International Construction Law Review
GLOBALISATION AND LIQUIDATED DAMAGES ON INTERNATIONAL PUBLIC WORKS AGREEMENTS IN EGYPT: AN ANALYTICAL PERSPECTIVE ON THE PENALTY FOR DELAY CLAUSE IN INFRASTRUCTURE AGREEMENTS
COUNSELLOR DR MOHAMED A M ISMAIL
LL B, MA, Ph D (Cairo University) MCI Arb (UK)
Vice-President of the Egyptian State Council Arbitrator in international construction contracts disputes
I. INTRODUCTION
The purpose of this paper is to examine the legal nature of liquidated damages (penalty for delay) in international public works agreements (infrastructure projects), with special reference to the Egyptian State Council (Conseil d’Etat) decisions, in the light of the influence of global-isation on these contracts.
Part II of this paper describes the situation in Egyptian legislation (State Procurement Law and the Egyptian Civil Code). Part III is an analytical perspective on the Egyptian State Council decisions in comparison with the Egyptian Court of Cassation decisions as the Court of Cassation is directly applying civil law provisions.
The Egyptian State Council plays a significant role in establishing and codifying rules of administrative contracts (les contrats administratifs) since administrative law is not codified in Egypt. The State Council is the founder of the Administrative Contracts Theory established in 1946. Since then, courts, and the General Assembly for Legal Opinion (Fatwa) and Legislation, have set out the legal framework of the criteria for administrative contracts.
State Council decisions for many decades have settled that a contract is considered administrative if a party to the contract is a public juristic entity, if it concerns any of the public utilities (their management or organisation) and if it includes amongst its provisions specific clauses that differ from civil and commercial contracts. These provisions are called “les clauses exorbitantes”.1
Pt 4] Globalisation and Liquidated Damages in Egypt
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