Professional Ethics in Engineering

Background (5 hours)

1.0 Background
1.1 History of Engineering practice
1.2 Cultural, Political, Societal motivations and limitations
1.3 Impacts and consequences of technology on society
1.4 Education and training of technologists, scientists and engineers

Prof. Dr. Hari Krishna Shrestha

Nepal Engineering College
Changunarayan, Bhaktapur

July 2017
Updated: August 12,
1.1 History of Engineering Practice
• Engineering: Application of data, information,
knowledge and technique for practical
beneficial use.
• “Beneficial for whom?” and “Are the benefits
sustainable?” are relatively modern issues in
Professional Engineering Practices.
• If a particular engineering project benefits only a few
persons in a society, is it justifiable? If an engineering
project’s benefit is unsustainable, should the society
promote it?
 1.1 History of Engineering Practice
Short History of Engineering Practice
• Concrete is used for arched bridges, roads and aqueducts in Rome
(1200 BC-1 AD)
• Gunpowder use improved (1-1000 AD)
• Manufacturing and use of silk and glass (1000-1400 AD)
• Toilet, telescope, vacuum, and Gas Law (1400 – 1700 AD)
• Industrial revolution, steam engine, Society of Engineers (UK), cast
iron building (1700-1800 AD)
• Mechanical automation, railroad, telegraph (1800-1825 AD)
• Reinforced concrete, synthetic plastic material, Oil well, mass
production of steel, typewriter (1825-1875 AD)
• Telephone, light bulb, gasoline engine, automobile (1875-1900 AD)
 1.1 History of Engineering Practice
Short History of Engineering Practice (continued…)
• Aeroplane, diesel engine, commercial flight, mass production of
automobile (1900 – 1925 AD)
• TV, atom bomb, transistor (1925-1950)
• Computer, artificial satellite, moon landing, electronic hand held
calculator (1950-1975)
• Supersonic plane, reusable rocket, artificial heart (1975-1990)
• Robot, under-sea train, internet, email, GPS (1990-2000)
• 2000 onwards: Exponential expansion in application of
engineering affecting daily life: Continuous connection anytime,
anywhere, mobile phone, electronic surveillance of equipment
and people, automation of virtually everything, instant access to
data and information, service industry dominating manufacturing.
1.2 Cultural, Political, Societal motivations & limitations
• Cultural practices, customs, rituals, and belief systems can
motivate or demotivate development and adoption of science
and technology.
• low value of time and punctuality, low value of work, intellectual property
right and copy right, research
• more value to ritual, predestination, formality, religion, tradition, caste
• Political systems can create conducive environment or hurdles in
development and use of science and technology.
• Authoritarian, despotic, repressive, lack of rule of law, impunity, irregular
and selective application of law, lack of freedom of expression and choice
frequently changing policies and rules, vague regulations
• Social norms and values can encourage or discourage (assign
arbitrary limits) people to be professional engineers.
• Gender-class-caste roles, defective social norms and values, gap between
rich and poor, access to health and education, social security, conflict, rent
seeking culture, suspicion of new ideas and technologies
1.3 Impacts and consequences of technology on society
• The impacts and consequences of technology on
society are multifaceted (consequences are positive
or negative, depending on use or abuse, or ability to
prevent abuse)
• Impact on social values and family structure
• Impact on cultural norms
• Impact on transportation of goods and services
• Impact on communication and information
generation
• Impact on production means and price of goods
 1.3 Impacts and Consequences of Technology on Socio-
economic parameters (positive): a) Agriculture
Impact on Impact
Food Mechanized, increasing, Green Revolution, GMF,
Production vertical hydroponic
Food Food processing getting complex, requiring industrial
Processing management
Food Food security increasing, for most, better food
Preservation preservation
Commercializat From subsistence to cash crop, patented seeds and
ion food processing techniques
Food Variety Increasing, year round availability, no more seasonal
Fertilizer/Pesticide From organic to chemical, pesticide use increasing
Water use Increasing due to cash crops & agricultural
intensification; reduced by micro-irrigation
Hydroponic agriculture

From traditional to
modern food processing
 1.3 b Impact on Communication
Impact on Impact
Information generation Increasing access to information
and dissemination
Mass communication: Enhanced public awareness, timely
Newspaper, Magazines, information to people
FM Radio, HAM radio, TV,
instant/breaking news
Internet and Social Media Increased access to information, social
media influencing design of
communication techniques
Telephone, mobile phone Increased and easier access to telephone
Virtual Meeting, virtual Less need of physical presence in
reality, tele-medicine meeting, distance medicine services and
remote controlled operation possible
 1.3 d Impact on Information Generation, Storage and Dissemination
Impact on Impact
Information access Increasing access to information through multiple mediums
Storage, virtual Tape, Floppy disk, CD, DVD, External hard disk, Dropbox, Cloud
storage storage, mailbox
Generation Information generation growing exponentially, automatic data
logging, GIS, GPS, Satellite Images, Remote sensing
Dissemination e-paper, interactive TV, internet, social media

1.3 e Impact on Dispute/Conflict Resolution

Impact on Impact
Warfare Increased use of gun power, rockets, missiles, drones, improvised
explosive devices, chemical-biological
WMD A-bomb, H-bomb, nuclear bomb made but not yet used (except two
in WW II), Star War, MAD policy
Evidence Evidence recorded in electronic media
 1.3 f Impacts on Family Structure, Culture and Livelihood
Impact on Impact
Family Family relation more complex, IV-fertilization, test-tube baby,
cloning, surrogacy, same sex marriage, family size reducing, micro-
family getting possible, life span increasing, change in status of
female and disabled
Tradition/ Traditions-values challenged and altered or replaced, heritage
Culture preservation better
Traditional dances/music/drama/games giving ways to movies,
Recreation video games, theme parks, pay per view
Social Norms Social norms and values increasingly challenged and altered or
and Values replaced, social class structure disintegrating, new economic class
emerging
Language International language use increasing, language getting
standardized, brail script & sign language use increasing
Livelihood and Livelihood diversification & specialization increasing, Living
living standard standard & HDI increasing, poverty decreasing, employment
opportunity increasing, price decreasing
 Electrical Vehicle
• First electrical vehicle: 1937 Robert Davidson
• In 1912: 38% of vehicles in US were electrical
• Volvo: No gasoline based vehicle (GBV) production from
2019 (only two years from now)
• France: Ban on use of GBV from 2040
• Germany: Ban on trade of GBV 2030
• Netherlands, Norway: Ban on trade of GBV from 2025
• India expected to follow suit.
 Computer and Computer Crimes
Computer:
• Modeling, simulation (visualization of potential impacts and solution
before the event occurs and solutions implemented), design, solution
techniques (FDM, FEM), Management Information System, Spatial
planning using GIS, computer crimes, intrusion on personal privacy, data
mining, data theft,
Effects: information generating, storing and dissemination
• Design of materials using simulation
• Electronic equipment
Electronic Transaction Act 2063 (2006) has listed the following acts under
the Computer Crime
• Theft, damage or alteration of computer source code
• Unauthorized access to materials on computer
• Destruction and computer and information system
• Publication of illegal materials on electronic form
• Violation of confidentiality
• Posting of false information
• Submitting or showing forged license or certificate
• Non-submission of the document or other materials
• Computer fraud
 1.4 Education and training of
technologists, scientists and engineers
• Continuous education and training (E&T) is a regular process for the
technologists, scientists and engineers (TSE)
• New concept, knowledge, technology, hardware and software, materials,
equipment, tools, gadgets, keep coming in the market. New policies,
acts/laws, rules and standards are periodically adopted. The TSE need to keep
up with the latest developments to prevent themselves from being out of
date.
o Information & Technology Policy 2000; Science & Technology Policy, 2005
o The Electronic Transactions Act 2006
o Electronic Transactions Rule 2007
o Nepal Electronic Cheque Clearing Rule Book, 2011 (ECC Rule)
o e-governance, e-bidding, e-procurement, e-banking, e-sewa,
o High Level Commission for Information Technology
• Nepal Administrative Staff College caters to the continuous E&T needs of
administrative staff; no similar institute for TSEs in Nepal.
• Continuing Education Division/IoE partially caters to the needs of TSEs
• Currently a myriad of different organizations are filling the gap of lack of
formal system of E&T for TSEs in Nepal.
https://books.google.com.np/books?id=kRtPAAAAQBAJ&pg=PP65&lpg=PP65&d
q=electronic+trensactions+rule+nepal&source=bl&ots=CFM_zUvWGk&sig=Fymp
L7SyUAMwkE_C6t49h-
AxAHw&hl=ne&sa=X&ved=0ahUKEwiy4tvA5JHVAhVIu7wKHXpgCdMQ6AEIajAJ
#v=onepage&q&f=false
 Potential Questions
• List the type of cultural, political and societal practices which
motivate development of science and technology in a society.
• List the type of cultural, political and societal practices which
limit development of science and technology in a society.
• What is the impact of development of ICT in social values?
• What is the impact of computers in mechanized production, and
how has it impacted society?
• What are the different forms of computer crimes, and how has
computer crime impacted society?
• What should be the modality of the education and training of
the technologists, scientists and engineers?
• What specific type of training should the electronics engineers
and/or electrical engineers be provided?
 Professional Ethics in Engineering
Profession and Ethics (3 hours)

