SUB-CONSULTANCY AGREEMENT - pngtssp.com · Sub-Consultancy Agreement Page 2 written authority to act on behalf of the Sub-Consultant for all purposes in connection with this Agreement

SUB-CONSULTANCY

AGREEMENT

Dated: ……………

SMEC INTERNATIONAL PTY LTD (the “Client”) ABN 32 065 440 619

AND

………………………..

(the “Consultant”)

Sub-Consultancy Agreement Page 1

This Sub-Consultancy Agreement is made this ………………

(“Effective Date”) by and between:

SMEC International Pty Limited a company incorporated

in Australia with company number (ACN) 065 440 619 of

Unit 2, Level 1, 243 Northbourne Avenue, Lyneham, ACT

2602 (“SMEC”) and …………………….., a company

incorporated in ………….., address of ………………….. (the

“Sub-Consultant”).

1. Nature of Engagement

1.1. SMEC engages the Sub-Consultant to provide the

services set out in Schedule 2 (the “Services”) in

accordance with this Agreement.

1.2. The conditions of this contract comprise five (5)

parts: Schedule 4, General Conditions, Schedule 1,

Schedule 2 and Schedule 3 (the “Agreement”).

Where there arises an inconsistency or ambiguity

between the provisions in those parts of this

Agreement, the order of precedence to resolve the

inconsistency or ambiguity is the order set out in

this Clause 1.2.

1.3. Where a copy or any extract of SMEC’s contract

(the “Main Contract”) with a client (“Client”) is

incorporated into this Agreement as Schedule 4:

a) the Sub-Consultant must generally perform its

obligations under this Agreement so as to

ensure that (to the extent relevant) SMEC

complies with its obligations under that Main

Contract; and

b) if it is expressly stated (in Schedule 4) that

certain Clauses from the Main Contract are to

be incorporated in, or replace Clauses in, this

Agreement then those Clauses form part of

this Agreement and must be strictly complied

with as though references to the Client refer

to SMEC (unless the context otherwise

requires) and references to SMEC refer to the

Sub-Consultant. The Sub-Consultant must

comply with any additional requirements

specified in Schedule 4.

1.4. The Sub-Consultant acknowledges and agrees that

it has reviewed Schedule 2 and that:

a) the SMEC Material is suitable, appropriate

and adequate to perform the Services, and

the Sub-Consultant’s deliverables to be

created pursuant to this Agreement will be

suitable, appropriate and adequate; and

b) it can meet each and every deliverable in

accordance with the Program set out in

Schedule 2.

1.5. The Sub-Consultant has represented and warrants

that:

a) it is a skilled and competent professional in

the particular fields relevant to the Services;

b) it will perform the Services to the standard of

skill, care and diligence expected of a skilled

and competent professional practising in the

particular field relevant to the Services;

c) it possesses all relevant authorisations,

permits and licences necessary in order to

achieve completion of the Services; and

d) it has made its own review, assessment,

investigation, interpretation and assumption

of all of the risks involved in performing the

Services and that the Service Fee is accurate

and sufficient and includes all necessary

allowances to accept the risks involved in

performing the Services in accordance with

the terms of this Agreement.

1.6. The Sub-Consultant acknowledges that SMEC has

entered into this Agreement in specific reliance on

the representations and warranties set out in

Clause 1.5.

1.7. The Sub-Consultant:

a) must not represent itself or allow itself to be

represented as an employee or agent of SMEC

or the Client;

b) does not by virtue of this Agreement become

an employee or agent of SMEC or the Client.

1.8. The Sub-Consultant agrees to provide and perform

the Services from the Commencement Date on the

terms set out in this Agreement. Any Services

which are performed, or which should have been

performed, by the Sub-Consultant before the

Commencement Date are governed by the terms

of this Agreement.

1.9. To the extent permissible by law, this Agreement

shall bind the Sub-Consultant’s executors,

administrators, successors and permitted assigns

jointly and severally.

2. Obligations of the Sub-Consultant

2.1. The Sub-Consultant must:

a) comply with all Legal Requirements in carrying

out the Services;

b) commence the Services on the

Commencement Date and complete the

Services on or before the Completion Date in

Schedule 1 in accordance with the Program;

c) implement a quality assurance system

compliant with the standard specified in

Schedule 1;

d) allow SMEC or the Client or their respective

representatives or agents access to assess the

quality assurance system;

e) do all things necessary and necessarily

incidental for the proper performance of the

Sub-Consultant’s obligations under and

pursuant to this Agreement;

f) designate an individual in Schedule 1 as its

representative for the administration of this

Agreement. The representative shall have


written authority to act on behalf of the Sub-

Consultant for all purposes in connection with

this Agreement. The Sub-Consultant may,

from time to time, replace its Representative,

but it must give SMEC prior written notice of

the replacement;

g) comply with all reasonable instructions and

directions from SMEC in relation to the

Services and this Agreement;

h) remove any person from the performance of

the Services who in the reasonable opinion of

SMEC’s Representative is guilty of misconduct

or is incompetent or negligent;

i) not comply with any instructions or directions

that are issued by the Client to the Sub-

Consultant. If the Sub-Consultant receives any

such instruction or direction, it must

immediately notify, in writing, SMEC’s

representative designated in Schedule 1;

j) fully co-operate with Other Contractors on site

or involved in the Project;

k) permit Other Contractors to carry out their

work;

l) co-ordinate and integrate its Services with the

activities of Other Contractors;

m) carry out the Services so as to avoid interfering

with, disrupting or delaying, the activities of

Other Contractors;

n) consult regularly with SMEC throughout the

performance of the Services under this

Agreement;

o) as soon as practicable after becoming aware of

any matter or circumstance that may

adversely affect or has adversely effected the:

i. scope;

ii. timing; or

iii. performance of the Services;

give written notice to SMEC detailing the

matter or circumstance, its anticipated effect

on the Services and what remedial or

corrective action will or is proposed to be

taken to mitigate the adverse matter or

circumstance;

p) not assign the benefit of this Agreement

without the written consent of SMEC;

q) not sub-contract the performance of any of

the Services unless otherwise agreed in writing

by SMEC. Where the Sub-Consultant has

obtained consent to sub-contract part of the

Services, the Sub-Consultant must enter into a

contract that is substantially in the form of this

Agreement. The Sub-Consultant

acknowledges and agrees that SMEC

consenting to any sub-contract pursuant to

this provision does not relieve the Sub-

Consultant from any obligation under this

Agreement;

r) attend such meetings and briefings as may be

necessary or desirable by SMEC or the Client;

and

s) notify SMEC, in writing, immediately of the

existence or likelihood of a Conflict of Interest

and co-operate with SMEC to resolve the

Conflict of Interest.

3. Obligations of SMEC

3.1. SMEC will:

a) act reasonably in providing a response to

matters referred to it for decision by the Sub-

Consultant (where required under this

Agreement);

b) pay the Sub-Consultant the Service Fee and

any agreed adjustments to the Service Fee in

accordance with this Agreement; and

c) designate an individual in Schedule 1 as its

representative for the administration of this

Agreement. The representative shall have

written authority to act on behalf of the SMEC

for all purposes in connection with this

Agreement. SMEC may, from time to time,

replace its Representative, but it must give the

Sub-Consultant prior written notice of the

replacement.

4. Ownership and Use of Information

4.1. Unless otherwise provided in Schedule 4,

copyright and any of Intellectual Property Rights

arising from the performance of the Services shall

vest in SMEC on creation.

4.2. The Sub-Consultant will do all things necessary to

perfect the vesting of Intellectual Property Rights

in accordance with the terms of Clause 4.1.

4.3. To the extent that Intellectual Property Rights are

not capable of vesting in accordance the terms of

Clause 4.1 because the Sub-Consultant does not

own the Intellectual Property Rights, the Sub-

Consultant will ensure that SMEC (and the Client

under the Main Contract) are irrevocably licensed

to use those Intellectual Property Rights.

4.4. The Sub-Consultant must ensure that neither the

Services nor the provision of the Services infringe

any Intellectual Property Rights of any person.

4.5. The Sub-Consultant must obtain a signed waiver of

moral rights (in the form required by SMEC) from

each servant or agent who is the author of any

copyright work that forms part of the Services. The

waiver must be presented to SMEC immediately

upon direction by SMEC’s Representative to do so.

4.6. Clause 4 will survive the termination or expiration

of this Agreement.

5. Confidentiality

5.1. Unless it is in accordance with this Agreement or

SMEC provides its written consent, the Sub-

Consultant must not and must not permit any of


its officers, employees, agents, contractors, or

related companies to:

a) use, exploit or disclose to any person any

information disclosed to it by SMEC under this

Agreement; or

b) reverse engineer, dissemble or decompile any

prototypes, software or other tangible objects

which embody the information disclosed to it

by SMEC under this Agreement.

5.2. Clause 5.1 does not apply to any information

which:

a) is generally available to the public (other than

as a result of the wrongful disclosure by the

Sub-Consultant); or

b) is required to be disclosed by any law.

5.3. Clauses 5.1 and 5.2 survive the termination or

expiration of this Agreement.

6. Payment

6.1. In consideration for the Sub-Consultant

performing the Services, SMEC must pay to the

Sub-Consultant the Service Fee set out in Schedule

3. Other than as is detailed in this Clause 6 or for a

Variation in accordance with Clause 7, the Service

Fee is not subject to adjustment for any cause

whatsoever including, but not limited to, changes

in the cost of labour, plant, equipment, materials,

taxation (other than VAT), excise, duty, fees or

charges.

6.2. The Sub-Consultant must submit all claims for

payment (“Payment Claim”) for performance of

the Services under this Agreement in accordance

with the Alternative applying in Schedule 1.

6.3. A Payment Claim must be in writing and must

include:

a) a tax invoice;

b) details of:

i. the Services performed by the Sub-

Consultant during the period to which

the claim relates;

ii. the value of the claim; and

iii. the amount already paid to the Sub

Consultant.

c) additional information or documentary

evidence that SMEC reasonably requests in

order to determine whether or not the

amount claimed is payable.

d) any documentation required by the Main

Contract (as detailed in Schedule 4); and

e) any other documentation required by law.

6.4. SMEC may within 10 Business Days of receiving

Payment Claim under Clause 6.2 give the Sub-

Consultant a payment schedule (“Payment

Schedule”) which states:

a) the amount already paid to the Sub-

Consultant;

b) the amount SMEC is entitled to retain, deduct,

withhold or set-off under this Agreement;

c) the amount (if any) which SMEC believes to be

then payable by the SMEC to the Sub-

Consultant on account of the Service Fee and

Reimbursable Expenses and which SMEC

proposes to pay to the Sub-Consultant; and

d) if the amount in paragraph c) is less than the

amount claimed in the invoice, the reason why

the amount in paragraph c) is less than the

amount claimed in the invoice.

6.5. Subject to Clauses 6.7 and 10.3:

a) where no Payment Schedule has been issued

by SMEC under Clause 6.4, SMEC must pay the

Sub-Consultant the amount specified in the

invoice within 30 days of receipt of a Payment

Claim under Clause 6.2; or

b) where a Payment Schedule has been issued by

SMEC under Clause 6.4, SMEC must pay the

Sub-Consultant the amount set out as payable

in the Payment Schedule within 30 days after

the issue of that Payment Claim.

6.6. The issue of a Payment Schedule or any payment

is on account only and is not evidence of the value

of the Services or an admission of liability or that

the Services comply with the terms of this

Agreement.

6.7. Without limiting SMEC rights under any other

provision in this Agreement or at law, SMEC may

withhold, deduct or set off from any money due

and payable to the Sub-Consultant under this

Agreement any sum which is due and payable by

the Sub-Consultant under this Agreement or the

amount of any claim to money which SMEC may

reasonably have against the Sub-Consultant

whether for damages or otherwise, whether under

contract or otherwise at law, relating to the

Services.

