On World Bank-financed works, good claims are often lost not on their merits but on timing. A notice goes out on day 35 instead of day 28. A Notice of Dissatisfaction is served and then nobody refers the dispute to the DAAB. Or the parties finally agree the money a few weeks after the loan has closed, and the Employer discovers there is no budget line left to pay it.
The stakes are not small. HKA’s ninth annual CRUX Insight report, published in October 2026, analysed 2,410 projects across 122 countries worth a combined US$2.56 trillion. On those projects, claims averaged around two-thirds of the contract schedule and a third of the contract budget. Design failures featured on 40.5% of projects and scope change on 33.4%.
Most guidance on FIDIC claims focuses on one deadline: the 28-day notice. On a World Bank-financed contract, three clocks run at the same time. Contractors who watch only the first one take avoidable risk, and so do Employers and Engineers.
Why World Bank-financed contracts are different
Since July 2019, the World Bank’s Standard Procurement Documents for works have been based on the FIDIC 2017 suite rather than the older MDB Harmonised Edition (the “Pink Book”), as Construction Law International has reported. The Bank’s licence with FIDIC was renewed and expanded for a further five years, covering among others the Red and Yellow Books, Second Edition 2017, reprinted 2022 with amendments. FIDIC’s General Conditions are applied together with the Bank’s Particular Conditions, so the starting point is always the specific contract, not the FIDIC book on the shelf.
Three features matter for claims:
- The DAAB is not optional. The Bank states that a Dispute Avoidance/Adjudication Board is mandatory in all works contracts that apply its Standard Procurement Documents, with a one-member board allowed on smaller contracts for proportionality.
- The Particular Conditions change the General Conditions. Time limits, Engineer approvals and payment mechanics can all be amended. Read Part A (Contract Data) and Part B (Special Provisions) before relying on any default period quoted in this article.
- The Bank is not a party to your contract. It finances the Borrower under a separate financing agreement, and that agreement has its own dates. This is where the third clock comes from.
Clock 1: the Clause 20 claim clock
Under the FIDIC 2017 Red and Yellow Books, Clause 20 governs both Employer’s and Contractor’s claims for additional time or money. The default sequence is:
- Notice of Claim (Sub-Clause 20.2.1): as soon as practicable, and no later than 28 days after the claiming Party became aware, or should have become aware, of the event or circumstance.
- Engineer’s response (Sub-Clause 20.2.2): if the Engineer considers the notice late, it must say so by Notice within 14 days. If it does not, the Notice of Claim is deemed valid, although the other Party can still challenge this.
- Fully detailed Claim (Sub-Clause 20.2.4): within 84 days of awareness, or another period proposed by the claiming Party and agreed by the Engineer. If the statement of the contractual and/or other legal basis is not submitted in time, the Notice of Claim is deemed to have lapsed.
- Continuing effects (Sub-Clause 20.2.6): interim updates at monthly intervals, and a final fully detailed Claim within 28 days after the end of the effects.
Two practical points get missed. First, the clock starts at awareness, including the date you should have become aware. A site diary entry or a meeting minute can fix that date for you, whether you like it or not. Second, the Sub-Clause 20.2.5 review gives the Engineer room to consider whether a late submission should be accepted. Treat that as a safety net, not a strategy.
Clock 2: the determination and DAAB clock
Once the fully detailed Claim is in, the Engineer runs the agree-or-determine process under Sub-Clause 3.7. Under the default 2017 provisions, the Engineer has 42 days to consult the Parties and try to reach agreement, then a further 42 days to make a fair determination. If no determination is issued in time, the Claim is deemed rejected, and that opens the route to the DAAB.
From there the sequence tightens:
| Step | Default time limit (FIDIC 2017) | If you miss it |
|---|---|---|
| Notice of Dissatisfaction with the Engineer’s determination | 28 days after receiving the determination | The determination becomes final and binding |
| Referral of the dispute to the DAAB | 42 days after giving the Notice of Dissatisfaction | The Notice of Dissatisfaction lapses; the determination becomes final and binding |
| DAAB decision | 84 days after referral (or as agreed) | Delay, not loss of rights |
| Notice of Dissatisfaction with the DAAB decision | 28 days after receiving the decision | The DAAB decision becomes final and binding |
| Amicable settlement before arbitration | 28 days | Arbitration may then be commenced |
The 42-day referral limit is the one I would put in red on every claims register. Teams tend to treat the Notice of Dissatisfaction as the decisive act. It is only the first step. If the referral does not follow in time, the Notice lapses and the Engineer’s determination stands.