2.0 Profession and Ethics

2.1 Definition and Characteristics
2.2 Codes of ethics and guidelines for professional engineering practice
2.3 Relationship of engineering profession to other professions (e.g. fellow engineers,
clients and contractors)
2.4 Moral dilemma on ethical decision making
2.5 Negligence and Liabilities

Prof. Dr. Hari Krishna Shrestha

Nepal Engineering College
Changunarayan, Bhaktapur

July 2017
Updated: August 12, 2017
 2.1 Definition and Characteristics
• Profession: An occupation carried out with a systematic
knowledge acquired through specialized training or
education and experience and practicing the same.
• Professional: A person practicing a profession in area of
expertise.
• Professionalism: The content of profession with moral and
ethical behaviours.
• Acts of a professional are evaluated by the public.
• Professionals follow their code of conduct, and standards
and norms.
• Professional have their own culture
– Through regular interactions, communications and experiences
in same field
 2.1 Definition and Characteristics
• Ethics: generally concerned with rules or
guidelines associated with a profession.
• Ethics is normally clear; ethical and unethical
behaviours are easier to distinguish, hence no
ethical dilemma, as opposed to moral dilemma.
• Ethical acts are legal and moral; but a particular
moral act is not necessarily ethical/professional.
 2.2 Codes of ethics and guidelines for
professional engineering practice
Different professional engineering societies have issued Code of Ethics for their
members. Examples: ABET, IEEE, ASME, NEC, NEA, SCAEF, FCAN, CAN, …

Accreditation Board of Engineering and Technology (ABET) Code of Ethics for

Engineers:
1. Engineers shall hold paramount the safety, health, and welfare of the public
in the performance of their professional duties.
2. Engineers shall perform services only in the areas of their competence.
3. Engineers shall issue public statements only in an objective and truthful
manner.
4. Engineers shall act in professional matters for each employer or client as
faithful agents or trustees, and shall avoid conflicts of interest.
5. Engineers shall build their professional reputation on the merit of their
services and shall not compete unfairly with others.
6. Engineers shall act in such a manner as to uphold and enhance the honor,
integrity, and dignity of the profession.
7. Engineers shall continue their professional development throughout their
careers and shall provide opportunities for the professional development of
those engineers under their supervision.
 IEEE Code of Ethics:
1. to accept responsibility in making decisions consistent with the safety, health,
and welfare of the public, and to disclose promptly factors that might endanger
the public or the environment;
2. to avoid real or perceived conflicts of interest whenever possible, and to disclose
them to affected parties when they do exist;
3. to be honest and realistic in stating claims or estimates based on available data;
4. to reject bribery in all its forms;
5. to improve the understanding of technology; its appropriate application, and
potential consequences;
6. to maintain and improve our technical competence and to undertake
technological tasks for others only if qualified by training or experience, or after
full disclosure of pertinent limitations;
7. to seek, accept, and offer honest criticism of technical work, to acknowledge
and correct errors, and to credit properly the contributions of others;
8. to treat fairly all persons and to not engage in acts of discrimination based on
race, religion, gender, disability, age, national origin, sexual orientation, gender
identity, or gender expression;
9. to avoid injuring others, their property, reputation, or employment by false or
malicious action;
10.to assist colleagues and co-workers in their professional development and to
support them in following this code of ethics.
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 NEC code of ethics
1. Discipline and Honesty: The Engineering sevice/profession must
be conducted in a disciplined manner with honesty, not
contravening professional dignity and well-being.
2. Politeness and Confidentiality: Engineering services for
customers should be sealt with in a polite manner and
professional information should remain confidential except with
written or verbal consent of the customers concerned. This,
however, is not deemed to be a restriction to provide such
information to the concerned authority as per the existing laws.
3. Non-discrimination: No discrimination should be made against
customers on the grounds of religion, sex, caste or any other
things while applying professional knowledge and skills.
4. Professional Work: Individuals should only do professional work
in their field or provide recommendation or suggestions only
within the area of theri study or obtained knowledge or skills.
With regards to the works not falling within the subject of one's
profession , such as works should be recommended to be done
by an experts of the subject matter.
 NEC code of ethics
5. Deeds which may cause harm to the engineering profession:
With the exception of salary, allowance, and benefits to be
received for services provided, one shall not obtain improper
financial gain of any kind of conduct improper activities of any
kinds, which would impair the engineering profession.
6. Personal responsibility: All individuals will be personally
responsible for all works performed in connection with his/her
engineering profession.
7. State name ,designation and registration number: While
signing the documents or descriptions such as the design , map ,
specification and estimates etc ralating to the Engineering
profession , the details should include, the name , designation
and NEC registration No. and should be stated in a clear
and comprehensive manner.
8. No publicity or advertisement to be made which cause
unnecessary effects: In connection with the professional
activities to be carried out, no publicity or advertisement shall be
made so as to cause unnecessary effects upon the customers.
Learn these 8 CoEs by heart
 2.3 Relationship of engineering profession to other
professions (e.g. fellow engineers, clients and contractors)

Relationship with fellow engineers:

