The conditions for revising and updating prices must be explicitly provided for in the initial contract.
Any revisable price contract must include:
(a) A single price revision formula applicable to all services;
(b) Several comprehensive independent formulas, each of them applicable to a service whose price is separate in the contract;
(c) Or a formula by payment currency, if there are several currencies, using the price fixing indexes of the country of origin of the inputs.
Revision formulas must include a fixed part of at least 0.15 (zero point one five).
The revision threshold shall represent a percentage from which the overall contract price variation gives entitlement to price revision.
The neutralisation margin shall be the increase share which, in any case, shall be borne by the contract holder or, conversely, the decrease shares from which he benefits.
The neutralisation margin shall always be less than or equal to the revision threshold.
The neutralisation margin shall be deducted from the revision coefficient.
The coefficient of revision shall apply to:
(a) Services provided during the month, deductions of any type relating to works done under State supervision, bonuses, and repayment of State advances applicable to the revised amount;
(b) Penalties;
(c) Interest on overdue payments.
It shall be forbidden to introduce a price revision clause by way of amendment in a firm price contract.
Where a contract includes a price revision clause, it must specify the date of fixing of the initial price, as well as the terms and conditions for revising the said price.
The update formula devised in accordance with this Article may not include any neutralisation margin.
The public contracts regulatory body shall, in conjunction with the Project Owner or the Delegated Project Owner and other government services concerned, verify the statement of amounts resulting from price update and revision duly approved by the Contract Engineer and the Contract Manager, prior to any payment.
It shall give its opinion within 15 (fifteen) days upon receipt of the file.
In any case, the price revision or update shall be capped at 25% (twenty-five percent) of the contract amount, under pain of cancellation, unless waived by the Authority in charge of public contracts.
However, where the parties do not wish to terminate the contract, they may either agree to fully execute the contract up to this ceiling price, modify, through amendment, the price variation formula to comply with the above-defined ceiling, or negotiate a new reduced price.
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