The Q&A is part of the global guide to construction and projects. Areas covered include trends and significant deals, the main parties, procurement arrangements, transaction structures and corporate vehicles, financing projects, security and contractual protections required by funders, standard forms of contract, risk allocation, exclusion of liability, caps and force majeure. Also covered are material delays and variations, appointing and paying contractors, subcontractors, licences and consents, project insurance, labour laws, health and safety, environmental issues, corrupt business practices and bribery, bankruptcy and insolvency, public private partnerships (PPPs), dispute resolution, tax, the main construction organisations, and proposals for reform.Read More
By Michael P. Cotton, K&L Gates, Pittsburgh
Through a recent amendment to Article 257 of the UAE Penal Code, any arbitrators, experts, or translators who issue biased decisions or opinions in UAE arbitration proceedings may now be subject to criminal liability. The new law has led to widespread concern and uncertainty in the international arbitration community.
In Appeal No. 173/2016, the Qatar Court of Cassation considered an appeal against the Court of Appeal’s decision dismissing an application for the enforcement of an International Chamber of Commerce (ICC) award.
The Qatari Court of Cassation has clarified the position on enforcement of foreign arbitral awards in Qatar, by confirming that none of the domestic requirements relating to certification and authentication of foreign official documents apply to international awards, thanks to the New York Convention.
This judgment is a significant step in the right direction for arbitration in Qatar, especially where it concerns the hotly debated topic of enforcement of foreign awards. Qatar, which has a mixed legal system (Civil Law based on overriding principles of the Shari’a), does not recognise the principle of legal precedent in the same way as a common law jurisdiction does. Judges are generally not strictly bound by the decisions made in previous cases or by superior courts. However, whilst this judgment may not be strictly binding on the lower courts in Qatar, it may be considered as highly persuasive, and is therefore not a case that the lower courts should overlook lightly.
It remains to be seen whether the French courts will uphold or dismiss the appeal in the parallel proceedings to annul the award. Until then, the Court of Cassation’s judgment stands and provides considerable clarity on the requirements for enforcement of an ICC award in Qatar. (Appeal No. 173/2016).
Welcome to this 32nd edition of Arbitration World.
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We are very pleased to include in this edition, as part of our series of guest contributions from expert witnesses, an article by Howard Rosen and Noel Matthews of FTI Consulting, regarding how “country risk” can affect the value of investments and the approach towards this issue in damages calculations in international arbitration.
We review recent developments in arbitration in Qatar, including court decisions regarding the validity of arbitration agreements and the enforcement of arbitration awards. As part of a series of articles related to so-called “Bermuda Form” liability insurance policies, we look at the process of formation of the arbitral tribunal in Bermuda Form policies and whether such insurance policies may conflict with certain U.S. state laws regulating insurance.
We report on a recent decision of the English Commercial Court regarding enforcement of a tribunal’s order for a provisional payment, as well as a recent UK Privy Council decision on the meaning and effect of permissive arbitration clauses. We review the new mediation rules of the Vienna International Arbitration Centre (VIAC) and report on the work of an International Bar Association (IBA) Subcommittee in assessing how states have defined the public policy exception under the New York Convention.
We review some recent decisions of the Federal Supreme Court of Switzerland on arbitration award set-aside applications in the past year. We are also very pleased to include a guest contribution from Ben Beaumont, a barrister from Thomas More Chambers and Chairman of the Arbitration Club, regarding a recent decision of the Federal Supreme Court of Switzerland on the role of a Dispute Adjudication Board (DAB) under the FIDIC Red Book regime.
We also provide our usual update on developments from around the globe in international arbitration and investment treaty arbitration.
We hope you find this edition of Arbitration World of interest, and we welcome any feedback (email firstname.lastname@example.org or email@example.com).
In a previous blog post, we looked at suspension and termination of a construction contract under a Civil Code system. We focused, in particular, on the FIDIC form of contract and looked at how that would be treated under the Qatar Civil Code.
In this article, we will continue that review, but look at how suspension and termination would operate under the UAE Civil Code.
By Alexander Brightman, K&L Gates, Doha
Although “freedom of contract” is a concept that is recognised in both the common law and civil law jurisdictions, the codified and prescriptive nature of a civil law system means that the relevant provisions of the Civil Code may even be implied into robustly drafted contracts, including standard forms. As set out below, such implied provisions could have the undesirable effect of delaying termination whilst a court order is obtained or exposing the terminating party to a claim for breach of contract (and compensation) for unlawful termination. In this article, I will be discussing suspension and termination rights under the FIDIC Contract (Red and Yellow Books), before examining the position under the Qatar Civil Code. In a follow-up blog post, I will look at suspension and termination under the UAE Civil Code.
