International Construction Law Review
GLOBALISATION AND THE NEW CONTRACTUAL REGIME IN INTERNATIONAL PUBLIC WORKS AGREEMENTS IN EGYPT
COUNSELLOR DR MOHAMED A M ISMAIL
LLB, MA, Ph D (Cairo University), MCI Arb (UK), Vice-President of the Egyptian State Council
INTRODUCTION
The contractual regime of international public works agreements in developing countries has been significantly influenced by cultural global-isation. Globalisation, in addition to the flow of commodities, includes capital and many other tangible concepts,1 plus intangible values, such as culture. Among these is legal culture. Legal culture has flowed from Anglo-American jurisdictions to civil law legal systems. Some scholars have addressed the fact that culture has a sharp edge that has been mitigated by globalisation.2 As the author pointed out in previous articles,3 globalisation has considerably influenced Egyptian legislator and judicial decisions taken by the Egyptian State Council (Conseil d’État) courts and the General Assembly for Legal Opinion and Legislation; the legal nature of administrative contracts (le contrat administratif) has drastically changed. Currently, the state cannot exercise the same exorbitant powers it once did over foreign contractors. In France4 and Egypt5 the state can, to a great extent, exercise unlimited powers in administrative contracts enabling it to uni-laterally amend, terminate or rescind (la résiliation administrative) a contract or impose penalties, such as forfeiture of performance bonds and penalties for delay, which differ from liquidated damages.6
The article has three parts: first, it discusses stabilisation clauses as a mechanism to compensate the contractor against price fluctuations, in
1 Joseph Stiglitz, winner of the 2001 Nobel Prize, Professor at Columbia Law School, USA: Making Globalisation Work, pp. 3–5.
2 See Mohamed S Abdel-Wahab, “Cultural Globalisation and Public Policy: Exclusion of Foreign Law in the Global Village” (2005) 8 Law and Sociology 367.
3 Mohamed A M Ismail, “Globalisation and Liquidated Damages in International Public Works Agreements in Egypt: An Analytical Perspective on the Penalty for Delay Clauses in Infrastructure Agreements” [2009] ICLR 506; and “Globalisation and Contract Price in International Public Works Agreements in the Egyptian State Procurement Law: New Trends” [2010] ICLR 92.
4 See the leading authority on administrative contracts in the civil law legal culture decades ago: André de Laubadere, Frank Modern and Pierre Delvolvé, Traité des contracts administratifs (Paris: LGDJ, 1983), Tome I, p. 210 et seq. See also ibid. Tome II, and Laurent Richer, Droits des Contracts Administratifs (Paris: LGDJ), p. 85 et seq.
5 In Egyptian doctrine, see Soliman El Tamawy, General Principles of Administrative Contracts (5th ed., 1991), p. 53.
6 See n. 3, above.
The International Construction Law Review [2010
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