ACP Determines that Contractors Notice of Intent to Suspend Work Lacks Merit Panama City, Panama, January , !

"#$ After analyzing the letter received on December 30, 2013 by the new locks contractor Gru o !nidos or el "anal, #$A$ %G!&"', which was made ublic on (anuary 1 by G!&", the &anama "anal Authority %A"&' determined that it is not valid and that the arguments raised by the contractor in the note lack legal basis and are not clear$ )herefore, it does not give any reasons for the contractor to sus end the work$ *n a letter, the A"& reminded the contractor that on December 13, 2013, it re+uested G!&" to res ond, within seven days, to several faults and illegitimate threats to delay the rogress of the works$ ,owever, des ite A"&-s willingness to find a solution to these issues, the consortium did not offer a res onse$ #ome of the concerns A"& had included. / / / )he reduction in the contractor-s ersonnel0 )he lack of rogress with the three 1orin+uen Dams, which are art of the contract0 )he significantly delays in the delivery of the lock gates0

/ )he contractor-s a arent intention to slow down erformance of the works to match the rogress under the &A"2 contract0 / )he lack of rogress in the rectification of defective works and, generally, the contractor-s failure to rogress the works in accordance with its contractual obligations$ *n its letter to the A"&, G!&" refers to various tenets and inter retations of &anamanian law$ ,owever, the A"& reminded the contractor that there is nothing in &anamanian law or in the contract signed that gives the contractor any grounds for sus ension of the works$ )hat is, the A"& reaffirmed that the contract was agreed to and should be fulfilled according to the rules and regulations of the &anama "anal$ *n addition, the A"& also warns in the letter of the wrongful a lication of #ub3"lause 14$1 of the contract 3 cited by the consortium to 5ustify the sus ension 3 because this clause rovides only the right to sus end the work when the em loyer has failed to issue ayment to the contractor$ ,owever, this is not the case and, therefore, such notice of intent to sus end works is not valid$ *n fact, the A"& ays G!&" within the first 16 days after the invoice is resented, significantly in advance of the contractually3stated eriod of 64 days$ )he A"& reiterated in the letter that the only channels to resent claims are clearly established within the contract$ A third arty decides two of the three methods included in the contract for the resolution of claims$ )hese terms were acce ted by G!&" u on signature of the contract$ )he A"& also trusts that the contractor is able to com ly with the terms agreed u on under the contract$ *f the contractor does not fulfill its commitment, the contract includes mechanisms to ensure

that the ro5ect is com leted$ )he "anal 78 ansion &rogram is 92: com lete, while the construction of the new locks is 46: com lete$ G!&" has reviously indicate that instead of com leting construction on ;ctober 2012, as originally established in the contract, the new locks will be finished (une 2016$ A%out the Panama Cana& Authority 'ACP( )he A"& is the autonomous agency of the Government of &anama in charge of managing, o erating and maintaining the &anama "anal$ )he o eration of the A"& is based on its organic law and the regulations a roved by its 1oard of Directors$ &lease refer to the A"& website. htt .<<www$ ancanal$com< or follow us on )witter =the anamacanal$ >>>