K&L Gates and Marsh recently co-sponsored a one-day, complimentary seminar titled “EPC Contracting Issues in the Oil & Gas Industry.”
The seminar featured six hour-long sessions, including a luncheon presentation by Robert Peterson, senior partner at Oliver Wyman, and an industry roundtable review panel consisting of industry experts from Exxon Mobil, Phillips 66, Chicago Bridge & Iron Company, Fluor, and Aker Solutions.
More than 100 representatives from leading energy companies attended the seminar at the JW Marriott Houston Downtown.
Houston partners Randel Young and John Sullivan III, Pittsburgh partners Richard Paciaroni and Jason Richey, London partner Matthew Smith, Washington, D.C. partner Steven Sparling, and Dallas partner Beth Petronio, along with Pittsburgh associate Jackie Celender, presented during the seminar.
Seminar materials can be found here.
By Darran J. Jenkins, K&L Gates, Doha
The concept of good faith as applicable in the Civil law jurisdictions of Qatar and the United Arab Emirates (“UAE”) is one that may be unfamiliar to lawyers from a common law background where good faith is applies in a very limited fashion, if at all. 
The Position in the Middle East
The position in Qatar is set out in Article 172 of the Qatar Civil Code:
“1. The contract must be performed in accordance with its contents and in a manner which consistent with the requirements of good faith.
2. The contract is not confined to obliging a contracting party to its contents, but also includes its requirements in accordance with the law, custom and equity as per the nature of the obligation.”
The corresponding article in the UAE Civil Code is Article 246 which states:
“(1) The contract must be performed in accordance with its contents, and in a manner consistent with the requirements of good faith.
(2) The contract shall not be restricted to an obligation upon the contracting party to do that which is (expressly) contained in it, but shall also embrace that which is appurtenant to it by virtue of the law, custom, and the nature of the transaction.”
In Bahrain, Article 127 of the Civil Code requires:
“A contract is not only limited to its expressed conditions, but also as regards everything which according to law, usage and equity is deemed in view of the nature of the obligation, to be a necessary sequel to the contract, taking into consideration custom and usage, requirements of equity, nature of business, good faith and honesty.”
And Article 129 provides:
“A contract must be performed in accordance with its contents and in compliance with the requirements of good faith and honesty.”
Each of these Civil Codes takes an almost identical approach to the treatment of good faith. As a result, a contract will not be interpreted using solely its terms but will be interpreted against the requirements of customs, equity and good faith.
The requirement to act in good faith is a strong, positive obligation on the parties to a contract. It is not merely a requirement not to act in bad faith and not to deceive one another. Each party is instead under a legal obligation to exercise good faith in the performance of its contractual obligations and it is dealings with the other party. In a construction context, the duty of good faith would require an employer to cooperate with the contractor and deal with change requests in a timely and fair manner, whilst a contractor would be obliged to avoid delaying the performance of their works.
It is interesting to note that the obligation within the Qatar Civil Code is to perform the contract in good faith but it does not extend to negotiating the contract in good faith. The parties are free to adopt an adversarial approach to negotiation of the contract to try to obtain the best possible deal for themselves. Only once the contract has been signed does the duty to act in good faith arise.
In relation to insurance contracts, the duty to perform in good faith under the Civil Code does not in any way limit the duty of the insured to act with utmost good faith when placing the policy. This is because the Civil Code also recognizes and enforces a higher standard of care where the parties have agreed it should apply.
 Please note, all English extracts in this Article are taken from an unofficial English translation of the Qatar and UAE Civil Code, reference should always be made to the original Arabic text.
 Law Number 22 of 2004
 Law Number 5 of 1985
 Law Number 19 of 2001
By Harriet C. Jenkins, K&L Gates, Doha
Liquidated Damages (LDs) are treated very differently across the Gulf region and from the position as understood within the English common law jurisdiction.
The universal starting point for LDs is in contract; parties should pre-determine the rate of damages a contractor should pay to the employer in the event of a (specified) breach, most commonly that of late completion. For the purposes of this article, we shall consider LDs solely in the context of delay damages, whereby in the event of delay to project completion, an employer can demand a fixed compensatory sum from the contractor.
The position of the civil law jurisdiction of the Middle East is very different from that understood within the English common law system. It is commonly accepted that English courts are generally very reluctant to look beyond the contractual position and open up any agreed position on LDs. Across the Gulf however, differing civil codes empower courts (and tribunals) to look behind the parties’ contract and adjust delay damages based upon principles of actual loss and fairness.
This article discusses the differing treatments of LDs across three Gulf jurisdictions (namely, the United Arab Emirates, Qatar and Saudi Arabia), and reveals what parties can expect in regards to their compensation for delay.