Design Must Be Integral Part of Project

The Panama Canal Authority will be making changes to the composition of consortia in tenders for construction works in order to prevent millions in losses because of claims made by subcontractors.

Tuesday, February 23, 2016

Conflicts between contracted parties who design and those who carrying out the works, and the lack of clarity in the responsibilities of each of the companies during the Panama Canal expansion motivated the adjustments to be made to future tender specifications.

Jorge Luis Quijano, administrator of the Panama Canal Authority (ACP), told Prensa.com that disputes caused delays in the work and payments of $380 million because of law suits filed by the contractor Grupo Unidos por el Canal (GUPC), pending arbitrations of $3,500 million and additional costs of $180 million.

Among the changes announced by the ACP for future tenders are "... that the designer of a tendered project form part of the consortium and not be subcontracted. Likewise, within a consortium there must be a company with more than 50% of the shares to be directly responsible and be the leader, " reported Prensa.com.

"... The ACP will try to include in the specification a score to measure the performance of companies on projects that have been implemented elsewhere. The aim would be to measure the tendency of companies to file claims and get an idea of the relationship between the contractor and the owner of the work. "

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