In the field of public works, the compliance to time limits is not a mere formality but an essential condition for the exercise of a contractor’s legitimate rights. The Romanian Works Contract, governed by Government Decision no. 1/2018, was adopted with the declared aim of ensuring clarity and balance in the implementation of contracts financed by public funds. However, in practice, this contractual framework brings significant risks due to the express forfeiture deadlines embedded in the contract.
1. The Romanian Works Contract: Theoretical Balance, Practical Risks
The model contract established by GD no. 1/2018 is widely used in execution or design-build contracts financed from public funds. Although the intention is to prevent disputes and delays by imposing a clear and predictable framework, in reality, these contracts impose severe procedural discipline. In particular, the forfeiture deadlines for notifications, signatures, or claims act as legal traps for contractors who, without careful management of contractual obligations, risk substantial losses.
2. What Is Forfeiture and How Does It Work in Practice
From a legal perspective, forfeiture is a procedural sanction resulting in the loss of the right to act if a party fails to meet an obligation within a specified deadline. Under the Romanian Works Contract, forfeitures are expressly attached to deadlines concerning the submission of claims, commentary on documents, signing of addenda, and contestation of the Supervisor’s decisions. This mechanism is intended to maintain project momentum but exposes contractors to severe consequences if they are not vigilant.
3. Examples of Critical Forfeitures
Deadlines appear as early as the project initiation phase, such as in Sub-Clause 8.3, dealing with delays in the provision of documents by the Beneficiary. Failure to notify within the prescribed term results in the loss of the contractor’s right to additional time or costs. Similar situations arise in regard to site access (Sub-Clause 9.2), Site Diary entries (Sub-Clause 39.2), signature of addenda (Sub-Clause 37.3), and receipt of the Final Payment Certificate (Sub-Clause 51.2).
The most complex regulations concern the claim procedure. According to Sub-Clauses 69a.1 and 69a.2, failure to submit the Claim Notice or Detailed Claim within 30 days, or the lack of financial details or legal basis, leads to automatic rejection of the claim and forfeiture of the associated rights. In cases of ongoing events, documentation must be updated monthly; otherwise, contractors lose all related entitlements.
4. Conclusion: How Contractors Can Avoid Contractual Forfeiture
In a challenging legal and economic environment, contractors must treat the contractual calendar with utmost seriousness. Implementing internal monitoring protocols, designating a legal project coordinator, and thoroughly documenting every step are essential to avoid the loss of rights. The forfeitures analysed above are not mere formalities: they constitute firm legal limits, and procedural negligence translates quickly into substantial financial losses.
A detailed analysis of the provisions and risks related to forfeitures under the Romanian Works Contract (GD 1/2018) is available in the full article “Avoiding Pitfalls in the Romanian Works Contract (GD 1/2018): Frequent Forfeitures Affecting Contractors” authored by PhD. Eugen Sarbu, attorney-at-law and Mihai Ionescu-Balea, attorney-at-law, partners at Sarbu Partners.
For additional information or personalised legal assistance in the fields of construction law, commercial arbitration and public procurement, we invite you to contact the Sarbu Partners team at office@sarbupartners.ro.