6.8. Notwithstanding anything else in this Agreement,

SMEC’s liability to pay any amount of fees,

expenses, VAT or other amount under this

Agreement will be subject to SMEC first having

received payment of the corresponding amount

from the Client. SMEC must use reasonable

endeavours to pursue payment from the Client. In

the event that SMEC, in pursuing payment,

compromises the relevant claim with the Client on

terms that involve a reduction of the relevant

amount to be paid by Client, SMEC’s liability to

make the corresponding payment to the Sub-

Consultant shall be reduced accordingly.

6.9. If SMEC is required by any applicable law to make

any deduction or withholding from any payment

(including for any taxes, levies, imposts, duties,

charges or fees), SMEC shall:

a) pay to the relevant taxation or other

authority the full amount of the requisite

deduction or withholding; and

b) furnish to the Sub-Consultant an official

receipt of the applicable taxation or other


authorities involved for all amounts deducted

or withheld as aforesaid.

7. Variations and Extensions of Time

7.1. SMEC may, by written notice to the Sub-

Consultant, direct the Sub-Consultant to vary the

Services in nature, scope or timing (including the

omission or reduction of any part of the Services)

and the Sub-Consultant will be bound to comply

with that direction.

7.2. If the Sub-Consultant is of the opinion that any

direction, other than a direction that expressly

states in writing that it is given in accordance with

Clause 7.1, is a direction to vary the Services, the

Sub-Consultant must, prior to the performance of

any services relating to the direction and in any

case within the period specified in Item 7 of

Schedule 1:

a) notify SMEC that it considers a direction to be

a direction to vary the Services (unless the

Sub-Consultant will not at any time claim an

extension of time or additional payment);

b) notify SMEC of the likely impact, if any, of that

direction on:

i. the time required from relevant

personnel of the Sub-Consultant to

perform the Services and the value of

that impact calculated by applying the

applicable hourly rates in Schedule 3

(‘Variation Rates’) or, if none, using

reasonable rates or fees by the increase

or decrease in each person’s time; and

/or

ii. the agreed Program.

7.3. No claim for additional fees will be payable unless

the provisions of Clause 7.1 or 7.2 have been met.

7.4. If the Sub-Consultant submits a notice in

accordance with Clause 7.2, SMEC will make a

determination as to whether the direction is a

variation. If SMEC determines that the direction is

a variation, or in the case of a direction that

expressly states in writing that it is given in

accordance with Clause 7.1:

a) SMEC will value the variation in accordance

with the Variation Rates or, if none, using

reasonable rates or fees and the Service Fee

will be adjusted by that amount; and

b) SMEC will determine an equitable adjustment

to the Program.

c) If the Sub-Consultant disagrees with SMEC’s

determination under this Clause, the Sub-

Consultant may refer the matter to dispute

resolution in accordance with Clause 12.

7.5. SMEC will not be liable to the Sub-Consultant for

any loss of profit or revenue should the Services

be reduced pursuant this Clause.

7.6. Notwithstanding that the Sub-Consultant is not

entitled to an extension of time, SMEC may in its

absolute discretion, to be exercised for the benefit

of SMEC, at any time extend the date for

completion.

7.7. Notwithstanding anything else in this Agreement,

the Sub-Consultant shall not be entitled to an

adjustment of the Service Fee or to the affected

items of the Program except to the extent that

SMEC has obtained a corresponding adjustment

under the Main Contract.

8. Non-compliant Services

8.1. If SMEC (acting reasonably) determines that the

Services (or part of the Services) do not comply in

all respects with the requirements of this

Agreement, SMEC may, at its option:

a) require the Sub-Consultant to promptly take

such steps as are necessary to ensure that the

Services comply with this Agreement at no

additional cost to SMEC; or

b) rectify, either itself or by others, the Services

which do not comply with this Agreement.

The Sub-Consultant agrees to reimburse

SMEC for reasonable costs and expenses

SMEC incurs in rectifying any non-compliant

Services (which cost and expense is deemed a

debt due by the Sub-Consultant to SMEC).

8.2. SMEC’s rights under Clause 8.1 do not in any way

change or affect the Sub-Consultant’s obligations

under this Agreement or affect SMEC’s rights

against the Sub-Consultant under this Agreement.

9. Liability

9.1. The Sub-Consultant indemnifies SMEC and its

officers, employees and agents against any and all

Loss arising out of or in connection with:

a) the negligent performance of the Services by

the Sub-Consultant, its sub-contractors and

their respective officers, employees and

agents;

b) the failure of the Sub-Consultant to perform

any of its obligations under this Agreement;

or

c) any infringement of Intellectual Property

Rights caused by the use by SMEC or the

Client of the Services or the Sub-Consultant’s

deliverables created pursuant to this

Agreement.

9.2. The Sub-Consultant’s liability to indemnify SMEC

under Clause 9.1 will be reduced proportionally to

the extent that a negligent act or omission of

SMEC or its employees or agents contributed to

the Loss.

10. Insurance

10.1. The Sub-Consultant will procure, prior to the

commencement of any work under this

Agreement, the following policies of insurance:

a) workers’ compensation insurance for liability

under statute and at common law in


accordance with statutory requirements. To

the extent permitted by law, the policy

should extend to provide indemnity to SMEC

in respect of any statutory liability to the Sub-

Consultant’s employees. The policy must be

maintained for the duration of this

Agreement;

b) public liability insurance for an amount not

less than that stated in Schedule 1. The policy

must be maintained for the duration of this

Agreement and should note the interests of

SMEC as Principal;

c) professional indemnity insurance for an

amount not less than that stated in Schedule

1, and maintained for the period stated in

Schedule 1; and

d) a comprehensive motor vehicle policy which

provides cover for loss or damage to any

motor vehicle used in the performance of the

Services and for loss or damage to property

and death or injury to any person arising out

of use of any motor vehicle used in the

performance of the Services for an amount

not less than stated in Schedule 1.

10.2. The Sub-Consultant will provide certificates of

currency for the insurances set out in Clause 10.1:

a) prior to the commencement of the Services;

and

b) any time during the continuance of this

Agreement when SMEC makes a request for a

particular insurance policy or for all of the

policies of insurance.

10.3. If the Sub-Consultant fails to effect or maintain any

of the insurances required by this Agreement,

SMEC may effect and maintain such insurances.

The cost incurred will be a debt owed by the Sub-

Consultant to SMEC. SMEC may set off the debt in

accordance with the terms of Clause 6.7 or

withhold payment until the Consultant has

complied with its insurance obligations as set out

in Clause 10 of this Agreement.

10.4. The Sub-Consultant’s compliance with this Clause

does not in any way limit the liabilities and

obligations of the Consultant under this

Agreement.

10.5. The provisions of Clause 10 survive the expiration

or termination of this Agreement.

11. Termination/Suspension

11.1. SMEC may terminate this Agreement:

a) by giving seven (7) days written notice to the

Sub-Consultant;

b) if the Sub-Consultant is in breach of a non-

material term of this Agreement and that

breach has not been remedied within 14 days

after receipt by the Sub-Consultant of a

written notice from SMEC identifying the

breach and requiring it to be remedied;

c) immediately if:

i. the Sub-Consultant becomes an

"externally administered body

corporate" or a person or entity is

appointed as a "controller" of any of the

Sub-Consultant's property (as those

terms are defined in section 9 of the

Corporations Act 2001); or

ii. SMEC has reason to believe that that

the Sub-Consultant is or is likely to

become unable to pay its debts as and

when they fall due;

iii. The Sub-Consultant breaches a material

term of this Agreement; or

iv. the Main Contract is terminated.

11.2. Upon termination:

a) the Sub-Consultant must deliver to SMEC all

information and documentation created by or

used by the Sub-Consultant in the

performance of the Services on or prior to the

termination of this Agreement;

b) subject to Clause 6.7 and the Sub-Consultant

complying with Clause 11.1(a), SMEC must

pay the Sub-Consultant:

i. the applicable portion of the Service

Fee for the Services properly performed

up to and including the date of

termination; and

ii. all disbursements incurred by the Sub-

Consultant prior to the date of the

termination which would have been

payable had this Agreement not been

terminated subject to the title for any

item which is the subject of the

disbursement being assigned to SMEC,

provided that the payment made

pursuant to this Clause, together with

amounts of the Service Fee already

paid, will not be greater than the

Service Fee.

c) subject to payment prescribed in Clause

11.1(b), SMEC will not be liable to pay the

Sub-Consultant any additional compensation

including, without limitation, any loss of

profits; and

11.3. Nothing in this Clause 11 limits SMEC’s right to

recover any costs, losses and damages suffered or

incurred by it arising out of or in connection with

any breach of contract by the Sub-Consultant or

the termination of the Agreement.

11.4. If, at any time, termination of this Agreement by

SMEC in accordance with Clause 11.1(b) or 11.1 (c)

is subsequently held by a court of law or arbitrator

to have been invalid, then any such notice of

termination shall be deemed to have been given in

accordance with Clause 11.1(a).

Effect of Termination

11.5. Termination of this Agreement by either party is

without prejudice to the rights and remedies


which either party may have against the other

party at the time of termination.

Suspension

11.6. SMEC may by written notice direct the Sub-

Consultant to suspend the progress of the whole

or part of the Services for such period as SMEC

determines.

11.7. The Sub-Consultant must take all reasonable steps

to mitigate costs that may arise from a suspension

of Services pursuant to Clause 11.6.

11.8. SMEC will pay any reasonable cost and expense

incurred by the Sub-Consultant by reason of the

suspension unless the suspension arose out of or

as a result of an act or omission of the Sub-

Consultant.

11.9. Subject to Clause 11.8, SMEC is not liable to pay

the Sub-Consultant any compensation including,

without limitation, any loss of profits.

11.10. SMEC may give the Sub-Consultant written

notice to re-commence the Services

(‘Recommencement Notice’) when required. The

Recommencement Notice will specify a reasonable

period in which the Sub-Consultant must

recommence the Services and the Sub-Consultant

must comply with that notice.

12. Dispute Resolution

12.1. If a dispute arises in connection with this

Agreement, then either party may give written

notice to the other party’s Representative

specifying the nature of the dispute (“Notice of

Dispute”). There must be sufficient particulars of

the dispute so that the recipient of the Notice of

Dispute is aware of:

a) what the dispute is;

b) the cause of the dispute; and

c) the means by which a dispute can be resolved

or corrected.

d) Within ten (10) Business Days after the Notice

of Dispute is given, the Representatives must

meet at least once to resolve the dispute.

e) If the dispute has not been resolved within 20

Business Days of service of the Notice of

Dispute either party may commence legal

proceedings or, if agreed in writing by the

parties, commence alternative dispute

resolution proceedings.

12.2. This Clause 12 survives the termination and

expiration of this Agreement.

13. Occupational Health & Safety

13.1. Without limiting Clause 2.1, the Sub-Consultant

must:

a) comply with any Act, Regulation, codes of

practice and other Legal Requirements

dealing with occupational health and safety;

b) comply with SMEC’s requirements in respect

of health and safety including all directions

given by SMEC or SMEC’s Representative in

respect of health and safety; and

c) take all appropriate steps to promote a high

level of awareness among its employees of

any occupational health and safety policy of:

i. SMEC;

ii. the Client; and

iii. the party identified in Item 17 of

Schedule 1.

13.2. The Sub-Consultant must comply with all

directions and the procedures and policies of the

party identified in Item 17 of Schedule 1 as

controlling the Site in respect of occupational

health, safety, security, protection of the

environment and employee relations relating to

the Site. The Sub-Consultant must ensure that all

persons employed or engaged by the Sub-

Consultant who require access to the Site,

undertake the safety and environmental induction

and or training provided by the party identified in

Schedule 1 prior to entering the Site, where such

induction or training forms part of the procedures

in respect of the Project or the Site. Any time

expended or any cost incurred to comply with the

provisions of this Clause 13 is included in the

Service Fee.

13.3. SMEC or SMEC’s Representative may direct the

Sub-Consultant to suspend the provision of the

Services if:

a) the Sub-Consultant has, or, in the reasonable

opinion of SMEC, is likely to breach this

Clause 13; or

b) SMEC (acting reasonably) forms the view that

the manner in which the Services are being

performed are likely to cause harm to the

health and safety of any person.

