We have been the leading law firm in defense of owner's interest in projects worth more than 70 million euros
There are two kind of projects in the chemical industry: those where the owner has all the resourses to build and those where investors are needed. Investors, specially investment banks, seek for risk avoidance. That is the reason why, where investors are involved, EPC contracts tend to be the preferred option. Whereas, when the owner has the financial resources to build, the EPCm is the preferred option. Why? There are two reasons for this: (i) an EPCm contract is much cheaper than an EPC contract and (ii) owner and EPCm contractor can allocate the risk in the contract as it suits both parties.
EPC contracts: An EPC constract is a turnkey contract that places the main risk to the EPC contractor, who must deliver to the owner a fully operational plant. The EPC contractor is bound to complete the project in the agreed time and according to the contractual specifications. If there is no fully operational plant, the EPC contractor breaches the EPC contract and, as a consequence, the EPC contractor is liable. For this reason, some owners think that, if there is an EPC contract in place, they are on the safe side. Though I understand their rationale, they are wrong. EPC contractors count on very experienced lawyers that are trained to water down the EPC contract so EPC contractor is able to avoid liability as much as possible. Therefore, even if the EPC contractor has the contractual risk, a careful drafting of an EPC contract is always needed.
EPCm contracts: the owner entrusts the contract management of the contract to an EPCm contractor (normally engingeering companies). However, in contrast to EPC contracts, the owner is the one responsible for the project and its execution. Lawyers defending EPCm contractors interests are always ready to highligh that, if there is no defect in contract managament, there is no EPCm contractor liability. The argument is sound and correct but very incomplete. Owners do not want to hire an international enginyering company to simply handle construction contractors and other contractors on the owner's behalf in a rather bureocratic manner. Owners expect much more from EPCm contractors. Owners expect them to lead the project, to foresee problems, to offer cost-effective solutions, to follow up all rellevant aspects of the project and to make sure that the fully operational plant will be build in time. That is why, it is vital for owners that external lawyers with long experience in EPCm projects are involded in the negotiation and drafting phase of the EPCm contract as well as during contract execution.
We are fully owner oriented. EPC and EPCm contractor - normally engineering companies - have their inhouse legal advisors. They have an advantage over the owner: experince in projects of other clients (i.e other owners). We are here to bring balance in your favour. We also have this experience.
We follow the PON method from Harvard Negotiation Project: we use objetive criteria whenever possible, we look for mutually beneficial scenarios, we are focused on interest and not positions, and we separate the people from the problem to avoid emotional driving negotiations.
In Spain, the vast majority of lawyers, both working in owners or in contractors, with expertise in EPC and EPCm contracts are inhouse lawyers. We offer our expertise to owners as external laywers, both helping owner's inhouse laywers or leading the legal negotiations.
We negotiate complex EPC and EPCM contract clauses using Harvard Negotiation Project techniques
We offer careful and thoroughful drafing to deliver the most solid clauses in defense of our client's best interest
We bring our expertise from the court house to contractual clauses in defense of our client's best interest
We guide our clients in mechanical completion processes from the legal point of view
We offer out best insight to the claims arising during the execution of the project
We offer new ideas and possiblities to seemingly dead-end scenarios