• Professional relationship with all the engineers, regardless
of their status, and even if the fellow engineer is a close
relative
• “Engineers shall not attempt to injure, maliciously or
falsely, directly or indirectly, the professional reputations,
prospects, practice or employment of other engineers, nor
indiscriminately criticize the work of other engineers”
• Criticize cautiously and objectively with respect to the
person’s professional status
• Have professional relationship
– Encourage fellow engineers to follow Code of Ethics
– Guide, train and orient freshly graduate engineers
– Create platform for information and knowledge sharing
– Support fellow engineers in professional development
Engineer’s relationship with Client:
• Strict professional relationship, even if the client is closely familiar
(relative, friend)
• No discrimination among client based on culture, race, religion, sex, …
• Work in the best interest of the client with loyalty with legal limit
• Deliver in time, with quality
• Not expect extra favour for works performed as per an agreement
• “An engineer shall not accept financial or other compensation from
more than one party for services rendered on one project unless the
details are fully disclosed and agreed by all parties.”
• Supervise work and prevent misuse/abuse of client’s property/trust
• Assist in decision making by providing options
• Warn potential risks of decisions
• Going beyond ToR, when professionally required
• Keep information confident, unless required by law
• Full disclosure of potential conflict of interest, if any
• Not take a client for granted: remembrance of bad experience lingers
much longer than a good experience
Engineer’s relationship with Contractor:
• Strict professional relationship, even if the contractor is closely familiar
(relative, friend)
• Provide due respect to the contractor
• No discrimination among contractors based on belief, race, religion,
culture, sex, sexual orientation, …
• Provide all the detailed drawings, quantity and quality (including
specification) of works (goods and services) to the contractor in time
• Check and approve running bills in time, as per specification
• Not expect or accept (directly or indirectly) extra favour of significant
value, for works performed as per an agreement
• Supervise work and prevent use of sub-standard methods and
materials being used
• Participate in co-decision making by providing options when necessary
• Assist the contractor when variations are technically needed
• Warn potential risks of decisions/actions
• Going beyond ToR, when professionally required
2.4 Moral dilemma on ethical decision
making
• Ethical decision, which is legal and follows all
the prevailing rules, regulations, and
standards, and is beneficial to the client, may
result in (a) environmental damage beyond
the limit what the engineer considers to be
moral, (b) reduced public safety, (c) loss to
helpless, voiceless, marginalized stakeholders.
Such a situation creates a moral dilemma to
an engineer.
 2.5 Negligence and Liabilities
Negligence in duty (dereliction of duty) results in liabilities
to stakeholder whose life, health or property is damaged.
Conditions for establishment of professional negligence:
• Duty: Unless there is a contractual duty to perform a
work there is no negligence in the performance of the
work.
• Breach: Unless there is a breach of the terms and
conditions of an agreement, professional negligence
cannot be proved.
• Damages: Unless there is a specific damage to the
claimant, professional negligence cannot be established.
• Proximate cause: There should be direct (one-to-one)
relation between the specific action of a professional and
the damage resulted by the action to the claimant.
 2.5 Liabilities of engineers in project design,
construction and implementation
Three sources of liability:
a) Liabilities due to contract: liable to fulfill all terms of contract; if there is
no contract, legally, there is no liability under this category. An engineer is
liable for loss of damage due to breach of contract clauses. Contract law
imposes liability on a party for promises that the first has made to another
party; liability related to loss of a single person’s life/property.
b) Liabilities due to criminal law: liable to follow all prevailing laws of
nation, breach of law related to design, construction and implementation of
design can result in criminal case, whether there is damage or not. Criminal law
imposes liability on a party due to illegal/ criminal acts; defendant has a liability
to the government/state.
c) Liabilities due to tort: liable to prevent customers/users of products and
services from loss or damage; even if there is no specific contract and no laws
have been breached, an engineers can be held liable for loss or damage to the
customer due to the use of services and products designed, constructed, or
implemented by the engineer. Pre-information or pre-warning or disclaimer
can prevent an engineer from liability due to tort. Tort provision is a legal
mechanism for compensating individuals injured by others, whether deliberate
or not; directed toward the compensation of individuals, rather than the
public.
 Vicarious and Partnership Liability
Two types of liability:
• Vicarious Liability: A company or a contractor/sub-contractor is
liable for the acts of its own and its employees. Three tests are
used to ascertain the degree of vicarious liability.
– Control test: degree of liability depends on level of control a company
has on its staff or contractor; the more control a company has over a
person (employee) the more liable the company is.
– Business integration test: degree of liability depends on level of
business integration; the more the work of a person is integrated into
the work of a company, the more liable the company is for the acts of
the person, even if the person is not a direct employee of the
company.
– Multiple test: Control test, business integration test, and other related
factors are taken into consideration to determine the degree of
liability.
• Partnership Liability: Liability of the partners in tort: The
partners of a company are liable for the acts of one (or more) of
its other partners.
 2.5 Liabilities of engineers in project design,
construction and implementation
Liabilities of an engineer in project design
• Fitness for purpose: The design of a project (overall and component-wise) should be proper to serve
the purpose of the project.
• Negligent misstatement: The designers and professionals are expected not to make any negligent or
unsubstantiated misstatements.
• Statutes, bylaws and building regulations/codes: It is the duty of the designers and professionals
to make themselves fully aware of the statutes, bylaws and codes related to their professional practice.
• Examination of site above and below the ground: Before finalizing a design, a designer should
know the conditions of the site above and below the ground.
• Public and private rights: The design of a project should not contradict with the public and private
rights of the client and others who may be affected by the design implementation.
• Plans, drawings and specifications: The design should include detailed plan, drawing, and
specification of each component of the project and equipment
• Materials (quantity, quality and availability): The details of the quantity and quality of materials to
be used in a project should be specifically mentioned. The availability of the materials should be kept in
mind while selecting the material types.
• Novel, risky design and employers’ interference in design: A designer may choose to use novel
and risky design, and may decide to incorporate employer/client’s idea in the design. However, the
designer is ultimately responsible for the safety & fitness for purpose of the design implementation.
• Revision of design during construction: Even if the design is revised during construction, the
designer is ultimately responsible for the safety & fitness for purpose of the design implementation.
 Liabilities of engineers in project construction and
implementation

• Completion of project in time, within budget

• With quality: material, workmanship, method of construction
• Consistency: in quality, form
• Safety and welfare of project workers, people living in and
around project area, and people travelling through or visiting
the project area
• Follow applicable laws, rules, regulations, guidelines,
conventions, codes and bylaws
• Meet social obligations

…engineer must struggle to design in such a way as to avoid failure, and, more importantly,
catastrophic failure which could result in loss of property, damage to the environment of the
user of that technology, and possibly injury or loss of life…
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 समयमै काम ऩूरा नगरे ऩछि ऩप्ऩझ कन्स्ट्रक्सनऱाई
एडडबीऱे छतरायो ५ करोड
साउन ६, २०७४ बाॉके:

एछसयाऱी विकास बैंक (एडडबी) ऱे जमझनहा–राॉझा सडक खण्ड छनमााणको

जजम्मा ऩाएको ऩप्ऩझ कन्स्ट्रकसन जेभीऱाई ५ करोडभन्स्टदा बढी रुऩैयाॉ हजााना
छतराएको ि। सम्झौता अनझसारको काम समयमा ऩूरा नगरे ऩछि एछसयाऱी
विकास बैंकऱे ऩप्ऩझ कन्स्ट्रकसन जेभीऱाई कररब ५ करोड ५० ऱाख रुऩैयाॉ
हजााना छतराएको मध्यऩजिम ऺेत्रीय सडक छनदे शनाऱय डडछभजन कायााऱय
नेऩाऱगन्स्टजका डडछभजन प्रमझख अजझना कझमार बमऱे जानकारी डदए। ‘हजााना
ऱगाउनझ भनेको कारबाही नै हो, यसऱे अन्स्टय योजनाको ठे क्काऩट्टामा ऩछन
असर ऩाना सक्ि,’ उनऱे भने। उनऱे ऩप्ऩझ कन्स्ट्रक्सनको ठे क्का जझऱाई, २०१६
सम्म मात्र भएकोऱे अब ऩप्ऩझ र एछसयाऱी विकास बैंकबीच कझनै सम्बन्स्टध
नरहे को बताए। ऩप्ऩझऱे ५७ करोड रुऩैयाॉमा राॉझा–जमझनहा सडकखण्ड काऱोऩत्रे
गने ठे क्का छऱएको छथयो। माऩदण्डअनझसार छनमााण नगरे को प्रमाजणत भएऩछि
एछसयाऱी विकास बैंकऱे उसऱाई एक करोड रुऩैयाॉ मात्र डदने छनणाय गरे को
छथयो। हजाानाबाऩतको रकम असझऱी हजााना बाऩतको रकम एडडबीऱे असझऱी
गररसकेको ि। काम गरे बाऩत उसऱे ऩाउने रुऩैयाॉ हजाानामा कटाइएको ि।
सडक छनमााणका ऱाछग ठे क्का छऱने क्रममा जम्मा गरे को रकम ऩछन राज्ि
कायााऱयमा ऩठाइएको सडक डडछभजन कायााऱय नेऩाऱगन्स्टजऱे जनाएको ि।
बाॉकी रकम वऩछभसीऱगायत ऩप्ऩझको बैंक खाताबाट असझऱी गररएको डडछभजन
प्रमझख बमऱे बताए।
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 Potential Questions
• What are the essential elements of a professional person?
• What are the characteristics of an ethical decision making?
• Discuss Nepal Engineering Council’s code of ethics.
• What should be the nature of the relationship between an engineer and a
client?
• What are the conditions necessary to prove professional negligence in
engineering practice?
• Discuss, with examples, three basic sources of liability of an engineer.
• Discuss the objectives of tort liability.
• Discuss the vicarious liability and partnership liability, with examples from
electronics and/or electrical engineering applications.
• Discuss, with an example, a case of moral dilemma when making ethical
decisions.
• Discuss the liabilities of an engineer in project design and project
implementation.
 Professional Ethics in Engineering
Professional Practices in Nepal (4 hours)

3.0 Professional Practices in Nepal

3.1 General job description of an engineer in public and private sector
3.2 Public and Private sector practices
3.3 Roles of Professional Associations

Prof. Dr. Hari Krishna Shrestha

Nepal Engineering College
Changunarayan, Bhaktapur

August 2017
Updated: August 12, 2017
3.0 Professional Practices (in engineering) in Nepal

