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Licence to build

Engineering consultants operate in a strictly regulated environment, given the importance of their work
Charles Schofield

In an age of increasingly complex construction projects, it is difficult to imagine any large project being undertaken without the assistance of engineering consultants. Engineering consultants may be responsible for preparing and signing off on technical designs, as well as tasks as diverse as determining the feasibility of a project, assessing and selecting suppliers, and managing the building process.

The projects, for which engineering consultants are engaged, range widely and include building construction, infrastructure development and oil and gas projects. With the current construction boom in Oman, there is a high level of demand for the services of well qualified engineering consultants.

Given the importance of their work, particularly where they are required to sign off on technical designs that may mean the difference between a safe or risky structure, it is no surprise that engineering consultants operate in a regulated environment. This article considers the regulatory framework applying to engineering consultants.

Engineering consultancy law
The Law Organising the Work of Engineering Consultancy Offices (Royal Decree 120 of 1994, The Law) governs engineering consultancy practices in Oman. Engineering consultancy offices cannot be operated in the sultanate unless a licence is obtained from the Ministry of Commerce and Industry, in accordance with the conditions and provisions set out in the law. The Law also establishes a special register at the Ministry of Commerce and Industry for registering engineering consultancy offices. The ministry is responsible for administering the licensing process.

A special committee is also established comprising senior members from various government bodies involved in construction projects. That committee decides on whether licences should be granted.

Obtaining a licence
The key criteria for obtaining an engineering consultancy licence are the qualifications and experience of the engineers who own and work in the business. The owner of the business, if an Omani national, should be the holder of, at least, a BSc degree in engineering or the equivalent. They must also have at least five years of experience after obtaining a BSc degree, or three years experience after obtaining a master's degree or a PhD in their field of speciality.

Foreign businesses looking to establish themselves in Oman as an engineering consu-ltancy practice must either be 35 per cent owned by an Omani national holding the above qualifications, or obtain special ministerial approval for 100 per cent foreign ownership. Such approval allows them to register as a local branch of the offshore parent company. Foreign businesses must also prove that they have at least ten years experience as engineering consultants in their home country. The process for obtaining a licence can be time consuming, as it involves a rigorous review of the applicant's qualifications and eligibility to hold the licence. Licences, once issued, must be renewed every three years.

Ongoing obligations
Licensed engineering consultants are required to adhere to all applicable professional rules and standards and otherwise meet appropriate technical standards in their work. They are also expressly prohibited from signing off on designs that may be unsafe and should only sign off on designs they have prepared.

Engineering consultancy offices are also required to keep full technical files relating to the progress of the phases of work supervised by them, as well as sketches and designs prepared for the project, including the contract signed with the client. All of these records must be retained for a period of not less than ten years after completion of a project.

The requirement to keep such extensive records for that lengthy period is, in part, due to the ongoing liability that engineering consultants have for their work. The owner of an enginee-ring consultancy office, which has designed or supervised the construction of a building or other installation, is jointly responsible with the builder for any defects in such an installation.

This liability continues for a period of ten years from the date of completion. The consu-ltant will still be liable even if the defect was due to the land on which the building is constructed, or if the owner had approved the construction of the defective installation.

If the office was commissioned to do only the design, excluding the supervision, then the owner of the engineering consultancy practice will be responsible only for defects arising from the design, and from defective supervision. This liability cannot be avoided by disclaiming liability in an engagement cont-ract. The law expressly declares null and void any condition in an engagement contract that seeks to avoid this liability.

As a measure of protection for engineering consultants, legal action to recover loss under the law must be commenced within three years from the date of discovery of the error that gives rise to the liability.

Disciplinary action
The law also establishes a disciplinary process for engineering consultants that may have breached the terms of their licence or standards of professional conduct. Complaints may be made to the director general of commerce or the director general may decide to initiate an investigation.

All matters must then be referred to a special disciplinary committee established to investigate and make findings on the conduct of the relevant engineering consultant. The disciplinary committee has three members under the chairmanship of the Under Secretary for Commerce and Industry. The other two members must be government engineers.

The committee can conduct hearings and call for the appearance of the engineering cons-ultant before it. If the committee finds the engineering consultant guilty of professional misconduct, it can penalise the consultant by one of the following:
i) A warning
ii) Suspension of licence for a period of not more than one year
iii) Cancellation of the licence

Any appeal from the findings of the committee must be made to the Minister of Commerce and Industry.

Engineering consultants play an extremely important role in the construction industry. Often their work can be critical in ensuring the success of a project and the safety of the buildings that we live and work in.

It is therefore not surprising to find that it is a regulated profession with a stringent liability regime and a dedicated disciplinary process. Regardless of this, the number of engineering consultants in Oman continues to grow piggybacking on a flourishing construction industry.

cracking the whip
An engineering consultant who breached the terms of his licence may:

  • Be issued a warning
  • Have licence suspended
  • Have licence cancelled

The author is solicitor, trowers & hamlins, muscat. Tel: +968 24 682923

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