13.4. If SMEC exercises the right in Clause 13.3 it will be

deemed to be a suspension that arose out of or as

a result of an act or omission of the Sub-

Consultant.

14. Notices

14.1. A notice or other communication ("notice")

connected with this Agreement has no legal effect

unless it is in writing and is:

a) delivered by hand at the address for service

of the Representative;

b) sent by facsimile to the facsimile number of

the Representative; or

c) sent by e-mail to the e-mail address of the

Representative and is acknowledged by the

Representative either by e-mail, facsimile or

post.

14.2. A notice is deemed given and received:

a) if delivered by hand, upon delivery; or

b) if sent by facsimile before 4 pm on a Business

Day, on the day it is sent at the place of


receipt and otherwise on the next Business

Day at the place of receipt.

c) if the Representative sends an

acknowledgement that the e-mail was

received.

14.3. Despite Clause 14.2(b), a facsimile is not deemed

given or received unless at the conclusion of the

transmission the sender's facsimile machine issues

a transmission report which indicates that the

relevant number of pages comprised in the notice

have been sent.

14.4. A party may change its address for service or

facsimile number by giving notice of that change

to each other party.

14.5. The address for service of the parties is set out in

Schedule 1.

15. Business Practices

15.1. The Sub-Consultant must comply at all times with

SMEC’s Code of Conduct (Appendix 1 to this

Agreement) and SMEC’s Business Integrity Policy

(Appendix 2 to this Agreement) as amended or

replaced from time to time.

15.2. The Sub-Consultant must:

a) maintain accurate and transparent books and

records of all transactions relating to the

performance of the Services and ensure that

all transactions are recorded accurately and

in reasonable detail in a way that does not

conceal the true nature of the transaction;

b) obtain and retain invoices and receipts for all

expenditure it incurs in performing the

Services, whether or not the expenditure is

reimbursable by SMEC under this Agreement;

c) maintain accurate records of all activities it

undertakes in the performance of the

Services including records of any discussions

or dealings with Public Officials and with

clients or prospective clients of SMEC and

provide copies to SMEC upon request;

d) comply with, and ensure that its agents and

employees comply with, all Legal

Requirements of any applicable jurisdiction,

in particular those relating to fraud, bribery

and corruption, and with the requirements of

the OECD Convention on Combating Bribery

of Foreign Public Officials in International

Business Transactions;

e) not offer, give, pay or promise to give or pay,

directly or indirectly, anything of value to:

i. a Public Official or a representative of

any client or prospective client of SMEC

in connection with the Project; or

ii. to any person to influence improperly

the actions of that person or another

person,

and must notify SMEC immediately in writing

with full particulars in the event that the Sub-

Consultant receives a request from any Public

Official or other such person for any such

payments or gifts;

f) not, by act or omission, engage in any

misrepresentation of facts to any person, or

mislead or attempt to mislead any person, in

the performance of the Services or otherwise

in relation to SMEC’s business; and

g) when requested by SMEC, attend training and

procure that its employees and contractors

attend training provided or on behalf of SMEC

on SMEC’s business integrity policies and

procedures.

15.3. Without limiting clause 15.2, the Sub-Consultant

must promptly disclose to SMEC full details of all

gifts, hospitality and entertainment given or

offered, directly or indirectly, to any person by or

on behalf of the Sub-Consultant in connection with

the Services or SMEC’s business, clients or

potential clients.

15.4. The Sub-Consultant must ensure that all

statements it makes to SMEC or to any

Government authority or otherwise prepares

under or pursuant to this Agreement, including

but not limited to claims, invoices, reports,

timesheets and records of disbursements,

accurately reflect the actual activities and

transactions to which they relate.

15.5. The Sub-Consultant warrants that, at all times

during the Term, neither the Sub-Consultant nor

an officer, director, senior executive or person

holding, directly or indirectly, an ownership

interest of greater than 10% in the Sub-

Consultant:

a) is a Public Official or a Close Family Member

of a Public Official other than as clearly

notified to SMEC by way of written

communication acknowledged by SMEC not

less than 7 days prior to the signature of this

Agreement;

b) is listed on a Relevant List or subject to any

proceedings or an informal process which

could lead to listing on a Relevant List;

c) is the subject of an investigation (whether

formal or informal) by the World Bank or

another donor or lender of development

funding; or

d) is or has been within the previous five years

the subject of an investigation by any

Government authority or entity into any

allegation involving fraud, bribery or

corruption.

15.6. The Sub-Consultant must immediately notify SMEC

with full details if it becomes any of the things set

out in clause 15.5 or of any contravention of this

clause 15 by the Sub-Consultant.

15.7. The Sub-Consultant must indemnify, defend and

hold harmless SMEC from and against any Loss

arising out of, or related to, or connected with the

Sub-Consultant’s failure to comply with the


provisions of this clause 15, to the fullest extent

permitted by law.

16. Audits and investigations

16.1. SMEC may from time to time audit the Sub-

Consultant’s records to determine compliance

with the requirements of this Agreement and the

validity of any claim for payment.

16.2. If SMEC receives information regarding a possible

breach of clause 15 by the Sub-Consultant, SMEC

may carry out an investigation to determine

compliance with the requirements of clause 15.

16.3. The Sub-Consultant must fully cooperate with any

such audit or investigation including:

a) providing all necessary information and

access for SMEC and its representatives to

audit the books and records of the Sub-

Consultant with respect to:

i. ownership of the Sub-Consultant with

respect to representations made under

clause 15.5; and

ii. any of the Sub-Consultant’s activities

related to performance under and

compliance with this Agreement; and

b) attending and requiring its employees and

agents to attend interviews and cooperate

with and answer questions put to any of them

by SMEC’s representatives.

16.4. In the case of an investigation under clause 16.2,

SMEC may, by notice in writing to the Sub-

Consultant, suspend performance of the Services

pending the commencement and completion of

the investigation and may lift the suspension by

further notice in writing.

17. General

17.1. This Agreement is governed by the law in force in

the jurisdiction nominated in Schedule 1. Each

party submits to the non-exclusive jurisdiction of

the courts of that jurisdiction.

17.2. A right created by this Agreement cannot be

waived except in writing signed by the party

entitled to that right. Delay by a party in exercising

a right does not constitute a waiver of that right,

nor will a waiver (either wholly or in part) by a

party of a right operate as a subsequent waiver of

the same or of any other right of that party.

17.3. If any provision of the Agreement is held to be

unenforceable, invalid, void or illegal for any

reason, then that provision will to the extent

possible be deemed to have been severed and

omitted from the Agreement without affecting the

enforceability, validity or legality of the remaining

provisions (or parts of those provisions) which will

continue in full force and effect.

17.4. The Consultant shall ensure all its staff are aware

of the Client’s Child Protection Policy and will

ensure this policy is observed and addressed

throughout the assignment.

17.5. The Consultant shall ensure all its staff have

signed the Client’s Child Protection Code of

Conduct and ensure all replacement staff,

temporary staff, visiting support staff and others

likewise sign the Code.

18. Definitions

In this Agreement the following terms have the

following defined meanings:

“Agreement” means this contract between SMEC and

the Sub-Consultant including all schedules and

attachments.

“Business Day” means a day other than a Saturday,

Sunday or public holiday in the city where the Project is

located.

“Commencement Date” means the commencement

date set out in Schedule 1.

“Client” means SMEC’s client under a Main Contract

identified in Schedule 1.

“Close Family Member” means, in respect of an

individual, the individual’s spouse; the individual’s and

the spouse’s grandparents, parents, siblings, children,

nieces, nephews, aunts, uncles and first cousins; the

spouse of any of these people; and any other individuals

who share the same household with the individual.

“Conflict of Interest’ includes engaging in any activity, or

having any interest which conflicts or may conflict with

the ability of the Sub-Consultant to perform its

obligations under this Agreement in good faith and

objectively.

“Effective Date” means the date inserted on the front

page of this Agreement that signifies when the parties

entered into a binding contractual arrangement for the

provision of the Services.

“Government” means any federal, state, national or

local authority, or their agencies and instrumentalities,

having jurisdiction in the Territory.

“Intellectual Property Rights” means any intellectual or

industrial property rights, whether registered or

unregistered, including:

a) all patents, trade-marks, copyright, designs, trade

secrets, know-how and other rights in any design,

materials, processes, documents and methods of

working; and

b) all licences and other rights to use or to grant the

use of those items in a);

but excluding Moral Rights.

“Legal Requirements” means all:

a) Acts, Regulations, Ordinances, Laws, By-Laws,

Codes of Practice and Standards in effect in, or any

binding proclamation by, the local, regional or

national Government of, the place in which the

Project is being undertaken or any Services are to

be performed; and

b) Certificates, licences, consents, permits, approvals

and requirements of organisations having

jurisdiction in the place in which the Project is


being undertaken or the Services are being

performed.

“Loss” means loss, damage, injury, harm, claim,

demand, cost (including legal costs on a full indemnity

basis), expense, penalty, charge or liability of any kind

whatsoever.

“Main Contract” means a contract between SMEC and

the Client included in Schedule 4 (if applicable).

“Moral Rights’ means the rights so named in the Berne

Convention for the Protection of Literary and Artistic

Works (1886) and any applicable rights under any law of

the place in which the Project is being undertaken or of

the place in which any Services are to be performed.

“Other Contractor” means any contractor, supplier,

subcontractor, consultant, project manager or any other

person engaged to work on the Project or on Site.

“Program” means the program set out in Schedule 2.

“Project” means the project identified in Schedule 1.

“Public Official” means any of the following:

a) any official or employee of, person acting in an

official capacity for or on behalf of, or individual

performing work under a contract for or who is

otherwise in the service of, any:

i. Government or Government department,

agency or instrumentality;

ii. Government-owned or controlled

corporation or enterprise; or

iii. public international organisation including

any donor or lender of development funding;

b) any person holding or performing the duties of an

appointment, office or position under any law;

c) any individual who holds or performs the duties of

an appointment, office or position created by

custom or convention of a country or of part of a

country;

d) any candidate for a political party or for political

office;

e) any political party, official of a political party or

funding organisation for a political party.

“Relevant List” means a list of organisations maintained

by the World Bank in its “Listing of Ineligible Firms” or

“Listings of Firms, Letters of Reprimand” and any similar

list maintained by any other donor or lender of

development funding.

“Site” means the place identified in Schedule 1.

“Services” means the services described in Schedule 2

together with those activities the Sub-Consultant is

required to carry out under the Agreement.

“Service Fee” means the amount set out in Schedule 3.

“SMEC Material” means all material provided by SMEC

to the Sub-Consultant, including but not limited to

documents, information and data referred to or

identified as such in Schedule 2.

“VAT” means Value Added Tax or similar tax on goods or

services including, without limitation, sales, use, excise,

and similar taxes (as amended from time to time) as

may be applicable to the Services.

EXECUTED as an agreement

Signed for and on behalf of:

SMEC International Pty Limited:

..............................………………………………………………………..

Signature of authorised person

..............................………………………………………………………..

Name (Block Letters) Title

in the presence of:

........................................................................................

Witnesses Signature

..............................………………………………………………………..


Signed for and on behalf of:

………………………………..

..............................………………………………………………………..

Signature of authorised person

..............................………………………………………………………..


in the presence of:

............................................ ...........................................

Witnesses Signature

..............................………………………………………………………..



