrators in FIDIC procedures
- Keep thorough records of notices, approvals, and communications