NEC4: Facilities Management Contract

The NEC4 Facilities Management Contract (FMC) is intended to be used for the appointment of a service provider for a period of time to manage and provide a facility management service. The NEC4 suite of contracts helps to streamline processes, reduce the potential for problems and promotes the best practice in the procurement of facilities management services.

Background

NEC, the construction industry’s leading procurement contract suite, and the Institute of Workplace and Facilities Management (IWFM) launched this set of contracts specifically for the procurement of facilities management services, helping to identify best practice in the sector and establish the way forward.

The contracts and their supporting documents are a great step to enable the facilities management sector to offer more integrated and consistent procurement strategies, add value to the supply chain and develop stronger, more collaborative, relationships and ways of working.

As with all NEC4 contracts, they are based on three core principles - ensuring they work to support good relationships between all parties; they can be used in a wide variety of commercial situations or locations, and are written in clear, simple terms.

Resources

• White paper - Introducing the Facilities Management Contracts
• White paper - Comparing the NEC4 Facilities Management and Term Service Contracts
• Practice note 1 - Including Social Value in the NEC4 FMC
• Practice note 2 - Including the Living Wage in the NEC4 FMC
• Practice note 3 - International Use of the NEC4 FMC

Core Clauses

1. General
2. The Service Provider’s main responsibilities
3. Time
4. Quality management
5. Payment
6. Compensation events
7. Use of equipment, Plant and Materials
8. Liabilities and insurance
9. Termination 

Main Option Clauses

• Option A: Priced contract with price list
• Option C: Target contract with price list
• Option E: Cost reimbursable contract

Resolving and Avoiding Disputes

• Option W1
• Option W2

Secondary Option Clauses

• Option X1: Price adjustment for inflation (used only with Options A and C)
• Option X2: Changes in the law
• Option X3: Multiple currencies (used only with Option A)
• Option X4: Performance guarantee
• Option X8: Undertakings to the Client or Others
• Option X9: Transfer of rights (only used with Option X15)
• Option X10: Information modelling
• Option X11: Termination by the Client (not used with Option X19)
• Option X12: Multiparty collaboration
• Option X18: Limitation of liability
• Option X19: Termination by either Party (not used with Option X11)
• Option X21: Whole life cost
• Option X23: Extending the Service Period
• Option X24: The accounting periods
• Option X27: Project Orders
• Option X28: Change of Control
• Option X29: Climate Change

• Option Y(UK)1: Project Bank Account
• Option Y(UK)2: The Housing Grants, Construction and Regeneration Act 1996
• Option Y(UK)3: The Contracts (Rights of Third Parties) Act 1999
• Option Z: Additional conditions of contract

• Schedule of Cost Components
• Short Schedule of Cost Components
• Subcontract Data
  • Part one – Data provided by the Client
  • Part two – Data provided by the Service Provider
• Index

NEC4 Y Clauses - February 2023

Y Northern Ireland Clauses

• NEC4 Y(NI) - Facilities Management Contract
• Download all the Y Northern Ireland Clauses

Users should note that the NEC Forms of Contract are protected by copyright and may not be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical or photocopying, recording or otherwise, without the prior permission of the copyright owner. However, Contract Data forms may be reproduced for the purpose of obtaining tenders, awarding and administering contracts.

Likewise, plagiarising any copyrighted document is illegal. For users seeking to prepare their own bespoke contracts based on the NEC Forms of Contract, please contact NEC at info@neccontract.com to discuss and obtain a copyright licence.

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