Can we consider that the consortium and the (registered) JV are more or less equal? It`s not that easy for unionized partners! As explained above, the key parameter for partners is their performance level. Initially, the parties have only a rough idea of their importance in the overall price of the contract. It is only at the time of submission of the common tender that the proportional share of each party is known: it is the percentage of its price in relation to the total price. This proportion will vary over the course of the project due to the inevitable change orders, price revision (if any) and successful claim. In a consortium, each party uses its existing resources to carry out the work. They can tap into their existing resource pool without the need to obtain permission from the other party. A JV is set up with the entire project team, including support functions such as human resources. The JV can “buy/lease” resources from unionized partners or third parties. In a consortium, each party has its own project manager. Together, they choose a leader to coordinate and present “a face for the customer.” Normally, the party with the most leeway becomes the leader. The director may not bind the parties without the prior agreement of all. Only in very exceptional cases can the scale act immediately.
It must do so impartially! And this only to preserve the rights of the consortium or avoid imminent dangers or damage. This is the case, for example, with an emergency related to health and safety or environmental damage. This article seems to assume that the JV is integrated. A consortium requires a clear distribution of the magnitude between the parties. Care should be taken to ensure that there is no gap between the scope of unionized partners. Together, they are obviously responsible for the entire magnitude vis-à-vis the employer. The scope of each party should be defined at the time of conclusion of the consortium agreement or shortly thereafter. On the basis of this distribution, each will prepare its share of the common offer. As part of a consortium, the risk allocation follows the scope of the work. From an employer`s perspective, there may not be a big difference between a JV and a consortium. However, the way contractors operate is totally different for the two solutions. For both employers and contractors, it is important to understand these differences….