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A cost plus contract states that a client agrees to reimburse a construction company for building expenses such as labor, materials, and other costs, plus additional payment usually stated as a percentage of the contract's full price. This type of construction contract is an alternative to lump sum agreements.
A "clean bill of lading" (aka "on-board bill of lading") is used when there is full compliance with no discrepancies between the description filed by the shipper and the actual goods shipped. A clean bill of lading indicates that the goods have been properly loaded onboard the carrier's ship in accordance with the contract.
Various abbreviations used for this type of contract are LSTK for lump sum turn key, EPIC for engineering, procurement, installation & commissioning and EPCC for engineering, procurement, construction and commissioning. Use of EPIC is common, e.g., by FIDIC and most Persian Gulf countries. Use of LSTK is common in the Kingdom of Saudi Arabia.
Responsibility for the goods is with the seller until the goods are loaded on board the ship. Once the cargo is on board, the buyer assumes the risk. Ship loading at a wharf. The use of "FOB" originated in the days of sailing ships. When the ICC first wrote their guidelines for the use of the term in 1936, [7] the ship's rail was still relevant ...
When the ship arrives the cargo is then taken from the warehouse to the quay and then lifted on board by either the ship's gear (derricks or cranes) or by the dockside cranes. The discharge of the ship is the reverse of the loading operation. Loading and discharging by breakbulk is labour-intensive.
When the cargo is being shipped by several different shipping companies on the same vessel, there will usually be separate bills of lading for each company, but only a single consolidated cargo manifest. On the other hand, if the cargo contains dangerous goods, there may be a separate dangerous cargo manifest. A manifest can be exchanged for ...
Depending upon the language in the bid proposal, a subcontracting construction company could make its bid final, and, if accepted, a legally enforceable contract is created. In these circumstances, upon determination by the general contractor that a bid is the lowest offer, it can accept the bid and, upon acceptance, a subcontractor cannot ...
Obtaining construction loans are easier with this type of contract. [9] [8] The profit margins and percentages are greater for engineers and contractors. [8] [9] Payments and instalments are made on regular basis which provides the contractor with a reliable cash flow. [8] [9] Management of the contract is a lot easier for the owner. [8] [9]