SCHEDULE 1 - AGREEMENT PARTICULARS

Item 1 SMEC’s Client (if relevant):

Item 2 Project Name:

Item 3 Commencement Date:

Item 4 Completion Date:

Item 5 SMEC’s Representative

Name:

Address:

Phone:

Fax:

Email:

Item 6 Sub-Consultant’s Representative

Name:

Address:

Phone:

Fax:

Email:

Item 7 Maximum time for notifying variation claims:

(If nothing stated, 7 days)

Item 8 Minimum Level of Professional Indemnity

Insurance:

(If nothing stated AUD10 million)

AUD300,000

Item 9 The period for which professional

indemnity insurance shall be

maintained:

(If nothing stated 6 years after the completion of

the Services)

3 months after completion of the services

Item 10 Minimum Level of Public Liability Insurance:


AUD10 million

Item 11 Minimum Level of Motor Vehicle Liability

Insurance:


Item 12 Variation Rates Refer to Schedule 3

Item 13 Quality Assurance System Standard

(If nothing stated AS/NZS ISO 9001)

Item 14 Payment alternative applying (see clause 6.2)

(If nothing stated Alternative 2)

As per schedule 3

Item 15 Jurisdiction whose laws govern this Agreement Australian state of New South Wales

Item 16 Location of the Site Port Moresby

Item 17 Party who has control of the Site Not applicable


SCHEDULE 2 - SCOPE AND PROGRAM OF THE SERVICES

Scope of Services

Background The Transport Sector Support Program (TSSP), funded by the Government of Australia (GoA), has provided

technical and financial support to the Transport Sector in Papua New Guinea to strengthen operational and

technical efficiencies, performance, and effectiveness.

The key agencies in the Transport Sector within the scope of TSSP are:

• Department of Transport (DoT);

• Department of Works (DoW);

• Accident Investigation Commission (AIC);

• Civil Aviation Safety Authority of PNG (CASA);

• National Maritime Safety Authority (NMSA); and

• PNG Air Services Limited (PNGASL).

Individual Agency Support Arrangements (ASAs) have been signed by the six agencies with GoA in recent years

and receive a range of direct supports from TSSP. Additional support is provided to the aviation and maritime

agencies through a Memorandum of Understanding (MoU) signed by GoA and GoPNG to strengthen the

transport sector in PNG.

A separate study has been tendered by TSSP to understand and assess the impact of GoA support at an agency

specific level for PNGASL, PNGAIC, CASA and DoW.

This study seeks to understand and account for sector change and transformation resulting from GoA support

to the sector. TSSP, for example, provides on-going advisory support to the sector in four key areas:

strengthening sector policy and planning; developing coherent sector legislation; integrating sector financing

and budgeting; and promoting a culture of sector monitoring and evaluation. TSSP is also strengthening the

sector in other ways including support for TSCMIC and for the Transport Sector Lawyers Network (TLSN) and

the Transport Sector Communications Network (TSCN).

Research Issue GoA and TSSP are interested to understand the contribution that GoA support is making to the strengthening

of the transport sector and to learn from the experiences of the sector over an extended time. The study seeks

to collect and document evidence about the nature and extent of change and transformation, or otherwise, in

the transport sector and what accounts for, or constrains, transformation of the sector.

It is intended that the study be conducted over an extended period from late-2017 to mid-2019 to observe,

record, and assess the impact of past and on-going GoA support.

Terms of Reference The terms of reference for the study are:

• Describe, assess and account for the nature and extent of change in the sector over time, by collecting

perspectives and evidence from senior management in agencies, TSSP advisers and specialists, MoU

supports, counterparts, and other key stakeholders.

• Collect and review the strategies and approaches used by GoA to improve systems and develop

capacity within the sector.

• Collect evidence and analyse and account for the effectiveness, or otherwise, of strategies and

approaches adopted to facilitate sector change.


• Conduct regular reviews of the sector to assess progress made towards strengthening and

transforming the sector in capacity, planning, legislation, funding and resource allocation, and

monitoring and evaluating performance.

• Report on, and account for, GoA initiatives to strengthen the sector that are working well and those

that are less successful.

• Identify factors which contribute to, or obstruct, change in the sector and how they operate.

• Describe and assess the implementation by agencies of safeguards policies such as the GoPNG Gender

Equity and Social Inclusion (GESI) and child and environmental protection, and identify factors

promoting, or limiting the implementation of such policies.

• Assess the impact of this investment on both men and women separately in the sector.

• Describe and assess challenges facing the sector and opportunities for the sector to drive change and

adapt effectively.

• Draw findings from the data collected to indicate improvements to efficiencies, effectiveness, and

sustainability of similar investments in the future in PNG.

• Provide progressive results and reports on a regular basis to inform TSSP and GoA of the progress and

outcomes of the study.

Deliverables

Program The Services are to be commenced on the Commencement Date in Schedule 1 and completed on or before the Completion

Date in Schedule 1 and in accordance with the attached technical proposal at schedule 7.


SCHEDULE 3 – PAYMENT TO THE SUB-CONSULTANT

1. MAXIMUM AMOUNT PAYABLE

1.1. The total maximum payable of this Contract is PGK………….. (exclusive of VAT but inclusive

of all other applicable taxes).

2. BASIS OF PAYMENT

2.1. The maximum amount payable outlined in Clause 1.1 of this Schedule 3 is comprised of

the following elements:

(a) Management Fee (see Clause 3); and

(b) Reimbursable Costs:

(i) Long Term Adviser Costs (see Clause 4);

(ii) Short Term Adviser Costs (see Clause 5);

(iii) Adviser Support Costs (see Clause 6);

(iv) Operational Cost (see Clause 7)

2.2. SMEC shall not be liable for any Cost or expenditure incurred by the Contractor in excess

of the amount specified in Clause 1.1.

2.3. The total amount payable is summarised in Table 1 below.

Table 1: Maximum Amount Payable

Item Total amount

payable (PGK)

Management Fee (Clauses 3 and Annex 1)

Long Term Adviser Costs (Clause 4 and Annex 2) Not Applicable

Short Term Adviser Costs (Clause 5 and Annex 3)

Adviser Support Costs – Short Term (Clause 6 and Annex 4)

Operational Cost (Clause 7 and Annex 5)

TOTAL AMOUNT PAYABLE

3. MANAGEMENT FEES

3.1. The maximum amount payable to the Sub-Consultant in Management Fee shall not

exceed the sum of PGK…………..

3.2. The Management Fee should include the Sub-Consultant profit and operating overhead

costs associated with providing the Services. SMEC will pay the Management Fee based on

Clause 3.3 below and in accordance with Annex 1 of Schedule 3. The Management Fee is


fixed and is payable against the satisfactory achievement of Milestones as detailed in

Clause 3.4 – 3.5 below.

3.3. The Management Fee comprises (but will not be limited to):

(a) All personnel costs (except for approved Long and Short Term Personnel costs as

per Annexe 2 and 3 to this Schedule 3, which shall be separately reimbursable in

accordance with Clause 4 and 5 of this Schedule 3);

(b) All necessary communication costs;

(c) All aspects of profit, including commercial margins/mark-up for all personnel;

(d) All overheads;

(e) Financial management costs;

(f) All management support costs for all personnel, including Short Term Personnel

(other than that approved as an activity to support Lead Advisers), all locally

engaged personnel and all Contractor administrative and high-level head office

management and administrative staff;

(g) Security costs for all personnel, including any contractor staff, all Short Term

Personnel and locally engaged personnel that may be appointed in-country;

(h) Insurance costs (including but not limited to, professional indemnity, worker’s

compensation, public liability, and any other insurances as required under the

Contract or deemed necessary by the Contractor) in accordance with Clause 10

(Insurance) of the Sub-Consultancy agreement;

(i) Taxation, as applicable;

(j) Costs of complying with the Contractor’s reporting and liaison obligations under the

Contract;

(k) Any costs associated with personnel recruitment, other procurement and

subcontracting any services;

(l) Costs for monitoring & assessment of the quality of activities by the Contractor;

(m) Costs, including domestic and international travel, accommodation, per diems, and

local transport costs where required for all Contractor Head Office personnel (other

than those listed as Long and Short Term Personnel costs at Clauses 4 and 5 of this

Schedule 3);

(n) All escalators for the Term of Contract;

(o) All other costs not specifically identified as Reimbursable Costs;

(p) Allowances for risks and contingencies; and

(q) Any other costs not listed under Professional Fees or Reimbursable.


3.4. SMEC shall pay the Management Fees as follows within thirty (30) days of its receipt of a

correctly rendered invoice:

(a) After SMEC’s acceptance of the satisfactory achievement of a Milestone, the

percentage of the Management Fees specified in the Milestone table at Annex 1 to

this Schedule 3 for achievement of the relevant Milestone (“Milestone Payment”).

3.5. In the event that SMEC learns that a Milestone for which SMEC has already made a

payment, has not been achieved to the specifications required by this contract, the

amount paid for that Milestone will become an overpayment and will be recoverable.

4. LONG TERM ADVISER COSTS

Not applicable

5. SHORT TERM ADVISER COSTS

5.1. SMEC shall reimburse the Sub-Consultant at actual cost up to a maximum of PGK………..

for Short Term Adviser Costs.

5.2. For each Short Term Personnel, SMEC shall pay the Contractor, monthly on a

reimbursable basis in arrears, an all-inclusive Daily Professional Fee detailed in Annex 3 to

this Schedule 3, the following item:

(a) The daily Remuneration Rate in accordance with the Job Level and Professional

Discipline Category specified in the position Terms of Reference and calculated in

accordance with the Adviser Remuneration Framework. The daily Remuneration

shall be:

(i) Inclusive of base salary;

(ii) Inclusive of all personnel-related taxes, levies and insurances incurred, with

the exception of GST;

(iii) Inclusive of superannuation levy, if any;

(iv) Inclusive of all escalators for the term of this Contract; BUT

(v) Exclusive of any profit, overheads, administration or management fee, or any

other mark-up/margins on the part of the Sub-Consultant.

6. ADVISER SUPPORT COSTS

6.1. SMEC shall reimburse the Sub-Consultant at actual cost up to a maximum of PGK……….. for

Support Cost for Short Term Advisers detailed in Annex 4 of this Schedule 3.

6.2. SMEC shall pay the Sub-Consultant, monthly on a reimbursable basis in arrears Adviser

Support Costs including the following items:

(a) Any reasonable costs related to security;


(b) Work related travel and accommodation costs at the rates determined by SMEC from

time to time;

(c) Reasonable costs for medical insurance;

(d) Fixed, non-acquittable per diems in accordance with the rates prescribed by SMEC for

the relevant location for the Short Term Advisers; and

(e) mobilisation/demobilisation costs for Short Term Advisers including all reasonable one-

off costs associated with mobilisation and demobilisation including any necessary

medical clearances and inoculations; uplift of effects; passport and visa costs; storage;

and the cost of one return international flight from home location for the Short Term

Advisers.

6.3. The cost of any airfares will be reimbursed at the cost of economy class for each flight sector

of four (4) hours or less and business class for each flight sector greater than four (4) hours

duration. Any travel undertaken at cheaper rates (eg discount fare) does not entitle the

Contractor to reimbursement of the cost of any higher class of travel. Travel must be via the

most direct and cost effective route. A ‘flight sector’ means from any one flight departure

point to any one flight landing point.

6.4. Adviser Support Costs will be reimbursed at cost on a monthly basis in arrears within thirty

(30) days of SMEC’s receipt of a correctly rendered invoice.

7. OPERATIONAL COSTS

7.1. SMEC shall reimburse the Sub-Consultant at actual cost (unless stated as lump sum in

Annex 5 to this Schedule) up to maximum of PGK………….. for Operational Costs.

7.2. For the purposes of this Contract, Operational Costs means goods and services such as

office rent, outfitting, office furniture, computers, ground transport hire (taxis and vehicle

hire when travelling for business within and outside Jakarta), domestic flights and

transfers, and associated accommodation and per diem for long-term personnel when

away from their permanent base for management purposes, office supplies/stationary,

recurrent office costs (phone, fax, printers, papers, photocopier and software),

communications (excluding head office and international), promotional events, seminars

and activities, personnel training/professional development costs, counterpart support

costs, any equipment and utilities and office rent required by the Sub-Consultant for the

day-to-day administration of the Activity.