• Professional Practices of engineering in Nepal

are guided
• formally by the laws/acts, guidelines, directives,
cabinet decisions, standards and codes,
• Guidelines, and code of Ethics of professional
bodies like Nepal Engineers’ Association, SCAEF,
FCAN, CAN, IEEE
• informally by the practices in specific institutions
 3.1 General job description of an
engineer in public and private sector
General duties of an engineer are mainly:
• Design and estimate of specific project, infrastructure
etc.
• Preparation of technical specification, tender
documents, contract document, agreement paper
• Evaluate and supervise the project assigned
• Allocation of resources
• Work as a member of investigation committee
• Prepare Annual Plan or Project specific plan of activities
• Provide suggestion and recommendation in area of
expertise
3.1 General job description of an engineer
in public sector (Gazetted Third Class)
• Perform preliminary and detail survey,
design and estimate
• Execute and assign for execution of
project works
• Conduct various programs for increasing
people’s capacity
• Prepare Progress Report , Feasibility Report ,
Final Report, Monitoring and Evaluation
report etc.
3.1 General job description of an engineer
in public sector (Gazetted Third Class)
• To execute other jobs planned specifically for
engineers as the nature and case may be
• To monitor and evaluate on going projects
• To facilitate donor agencies is involved
• To monitor and coordinate the operation and
maintenance of facilities
• To execute and perform works and jobs
assigned by immediate superiors
3.1 General job description of an engineer
in public sector (Gazetted Second Class)
• Planning, programming and execution of
works
• Research on technology, cases, various skills
for upgrading
• Administrative activities
• Financial administrative activities
3.1 General job description of an engineer
in private sector
• Coordinate works between stakeholders, clients, consulting
and contractors
• Layout works, to survey and to estimate
• Supervise, monitor, and control works
• Control quality, to assess and report to concerning
authorities
• Prepare bills as a quantity surveyor
• Plan project and report progress
• Prepare technical report and prepare claims if any
• Conduct necessary training regarding site work and office
organizations system to new staffs
• Overall management of construction project etc.
 Typical work assignments
Electrical engineers typically do the following:
• Design new ways to use electrical power to develop or improve products
• Perform detailed calculations to develop manufacturing, construction, and installation
standards and specifications
• Direct the manufacture, installation, and testing of electrical equipment to ensure that
products meet specifications and codes
• Investigate complaints from customers or the public, evaluate problems, and recommend
solutions
• Work with project managers on production efforts to ensure that projects are completed
satisfactorily, on time, and within budget
Electronics engineers typically do the following:
• Design electronic components, software, products, or systems for commercial, industrial,
medical, military, or scientific applications
• Analyze customer needs and determine the requirements, capacity, and cost for
developing an electrical system plan
• Develop maintenance and testing procedures for electronic components and equipment
• Evaluate systems and recommend design modifications or equipment repair
• Inspect electronic equipment, instruments, and systems to make sure that they meet
safety standards and applicable regulations
• Plan and develop applications and modifications for electronic properties used in
parts and systems in order to improve technical performance
https://collegegrad.com/careers/electrical-and-electronics-engineers
3.2 Public and Private sector practices
• The scope of work carried out by the
engineers in the public and private sector
covers many areas. The scope of work of each
public and private organization is listed in their
website
• In general, the public organization, or an
organization which receives public fund, is
bounded by Public Procurement Act/Rule.
 3.2 Private sector practices
• In the open market system, there are thousands of private
organisations and firms working in engineering sectors
• Entrepreneurs have used engineers to produce in large
quantity in economic investments,
• Private sector working more efficiently under strict
supervision and motivations
• More than 50 private engineering colleges affiliated to
7 universities - governmental and nongovernmental.
• Numerous consultancies, construction companies and
firms
• Many computer institutes, training institutes, e-business
organisations, hospitals, research centers have employed
engineers
 Sample List of Public Organizations (ministries)
where engineers are involved/employed
1. Finance 14. Population and Environment
2. Home Affairs 15. Culture, Tourism and Civil
3. Foreign Affairs Aviation
4. General Administration 16. Irrigation
5. Law and Justice 17. Energy
6. Land-reform and Land 18. Physical Infrastructure and
Management Transports
7. Women, Children and Social 19. Forests and Soil Conservation
Welfare 20. Science and Technology
8. Education and Sports 21. Information and
9. Defence communication
10. Health 22. Federal Affairs and Local
Development
11. Labor and Transport
12. Industry, Commerce and Supply Note: The name of the ministries keep
13. Agriculture and Cooperative changing. Many more engineers are employed
in the departments under the ministries.
 Sample List of Public/Semi-Public Organizations
where engineers are involved/employed
1. Nepal Telecommunication Authority 13. Nepal Telecom
2. Nepal Airlines Corporation 14. CAAN
3. Diary Development Corporation 15. Diary Development Corporation
4. Nepal Industrial Development 16. Investment Board Nepal
Corporation 17. Salt Trading Corporation
5. Nepal Electricity Authority 18. Industrial Estates (Balaju, Patan,
6. Nepal Rastra Bank Pokhara, Hetauda, …)
7. Agricultural Development Bank 19. Central Bureau of Statistics
8. Rastriya Banijya Bank 20. Nepal Bureau of Standards and
9. TU/PU/PU/MWU/FWU/KU Metrology
10. University Grants Commission
11. Hetauda Cement Factory
12. Udayapur Cement Factory
 3.3 Roles of Professional Associations
• Regulate professional practices through enactment of rules
and reward and punishment system
• Develop norms, standards, and codes of professional
practices
• Monitor practices and performance
• Orient new professional members
• Enhance professionalism through professional development
programs
• Provide platform for knowledge sharing and mutual learning
• Provide suggestions for development and update of policies/
acts/ laws/ rules/ regulations/ codes
 Professional Associations Regulate Profession
One of the fundamental roles of professional associations is to
regulate the professional practices of the persons or institutes engaged
in a particular profession. E.g., the FCAN regulates the ways
contractors, act when performing duties related to their profession,
through:
• developing guidelines & procedures to be followed by its members,
• developing minimum standards of profession,
• developing and issuing codes of conduct for FCAN members,
• developing and approving written/unwritten rules of the
profession,
• preparing standard procedure/formats of submitting bids,
• monitoring and evaluating compliance of the rules, and
• taking actions against breakers of the rules and/or code of conduct.
NEC and NEA regulate engineering profession by developing policies,
plans/programs for the smooth functioning of engineering profession
and execute them. The NEC regulates higher engineering education in
Nepal through evaluation, recognition and monitoring of academic
institutes providing formal engineering education.
 3.3.1 Roles of professional organizations in induction
of new entrants into the profession
Another major role of the professional associations is to
guide new entrants into the profession by
• providing orientation and training,
• guiding on the conventions of the profession,
• providing information on the dos and don’ts of the
profession,
• potential pitfalls when the Code of Conduct are not
followed,
• linking the new comers with established members of
the profession.
• Guiding on general job description and employers’
expectation from new recruits
• Training new entrants for job seekers, proposal writing,
bidding, project terms and conditions negotiation, etc.
 3.3.2 Upgrading and maintaining the professional and
technical competence of members of professional association
Professional societies take various steps for upgrading and maintaining the
professional and technical competence of its members by
• Organizing regular professional development courses and continuing education
programs, like running Engineering Staff College
• Organizing skill development oriented training programs
• Organizing regular talk programs to share experiences and lessons learned from
different projects
• Providing platform for its members to expose their works by organizing national
and international seminars/workshops on regular basis
• Publishing technical journals and news bulletin
• Organizing exposure field visits to different projects
• Providing exposure to national and international experiences by organizing
national and international visits to its members
• Proactively working with academic institutes on development and update of
university curriculums
• Proactively working with research institutes for involving its members in research
and development activities
• Proactively working with service providing organizations (consulting companies,
contractors, material suppliers, software developers, equipment operators) to
establish link of its members with established organizations.
 3.3.2 Upgrading and maintaining the professional and
technical competence of members of professional association
Some of the ways in which the professional associations in Nepal have
been playing this role in Nepal are:
• Providing Continuing Education Programs (NEA, SCAEF, FCAN, CAN)
• Engineering Staff College (proposed by NEA, not yet fulfilled)