The DAAB is also more than an adjudicator. Under Sub-Clause 21.3 the Parties can jointly ask it to help with an issue informally, before it becomes a formal dispute. On a long contract with recurring issues, such as ground conditions, design approvals or access, early informal assistance is usually cheaper than a sequence of referrals.
Clock 3: the financing clock that rarely appears on a claims register
World Bank financing pays for eligible expenditures incurred on or before the loan or credit Closing Date. Under the Bank’s disbursement guidelines, the final date for disbursement applications, the Disbursement Deadline Date, may be the same as the Closing Date or up to four months after it. The applicable date for your project is set in the Disbursement and Financial Information Letter.
This does not change the contractual entitlement. A valid claim remains valid. What changes is where the money comes from. If a claim is agreed or decided after the Bank’s financing window has closed, the Employer may have to pay it from its own budget. In many borrowing countries that means a new budget approval, which can take far longer than the contract’s payment periods suggest. Extensions of the Closing Date are possible, but they are a decision for the Borrower and the Bank, not something a contractor can rely on.
For Employers, the same logic works in reverse. An unresolved claims portfolio in the last year of a loan is a funding risk, not only a contractual one. The Project Implementation Unit and the Engineer should be resolving claims while Bank financing is still available.
What contractors should do
- Keep an awareness log. Record the date each potential event first surfaced, with the document that shows it. This is the date the other side will use.
- Diarise every claim on all three clocks. The 28/84-day Clause 20 limits, the 28/42-day dissatisfaction and referral limits, and the loan Closing Date.
- Find the Closing Date on day one. It appears in the project documents, and the World Bank’s project pages usually show it publicly. Ask the Employer to confirm it, and ask again whenever the project is restructured.
- Submit the legal basis early. The Sub-Clause 20.2.4 lapse is triggered by the missing statement of contractual or legal basis, not by incomplete quantum. Lock the entitlement in first and refine the numbers through the interim updates.
- Use the DAAB for avoidance. Raise recurring issues informally under Sub-Clause 21.3 before they harden into formal disputes.
What Employers and Engineers should do
- Respond to late notices properly. If a Notice of Claim is out of time, say so by Notice within 14 days. Silence makes the notice valid.
- Determine on time. A deemed rejection is not a neutral outcome. It hands the Contractor a dispute and removes the chance of an agreed settlement.
- Map claims against the financing timeline. Report open claims and their likely value against the remaining financing window in every progress report.
- Keep the DAAB operational. A board that has visited site and knows the project can resolve issues far faster than one constituted in a hurry.
How to measure it
A claims process that works shows up in a few simple indicators:
- Percentage of Notices of Claim issued within 14 days of awareness (target: well above the contractual minimum).
- Average days from awareness to fully detailed Claim, against the 84-day limit.
- Number and value of open claims within 12 months of the Closing Date.
- Number of Notices of Dissatisfaction not referred to the DAAB within 42 days (target: zero).
The bottom line
On World Bank-financed works, FIDIC claims are won or lost on three timelines: the contract’s notice clock, the dispute clock and the financing clock. The first two decide whether you are entitled to be paid. The third decides, in practice, how and when payment happens. Manage all three from the first month of the contract, not the last.
If you are delivering, supervising or financing an MDB-funded contract and want an independent review of your claims register, notice strategy or DAAB position, get in touch at amirmehdi@amasghari.com.
This article is general information, not legal advice. Time limits and procedures depend on the Particular Conditions and governing law of each contract. Check your contract and take specific advice before acting.
Sources
- HKA, CRUX Insight Ninth Annual Report: Powering through Uncertainty (October 2026)
- FIDIC, World Bank renews agreement to use FIDIC standard contracts for a further five years
- IBA, Construction Law International: DAAB Update – The World Bank expands the role of the DAAB (June 2021)
- World Bank, Q&A: SEA/SH prevention procurement mechanism (DAAB requirement)
- World Bank, Disbursement Guidelines for Projects, 2006 edition, s. 3.6–3.7 (third-party hosted copy)