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CIAP sets guidelines for contractors and project owners to foster smooth construction contracts

The Construction Industry Association of the Philippines (CIAP) has released CIAP Document 102, the Uniform General Conditions of Contract for Private Construction, aimed at mitigating disputes between contractors and project owners.

CIAP Document No. 2 offers comprehensive guidelines for drafting contracts, outlining recommended procedures, guidelines, and criteria for contract implementation. It specifically addresses the interpretation of ambiguous or omitted stipulations in contracts.

Given the Build Better More program’s extensive pipeline of 194 projects, the construction sector will continue to play a vital role in the economy, necessitating the signing of numerous contracts.

One of the primary causes of project delays is divergent interpretations of agreements between parties, leading to potential contract breaches and even project abandonment, resulting in substantial losses for contractors and project owners alike.

The Department of Trade and Industry (DTI) handles arbitration cases related to contract breaches, where micro and small domestic contractors often suffer the consequences of unfair arrangements despite entering projects in good faith.

DTI Undersecretary and CIAP alternate chairman Ireneo Vizmonte explained that CIAP Document 102 outlines minimum terms and conditions that contracts should contain, aligning with industry best practices and customary practices.

The document serves as a valuable reference for courts, quasi-judicial bodies, and the Construction Industry Arbitration Commission (CIAC) when resolving disputes related to construction contracts.

To promote fair and equitable contracts and establish CIAP Document 102 as an industry standard, the Philippine Domestic Construction Board, CIAP’s implementing arm, signed a memorandum of agreement with construction organizations and associations on July 18, 2023.

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