A government-approved association of Saudi contractors is working on new contract forms that will be a pre-requisite for all contractors bidding for government projects in a bid to tackle persistent delays in projects in the world's largest oil exporter, a Saudi newspaper reported on Wednesday.
The Saudi Contractors' Authority (SCA) will soon issue the new contracts which will be the basis for any project agreement between the government and the contractors, the Arabic language daily Aliqitisadia said.
It quoted SCA chairman Osama Al-Afaliq as saying companies which do not have such contracts or fail to register with SCA would be barred from public sector projects in the Kingdom.
Afaliq said nearly 140,000 construction firms operate in the largest Arab economy but only around 1,800 of them have so far registered with SCA, which was approved by the government nearly two years ago to act as an umbrella for the contractors.
Afaliq told the paper that SCA had decided to issue new forms of contracts to regulate the "contracting market" after talks with 35 government organisations.
"We are in the process of issuing the new contracts, which will be the basis of relationship between the contractor and the project owner to avert the collapse or a delay in the project…this contract will guarantee the rights of all parties."
He said the new contracts would be approved by the competent government departments and are also intended to "force contractors to register with SCA."
(Writing by Nadim Kawach; Editing by Anoop Menon)
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