Article 7 Patent Infringement

7.1 The Licensor shall indemnify and hold harmless the Licensee in the event that any claim is made or any suit or other action is brought against the Licensee alleging infringement of one or more of Third Parties' Patents published until the Effective Date by reason of the Licensee's practice of the Process and the Know-how in the Plant or of the sale on the home market of the product produced in the Plant, provided the Licensee so notifies the Licensor promptly.

7.1.1 Indemnify shall mean that the Licensor shall reimburse in full to the Licensee any royalties, licence fee or damages paid to a third party as a result of a ruling of a competent court of law that Licensee's prac­tice of the Process and/or Know-how infringes the patent rights of the third party.

detailed engineering of the Plant... thousand US Dollars for each week of delay;

(2) if the Plant fails to demonstrate the Performance Guarantees in the last Performance Guarantee Test the Licensor shall pay the Licensee compensation in the form of penalties.

Article 4 Obligations of the Licensee

Provisions of Basic Design Data for the Plant

4.1 The Licensee shall provide and be responsible for the accuracy of Ba­ sic Design Data on which the design of the Plant is to be based. The Basic Design Data shall be transmitted to the Licensor and discussed at the First Basic Engineering Meeting.

Secrecy and Confidentiality

4.2 The Licensee shall treat all process and technical information, propri­ etary Know-how, patented processes, documents, data and drawings supplied by the Licensor as "Confidential Information" and shall not divulge such Confidential Information to a third party.

Article 6 Training of Licensee's Personnel

1. The Licensor shall arrange for the training of Licensee's personnel at one of the Licensor's plants. The training shall cover, but not be lim­ited to, plant operations, plant maintenance, material handling, qual­ity control. The Licensor shall ensure that the training shall be adequate to enable the Licensee's personnel to master the technology of the Process, the operation, maintenance and control of the Plant.

2. The cost of the Licensor's personnel supervising the training and train­ing fees are included in the lump sum fee payable to the Licensor.

3. The Licensor shall have the right at any time to require the immediate repatriation of any of Licensee's personnel found to be negligent and lacking in competence.

the latest commercially proven process новейший, коммерчески испытанный процесс

effective date дата вступления в си­лу (контракта)

life time of the plant продолжитель­ность эксплуатации завода

to dispose of the product зд. реали­зовать продукцию

preventive maintenance профилак­тический ремонт

process developments новшества, нововведения в процессе произ­водства

to use proprietary process develop­ments использовать запатенто­ванные новшества в процессе про­изводства

commission v ввести в эксплуата­цию, осуществить пуск объекта

penalty п штраф, штрафные санкции

accuracy of basic design data точ­ность исходных данных для проек­тирования

material handling обработка мате­риала

to master the technology освоить технологию

repatriate v отозвать, выслать

to be found negligent, lacking in competence характеризующийся нерадивостью и некомпетентностью

patent infringement нарушение па­тентных прав

indemnify v обезопасить

to hold harmless обеспечить патент­ную защиту

to make a claim on smb предъявить претензию

to bring suit against smb подать в суд

to allege infringement of a third party's patent необоснованно за­явить о нарушении патентных прав третьей стороны

to promptly notify smb of smth срочно известить, информировать кого-л.

to pay damages возмещать убытки

a ruling of a competent court of law постановление, решение компе­тентного суда

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UNIT 7 TURN-KEY CONSTRUCTION

A.

TEXT

The type of assistance to foreign countries in building industrial enter­prises and other projects where the Contractor undertakes full responsibil­ity for' the organization of the project construction and its commissioning is now referred to as turn-key construction.

The Contractor party undertakes to execute survey and design work, to work out the DPR, to prepare working drawings and supply equipment. The Contractor also sends specialists to the Customer's country to do part or full civil engineering works and carry out erection and starting-up and ad­justment operations. As a rule the Contractor supplies spare parts so that the project could normally operate² during the maintenance guarantee pe­riod.

Many developing countries that lack engineers, technicians and skilled labour have already signed a lot of contracts on such terms.

When carrying out turn-key construction, the Contractor engages local firms as sub-contractors to do a certain amount of civil work on the con­struction of projects. Upon completion of construction, the Contractor im­mediately hands over the projects to the Customers without any conditions attached that might infringe the rights of the client country to control and run the enterprise.

In keeping with the requirements of the time favourable possibilities are being opened today for construction of enterprises on a turn-key basis in Russia.

B.

September 29, 20... Dear Sirs,

In accordance with the Protocol of meetings and the talks between the organizations concerned, we wish to inform you that we are ready to give

you technical assistance in the construction of the project, your Govern­ment intends to build, and to execute the work on a turn-key basis.