7.3. The Sub-Consultant will be reimbursed at cost (unless stated as lump sum in Annex 5 to

this Schedule) on a monthly basis in arrears for items identified as reimbursable detailed

in Annex 5 of this Schedule 3, within thirty (30) days of SMEC’s receipt of a correctly

rendered invoice. Reimbursement is subject to:

(a) Details of the items purchased or expenses incurred contained in a monthly

payment invoice; and

(b) Original receipts and invoices maintained to substantiate any claim.


7.4. The actual cost will be exclusive of any procurement costs, all profits, all overheads,

administration or management fee, or any other commercial margins/mark-up on the part

of the Contractor, as these costs are assumed to be covered by the Management Fee

detailed in Clause 3 above.

7.5. The Sub-Consultant may vary the sums assigned against individual line items within a

Category in Annex 5 to this Schedule 3, subject to SMEC approval. Such changes will not

require a contract amendment.

8. CLAIM FOR PAYMENT

8.1. The Sub-Consultant’s tax invoices must be submitted when due pursuant to this Schedule

in a form identifiable with the Services.

8.2. All tax invoices must include a certification by a Company director of the Sub-Consultant,

or their delegate:

(a) That the invoices has been correctly calculated; and

(b) That the Services included in it have been performed in accordance with the

Contract;

8.3. All claims for payment must be made out to the SMEC Representative.

ANNEX 1 – MANAGEMENT FEE MILESTONE PAYMETS

Milestone Deliverables; to a standard acceptable by SMEC %of MF Cost (PGK) Approval by Due date

Mobilisation payment 20% TSSP M&E Manager Commencement

1 Inception and evaluation plan accepted 20% TSSP M&E Manager

2 TSSP M&E Manager

3 TSSP M&E Manager

4 TSSP M&E Manager

TOTAL


ANNEX 2 – LONG TERM ADVISER COSTS - Not Applicable


ANNEX 3 – SHORT TERM ADVISER COSTS

Position Name Job Level and Professional

Discipline Category1

Number of Days

Input Payable Up

To

Daily fee

(PGK)

Upper

Limits

Payable

(PGK)

TOTAL

1 Not Applicable for national positions


ANNEX 4 – ADVISOR SUPPORT COSTS

LONG TERM ADVISER – Not Applicable

SHORT TERM ADVISER – Based on financial proposal

ANNEX 5 – OPERATIONAL COSTS

Description Unit cost Quantity Upper limits

Payable (PGK)

TOTAL


SCHEDULE 4 –MAIN CONTRACT

Main Contract

The following are clauses extracted from the Main Contract and are relevant in accordance with Clause

1.3 of this Agreement.

Notes:

This Schedule relates to the “Head Contract” entered into between SMEC International and the

Commonwealth of Australia for the implementation of the PNG-Australia Transport Sector Support

Program (TSSP).

For the purpose of this sub-consultancy agreement, personnel employed by the sub-consultant or its

lower tier sub-consultants or subcontractors will be taken to be within the definition of Contractor

Personnel.)

In this Schedule:

“the Contractor” refers to SMEC International.

“the Contract” refers to the Head Contract (Contract 68980)

In respect to Clause 52.2 (Early Notification) below, the following Clauses referred to therein are not

applicable to the Contract: Clause 9 (Performance Standards), Clause 10 (Warranties), Clause 11

(Conflict of Interest), Clause 30 (Security), Clause 32 (Confidentiality), and Clause 33 (Privacy).

PARTS 1 - 6 STANDARD CONTRACT CONDITIONS

1. DEFINITIONS

1.1 In this Contract:

Personnel means the Contractor’s officers, employees, agents, advisers, Contractors and

subcontractors (including their respective personnel), and includes Specified Personnel and

Associates.

6. CONTRACTOR OBLIGATIONS

6.1 The Contractor must:

(c) ensure the adequacy and lawfulness of any workers’ compensation insurance for its

Personnel, both in Australia, and in any relevant Country it operates in;

12. INSURANCES


12.1 The Contractor must arrange and maintain for the Term of the Contract unless otherwise

specified:

(a) Public Liability insurance with a limit of at least AUD20 million for each and every claim

which covers Loss of, or damage to, or Loss of Use of any real or personal property

and/or any personal injury to, illness or death of any person arising from the

performance of the Contract;

(b) Motor vehicle third party property damage insurance;

(c) Workers' Compensation insurance in accordance with Clause 6.1 (c) which:

(i) fully insures the Contractor for any amount it becomes liable to pay under any

statute relating to workers' or accident compensation or for employer's liability

at common law;

(ii) is effected in the Partner Country as well as every state or territory in Australia

where its Personnel normally reside or in which their contract of employment

was made; and

(iii) where possible at law, extends to indemnify DFAT as principal for DFAT's

liability to persons engaged by the Contractor.

(d) adequate property insurance covering any Contract Material, Supplies and the

reinstatement of any Data while in the care, custody or control of the Contractor for its

full replacement value;

(e) adequate Professional Indemnity insurance to cover the Contractor's obligations under

this Contract. The Contractor must maintain the necessary insurance each year until the

expiration of three (3) years after the full Term of the Contract or earlier termination of

the Contract;

(f) adequate medical and dental insurance for its Personnel who are engaged to operate

outside their country of permanent residence; and

(g) adequate insurance for medical evacuation and evacuation resulting from an insured

event for all its Personnel.

12.2 Where there is no workers compensation legislation in force in the Partner Country, the

Contractor should arrange adequate personal accident and illness insurance (accidental

death and weekly benefits) for any of its Personnel not otherwise covered for the Term of

the Contract.

12.3 The Contractor must, within fourteen (14) Business Days after a request by DFAT, provide

for any insurance policy: a certificate of currency, a list of exclusions; and the amount of

excess payable.

12.4 Where any policy is to be cancelled, or the level of cover reduced, the Contractor must give

DFAT at least fourteen (14) Business Days prior notice of the cancellation.

12.5 Neither the arrangement and maintenance of insurance nor any failure to arrange and

maintain such insurance shall in any way limit, reduce or otherwise affect any of the


obligations, responsibilities and liabilities of the Contractor under the other provisions of this

Contract or at law.

12.6 Failure by the Contractor to maintain all necessary insurances will entitle DFAT to terminate

this Contract immediately in accordance with Clause 53 (Termination for Breach).

12.7 In the event of an insurance claim any deductible or excess payable will be the responsibility

of the Contractor.

14. INDEMNITIES

14.1 The Contractor indemnifies DFAT (and its officers, employees, agents, and any relevant

Partner Country) against any Loss suffered or incurred (including personal injury, death

and legal costs and expenses on a solicitor/own client basis) and the cost of time and

resources arising from:

(a) a breach of the Contractor’s performance of this Contract;

(b) an infringement, or an alleged infringement, of the Intellectual Property Rights of any

person, which occurred by reason of the performance or use of the Services;

(c) an infringement or an alleged infringement of the provisions of the Privacy Act

1988(Cth), in connection with the Services;

(d) an investigation carried out by the Ombudsman which arises directly or indirectly, as a

result of, and/or due to conduct of the Contractor or its Personnel; and/or

(e) any act or omission involving fault on the Contractor’s or the Contractor Personnel’s

part in connection with this Contract.

14.2 The indemnity in this clause 14 is reduced to the extent that the Loss or liability is directly

cause by DFAT, its employees or contractors (except the Contractor) as substantiated by

the Contractor.

14.3 DFAT must take any reasonable action to mitigate any Loss arising out of clause 14.1.

15. BRANDING


(a) identify, and with prior DFAT approval, implement appropriate opportunities for

publicising the Project/Program (including signage at each Project/Program site that

acknowledges the funding of the Project/Program) in accordance with “DFAT Guidelines

for managing Contractors (or NGOs or multilateral agencies) on the use of logos and

other forms of acknowledgement” at all times;

(b) only use the Australian Government/DFAT crest logo with prior approval, (in-line

version or stacked version) in Australia or the Australian Aid identifier overseas to

denote association with Australia, the Australian Government or DFAT in any publicity

or other project related materials; and

(c) promptly remove Contractor signs at the completion of the Project/Program unless

otherwise instructed by DFAT.

16. PUBLICITY


16.1 The Contractor may not make media or other announcements or releases relating to this

Contract without DFAT’s prior written approval except to the extent that the

announcement or release is required to be made by law.

17. AGENCY

17.1 The Contractor, and its Personnel are not, will not be deemed to be and must not

represent themselves as being, by virtue of this Contract, an employee, partner or agent

of DFAT.

17.2 The Contractor acknowledges that it has no authority to bind DFAT without DFAT’s

specific consent.

25. INVESTIGATION BY THE OMBUDSMAN

25.1 In carrying out the Services, the Contractor, and an employee or sub-contractor of the

Contractor, may be a “Commonwealth service provider’ under Section 3BA of the

Ombudsman Act 1976 (Cth).

25.2 The Contractor must use its best endeavours, and must ensure that employees and sub-

contractors of the Contractor use their best endeavours, in undertaking the Services, not

to engage in conduct that:

(a) would, if the Contractor or an employee or sub-contractor were an officer of DFAT,

amount to a breach of duty or to misconduct; or

(b) should be brought to the attention of the principal officer of DFAT as defined in the

Ombudsman Act 1976 (Cth).

25.3 If the Commonwealth Ombudsman commences an investigation of conduct of the

Contractor, as a Commonwealth service provider, the Contractor, at the cost of the

Contractor, must cooperate with the investigator including:

(a) providing all documentation required by the investigator;

(b) making Contractor Personnel available to assist the investigator; and

(c) allowing the investigator, at any reasonable time of the day, to enter a place occupied

by the Contractor and carry on the investigation at that place.

25.4 If the Ombudsman brings evidence to the notice of DFAT concerning the conduct of the

Contractor, or of an employee or sub-contractor of the Contractor, the Contractor must,

at the cost of the Contractor, take whatever remedial action is required by DFAT or by

the Ombudsman to rectify the situation.

26. COUNTER-TERRORISM

26.1 The Contractor must ensure that funds provided under this Contract (whether through a

subcontract or not) do not provide direct or indirect support or resources to:

(a) organisations and/or individuals associated with terrorism, and

(b) organisations and individuals for whom Australia has imposed sanctions under: the

Charter of the United Nations Act 1945 (Cth) and regulations made under that Act; the

Autonomous Sanctions Act 2011 (Cth) and regulations made under that Act or the World

Bank List or a Relevant List.


27. FRAUD

27.1 The Contractor must not, and must ensure that Personnel do not, engage in any Fraud and

must prevent and detect Fraud, including Fraud by its Personnel.

27.2 Within one (1) month of the Start Date, the Contractor must conduct a Fraud risk

assessment and produce a Fraud control strategy in compliance with the Commonwealth

Fraud Control Guidelines available at www.ag.gov.au. The risk assessment and strategy must

contain appropriate fraud prevention, detection, investigation and reporting processes and

procedures.

27.3 The Contractor is responsible for preventing and detecting Fraud including Fraud within

those functions outsourced/performed by a subcontractor or under any other arrangement

established by the Contractor relating to the performance of this Contract.

27.4 The Contractor must ensure that Personnel are responsible and accountable to the

Contractor for preventing and reporting any Fraud as part of their routine responsibilities.

The Contractor must ensure that Personnel who are not employed by the Contractor report

Fraud to the Contractor within five (5) Business Days.

27.5 If the Contractor becomes aware of a Fraud, it must report the matter to DFAT in writing

within five (5) Business Days. The written report to DFAT must be signed by a Contractor

authorised person and must include the following (where known):

(a) the name of the Activity under which DFAT funding is being provided;

(b) name of any Personnel (including any subcontractors) involved;

(c) the allegation(s), including a chronological account of the facts giving rise to the

allegation(s);

(d) the names of the suspected offender(s) (where known);

(e) details of witnesses;

(f) copies of relevant documents;

(g) references to any relevant legislation;

(h) a nominated contact officer;

(i) any other relevant information (for example, political sensitivities, any other party or

agency that has been informed, involved or that can assist with investigations); and

(j) the current status of any inquiries commenced by the Contractor.

27.6 If a report has been made in accordance with Clause 27.5 above, the Contractor must

respond within five (5) Business Days to any further requests for information DFAT may make.