• Provision of Professional Engineer (NEC)
• Provision of periodic test as part of NEC registration renewal
(proposed)
• Professional Development as part of evaluation of engineering
colleges (NEA)
• Organizing professional meeting/seminar/conferences/conclave:
(NEA, SCAEF, FCAN, CAN…)
• Organizing trainings, weekly lecture series (NEA);
http://www.neanepal.org.np/showmodule.php?what=weeklytalk&under=home
• Organizing workshop on specific issues related to engineering education in Nepal
(NEC, AECON, OPEN, TUTA)
Some examples: Rapid Assessment Training after April 25, 2015 Gorkha Earthquake;
recommendations after Jure Landslide
 3.3.3 Providing technical expertise to public authorities in
developing policies, acts, standards, project implementation
procedures and international agreements and negotiations
• The legislators and other governmental organizations frequently
seek technical expertise from professional associations in the
development, drafting and amendments to the existing acts, rules,
regulations, policies, guidelines, bylaws, provisions, plans and
programs.
• NEC, NEA, SCAEF, FCAN, CAN and other professional organizations
provide technical expertise to different government organizations,
including legislators, as and when requested. When these
professional associations do not have in-house expertise, they
coordinate with individual (or institutional) members to provide
such services.
• NEA and DPNet independently conducted study of Jure Landslide
(Sunkoshi) in 2014 and submitted expert advice to deal with the
disaster.
(https://drive.google.com/a/nec.edu.np/file/d/0B19Ck0L5dMSrUklZUDN2dk5lZUx6aEtCYnpmenp2TjFId2kw/edit)
 3.3.4 Ensuring occupational health, safety and
general welfare of the public
• The professional engineering associations are expected to play the
role of monitors of quality of works of its members, including the
matter of safety and general welfare of the public.
• When a particular member is found to violate the codes of conduct,
compromise on quality of works, and neglect public safety and public
welfare, the concerned professional engineering association can warn
them, and reprimand/cancel their membership.
• NEC is planning to introduce a system of Accountability in Engineering
Professional services.
• The standard design manuals, design procedures, building codes,
including professional judgments will be evaluated as a part of safety
and general welfare of public in engineering works.
• NEC/NEC/ SCAEF/FCAN etc. can monitor provision of occupational
health, safety and general welfare of workers and general public in
specific projects.
3.3.5 Role of professional societies in environment protection
• Raise awareness among society members, public decision makers,
and legislators on environment & sustainable development issues;
work with universities in developing environment protection courses
• Circulate environment protection related acts, rules and regulations
to society members
• Study and publish results of impacts (short term and long term) of
development works on environment
• Develop manuals and guidelines on design, operation and
maintenance of development projects by considering environment
protection
• Conduct training courses on environmental law compliance
• Conduct advocacy programs for environment sensitive development
methods
• Monitor specific development projects from environment protection
aspect and suggest improvements, if needed, in carrying out project
works with environment compliance
• Award organizations with excellent environment protection records.
What information can you obtain from this photograph?
 Self test
• Briefly discuss the code of ethics of Nepal Engineering Council.
• Explain the code of ethics applicable to engineering profession.
• What do you understand by the code of conduct? Describe the
code of conduct for engineers.
• How do you judge the ethical standard of Engineers in Nepal?
Describe the role of Nepal Engineering Council in maintaining
ethical standard of Nepalese Engineers.
• Differentiate between the NEA and NEC with suitable examples.
• What are the meaningful roles of professional societies or
associations? Why are they needed? Explain.
• Explain roles of Engineering council and Nepal Engineers
Association. In what regards, they are different?
• What are the general job descriptions of engineers working in
public sector?
• Describe the basic duties of an engineer.
 Professional Ethics in Engineering
Chapter 4: Legal Aspects and Regulatory Environment
of Professional Engineering in Nepal
(8 hours)
4.1 Nepal Engineering Council Act
4.2 Labor Law
4.3 Contract Law
4.4 Cyber Law
4.5 Public Procurement Act
4.6 Intellectual Property Right
4.7 Company Registration Procedures
4.8 Relationship to foreign firms working in Nepal
Electricity Act, 2049; Electricity Regulation, 2050
Prof. Dr. Hari Krishna Shrestha
Nepal Engineering College
Changunarayan, Bhaktapur
August 2017
Updated: August 12, 2017
 Legal Aspects and Regulatory Environment
Components of a Legal System
The legal system of a nation includes:
1. acts/laws, court decisions/precedents (ain, kanun, nirnaya/najir)
2. rules, regulations, bylaws, directives (niyam, biniyam, nirdeshika)
3. treaties, conventions, policies, (sandhi, prachalan, niti)
4. formation orders, ordinance, promulgations, (adesh, adhyadesh, ghoshana)
5. access to justice, freedom to choose legal advisor,
6. concepts of “innocent until proven guilty”, “equal under law” and
7. implementation aspects, including consistency, of 1 to 6 above.
Nepalese Legal System
• In Nepalese legal system, a person is practically “presumed guilty until proven
innocent”. As soon as a person, or an officer, is charged of a crime, he/she is
losses his/her official privileges, expected to resign from his/her post or
automatically suspended till the case is “closed” by a court of law.
• The Nepalese society normally presumes a person guilty as soon as s/he is
charged of a crime. People have very low level of faith on the impartiality of
justice/legal system. Many persons found guilty by a court, but with good
connection, roam in government offices, while persons with low access to
resources waits for years, even decades, for court verdict on cases he/she files.
नेपालको कानून दै वले जानुन ् ! सानालाई ऐन ठू लालाई चैन !!
4.1 Nepal Engineering Council Act
• Regulate professional engineering practices
• No. of Chapters: 7, No. of Sections: 38
• Chapter 1: Definitions:
• d. Engineer: a person who holds at least a Bachelor's Degree in an engineering
subject from an academic institution recognized by the council.
e. Engineering Profession: the profession to be practiced by the engineers
who have acquired the technical knowledge and skill in the subjects
• g. Registered Engineer: the engineer whose name has been registered in the
Registration Book.
• Chapter 2:
• 5: Constitution of the Council
• Chapter 3:
• 15.Registration of Name: The Subject Committee scrutinizes application as
per Section 14, and recommends to NEC Board, which decides on registration.
If decision is positive, the Registrar registers in the Registration Book.
 4.1 Nepal Engineering Council Act
• Chapter 3: Section 18.Name to be Removed from the registration:
a) mentally unsound,
b) property divided among the creditors for failing to pay debts,
c) charge of violating the code of conduct passed by 2/3rd majority,
d) convicted by a court in a criminal charge involving immoral act,
e) registered by fraud or error.
Chapter 4: Section 23. Inspection of Examination:
1) Before or after recognizing the certificate/degree, NEC can inspect
examination system of the concerned academic institution.
Section 24: Recognition to be withdrawn
• Chapter 7: Section 30. Offences and Punishment and Penalties:
1) Practicing engineering without registration is an offence.
2) The offender of 30-1 is liable to a punishment of up to Rs. 3000 or
an imprisonment of up to 3 months or both.
3) Offenders of the Act of other types can be fined up to Rs. 2000.
 4.2 Labor Law, 2048 (1992)
• No. of Chapters: 11, No. of Sections: 92
Chapter 1: Preliminary:
• Enterprise: any factory, company, organisation, association, firm, … established for operating any
industry, profession or service, with ten or more workers/employees
• Worker: a person employed on the basis of remuneration, and worker at piece-rate, contract or
agreement. Labor Law 2073 (parliament approval
• Minor: a person between 16 and 18 years of age
August 11, 2017) (२७/४/२०७४) has
Chapter 2: Employment and job security updated provisions.
• 4.1: advertise to select worker and provide an appointment letter
• 4.2: One year (240 days in 12 months, including public and weekly holidays) probation, permanent
appoint letter, inform to Labour Officer
• 4A.1: No non-Nepalese to be hired, unless skilled technicians not available even after advertising
• 5: Minor/female: 6 AM-6PM OK; females same as male with mutual consent
• 7: Contract: only in non-permanent type of work
• 10: Firing only by following procedure; 15: compulsory retirement at 55 age, may extend 5 years
Chapter 3: Working Hours
• 18: 8 hours/day; 48 hours/week, one day holiday/week; Max. 5 hr shift, including ½ hr tiffin break
• 19: Overtime at 1.5 times rate; no compulsory overtime; max. OT: 4 hrs/day. 20 hrs/week
Chapter 4: Remuneration
• 21: Agreement below minimum remuneration rate not allowed; 21A: Grade: ½ day wage
• 25.3: 3 times penalty for undue deduction in remuneration
• 25.4: Max. Rs. 1000 penalty if petition filed with malicious intent
 4.2 Labor Law, 2048 (1992)
Chapter 5: Health and Safety:
• 27: Work area to be clean, supply of fresh air, light and proper temperature;
• proper solid waste and noise management,
• prevention of accumulation of dust, fume, vapour;
• no congestion: minimum 15 m3/worker, maximum 4 m height
• Adequate drinking and cleaning/washing water, fire extinguishing
• Separate toilet for male and female; No-smoking zone
• Compulsory health check once a year for hazardous works
• 28: protection of eyes; 29: personal protective devices against chemical hazard;
• 30: safety against fire; fire exit; fire-fighting devices; 31: Hazardous area to be fenced