In the performance of the above work we as Contractor undertake to provide all necessary materials, equipment, labour and services for the de­sign and construction of the project.

Upon completion of construction we will carry out starting-up and ad­justment operations and hand the project over to the Customer ready for commercial operation.

Our company shall extend to your company a credit at an annual inter­est rate of ... per cent which shall be repaid by equal annual installments beginning from the year following the year of utilization of the appropriate part of the credit.³

We are sending you our Draft Contract and hope to have your comments soon.

Yours faithfully,

С

DISCUSSING CONSTRUCTION PERIOD

Contractor: Well, Mr A., I've got good news for you. Our design organiza­tion has considered your request and is prepared to speed up the design work.

Customer: Glad to hear that, Mr P. And what about the period of construc­tion and erection works?

Contr.: We've looked into the matter and I think we could reduce it a bit if you deliver some equipment for the project.

Cust.: Oh, fine, that's just what we were going to suggest. We are very much interested in using local building materials and our own equip­ment.

Contr.: Very good, Mr A. That will certainly speed up the work and bring down the cost.

Cust.: You see, Mr P., as you undertake to do the construction work, we could recommend you a reliable sub-contractor.

Contr.: That would be excellent, Mr A. We'll try to hire as many local work­ers as possible. But we'd like to reserve the right to engage foreign sub­contractors as well.

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Cust.: Agreed. But, please, bear in mind that contracts with foreign sub

contractors should be governed by the laws of our country. Contr.: Yes, certainly, Mr A. Observance of laws is essential. So, as soon as

we know the names of our sub-contractors we'll return to the matter

and finalize the construction period. Cust.: Well, that seems fair, Mr P. Contr.: And I suppose, Mr A., you understand that we'll be able to do the

work in the stipulated time only on one condition: you should approve

the DPR, provide the site and finance the works without delay. Cust.: Oh, yes, Mr P., everything will be done on time, I can assure you.

But if you are delayed, we'll grant you an extension of the contractual

time to get the work completed.⁴ Contr.: Good.

D.

DISCUSSING ENGAGEMENT OF A CONSULTING COMPANY

Customer: Mr P., since we don't have qualified staff to supervise the work, we've engaged Wright and Sons as the Engineer on the site.

Contractor: Oh, we know the consulting company very well. It's good that they are going to represent you. We take it they'll be authorized to de­cide all matters that may arise, right?

Cust.: Yes, the Engineer will be acting within the limits of his powers en­tirely in compliance with the tender documents. One of his responsibili­ties will be to sign the progress reports as they come in. Without the Engineer's signature you won't get paid for the work done.

Contr.: That's fair. Are there any representatives of the Engineer here now?

Cust.: No, they are arriving towards the end of the week.

Contr.: I see. Then we'll have to put off the discussion of the construction and erection schedules as well as the utilities supply until they come.

Cust.: Could I stress also that the Engineer should have access to all the works he might wish to see.

Contr.: Certainly. The right should be granted to him. That's standard prac­tice. And especially to covered-up works like foundations, for example.

Cust.: Good. And there's one more thing, that's the contractor's obligation to pull down and re-do totally at his expense the work that will be found improper.

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Contr.: You may be sure that we'll do our best to perform the work and we hope you will like it.

E.

DISCUSSING FIRST AID AND MEDICAL SERVICES

Contractor: Speaking about first aid, may I remind you that our conclusion

was that all medical services at the site should be provided by us. Customer: That's right, Mr P. We like your idea of setting up a dispensary

at the site. It's good that you are going to equip it with modern medical

equipment and staff with a highly qualified doctor and nurses. Contr.: Thank you, Mr A. And have you talked over our request about your

assistance in providing medical treatment to our specialists? Cust.: Well, Mr P., we are keen to do our share, say hospitalize your people

when necessary. Contr.: And you will bear the cost involved, right? Cust.: I'm sorry to say no. This goes contrary to the provisions of the tender

documents. We'll cover the hospital bills and then invoice the sums on

you. Contr.: I see. We'll have to agree then. Cust.: Good. While we are on this "medical" subject, Mr P., you remember,

don't you, that all your specialists and their families must have medical

certificates on vaccinations and inoculations. Contr.: Thanks for reminding me. We know about such formalities and we'll

comply with them. Well, if that's all, let's call it a day. Cust.: O.K.

NOTES

1. where the Contractor under- при которой Подрядчик берет на takes full responsibility for... себя полную ответственность

за ...

2. so that the project could nor- с тем, чтобы объект нормально ра-mally operate ботал

3. beginning from the year fol- начиная с года, следующего за го-lowing the year of utilization дом использования соответ-of the appropriate part of the ствующей части кредита credit

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