27.7 If the Contractor becomes aware of a Fraud, the Contractor must, in consultation with DFAT,

develop and implement a strategy to investigate the Fraud based on the principles set out in

the Australian Government Investigations Standards.

27.8 The Contractor must investigate any fraud at the Contractor’s cost and in accordance with

any directions or standards required by DFAT. Whether the Contractor conducts an

investigation or appoints an investigator to conduct an investigation, the person conducting

the investigation must possess the minimum qualifications specified in the Australian

Government Investigation Standards or an equivalent agreed to by DFAT.


27.9 DFAT reserves the right to appoint its own investigator, conduct its own investigation or

report Fraud to the appropriate law enforcement agencies or any other person or entity DFAT

deems appropriate in Australia or in the Relevant Country for investigation. If DFAT exercises

its rights under this Clause 27.9, the Contractor must provide all reasonable assistance that

may be required at its sole expense.

27.10 After the investigation is finished, if a suspected offender has been identified or at the

direction of the Director of DFAT Fraud Control Section, the Contractor must promptly report

the Fraud to the local police and any other appropriate law enforcement agency in the country

where the incident has occurred, unless the Director of DFAT Fraud Control Section agrees

otherwise in writing.

27.11 If the investigation finds the Contractor or Personnel have engaged in Fraud, the Contractor,

in consultation with DFAT, must:

(a) if DFAT funds have been misappropriated, pay to DFAT the full value of the

misappropriated funds; and

(b) if DFAT-funded property has been misappropriated, either return the property to DFAT

or, if the property cannot be recovered or has been damaged, replace the property with

property of equal or greater value or quality, or repair the property, at no cost to DFAT.

27.12 If the investigation finds that a person other than the Contractor or Personnel has engaged

in Fraud, the Contractor must, at the Contractor’s cost, take all reasonable action to recover

any DFAT funds or DFAT-funded property acquired or distributed through the Fraud, including

taking recovery action in accordance with recovery procedures (including civil litigation)

available in the Relevant Country.

27.13 The Contractor must keep DFAT informed, in writing, on a monthly basis, of the progress of

its efforts to recover the DFAT funds or DFAT-funded property, including any recovery action.

27.14 If the Contractor considers that all reasonable action has been taken to recover the DFAT

funds or DFAT-funded property and recovery has not been achieved or recovery has only been

achieved in part, the Contractor may seek approval from DFAT that no further recovery action

be taken.

27.15 If an investigation finds that the Contractor or Personnel have engaged in Fraud, or if DFAT

discovers that a Fraud has not been reported to DFAT in accordance with Clause 27.5, DFAT

reserves the right to:

(a) terminate this Contract by giving the Contractor notice in writing specifying the date on

which the termination will take effect; and

(b) not enter into any further agreements with the Contractor until such time as DFAT is

satisfied that any recommended changes to the Contractor’s management and

procedures have been made in order to prevent any further Fraud from occurring and to

ensure timely reporting of fraud to DFAT.

27.16 Without limitation to DFAT’s rights pursuant to Clauses 53 (Termination for Breach) and

27.15, if the Contractor fails to comply with its obligations under this Clause 27 with respect to

a Fraud, DFAT may give the Contractor a written notice which specifies:

(a) the obligation(s) with which the Contractor has not complied;


(b) the action that the Contractor must take to rectify the failure; and

(c) the date by which the Contractor must rectify the failure.

27.17 If the Contractor does not comply with a notice issued pursuant to Clause 27.16, DFAT

reserves the right to:

(a) terminate this Contract in accordance with Clause 53; and/or

(b) exercise its rights pursuant to Clause 27.8; and/or

(c) withhold payments (or parts of payments) due to the Contractor under this Contract until

the Contractor has complied with the notice.

27.18 This Clause 27 survives the termination or expiration of this Contract, including with respect

to any Fraud relating to the performance of this Contract, which is not detected until after this

Contract has been terminated or has expired.

28. ANTI - CORRUPTION

28.1 The Contractor warrants that neither it nor its Personnel will make or cause to be made,

receive or seek to receive any offer, gift or payment, or benefit of any kind, which could

be construed as an illegal or corrupt act, either directly or indirectly to any Party, in

relation to the execution of this Contract.

28.2 Any breach of this Clause 28 will entitle DFAT to issue a notice under Clause 53

(Termination for Breach) to terminate this Contract immediately.

29. COMPLIANCE WITH LAWS AND POLICIES

29.3 In performing any part of this Contract outside Australia, the Contractor and its Personnel

and Sub-Contractors must:

(a) not engage in any political activity in the relevant country during the provision of the

Goods and/or Services;

(b) observe all laws and respect all religions and customs of that country; and

(c) conduct themselves in a manner consistent with the Public Service Act 1999 (Cth)

(including the Australian Public Service Values and Employment Principles and Code of

Conduct).

36. PERFORMANCE ASSESSMENT

36.1 The Contractor acknowledges and agrees that DFAT may issue in relation to this Contract:

(a) a Contractor performance assessment;

(b) Adviser performance assessments;

(c) sub-contractor performance assessments; and

(d) sub-contractor key personnel performance assessments.

36.2 performance assessments will be substantially in accordance with the assessment sheet

in Schedule 11. Within 28 days of receiving a performance assessment from DFAT, the

Contractor must:


(a) sign and return to DFAT the Contractor Performance Assessment together with any

response; and

(b) ensure that all other performance assessments together with any response the sub-

contractor or any personnel wishes to include are signed and returned to DFAT.

36.3 Contractor must undertake Adviser, sub-contractor and sub-contractor personnel

assessments as required by DFAT.

36.4 The Contractor must insert clauses in any sub-contracts relating to the Contract that

require the sub-contractor to agree that:

(a) DFAT or the Contractor may issue:

a sub-contractor performance assessment; or

sub-contractor key personnel performance assessments,

in relation to the sub-contract;

(b) the performance assessments will be substantially in accordance with the assessment

sheet in Schedule 12; and

(c) the sub-contractor will sign and return the sub-contractor performance assessment

together with any response within 28 days of receipt and will ensure that sub-

contractor personnel performance assessments together with any response any

personnel wishes to include are signed and returned within 28 days of receipt.

38. SUBCONTRACTING

38.1 The Contractor may not sub-contract the provision of the whole of the Goods and/or

Services and must not enter into a subcontract relating to the provision of the Goods

and/or Services with a person who is or an entity which is listed on a World Bank List or

a Relevant List.

38.2 The Contractor must obtain DFAT’s prior written approval to sub-contract with any third

party, except Specified Personnel, to the value of AUD100,000 or more. In granting its

approval, DFAT may impose any conditions it considers appropriate.

38.3 Where DFAT objects to the Contractor’s preferred sub-contractor or DFAT nominates a

particular sub-contractor in place of the Contractor’s preferred sub-contractor, the

Contractor must enter into an agreement with the sub-contractor as directed by DFAT on

the basis of remuneration approved by DFAT and provide DFAT with a copy of the

executed sub-contract.

38.4 If the Contractor subcontracts its performance of any part of this Contract, the Contractor

will remain liable for the acts, defaults and omissions of the subcontractor as if they were

the Contractor’s acts, defaults and omissions.

38.5 Any subcontract entered into by the Contractor for the performance of any part of this

Contract must contain clauses:

(a) that authorise the Commonwealth to publish details of the name of the subcontractor

and the nature of the Services that the subcontractor is subcontracted to perform;


(b) under which the subcontractor assumes all the Contractor’s obligations (including all

obligations under Australian Law and development policies), and gives all the

warranties the Contractor gives, under this Contract to the extent they are relevant to

the Services the subcontractor is subcontracted to perform; and

(c) that give DFAT the right of substitution under Schedule 5 (Deed of Novation and

Substitution), to further novate the sub-contract to another contractor. The Contractor

entering into a subcontract for the provision of parts or elements of the performance

of the Services, or provision of the Goods, does not create any contractual relationship

between DFAT and the subcontractor.

41. ACCESS TO PREMISES AND RECORDS


(a) produce records, books and accounts for inspection by DFAT immediately upon request

(including where entering into a subcontract and executing a Deed of Novation and

Substitution) at the same time or within ten (10) Business Days of execution of the sub-

contract by the Contractor.

(b) permit each of DFAT, the Commonwealth Auditor-General and the Information Privacy

Commissioner or Privacy Commissioner as appropriate at reasonable times and on

reasonable notice, through their officers, agents or advisers authorised on their behalf,

to:

(i) access the Contractor’s premises;

examine, inspect, audit and copy any accounts and records relating to this Contract

or the Goods and/or Services;

provide all necessary facilities for this purpose; and

in the case of documents or records stored on a medium other than in writing, make

available to DFAT on request reasonable facilities necessary to enable a

legible reproduction to be created.

41.2 In the exercise of the rights under this Clause 41, DFAT must use reasonable endeavours

not to unreasonably interfere with the Contractor’s performance under the Contract in

any material respect.

42. AUDIT

42.1 DFAT has the inspection and audit rights described in Clause 41 (Access to Premises and

Records) and this Clause 42 and subject to these provisions, each Party is to bear its own

costs in relation to any audit.

42.2 DFAT or a representative of DFAT may conduct audits relevant to the performance and/or

compliance by the Contractor with any of its obligations under the Contract, including audits

of the Contractor’s relevant:


(a) operational practices and procedures;

(b) project and financial management governance;

(c) oversight practices and procedures;

(d) invoices and reports;

(e) Material (including records, books and accounts) in the possession of the Contractor;

and/or

(f) other matters determined by DFAT to be relevant to the performance of the

Contractor’s obligations under the Contract.

42.3 Where DFAT has reasonable concerns regarding the Contractor's financial management

systems, DFAT must provide the Contractor with written notification of those concerns

outlining the action to be undertaken by the Contractor. These actions include:

(a) a request that the Contractor’s Company Director provide a Statutory Declaration

confirming that he/she has sighted the necessary supporting documentation and

confirms the veracity of the claim for payment;

(b) the Contractor providing DFAT with additional documentation to support the claim for

payment; and/or

(c) a direction that the Contractor engage an independent, suitable organisation to

undertake an audit of those financial management systems, including its invoicing

procedures and practices, with a copy of the audit report to be provided to DFAT.

42.4 The Contractor must respond to any notice received under Clause 42.3 above within

fourteen (14) Business days.

42.5 DFAT reserves the right, at any time to direct the Contractor engage an independent audit

firm and to provide DFAT with a copy of the audit report from the independent auditor.

42.6 If DFAT directs the Contractor to undertake an independent audit it must do so at the

Contractor’s cost, and the Contractor must comply with any directions given by DFAT

regarding terms of reference or required auditing standards.

42.7 Where a direction has been made under Clause 42.6 above, DFAT will not make any further

payments owed to the Contractor pending certification of the reliability of the Contractor’s

financial management systems and the veracity of the invoicing procedures and practices.

42.8 This Clause 42 applies for the term of this Contract and for a period of seven (7) years from

the date of its expiration or termination.

42.9 The requirement for access and participation in audits does not in any way reduce the

Contractor’s responsibility to perform its obligations in accordance with this Contract.

48. TAXES

48.5 Except as provided by this Clause 48, all taxes, duties and charges imposed or levied in

Australia or in the Partner Country in connection with:

(a) the performance of this Contract (including any sub-contracts entered into for the

performance of the Services and the obtaining of any approvals, consents or

authorisations); and

(b) the sale, purchase, lease, assignment, licence or transfer of any property under this

Contract.


shall be borne by the Contractor or its sub-contractor(s) as the case requires.

52. EARLY NOTIFICATION

52.1 The Contractor must immediately notify DFAT if the Contractor (including Contractor

Personnel) or a sub-contractor is:

(a) listed on a World Bank List or on a Relevant List;

(b) subject to any proceedings or an informal process which could lead to listing on a World

Bank List or listing on a Relevant List;

(c) temporarily suspended from tendering for World Bank contracts by the World Bank,

pending the outcome of a sanctions process;

(d) temporarily suspended from tendering by a donor of development funding other than

the World Bank; and/or

(e) the subject of an investigation (whether formal or informal) by the World Bank or

another donor of development funding.

