The 2017 edition of the FIDIC Conditions of Contract introduced a significant enhancement in dispute resolution through the Dispute Avoidance/Adjudication Board (DAAB).
This mechanism reflects a global trend toward early intervention, proactive dispute management, and cost-effective project continuity.

1. From DAB to DAAB: Structural and Functional Differences

Under FIDIC 1999, the Dispute Adjudication Board (DAB) could be established either as an ad hoc or a standing body.
Its role was limited to deciding disputes formally referred to it after they had arisen.
FIDIC 2017 introduced the DAAB as a standing board by default, to be appointed within 28 days of the contract’s commencement (Clause 21.1).
Unlike the DAB, the DAAB is empowered not only to adjudicate disputes but also to help parties avoid them through informal guidance, participation in meetings, and providing early opinions.
This preventive function reflects the understanding that disputes are often easier and cheaper to resolve before positions become entrenched or formal claims are filed.

2. Immediate Binding Effect, with Preserved Right to Challenge

Clause 21.4.3 of FIDIC 2017 provides that decisions of the DAAB are immediately binding, regardless of whether a party agrees with them.
The parties are obligated to comply “without delay.”
However, under Clause 21.4.4, a party may issue a Notice of Dissatisfaction (NoD) within 28 days if it wishes to contest the decision.
This preserves the right to refer the matter to arbitration under Clause 21.6.
The logic is simple: comply now, challenge later.
This model maintains momentum on site, avoids cash flow interruptions, and reduces adversarial escalation while still respecting both parties’ rights to final adjudication.

3. Practical Viability: Why a DAAB Should Be Considered

While FIDIC 2017 assumes the appointment of a DAAB, it is not mandatory unless expressly agreed in the contract’s Particular Conditions.
Nonetheless, its benefits make a strong case for inclusion in most major contracts.
Key advantages of DAAB implementation include:
•Early intervention: Informal engagement helps resolve tensions before they become legal disputes.
•Neutral expertise: Board members typically have strong legal, engineering, or project management backgrounds.
•Efficiency: DAAB decisions are faster and more cost-effective than arbitration.
•Continuity: Decisions are binding immediately, reducing disruption to the project timeline.
From a commercial perspective, investing in a DAAB is far less costly than the combined time, legal fees, and reputational risks associated with full-blown arbitration or litigation.

4. Amicable Settlement: A Required Precursor to Arbitration

FIDIC 2017 also requires the parties to attempt amicable settlement before proceeding to arbitration (Clause 21.5).
Once a Notice of Dissatisfaction is issued, the parties must engage in a 28-day period of direct negotiation or facilitated resolution.
This structured opportunity encourages the parties to:
•Reassess their legal and commercial positions;
•Preserve the relationship where possible;
•Resolve matters without proceeding further.
Amicable settlement provisions complement the DAAB process by reinforcing the idea that formal legal disputes should be a last resort, not a starting point.

5. Legal Recognition and Enforceability of DAAB Decisions

Under Clause 21.7, if a party fails to comply with a DAAB decision that is either final or upheld in arbitration, the other party may seek enforcement through arbitration.
This mechanism ensures enforceability even where cooperation breaks down.
DAAB decisions are not court judgments but are often recognized as contractually binding obligations.
In practice, many legal systems (including the UAE) enforce such contractual duties through arbitral awards or court orders where appropriate.

6. Implementation Challenges and Best Practices

Implementing a DAAB requires clarity and commitment.
Common challenges include:
•Delay in appointing board members;
•Parties underestimating the value of informal involvement;
•Poorly drafted dispute resolution clauses.
To maximize effectiveness:
•Appoint experienced, impartial professionals;
•Define clear roles and timeframes in the Particular Conditions;
•Encourage project teams to use the DAAB for advice, not just formal disputes.
When implemented properly, the DAAB can act as both a contractual safeguard and a strategic asset.

7. Integration with Project Governance and Risk Management

The DAAB should not be viewed in isolation. Its role should be integrated into the project’s broader governance and communication framework.
Regular site visits, joint reviews, and early warnings allow the DAAB to act as a buffer zone between minor disputes and major breakdowns.
For large infrastructure projects involving multiple subcontractors, joint ventures, or international funding, the DAAB’s ongoing presence also contributes to improved compliance, documentation, and transparency.

A Strategic Tool for Modern Construction Projects

The DAAB, supported by the amicable settlement period and arbitration as a final tier, provides a tiered, flexible, and reliable dispute resolution model that meets the demands of modern construction projects.
It reduces risk, promotes fairness, preserves relationships, and ensures the contract serves its commercial purpose the successful and timely delivery of the project.
At AWS Legal Group, our construction and arbitration specialists help clients structure contracts that integrate DAABs effectively, draft enforceable dispute resolution clauses, and manage the entire life cycle of construction disputes from early advice to final award enforcement.
Contact us today to learn how to implement DAABs into your FIDIC-based contracts and strengthen your dispute resolution strategy.