Wednesday, October 12, 2016

Oman's New Engineering Consultancy Law

The  May  edition  of  the  Client  Alert  contained  a  comprehensive  discussion  on  the  procedural formalities that must be met in order to establish an Engineering Consultancy firm under the new Engineering Consultancy Law, entitled “Issuing the Law Regulating the Work of Engineering Consultancy Offices” (“Engineering Consultancy Law”) (Royal Decree 27/2016).  The primary focus of this  article  is  to  identify  key  features  that  have  been  introduced  by  the  legislature  in  the  new Engineering Consultancy Law.

Engineering consultants play a vital role in administering large-scale infrastructure projects.  Broadly speaking, the engineering consultant is responsible for providing both technical and administrative support needed to ensure that a construction project runs smoothly.

The scope of an engineering consultant’s responsibilities may be classified into two distinct categories, namely as a project’s administrative manager and as a project’s technical expert:

a)   Administrative manager:  In its capacity as administrative manager, the engineering consultant’s responsibility may include administering the tendering process, managing contractors and sub- contractors on behalf of a project owner, as well as reviewing and approving contractor’s variation requests.   In some instances, engineering consultants may also be tasked with reviewing any potential disputes that arise between contracting parties.

b)  Technical expert:  Engineering consultants are often called upon to provide technical, engineering and/or quantum expertise on a specific project.   In this regard, the scope of an engineering consultant’s responsibilities may include conducting and interpreting feasibility studies, such as soil and/or rock investigation, producing the detailed project design, and resolving any potential design related issues that may arise.

In light of the number of large-scale construction projects in Oman, engineering consultants, perhaps unbeknownst,   play   a   pivotal   role   in   the   Sultanate’s   long-term   economic   and   infrastructural development plans.  It is in this context that the Omani legislature considered it necessary to appraise and, ultimately, to modernize the Engineering Consultancy Law in Oman.

The new Engineering Consultancy Law – Royal Decree 27/2016

Until very recently, the primary legislation which regulated Engineering Consultancy profession was the Engineering Consultancy Law of 1994, promulgated by Royal Decree 120/1994 (“Previous Law”). However, on 22 May 2016, the Omani legislature issued a new, and more comprehensive, Engineering Consultancy Law, under Royal Decree 27/2016.   The Engineering Consultancy Law replaces the Previous Law, and thus provides a new and comprehensive framework to regulate the engineering consultancy profession.
The Engineering Consultancy Law in many ways resembles the Previous Law.   However, there are many new and noteworthy features in the new law, some of which we discuss below:

Credentials necessary to register an Engineering Consultancy Office

Significantly, Article 7 of the Engineering Consultancy Law has raised an applicant’s credentials required to establish an engineering consultancy office.

The legislature now draws an important distinction between an “Engineering Office” and an “Engineering ‘Consultancy’ Office” under the aforesaid Article 7.  In order to qualify to open an Engineering Consultancy Office, an applicant must first have a registered Engineering Office.  The applicant must also meet one of the following criteria: (i) gained a minimum of five years of specialized work experience after having obtained a BSC (Bachelors); (ii) gained three years of specialized work experience after having obtained an MSC (Masters); or (iii) gained two years of specialized work experience after having obtained a PhD in the same area of specialization.

However, as mentioned above, an applicant for an Engineering Consultancy Office must first have an established Engineering Office.  In order to establish an Engineering Office, Article 7 provides that the applicant must have either: (i) obtained at minimum three years of specialized work experience after having obtained a BSC (Bachelors); or (ii) gained one year of specialized work experience after having obtained a PhD in the same area of specialization.

The qualifications set out above are more stringent than what was provided under the Previous Law. Under Article 3(c) of the Previous Law, an applicant only needed to have either: (i) gained five years of specialized  work  experience;  (ii)  gained  three  years  of  specialized  work  experience  after  having obtained a BSC (Bachelors); or (iii) obtained a PhD in order to open an Engineering Consultancy Office.

Chapter 3 – “Working Engineer”

The Engineering Consultancy Law has introduced new provisions intended to elevate professional engineering standards under Chapter 3, Working Engineer.   For example, Article 17 restricts the right to sign off on key documents, including schemes, graphics, designs, specifications, project report samples, and supervision bonds, to only the licensee, and to engineers who: (i) are registered as authorized signatories with the MOCI; (ii) have met the requirements to obtain the professional degree from the authority; and (iii) work exclusively for the specific office.

Chapter 5 – Violations Committee

Chapter  5  of  the  new  Engineering  Consultancy  Law  has  introduced  a  formalized  Violations
Committee, to be chaired by the undersecretary of the MOCI.  Once formed, the Violations Committee will be comprised of four experienced engineers, with two of the four serving as representatives of the Omani Engineer’s Association, each for a five-year term.

The Violations Committee is to serve as a quasi-adjudicatory board, to consider any complaints and/or potential violations of the Engineering Consultancy Law.  The Violations Committee will be authorized to levy one of the following penalties: to issue warnings, to suspend a licence up to one year, or to cancel  a  licence  altogether.    Any  adverse  decisions  issued  by  the  Violations  Committee  may  be appealed to the Minister within 60 days from the date of the Violations Committee’s decision.

Chapter 6 – Penalties

Perhaps most notably, Article 29 of Chapter 6, Penalties, introduces criminal culpability for acts of “gross negligence,” or for having failed to “take necessary precaution which jeopardized the safety of the people or the properties or the environment” by an engineering consultant.  The Previous Law does expressly provide for criminal culpability for any violations of its provisions.

It is reasonable to assume that the legislature has included criminal penalties for gross misconduct, as perpetuation of its firm commitment to protecting those who may be unnecessarily placed in harm’s way due to any compromised or unsafe civil structures.