Chapter 6: Welfare provisions

• 37: establishment of a welfare fund; 38: compensation for injury or death
• 39: Gratuity, provident fund, Medical expenses; 40: Leave
• 41: Provision of quarter; 42: If 50 or more female workers: provision of children’s room,
trained nurse, toys, time for female workers to feed suckling babies
• If 50 or more workers: 43: relaxing room; 44: canteen

Chapter 7: Special provisions for special enterprise

• 46: Construction business
Chapter 8: Conduct and Punishment
Chapter 10: Settlement of legal disputes
 4.3 Contract Law, 2056 (2000)
• No. of Chapters: 13, No. of Sections: 90
• Chapter 1:
• (a) Contract: an agreement enforceable by law concluded between two or more parties for performing or
not performing any work.
• (b) Proposal: a proposal presented by one person to another with the intent of obtaining his/her consent to
do or not to do any work.
• (c) Consent: the consent given by the person to whom a proposal has been presented in the same meaning
of that offer.
• (d) Consideration: the promise made to do or not to do any work in return of doing or not doing of any
work mentioned in the proposal.
• Chapter 2: Contracting Parties, Proposal and Consent
• 3: Person competent to conclude contracts
• 16 years and sane; guardian may contract on behalf of incompetent

• Chapter 3: Void and Voidable Contracts

• 13: Void Contract
• 14: Voidable Contract
• Chapter 5:
• Chapter 6: Contract relating to Collateral and Deposit
• Chapter 7: Contract relating to Sale of Goods
• Chapter 8: Contract relating to Agency
• Chapter 11: Execution of Contract and Obligation Arising out of the Contract
• 79. Contracts need not executed in the event of fundamental changes in the situation
• Chapter 12: Breach of Contract and Remedies
 4.3 Essentials of a valid contract
• Offer and acceptance: An offer is a promise made by a party/person to
another party/person with an intention of getting approval over his/her
promise. A tender submitted by a contractor is considered as offer. The
client, after due consideration and evaluation of the offer, provides
acceptance of the offer.
• Mutual intent to enter into contract: An agreement between two (or
more) parties is not automatically a contract. A contract requires the
parties intention to establish a legal relationship. The parties’ intention of
entering into contract should be clearly reflected in the agreement.
• Consideration: All the concerned parties of the contract should get
something of value for fulfilling the terms and conditions of the contract.
• Capacity to contract: A party (or person) entering into a contract should
be of legal age and should be under his/her own control.
• Lawful purpose: The objective of a contract must be lawful to be valid.
• Free consent: The parties in a contract should have consented freely to
enter into the contract. A contract signed under coercion, undue influence,
fraud, misrepresentation etc. are invalid.
 4.3 Void contracts (Section 13)
4.3.1 Void Contracts:

a) preventing anyone from engaging in any legal occupation, profession or

trade.
b) restraining legal marriages.
c) preventing any one from enjoying public facilities.
d) seeking to prevent the legal rights of any person from being enforced by
any government office or court.
e) concluded in matters, contrary to/prohibited by prevailing laws.
f) concluded for immoral purpose/against public morality or public interest.
g) which cannot be performed because the parties thereto do not exactly
know about the matter in relation to which it has been concluded.
h) which is considered impossible to fulfill even at the time the contract is
concluded.
i) which is vague (does not provide reasonable meaning thereof).
j) concluded by an incompetent person.
k) concluded with an unlawful consideration or objective.
 4.3.2 Voidable Contracts (Section 14)
A contract concluded through:
a) coercion: threatens to withhold property,
threatens defamation, takes actions against law
b) undue influence: influence exercised by a person
upon another who is under his/her influence,
like a ward/ subordinate/sick
c) fraud: knowingly leads the other party to believe
untrue issue to be true, withholds or suppresses
information
d) deceit: Submission of false particulars, falsifying
document
The burden of proof rests on the claimant.
 4.4 Cyber Law
• Cyber law provides the legal basis related
to the appropriate use of computer and
information and communication technology by a
person, organization and the government offices.
• It regulates the computer and other electronic
equipment based activities including business (e-
commerce) and the government (e-government).
• Nepal has enacted the Electronic Transaction
Act 2063 and Electronic Transactions Rule, 2064.
 Electronic Transaction Act, 2063 (2006)
• To make legal provisions for authentication and regularization of the recognition,
validity, integrity and reliability of generation, production, processing, storage,
communication and transmission system of electronic records.
• For controlling the unauthorized access of electronic records (violation of the
confidentiality) or of making alteration in such records through the illegal
manner (violation of the integrity)
• No. of Chapters: 12, No. of Sections: 80, 31 definitions
• Section 2: Definitions:
• 2-a: "Asymmetric Crypto System“: a system that creates a secured key-pair
consisting of a private key creating a digital signature and a public key to verify
the digital signature.
• 2-j: “Key Pair“: a private key in an asymmetric crypto system and of pair of public
key, interconnected in a mathematics form with the private key which has a code
to verify digital signature by the public key to be created from the private key.
• 2-o: "Digital Signature“: a signature made in any electronic form to be included in
the transformation of electronic record by a person having a non- transformed
initial electronic record and the public key of signatory by using a type of
asymmetric crypto system that may clearly ascertain the following matters:
(1) Whether or not transformation of electronic record was created by using a
type of private key keeping a logical consistency with the public key of signatory;
and
(2) Whether or not the initial electronic record has been changed after the
transformation of electronic record.
 ETA 2063 continued
• Chapter 2: Provisions Relating to Electronic Record and Digital Signature
3. Authenticity of Electronic Record: (1) Any subscriber may, subject to the
provisions of this section, authenticate to any electronic record by his/her
personal digital signature.
(2) While authenticating the electronic record pursuant to Subsection (1), an act
of transforming such electronic record to other electronic record shall be effected
by the use of asymmetric crypto system and hash function
4. Legal Recognition of Electronic Record
5. Legal Recognition of Digital Signature
Chapter 8: Provisions Relating to Network Service
• Chapter 9: Offence Relating To Computer (Cyber Crime)
– 44. To Pirate, Destroy or Alter computer source code
45. Unauthorized Access in Computer Materials
46. Damage to any Computer and Information System
47. Publication of illegal materials in electronic form
48. Confidentiality to Divulge
49. To inform False statement
50. Submission or Display of False License or Certificates
51. Non-submission of Prescribed Statements or Documents
52. To commit computer fraud
• Chapter 10: Provisions Relating to Information Technology Tribunal
• Chapter 11: Provisions Relating to Information Technology Appellate Tribunal
 4.5 Public Procurement Act, 2063
• Systematic, fair, transparent and optimum use of public resources in
procurement of goods and services by public entities
• No. of Chapters: 10; No. of Sections: 76
• 2-a: “Procurement”: acquisition of any goods, consultancy services or other services or
carrying out or causing to be carried out any construction works, by a public entity
pursuant to this Act.
• 3: All procurement by any public entity should follow this act, else the procurement will
be invalid.
Chapter 2: Responsibility for Procurement and Procurement Method
• 4: Description of Goods, Construction Works and Services to be Prepared
• 5: Cost Estimate to be Prepared
• 6: Procurement Plan to be Prepared
• 8: Procurement Method to be Selected
• Chapter 3: Bid
• 12: Prequalification to be Determined
13: Bidding Documents to be Prepared
14: Invitation to Bids
• Chapter 4: Consultancy Services
• 30: Short List to be Prepared by Soliciting Expression of Interest Openly:
31 & 32: Soliciting and opening proposals
• 33: Evaluation of Technical Proposal
• 34 & 35: opening and evaluation of Financial Proposal
 4.5 Public Procurement Act
• Chapter 5: Other Provision Relating to Procurement
• 40 & 41: provisions related to sealed quotation and direct procurement
Chapter 6: Provision Relating to Review of Procurement Proceedings or
Decision
Chapter 7: Provision Relating to Procurement contract
• 54: Variation Order
55: Price Adjustment in Procurement Contract
56: Provision Concerning Extension of Contract Period
58: Mechanism for Dispute Settlement
60: Public Notice of Procurement Contract:
Chapter 8: Provision Relating to Conduct
• 61 & 62: Conduct of official and bidder
Chapter 9: Provision Relating to Monitoring of Procurement Activities
• Chapter 10: Miscellaneous
– 66: Provision Concerning Procurement to be Made in Special Circumstances
– 67: Procurement Process under this Act not to be Applied
– 68: All records are to be in written form
– 69: Procurement Transaction May be Carried Out Through Electronic
Communications Means
– 70: Legal Documents to be kept in Website
 4.6 Intellectual property right (patent,
design and trademark, copyright)
The creations of human mind are considered as intellectual property. It covers
patents, designs, trademarks and copy right; the legal rights given to the creators of
such properties are called intellectual property rights. The World Intellectual
Property Organization has listed the following as intellectual property.

