Nandlall signals overhaul of Guyana’s outdated contract system

Guyana’s existing contract framework, seen as outdated, poorly enforced and structurally weak, is no longer fit for purpose, Attorney General Anil Nandlall has said.

Speaking at the close of an International Federation of Consulting Engineers FIDIC-focused workshop at the Grand Coastal Hotel on Thursday, Nandlall said key elements of the State’s contracting regime, particularly non-FIDIC agreements, are decades old and increasingly ineffective in a modern, high-stakes development environment.

“We are using models that are going on to three decades,” he said.

He highlighted a pattern of structural deficiencies that he suggested are actively weakening the State’s ability to protect its interests.

Among the most serious failures is the collapse in effectiveness of financial safeguards, notably performance bonds and guarantees which are supposed to secure compliance and protect public funds.

“These instruments… have lost their commercial and financial efficacy,” Nandlall said.

Instead of functioning as powerful enforcement tools, they have become difficult to activate and unreliable in practice, leaving the State exposed. Compounding the issue, he acknowledged that government agencies themselves have contributed to the problem by allowing such instruments to lapse during the life of contracts.

“That must change,” he stressed.

The Attorney General also highlighted weaknesses in contract monitoring and supervision, particularly the role of engineers and consultants tasked with ensuring compliance.

While these actors are bound by contractual duties and professional standards, Nandlall argued that the system has not been extracting sufficient accountability.

“We have to exact a greater degree of responsibility, transparency and accountability,” he said.

Equally troubling is the limited effectiveness of contractual remedies.

Nandlall pointed to caps on liquidated damages and other constraints that may blunt the State’s ability to penalize breaches meaningfully. In their current form, he suggested, these provisions lack the strength to deter non-performance or delays.

One of the most pointed criticisms was directed at strict notice requirements embedded in contracts.

These provisions, he explained, can result in the State losing its right to pursue legitimate claims simply because of administrative delays or failures.

“I must lose my right to recover a lawful remedy… because an officer failed to serve a notice in time?” he asked.

Describing such outcomes as unjust and counterproductive, he called for a rebalancing of these clauses to prevent technicalities from overriding substantive rights.

In response to these failures, the government has launched a parallel review of both FIDIC and non-FIDIC contracts.

While FIDIC contracts dominate large, externally financed projects, Nandlall emphasized that the bulk of government work relies on locally funded, non-FIDIC agreements.

The aim is to develop updated model contracts, strengthen enforcement mechanisms, and create a more robust legal and administrative framework capable of supporting Guyana’s rapid transformation.

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