In general, foreign contractors may tender for and execute projects in Jordan that are declared by an official technical committee to be of a "specialised nature requiring foreign expertise". Projects that are financed by foreign development loans or grants are also open to foreign contractors, irrespective of whether or not same meet the above mentioned criterion.
A foreign contractor may tender for a project in Jordan which is open to foreign participation without having a locally registered entity. However, once such foreign contractor is awarded a contract requiring execution of work in Jordan, it is required to register a branch office in Jordan.
The foreign contractor must register with the Jordanian Construction Contractors Association ("JCCA") and pay its registration fees, which are currently JD. 5,000 (approximately US$ 7,150), annual subscription fees of JD. 2,500 (approximately US$ 3,600) and a fee amounting to 1 per mille of the value of all contracts awarded to the foreign contractor, with a cap of JD. 1,000 per contract.
Foreign contractors who intend to execute projects in Jordan are also required to associate themselves with local contractors. This association may take the form of a partnership, joint venture or sub-contract arrangement. The terms of any such association should be approved by the JCCA.
Although the use of foreign labour is permitted in certain circumstances, in general, no less than 60% of those employed on a project must be Jordanian nationals.
Stamp Duties and University Fees, at the rates of 6 and 1 per mille respectively of the total value of the contract, are levied on local and foreign contractors.
FOREIGN CONSULTING ENGINEERS
Foreign firms of consulting engineers are required to establish a branch office which must be registered with the Engineers Association upon being awarded a contract in Jordan. Registration fees with this Association are JD. 200 (approximately US$ 285) and annual subscription fees are JD. 150 (approximately US$ 215). A fee amounting to 0.25% of the total value of the contract is also payable, subject to a cap of JD. 3,000 (approximately US$ 4,285).
Stamp Duties and University Fees, at the rates of 6 and 1 per mille respectively of the total value of the contract, are levied on local and foreign engineering firms.
Foreign firms of consulting engineers are also required to enter into a partnership or association arrangement with local engineering firms, the terms of which are to be approved by the Engineers Association.
DECENNIAL LIABILITY OF CONTRACTORS AND ENGINEERS
The concept of the decennial liability of contractors and engineers in Jordan is fairly strict and requires that the contractor who executed construction works designed and supervised by an engineer is, jointly with the engineer, liable for damages in respect of any total or partial destruction which may occur in the works and for any fault which may threaten the strength and safety of the works. Such liability continues for a period of ten years, starting from the date of delivery of the works, (unless the contract provides for a longer period).
The party entitled to claim damages for defects in the construction is the owner in a contract for performance of work. If such a construction has been sold to a third party, the right to claim such damages is transferred with the construction to the purchaser.
If the engineer only prepares the designs without supervising the execution thereof, then he shall only be liable for any defects in such designs. Similarly, if the contractor works under the supervision of an engineer or the employer who assumes the position of an engineer, then he shall only be liable for defects occurring in the execution and not the design.
Any condition in the contract intended to exempt the contractor or engineer from liability or limiting same shall be null and void.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
Ali Sharif Zu'bi & Sharif Ali Zu'bi Law Office - Amman, Jordan - Fax: (962) 6 634277.