• Literary, artistic and scientific works

• Performances of performing artists, phonograms, and broadcasts
• Inventions in all fields of human endeavor
• Scientific discoveries
• Industrial designs
• Trademarks, service marks, and commercial names and designations
• Protection against unfair competition, and
• All other rights resulting from intellectual activities in industrial, scientific,
literary or artistic fields

The laws related to intellectual property rights in Nepal are:

(a) Patent, Design and Trademark Act 2022 (1965), amended in 1987 and
(b) Copyright Act 2059 (2002).
 Patent
• Patent: As per the PDT Act 2022, the patent can be issued to any useful
invention based on new principle or formula, or any new way or method of
construction, operation or transmission related to substance or a body of
substance.

• A patent should be duly registered, by submitting all the required documents, to

have the patent right. Once registered, the right over the patent is protected for
7 years (plus two extensions, each of 7 years). The patent right is transferrable.
The registered patent should not be used or copied without obtaining specific
written permission from the patent holder, until the patent duration expires,
within the jurisdiction of the patent provider. The law breaker can be fined up to
Rs. 500000 and confiscation of the related items, and up to Rs. 250000 for
committing an attempt of an offence.

A patent right cannot be granted if:

• The patent is already registered in another person’s name
• The patent was not invented by the applicant and the right to patent has also
not been received from the inventor
• The patent is likely to produce adverse effects on health, conduct and morality
of the citizen or on national interest
• The patent is against the existing law
 Design
• Design: The PDT Act 2022 has defined design as a feature,
pattern or shape of a substance made by following any means.
• The design should be registered to have design right. A
registered design should be used by someone else only with
specific written permission of the design right holder, until the
design right duration expires (5 years plus two extensions, each
of 5 years).

The breach of the design right constitutes a fine of up to Rs. 50000

and confiscation of the related items.

The design right cannot be issued if

(a) the design was already registered by someone else, and
(b) the design is likely to have adverse impact on the conduct or
morality of a person or institution or on national interest.
(c) The patent is against the existing law
 Trademark
Trademark: The PDT Act 2022 has defined trademark as the use of any
word, sign or picture or a combination of them by a firm, company or
person to distinguish the product or services from those of others.

The trademark should be registered to have trademark right. A

registered trademark, or its close imitation, should not be used by
someone else. The right over a trademark can be protected forever
subject to renewal (7 years in each renewal).

The trademark will not be registered if

(a) the trademark has already been registered by someone else and
(b) the registration will have adverse impact on the conduct or
morality of a person or institution or on national interest.

The breach of the trademark right constitutes a fine of up to Rs.