52.2 If the Contractor becomes aware of any issue that may affect its performance of the

Contract and in particular its compliance with any of the following clauses: Clause 9

(Performance Standards), Clause 10 (Warranties), Clause 11 (Conflict of Interest), Clause

12 (Insurances), Clause 26 (Counter-terrorism), Clause 27 (Fraud), Clause 28 (Anti-

Corruption), Clause 29 (Compliance with Laws and Policies), Clause 30 (Security), Clause

32 (Confidentiality), or Clause 33 (Privacy) and Clause 38 (Sub-contracting), (including the

use or disclosure of Sensitive, Personal or Confidential Information, or any Security

Incident that arises), it must inform DFAT immediately.

53. TERMINATION FOR BREACH

53.1 Failure by the Contractor to notify DFAT under Clause 52 (Early Notification) may result

in immediate termination for breach under this Clause 53.

53.2 In addition to the rights to terminate outlined in Clause 52 (Early Notification), DFAT may

terminate this Contract by notice to the Contractor in accordance with Clause 24

(Notices), if the Contractor or subcontractor, in any of the following circumstances:

(a) commits a material breach or breach which, in DFAT’s opinion, is not capable of remedy;

(b) commits a breach capable of being remedied by the Contractor but the Contractor fails

to remedy it within ten (10) Business days of receipt of a notice from DFAT specifying

the breach;

(c) commits a Persistent Breach under Clause 9 (Performance Standards);

(d) where the other Party is a company- if there is appointed or if steps are taken to appoint

a liquidator, receiver, manager, controller or an administrator over the whole or any

part of its affairs;

(e) where the other Party is an individual – if it enters into a scheme of arrangement with

its creditors, commits any act of bankruptcy or becomes bankrupt, or becomes

incapable of managing its own affairs;


(f) where the other Party has entered into this Contract in the capacity of trustee of a trust

– if any event occurs or any action or step is (or is proposed to be) taken, which limits,

restricts, or prevents it being indemnified out of the assets of that trust in respect of its

obligations and liabilities under this Contract;

(g) ceases to hold any licence, qualification, approval, authority or consent required for the

Contractor to comply with its obligations under this Contract (except to the extent that

this is outside the Contractor’s reasonable control);

(h) made a statement or warranty in its Tender or failed to make a disclosure in its Tender

Declaration leading to this Contract and DFAT is satisfied on reasonable grounds that

the statement was materially inaccurate, incorrect or misleading or the failure to make

a disclosure would, in DFAT’s opinion not have led to the formation of a Contract;

(i) is convicted of any offence during the Term of this Contract;

(j) the Contractor, its Personnel or subcontractors are or become listed on a World Bank

or Relevant List or are subject to an informal process that may lead to them becoming

so listed; and/or

(k) does not take appropriate steps to manage and resolve an allegation of child

exploitation or abuse with respect to this Contract, including a failure to inform DFAT

immediately of any allegation of child abuse or exploitation in accordance with DFAT’s

Child Protection Policy.


PART 7 - PROJECT SPECIFIC CONDITIONS

Schedule of Requirements:

(9.10 j) where sub-contracting conditions (refer to Clause 38 of Part 3 (Subcontracting) allow,

the Contractor must actively look at opportunities for Papua New Guinean sub-contractors.

(10.2 i) The Contractor must ensure that all safeguards and cross-cutting issues are effectively

implemented on all DFAT-funded Civil Works contracts or sub-contracts;

68. CONSTRUCTION SERVICES AND USE OF APPROPRIATE BUILDING MATERIALS

68.1 The Contractor must engage specialist construction sub-contractors to undertake all

Construction Work. However, the engagement of Construction sub-contractors shall not

relieve the Contractor from any liability for the performance of this Contract in accordance

with Clause 38 (Sub-contracting).

68.2 The Contractor must ensure that all construction design work is carried out:

(a) in accordance with and so as to comply with any design brief or functionality

requirements notified by DFAT;

(b) to a high standard of skill, care and diligence expected of a design professional; and

(c) to ensure that the design work is fit for its intended purpose.

68.3 The Contractor must ensure that all Construction Work is carried out:

(a) in accordance with DFAT approved plans and specifications;

(b) so that it is fit for its intended purpose;

(c) using good workmanship and, unless otherwise approved or specified, new materials;

(d) employing competent and appropriately qualified personnel; and

(e) in a manner which clearly seeks to achieve the aims of the Project.

68.4 When engaging a construction sub-contractor, the Contractor must undertake a competitive

tendering process that complies with the Commonwealth Procurement Rules (‘CPRs’) and

the Public Governance Performance and Accountability Act (‘PGPA Act’) and DFAT's policy

on applying Division 2 of the CPRs and the PGPA Rules.

68.5 If DFAT reasonably considers that the Contractor has not adhered to appropriate processes

or policies with respect to advertising for, or the evaluation of, tenders, DFAT may require

the Contractor to cancel the tender selection process. In such circumstances the Contractor

may be required to repeat the competitive tender process at no additional cost to DFAT.


68.6 The Contractor warrants that it will exercise a duty of care and good faith to DFAT in

performing its obligations under this Contract including the preparation of all tender

documentation and the administration of any construction sub-contract, including ensuring

that such sub-contracts allow for the correction of any Construction Defects.

68.7 The Contractor must ensure, and provide certification in reports that any timber or other

building materials used in any way for the Project has been sustainably harvested, or sourced

from recycled building materials, and are not made of and do not contain any asbestos

68.8 In the event that Supplies or building materials provided or used in any way by the

Contractor for the Project/Program do not comply with the requirements of this Clause 68

the Contractor must remedy this defect at the Contractor’s own cost.

75. PROVISION OF SERVICES

75.2 The Contractor represents and warrants that:

(a) it and the Contractor Personnel have the necessary experience, skill, knowledge,

expertise and competence to perform the Services;

(b) the Services will be fit for purpose;

(c) the Services will be complete, accurate and free from material faults;

(d) any materials that the Contractor incorporated in the Services are free from defects

in design, performance and workmanship; and

75.3 all work performed under this Contract will be carried out and completed in a proper and

workmanlike manner and in the most cost-effective manner and using materials suitable for

the purpose.

75.4 Without limiting its other obligations and liabilities under this Contract, the Contractor must

remedy at its cost any failure to comply with its obligations to perform the Services in

accordance with this Contract as soon as practicable after becoming aware of the failure.

75.5 The Parties recognise that the performance of the Services may be affected by changes to

relevant policy in the Partner Country, and that some flexibility in the performance of the

Services shall be required.


SCHEDULE 5 – SPECIAL CONDITIONS

1. The Sub-Consultant must comply with the following SMEC policies, procedures and plans:

• the SMEC security plan;

• the plans implemented by SMEC for compliance with DFAT policies

2. The Sub-Consultant must comply with relevant and applicable laws, regulations and

development policies, including DFAT’s Child protection policy ( http://dfat.gov.au/about-

us/publications/Pages/child-protection-policy.aspx ), both in Australia and in the Partner

Country, and also Family Planning and the Aid Program: Guiding Principles (May 2015),

accessible on DFAT’s website ( http://dfat.gov.au/about-us/publications/Pages/family-

planning-and-the-aid-program-guiding-principles.aspx ) as amended or updated from time

to time.

3. The Sub-Consultant must be insured to at least the minimum of their statutory obligations

and must carry all commercially prudent insurances for the activities to be undertaken as

part of the Services.

4. The Sub-Consultant must maintain up-to-date records of the names of all sub-contractors

engaged by the Sub-Consultant to perform part of the Services. If requested by SMEC the

Sub-Consultant must, within three (3) working days, provide to SMEC a copy of the records

of sub-contractors’ names, in the format specified by SMEC. The Sub-Consultant consents to

DFAT disclosing its name and the names of its sub-contractors to Commonwealth

governmental departments and agencies, Commonwealth Ministers and Parliamentary

Secretaries, and to the Commonwealth Parliament, including responding to requests for

information from Parliamentary committees or inquiries. This clause shall survive

termination or expiration of this Agreement.

5. Fraud

5.1 For the purpose of this clause, 'fraudulent activity' or 'fraud' means dishonestly obtaining a

benefit by deception or other means.

5.2 The Sub-Consultant and its sub-contractors must not engage in any fraudulent activity.

5.3 The Sub-Consultant is responsible for preventing and detecting fraud including fraud within

those functions outsourced / performed by a sub-contractor or under any other

arrangement established by the Sub-Consultant relating to the management or

administration of SMEC or DFAT provided funds. The Sub-Consultant is responsible for

ensuring that its staff and its subcontractors’ staff are responsible and accountable to the

Sub-Consultant for preventing and reporting any fraud or suspected fraud as part of their

routine responsibilities.

5.4 The Sub-Consultant must report in writing within 3 working days to SMEC any detected,

suspected, or attempted fraudulent activity involving SMEC or DFAT provided funds. The

report must provide where known:

(a) the name of any personnel or subcontractors involved;

(b) the allegation(s), including a chronological account of the facts giving rise to the

allegation(s);

(c) the names of the suspected offender(s) (where known);

(d) details of witnesses;


(e) copies of relevant documents;

(f) references to any relevant legislation;

(g) a nominated contact officer;

(h) any other relevant information (eg, political sensitivities, any other party or agency

that has been informed, involved or that can assist with investigations); and

(i) the current status of any inquiries commenced by the Sub-Consultant.

5.5 The Sub-Consultant must at its cost cooperate, and ensure that its personnel cooperates, in

the implementation by DFAT or SMEC of any process or strategy to investigate the detected,

suspected or attempted fraud including providing all assistance requested by DFAT or SMEC.

5.6 Following the conclusion of an investigation, where the investigation finds the Sub-

Consultant, an employee of the Sub-Consultant or a subcontractor of the Sub-Consultant has

acted in a fraudulent manner, the Sub-Consultant shall:

(a) where money has been misappropriated, pay to SMEC or DFAT or the project the full

value of the funds that have been misappropriated; or

(b) where an item of property has been misappropriated, either return the item to

SMEC or DFAT or the project or if the item cannot be recovered or has been

damaged so that it is no longer usable, replace the item with one of equal quality.

5.7 Following the conclusion of an investigation, where the investigation finds that a party other

than the Sub-Consultant, an employee of the Sub-Consultant or a subcontractor of the Sub-

Consultant, has acted in a fraudulent manner, the Sub-Consultant shall at its cost make

every effort to recover any SMEC or DFAT funds or funded property acquired or distributed

through fraudulent activity, including without limitation, taking recovery action in

accordance with recovery procedures, including civil litigation, available in Indonesia. The

Sub-Consultant must consult with SMEC before commencing recovery action, including as to

the projected costs of the action and the prospect of SMEC seeking for DFAT to agree to

meet some or all of those costs.

5.8 The Sub-Consultant must keep SMEC informed, in writing, on a monthly basis, of the

progress of the recovery action.

5.9 If the Sub-Consultant considers that after all reasonable action has been taken to recover

the funds or funded property and full recovery has not been achieved or recovery has only

been achieved in part, the Sub-Consultant may seek approval from SMEC that no further

recovery action be taken. The Sub-Consultant must provide to SMEC all information, records

and documents required by SMEC or DFAT to enable the SMEC or DFAT delegate to make a

decision on whether to approve non-recovery of funds or funded property.

5.10 In the event that any investigation finds that the contractor, an employee of the Sub-

Consultant or a subcontractor of the Sub-Consultant has been involved in any fraudulent

activity, or in the event that SMEC discovers that a suspected, attempted or detected fraud

has not been reported to SMEC, SMEC reserves the right to terminate this Agreement, in

which event SMEC not be liable to the Sub-Consultant for any claim, demand, proceeding

suit or action by the Sub-Consultant.

