THE NEGOTIATIONS WITH THE BAMCO CONSORTIUM ARE RESUMED

This morning the BAMCO Consortium temporarily stopped all works under the contract, moreover, they failed to meet their contractual obligation to mitigate damages: they suspended operations in the manner that hampers the progress of other contractors.

Tunnel construction was suspended weeks ago, since the Consortium failed to apply in time for the construction license for the crossover tunnel at Gellért Square. In addition to this, the company is involved in the construction of the TBM launching shaft at Etele Square and several ventilation tunnels. Negotiations are underway, but DBR shares the view that BAMCO tends to dramatize to the current situation, which is not the first case in the international practice of the contractor. The employer considers the legal options available, but no unjustified claims will be fulfilled despite the stand-down.
It is the well-known fact that the contractor submitted in the past eighteen months approximately 150 claims for the reimbursement of excess expenses amounting to roughly HUF 37 billion, whereas the claims of other, nearly 20 contractors come to the fraction of this sum. The employer has examined these claims of which around 25 amounting to approximately HUF 1.6 billion proved realistic and legitimate. Whilst the payment of these claims is in progress, others are either being processed or rejected as entirely unrealistic. Otherwise the total worth of the contract of the Consortium including all works is HUF 44 billion.
Despite the unceasing threats and the temporary stand-down the Employer will only accept legitimate and justified claims.
The DBR Metro Project Directorate regrets that the BAMCO Consortium elected arbitrary stand-down, since the contractor still had the chance to settle the dispute in an amicable manner, at the arbitration court. The negotiations are carried on; for the time being the project completion deadline is not jeopardized by the current stand-down due to the delay in the completion of the platform tunnel of the Fővám Square station; yet the Employer wishes to clarify the current situation as soon as possible. According to the position of the DBR the Consortium shall take full material and legal responsibility for the dramatized measure taken qualifying eventually as breach of the contract, including any and all damages ensuing from such breach. DBR will make public the results of negotiations.
At all other sites including all stations, the Etele Square metro station outside the TBM launching shaft and the components of the Gellért Square station built by contractors other than BAMCO construction works advance as scheduled; the stand-down is restricted to the minor portion of metro construction.
DBR Metro Project Directorate