The Project Alliance Agreement is used for complex infrastructure and construction projects in Malaysia where traditional contracting approaches may not be optimal. This agreement type is particularly suitable when project success depends on close collaboration between multiple parties, innovation in delivery approaches, and aligned commercial interests. The document establishes a no-blame culture, shared risk-reward mechanism, and integrated decision-making processes while ensuring compliance with Malaysian legal requirements. It includes detailed provisions for alliance governance, commercial frameworks, and project execution methodologies, making it ideal for large-scale infrastructure projects, complex industrial developments, or public works requiring innovative delivery approaches.
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1. Parties: Identifies all alliance participants and their legal details
2. Background: Sets out the context of the project and formation of the alliance
3. Definitions and Interpretation: Defines key terms and interpretation rules for the agreement
4. Alliance Objectives and Principles: States the project goals and alliance behavioral principles
5. Formation and Operation of Alliance: Details the alliance structure and operational framework
6. Governance Structure: Defines the alliance leadership team, management team, and decision-making processes
7. Obligations of Participants: Sets out key responsibilities and commitments of each participant
8. Project Scope and Implementation: Describes the work to be performed and delivery methodology
9. Commercial Framework: Details the compensation model, including target cost and pain/gain share mechanisms
10. Performance Measurement: Defines KPIs and performance assessment methods
11. Risk and Insurance: Addresses shared risk approach and required insurance coverage
12. Intellectual Property: Covers ownership and licensing of project IP
13. Dispute Resolution: Sets out process for resolving issues within alliance principles
14. Term and Termination: Specifies duration, completion, and termination provisions
15. General Provisions: Includes standard legal provisions like notices, governing law, etc.
1. Interface Management: Required when project involves significant interfaces with other contractors or stakeholders
2. Community Engagement: Include for projects with significant public impact or stakeholder management requirements
3. Environmental Management: Required for projects with significant environmental impacts or requirements
4. Indigenous Peoples and Cultural Heritage: Include when project affects native lands or cultural sites
5. Innovation and Value Engineering: Optional section for projects emphasizing innovation
6. BIM and Digital Engineering: Include when project requires specific digital delivery requirements
7. Force Majeure: Optional detailed provisions for force majeure events
8. Parent Company Support: Include when parent company guarantees are required
1. Project Scope: Detailed description of works and deliverables
2. Site Details: Site information, access requirements and conditions
3. Target Cost Breakdown: Detailed cost elements and assumptions
4. KPI Framework: Detailed performance measures and calculations
5. Governance Procedures: Detailed procedures for alliance management
6. Commercial Framework Details: Detailed pain/gain calculations and commercial mechanisms
7. Form of Certificates: Template certificates required under the agreement
8. Insurance Requirements: Detailed insurance specifications and requirements
9. Project Program: Detailed project schedule and milestones
10. Roles and Responsibilities Matrix: Detailed allocation of responsibilities
11. Alliance Leadership Team Charter: Principles and procedures for alliance leadership
12. Quality Management Requirements: Quality standards and procedures
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