NEC4 Project Alliance Contract (PAC): a major step forward for collaborative contracting

NEC4 Project Alliance Contract (PAC): a major step forward for collaborative contracting 

NEC Contracts has announced the NEC4 Project Alliance Contract (PAC), the next generation of NEC alliancing contracts. Developed by the NEC4 Contract Board in collaboration with the Alliance Steering Group, the PAC is a multi-party contract for the appointment of a number of suppliers to form an alliance with the client, working together to design and build an asset in a collaborative, two-stage environment. It is intended for publication in the final quarter of 2026. 

David Mosey said: 

The new ‘NEC4 PAC’ Project Alliance Contract is a major step forward for collaborative procurement and contracting. It is a fully integrated multi-party contract that will succeed the PPC2000 Project Partnering Contract and the NEC4 Alliance Contract. It draws on the best of both forms and also incorporates features of the highly successful NEC Framework Alliance Contract (FAC-1) and Term Alliance Contract (TAC-1).

How the NEC4 PAC works 

The PAC retains the standard NEC format of core clauses, optional clauses and Contract Data, alongside the NEC principles of clarity, simplicity and a stimulus to good contract management. It is designed to drive improved performance and collaborative behaviours through: 

• multi-party governance and delivery mechanisms 
• alliance integration and joint risk management 
• shared objectives, targets, incentives and timetables 
• systems of early supply chain involvement and value improvement. 

Day-to-day delivery is led by an Alliance Manager, while key decisions are taken by unanimous agreement of the Core Group, on which every Alliance Member is represented. Familiar NEC mechanisms such as early warnings, the programme, compensation events and performance incentives all feature, alongside a combined duty of care and the option of a ‘no blame, no claim’ approach. Pre-construction phase alliance activities are built in as a fundamental requirement rather than an option. 

Designed for any project, anywhere 

The PAC is suitable for the design and construction of any type of project anywhere in the world, from buildings and infrastructure to power, renewables and oil and gas, where multiple parties need to work together under sophisticated management processes. As with all NEC4 contracts, it is designed for international use through Y clauses that address the requirements of different legal jurisdictions. 

The PAC is the successor to the ALC and is intended to replace PPC2000 over time, with existing users of both fully supported during the transition. FAC-1 remains the go-to contract for framework alliances. On publication, the PAC will be supported by dedicated User Guides and flowcharts. 

The product of close collaboration 

Peter Higgins of pdConsult, Chair of the NEC4 Contract Board, said: 

I am pleased to present the NEC4 Project Alliance Contract, the product of close collaboration between the NEC4 Contract Board and the Alliance Steering Group. We have been able to create an improved alliancing contract that combines NEC principles and style with new initiatives which will help all parties to deliver a successful project. It continues the NEC approach of flexibility, by providing for Clients a range of options in setting up the Alliance.

Find out more 

To learn more about the NEC4 PAC, including why it was created, how it is structured, the projects it is designed for and how it sits alongside the rest of the NEC suite, read our full Frequently Asked Questions document.

The Institution of Civil Engineers (ICE) acknowledges the help in drafting the NEC4 Project Alliance Contract given by the NEC4 Contract Board and the Alliance Steering Group, in particular, the following:

• Kevin Murray, BSc (Hons), MSc Construction Law and Arbitration, MRICS, MCIPS, Managing Director, Meter Sq Limited, ASG member
• Assad Maqbool, MA (Oxon), Partner, Trowers & Hamlins LLP, ASG member
• Jason Russell, FCIHT, Director, Business Transformation, AtkinsRéalis, ASG member

The NEC4 Contract Board is: 

• Peter Higgins, BSc (Hons), CEng, FICE (Chair) 
• Ian Heaphy, BSc (Hons), FRICS, FCIArb, FCInstCES, MACostE 
• Matthew Garratt, BSc (Hons), MRICS, FCIArb 
• Shy Jackson, LLB, LLM, MSc, FCIArb, FCInstCES 
• Dale Evans, BSc, FICE, CEng, MBA
• Professor David Mosey, CBE, LLB (Hons), PHD
• Helen Sturdy, CEng, MSc, BEng (Hons), FIHEEM, CIWFM, MCIBSE, MAPM, MAfH