International construction and insurance law specialists Beale and Co has published three guidance updates for companies looking to work in Ukraine.
Leading international construction and insurance law specialists Beale and Co have published a series of articles providing guidance to those firms looking to support the rebuild in Ukraine. The first three articles cover the areas of contract conditions, funding and insurance and procurement (see links at the end of this article).
Some estimates put the cost of rebuilding Ukraine’s physical infrastructure as high as $750bn. The New York Times has already described Ukraine as “the world’s largest construction site”, as companies from around the world position themselves to gain an advantage in what could potentially be a multibillion-dollar effort, although one loaded with risk.
Against that background – and hot on the heels of this week’s Ukraine Reconstruction Summit in London – the articles by Beale and Co are sure to be well received by the construction and infrastructure industry.
The contract conditions article sets out some of the key risks which businesses will have to look out for, deal with, or otherwise allow for in their contractual arrangements for projects forming part of the rebuild of Ukraine. The article deals with a number of relevant contract areas including insurance and limitations on liability, ground risk and site conditions, suspension and termination, delay, loss and expense relief events, choice of pricing mechanism and programming, design obligations and innovative design and dispute considerations.
In their funding and insurance briefing, Beale and Co’s leading lawyers highlight some of the issues around the finance required to start the rebuild of Ukraine along with the associated insurance implications. Given that the impact of the conflict in Ukraine on the insurance industry is thought to be considerable and has highlighted the need for the industry to protect against emerging risks, it will be vital that adequate insurance is in place on each project and so companies considering working on the Ukraine rebuild will be well advised to take account of this.
Beale and Co’s procurement article looks at the potential key partners and funders involved in the recovery effort in what is bound to be an inclusive multi-stakeholder process and the likely procurement rules to be applied. A number of projects already tendered by the EU involving construction in Ukraine have been funded by the European Investment Bank applying the bank’s own guidance on procurement, so while it is likely for this approach to continue, the EU Finance Regulation will also have an impact on new projects being undertaken.
The specific parameters and nature (including the funding, structure, and client/employer identity) of the contracts for the rebuild of Ukraine are yet to be fully revealed. However, it is likely that the issues raised in the areas of contract conditions, funding and insurance and procurement will be relevant to those businesses who may be engaged on projects in the Ukraine in the coming months and years.
In advising on contracts, projects and disputes, Beale & Co will be supported by KPD Consulting, the Ukrainian law firm member of Lexicom. Lexicom is a network of independent commercial law firms across Europe which was founded by Beale & Co.