5.11 Special Conditions 5.5 to 5.9 shall survive termination or expiry of this Agreement.

6. The Sub-Consultant must ensure that sub-contracts include equivalent provisions regarding

the Sub-Consultant’s relevant obligations under this Agreement including in particular clause


15, Special Conditions 1 to 5 and the provisions set out in clauses 15, 16, 17 and 27 of

Schedule 4.

7. The Sub-Consultant must provide to SMEC an executed Deed of Novation and Substitution in

the form annexed to this Agreement. The Sub-Consultant agrees that DFAT may issue a

notice of substitution under the Deed of Novation and Substitution to further novate the

sub-contract to another contractor.

8. The Sub-consultant may not sub-contract the whole of the Services. The sub-contracting of

parts or elements of the performance of the Services is subject to compliance with the

following requirements:

(a) the Sub-consultant must ensure the sub-contracts include equivalent provisions

regarding the Contractor’s relevant obligations under this Contract. In particular sub-

contractors must:

(i) be bound by appropriate obligations in relation to ongoing software licensing,

commuter maintenance requirements and handover arrangements to the Partner

Country.

9. Ethics

9.1 The Sub-consultant is aware of the provisions of the Joint Statement on Zero Tolerance to

Fraud in Australia’s Aid Program in Papua New Guinea. In support of these provisions the

Sub-consultant will observe the highest standard of ethics during the execution of the

Agreement, and

(a) will promptly bring to the Client’s attention any suspected or actual incidence of corrupt,

fraudulent, collusive or coercive practice in the awarding or execution of the Agreement;

(b) will carry out, at its own cost, a thorough investigation of any suspected or actual fraud

related to the awarding or execution of the Agreement; and

(c) will permit the Client, upon reasonable notice, to inspect its accounts and records and

other documents relating to the submission of proposals and Agreement performance,

and have them audited by the auditors appointed by the Client or the Agency.

9.2 The Sub-consultant is aware of the provisions of the Government of Papua New Guinea

Public Service Code of Conduct and will immediately report to the Recipient and the Client

any breach of the code on the part of the Recipient’s staff or others.

9.3 The Sub-consultant must immediately notify the Client if the Sub-consultant (including Sub-

consultant personnel) or a sub-contractor is:

(a) listed on a World Bank List or on a Relevant List;

(b) subject to any proceedings or an informal process which could lead to listing on a

(c) World Bank List or a Relevant List

(d) temporarily suspended from tendering by a donor of development funding other than

the World Bank; or

(e) the subject of an investigation (whether formal or informal) by the World Bank or

another donor of development funding.

For the purpose of this clause:

“World Bank List” means a list of organisations maintained by the World Bank in its “Listing if

Ineligible Firms” or “Listing of Firms, Letters of Reprimand” or “Debarred and Cross-Debarred


Firms and Individuals” or any similar list posted at:

http://web.worldbank.org/external/default/main?theSitePK=84266&contentMDK=6406984

4&menuPK=116730&pagePK=64148989&piPK=64148984 or any other address on the World

Bank website.

“Relevant List” means any similar list to the World Bank List maintained by any other donor

of development funding.


SCHEDULE 6 – DEED OF NOVATION AND SUBSTITUTION

This DEED OF NOVATION AND SUBSTITUTION made the day of 201_.

BETWEEN:

XXX of

AND:

[ ABN of ] (the “Subcontractor”) of the second

part;

AND:

SMEC International Pty Ltd, Suite 2, Level 1, 243 Northbourne Avenue Lyneham ACT 2602 (the

“Contractor”) of the third part.

WHEREAS:

A. DFAT is concerned to ensure that the Services under the Contract are properly delivered.

B. The Subcontractor is a subcontractor to the Contractor for the Services.

C. The Subcontractor and Contractor have agreed with DFAT to novate the Subcontract to XXX

in the event that DFAT exercises its right under Clause 38 (Subcontracting) and 37 (Specified

Personnel) of the Contract.

D. The Subcontractor agrees that DFAT may novate the Subcontract to another Contractor at its

sole and absolute discretion in the event that DFAT has exercised its right under Clause 38 and

Clause 37 of the Contract.

NOW THIS DEED WITNESSES AS FOLLOWS:

1. DEFINITIONS

“Business Day” means a day on which trading banks are open for business in Canberra;

“Commencement Date” has the same meaning as in the Contract;

“Contract” means the Contract for the provision of Services between DFAT and the

Contractor dated on or about 20 November, 2014, as subsequently amended;

“Deed” means this Deed of Novation;

“Services” means the services to be provided by the Contractor to DFAT under the Contract;

“Party” means DFAT, the Subcontractor or the Contractor;


“Subcontract” means the contract between the Contractor and the Subcontractor for the

provision of the Subcontractor Services; and

“Subcontractor Services” means the services that the Subcontractor is obliged to provide to

the Contractor under the Subcontract.

2. APPLICATION OF DEED DEFINITIONS

2.1 The Contractor and the Subcontractor agree that:

(a) this Deed is entered into for the benefit of DFAT; and

(b) DFAT may exercise the rights granted to it under this Deed.

2.2 This Deed commences on the Commencement Date of the Subcontract.

3. NOVATION

3.1 DFAT may issue a notice of substitution to the Subcontractor if DFAT is entitled to exercise

its rights under Clause 38 (Subcontracting) and Clause 37 (Specified Personnel) of the

Contract.

3.2 The Parties agree that on and from the date of issue of a notice of substitution:

(a) DFAT is substituted for the Contractor under the Subcontract in respect of the

Subcontractor Services as if DFAT was originally the Party to the Subcontract instead

of the Contractor, and all references in the Subcontract to the Contractor are to be

read and construed as if they were references to DFAT;

(b) DFAT is to pay any amount due to the Subcontractor under the Subcontract to the

Subcontractor and the receipt of the Subcontractor shall be full and sufficient

discharge for any such payments;

(c) subject to paragraph (a), DFAT is bound by, and must fulfil, comply with and observe

all the provisions of the Subcontract and enjoys all the rights and benefits of the

Contractor under the Subcontract; and

(d) the performance by the Subcontractor of services under the Subcontract, is instead

of, and not in addition to, any performance by the Contractor of its obligations under

that Subcontract.

3.3 If DFAT exercises its rights of novation under this deed, DFAT may further novate the

Subcontract by substituting a new contractor in place of the Contractor on the terms of this

deed with appropriate alterations. In the event of such novation, the rights and obligations of

the Subcontractor with respect to the Contractor shall become the rights and obligations of

the Subcontractor with respect to the new contractor.


4. RELEASE

4.1 Except in relation to payment due from the Contractor to the Subcontractor under the

Subcontract but unpaid on the date of issuing of the notice of substitution referred to in Clause

3 of this Schedule, the Contractor releases and discharges DFAT from any and all claims,

actions, proceedings, obligations and liabilities (whether based in negligence or any other

form of legal liability) in respect of or in any way arising from the Subcontract prior to the date

of the notice of substitution in respect of the Subcontractor Services.

5. FURTHER ASSURANCES

5.1 Each Party must take such steps, execute all such documents, and do all such acts and things

as may be reasonably required by the other Party to give effect to any of the transactions

contemplated by this Deed.

6. DISCHARGE

6.1 Neither the Subcontractor nor the Contractor are discharged or released or excused from this

Deed by an arrangement made between the Contractor and the Subcontractor prior to the

issue of a notice of substitution with, by any change to the Subcontract, or by any forbearance

whether as to payment, time or otherwise.

6.2 The Contractor undertakes to notify DFAT of any alterations to the Subcontract or other

matter referred to in Clause 3 of this Schedule. A failure of the Contractor to notify DFAT under

this clause does not alter the Subcontractor’s obligations under this Deed.

6.3 This Deed by the Subcontractor for DFAT to assume the obligations of the Contractor is

discharged in relation to the Subcontract only on completion by the Subcontractor of all its

obligations under the Subcontract in respect of the Subcontractor Services, or, in the event of

the issue of a notice of substitution, on the due and proper performance of the Subcontract

by the Subcontractor.

6.4 The obligations of DFAT under this Deed in its application to the Subcontract must not exceed

the obligations of the Contractor under the Subcontract.

7. NOTICES

7.1 A notice required or permitted to be given by one Party to another under this Deed must be

in writing and is treated as being duly given and received:

(a) when delivered (if left at that Party’s address);

(b) on the third Business Day after posting (if sent by pre-paid mail); or

(c) on the Business Day of transmission (if given by facsimile and sent to the facsimile

receiver number of that Party and the facsimile machine provides an affirmation of a

successful transmission).


Address of Party

7.2 For the purposes of this clause, the address of a Party is the address set out below or

another address of which that Party may from time to time give notice to each other Party:

DFAT

To: Department of Foreign Affairs and Trade

Attention: Country Program Manager – PNG TSSP2

Address: RG Casey Building

John McEwan Crescent

Barton ACT 0221

AUSTRALIA

Facsimile:

Contractor

To: SMEC International Pty Limited

Attention: General Manager, Urban and Social Development Group

Address: Suite 2, Level 1, 243 Northbourne Avenue

Lyneham ACT 2602

Facsimile: +61 2 6234 1966

Subcontractor

To:

Attention:

Address:

Facsimile:

8. LAWS

8.1 This Deed is subject to and construed in accordance with the laws in force in the Australian

Capital Territory.

9. WARRANTY

9.1 The Subcontractor and the Contractor each warrant and represent to DFAT that at all times:

(a) the execution and delivery of this Deed has been properly authorised by all necessary

corporate action of the Subcontractor and the Contractor respectively;


(b) the Subcontractor and the Contractor respectively each has full corporate power and

lawful authority to execute and deliver this Deed and to consummate and perform or

caused to be performed its obligations under this Deed;

(c) this Deed constitutes a legal, valid and binding obligation of the Subcontractor and

the Contractor respectively, enforceable in accordance with its terms by appropriate

legal remedy; and

(d) to the best of each of the Subcontractor’s or the Contractor’s knowledge, there are

no actions, claims, proceedings or investigations pending or threatened against or by

the Subcontractor or the Contractor respectively that may have a material effect on

the ability of the Subcontractor or the Contractor respectively to perform its

obligations under this Deed.

10. GENERAL

Counterparts

10.1 This Deed may be executed up to three (3) counterparts and all of those counterparts taken

together constitute one and the same instrument.

Attorneys

10.2 Where this Deed is executed on behalf of a Party by an attorney, that attorney by executing

declares that the attorney has no notice of the revocation of the power of attorney under

the authority of which the attorney executes this Deed on behalf of that Party.

Further Assurance

10.3 Each Party must do, sign, execute and deliver and must procure that each of its employees

and agents does, signs, executes and delivers all deeds, documents, instruments and acts

reasonably required of it or them by notice from another Party effectively to carry out and

give full effect to this Deed and the rights and obligations of the Party under it.

Assignment

10.4 No Party may assign or transfer any of its rights or obligations under this Deed without the

prior consent in writing of the other Parties. DFAT may withhold its consent in its absolute

discretion.

EXECUTED as a Deed.

SIGNED, for and on behalf of the

COMMONWEALTH OF AUSTRALIA in

the presence of:

)

)

)

……………………………………..

Signature


……………………………………..

Signature of witness

……………………………………..

Name of witness

(Print)

SIGNED for and on behalf of

[Subcontractor] by:

)

)

)

……………………………………..

Director

Name of Director

(Print)

……………………………………..

Director/Secretary

Name of Director/Secretary

(Print)

SIGNED for and on behalf of

[Contractor] by:

)

)

)

……………………………………..

Director

Name of Director

(Print)

……………………………………..

Director/Secretary

Name of Director/Secretary

(Print)


SCHEDULE 7 – TECHNICAL PROPOSAL


APPENDIX 1 SMEC GROUP’S CODE OF CONDUCT


APPENDIX 2 SMEC GROUP’S BUSINESS INTEGRITY POLICY

Documents

SUB-CONSULTANCY AGREEMENT - pngtssp.com · Sub-Consultancy Agreement Page 2 written authority to act on behalf of the Sub-Consultant for all purposes in connection with this Agreement