100000 and confiscation of the related items.
 Copyright
As per the Copy Right Act 2059, the copy right can be provided to the
author of the works that are related to the following.
• Book, pamphlet, article, and research paper
• Drama, opera, dumb-show and similar works prepared for show
• Musical works with or without words
• Audiovisual works
• Architectural design
• Painting, sculpture, wood carving, lithography and architecture
related other works
• Photographic works
• Works related to applied art
• Excerpt, maps, plan, three dimensional works related to geography,
topography, and scientific writing and articles
• Computer program
• The description or the explanations of the ideas, religion, news, concept, formula,
law, court decisions, administrative decisions, folk songs, folk stories, proverbs &
general statistics, even if they are included in any works, cannot be copy righted.
• Specific registration is not required to have copy right.
• There are two types of rights granted under the Copy Right Act: Economic and
Moral. Moreover, the Act has granted rights to performers, producers of
phonograms and to broadcasting institutions. The copy right is effective up to 50
years after the death of the author (or creator) of the copy righted materials.
The copy righted materials can be used without permission in the following
circumstances.
a) A portion of the work for personal use, as long as it does not hamper the
economic right of the copy right holder.
b) For public cause or academic purpose, portion of a published materials may be
used with proper citation of the source, provided that the use does not directly
benefit (economically) the user of the copy righted materials.
c) Libraries and archives can reproduce the works for general purpose.
• Depending on the degree of infringement of the copy righted material, the
penalty can range from Rs. 10,000 to Rs. 100000 or imprisonment up to six
months or both for the first offense. The penalty doubles for the second offense.
Besides, the offender shall be liable for compensation of the damages caused by
his/her act.
 Copy Right, Patent, Design and Trademark Comparison
SN Particular Copy Right Patent Design Trademark
1 Subject Rights related to work authorship/ Rights related to new Rights related to shape, Rights related to word,
Matter/ literary work, artistic work: music, book, inventions/theory/ pattern, color of symbol, picture, figure or
Coverage movies, painting, photos principles, process, commodities, product combination of all these to
formula recognize goods or products
2 Validity a) Life time + 50 years 7 years and two times 5 years and two times 7 years and indefinite period
b) 50 years from death of last surviving renewable (21 years renewable (15 years as long as timely renewed
author maximum) maximum)
c) For anonymous or pseudonym work:
50 years from first date of publication
d) For applied art & photograph: 25
years from preparation of such work
e) 50 years for posthumous publication
3 Infringement Person other than owner comes up with Confers statutory Confers statutory Confers statutory monopoly
same work, there is no infringement; monopoly that prevents monopoly that prevents that prevents anyone other
can be copied and used without anyone other than patent anyone other than design than trademark holder from
permission for academic, public welfare holder from making, using holder from making, using making, using or selling
purpose, with source cited or selling or selling
4 Punishment a) 10,000 to 100,000 or 6 months Rs. 250,000 to 500,000 + Up to R. 50,000 + Up to Rs. 100,000 +
on imprisonment, or both + confiscation confiscation of product confiscation of product confiscation of product
infringement b) 20,000 to 200,000 or one year
imprisonment or both + confiscation
5 Start of As soon as work is created (registration From patent application From design application From trademark application
protection is optional) registration date registration date registration date
6 Requirement Original Novel/non-obvious, useful New and different New and different
7 Application, Rs. 100; 1000; 300 Rs. 100; 700; 200 Rs. 100; 400; 150
registration
and renew fee
8 Governing Act Copy Right Act 2059 PDTA 2022 PDTA 2022 PDTA 2022
 4.7 Company Registration Procedures
• Application with following documents:
– Filled application form, format as per Annex 1
– Two copies of Prabandha Patra (Article of Association), and Niyamawali (Article of Memorandum)
– Citizenship certificates of all the founder shareholders
– In case of a public company, a copy of the agreement made among the founder members before the
establishment of the company.
– In case of a private company, a copy of the mutual agreement (if any).
(Additional documents needed for foreigner registering a company.)
Other considerations:
– Max 101 founders in private company; minimum 7 founders in public company
– Prabandha Patra and Niyamawali to be in Nepali
– Each founder should sign on each page of Prabandha Patra and Niyamawali
– Last page should have
• full name, full signature, address, number of share of each founder,
• full name, full signature, address of witness (one witness per founder)
• full name, full signature, registration number of legal-professional or chartered accountant
preparing the document, and date of document preparation
• The OCR checks the documents and if found OK, notifies the applicant(s) to pay registration fee and collect
certificate. If the Registered Capital is up to Rs. 5000, the charge can be paid at the OCR; else required fee to
be deposited in NRB or other authorized banks in ‘RAJASWA’ account number1-1-05-10. Two copies of the
voucher to be submitted in the OCR’s A/C section, and then presented in the registration section. After this,
the company registration certificate (according to the index 5) and one copy of each (approved and signed
by CRO Officer) of the ‘PRABHANDA PATRA’ and the ‘NIYAMAWALI’ presented by the founders are provided
to the founders.
• Only electronic registration, from Baisakh 2074, as per first amendment in 2074
http://www.ocr.gov.np/index.php/en/component/content/category/87-registration-process-information
 4.8 Relationship to foreign firms working in Nepal
• Hundreds of foreign firms are working in Nepal, directly or indirectly, as INGO, banks,
industry, management consultants, engineers in consulting companies, software,
outsourcing, …
• Directly related acts: Foreign Investments and Technology Transfer Act,1992; Foreign
Exchange (Regulation) Act,1963; Immigration Act
• Foreign Investment and One Window Policy
• Foreign Investment Policy, 2015 aims to:
– Attract foreign investment in energy efficient/non-polluting industries by granting additional facilities.
– Establish SEZ or export promotion zones.
– Promote Nepalese products in int’l market and protect intellectual property of such products.
– Transfer of technology within a specified period of time.
– Develop legal basis for technology transfer in industries where foreign investment is restricted.
– Include supply of equipment under the ‘lease financing’ model, investment in bonds and debentures,
and investment through secondary market within the purview of foreign investment.
– Technology transfer via – assignment, user’s licensing, sharing of technical know-how and franchising.
– Institutional investors to invest through the secondary market (portfolio investment).
– Form Foreign Investment Promotion Board to facilitate establishment of foreign investment based
industries
– Form SOP to simplify the process of foreign investment.
– Limit customs tariff on machinery imported for foreign investment in kind to 4%.
– Avoid double taxation with additional countries.
– Rights to use immovable property in relation to HEP and infrastructure projects under the BOT model
remain with the investor for the duration of the related BOT agreement.
– Facilitate repatriation of amount remaining after liquidation of the company by the foreign investor.
– Enable parties to determine the mode and venue of dispute resolution procedure in case of industries
having over USD10 million as investment.
 Foreign Investment under the law of Nepal
1. Foreign Investment: Investment made by a foreign investor in any
industry in form of:
a) investment in equity,
b) reinvestment of earning derived from existing investment,
c) investment made in form of loan or loan facilities
d) transfer of technology,
e) lease finance,
f) opening a branch to carry out business.
2. Transfer of technology: transfer of technology under an agreement
between foreign investor and an industry on the following matters:
a. use of any intellectual property rights of foreign origin,
b. acquiring any foreign technical consultancy and management,
c. acquiring foreign market service.
3. Foreign Investor:
individual, firm, company, foreign government or international agency
Rights, Guarantees and security of FDI
• Fair and equitable treatment: No discriminatory treatment
in all time,
• Most-favoured nation treatment: transfer of funds,
incorporation of a company, FDI approval etc.
• National treatment: management, operation, protection,
incentives etc.,
• Guarantee against expropriation: no nationalization,
(Industrial Enterprises Act,sec.21)
• Nepal is a party to MIGA that protects political risks of FDI,
• An industry established under FDI in Nepal is entitled to the
incentives awarded to other industries, (FITTA,sec.2(a),
• Guarantee for repatriation of FDI, (sec.5(2) FITTA)
• Nepal is a party to BITs/BIPPAs concluded with some
countries that protects FDI of the country concerned.
Resolution of investment disputes involving foreign forms
• Investment disputes are contractual matters under Nepal law,
• Disputes between a foreign investor and Nepali investor or
concerned industry shall be settled by mutual consultation in the
presence of DOI, (sec.7,FITTA)
• If disputes could not be settled in that manner it shall be settled by
arbitration under UNCITRAL Arbitration Rules, (sec.7(2) FITTA)
• Disputes in regard to foreign investment exceeding NRs.5oo million,
may be settled by any manner as the parties design,( Parties are
free to decide the manner for dispute resolution), ( sec.7(4),FITTA)
• Nepal is a party to New york Convention on Recognition and
Enforcement of Foreign Arbitral Award(1958),
• Arbitration Act,1999 is based on Model UNCITRAL Commercial
Arbitration Act (1985)
• Nepal is also a party to the International Centre for Settlement of
Investment Disputes (ICSID) Convention (1969)
 Potential Questions
• How does Nepal Engineering Council regulate professional engineering practices in Nepal?
• Discuss the process of registration of an engineer at NEC and conditions for cancellation of
registration.
• What are the employment and job security provisions for the workers, as per the Labor Act of
Nepal?
• What are the health and safety provisions for the workers, as per the Labor Act of Nepal?
• What are the welfare provisions for the workers, as per the Labor Act of Nepal?
• Discuss the essential elements of a valid contract.
• What are the differences between a void and a voidable contract?
• What are the basic objectives of the Electronic Transaction Act of Nepal?
• What type of activities are considered to be an offence of the Electronic Transaction Act of Nepal?
• What is the basic objective of the Public Procurement Act of Nepal?
• What are the basic provisions in procurement of consultancy services by a public entity in Nepal?
• Discuss the importance of the intellectual property right in the development of science and
technology of a society.
• Compare and contrast copy right, patent right, design right and trademark right, as per the laws of
Nepal.
• Discuss the process of a private company registration in Nepal, including the types of documents
required.
• What are the objectives of Foreign Investment Policy 2015 of Nepal?
• What are the rights, guarantees and securities provided to FDI in Nepal?
• What is the reason for the Nepalese government trying to attract foreign direct investment in Nepal?
 Professional Ethics in Engineering
Contemporary and Emerging Issues in Engineering (6 hours)

5.0 Contemporary and Emerging Issues in Engineering

5.1 Globalization and cross cultural issues
5.2 WTO perspectives
5.3 Public Private Partnership (PPP)
5.4 Development versus Environmental Degradation
5.5 Addressing the Climate Change issues
5.6 Conflicts and Dispute management

Prof. Dr. Hari Krishna Shrestha

Nepal Engineering College
Changunarayan, Bhaktapur

August 2017
Update: August 12. 2017
5.0 Contemporary and Emerging Issues in Engineering
• Efficiency in resource use (energy, human resource, bio-physical resource)
• Safety (public, workers, users)
• Environmentally and Socially justified development
• Benefit Sharing and protection of private property right
• Corporate Social Responsibility
• Gender and cultural aspects
• Child Right, Labor Right, Fair trade
• Accountability in Engineering
• Sustainability
• Reduce, reuse, recycle: zero waste
• Climate Change
• Output and outcome; technical auditing, energy auditing
• Transparency
• E-governance, instant access to public information
• Privacy of private information
• Community involvement in project design
• Automation of operation, monitoring and production process
• Robotics and mechatronics
• No trade barrier; WTO provisions
• Genetic and Medical Engineering: balance between technology and moral values
• Social Engineering
• Development in transportation and ICT: Globalization
 5.1 Globalization and cross cultural issues
• Rapid development in transportation and ICT: Globalization
– transfer of goods and services and movement of human
beings across the world at rapid rate, and impact of an
incident in one corner of the globe felt across the globe
• Need for understanding cross cultural values increase due
to globalization
• Knowing when to listen, when to ask for help, and when—
finally—to speak
• Developing effective relationship with people from cultures
substantially different from ours.
• Individualism versus collectivism.
• Acceptance of power and authority.
• Materialism versus concern for others.
• Formality versus informality.
 5.2 WTO Perspectives
• World Trade Organization (WTO) is a worldwide organization for maintaining
trade relation among different countries. WTO officially commenced on
1/1/1995. Nepal got WTO membership on 11/1/2061 B.S. WTO helps in
setting trade disputes among countries and creates a healthy environment
for global trading.
• WTO deals with regulation of trade among member countries by providing a
framework for negotiating and formalizing trade agreements and dispute
resolution. It determines the Terms of Trade, International Policies, and
Rules for Global Trade.
• WTO promotes world trade. It works for the implementation and operation
of the various agreements made among different countries. It monitors and
suggests improvements in the trade policies and rules of the member
countries. It conducts programs for the livelihood upliftment and ensuring
employment opportunities in member countries.
• WTO facilitates in enhancement of productivity and income level of the
ordinary people including food security in the countries.
 5.2 WTO perspectives
Opportunities for WTO membership:
• Government will become more rational in decision-making
• Rent seeking activities will decrease
• Problem of transit will be less
• Provisions of technical support
• Access to markets, duty-free-quota-free access among member countries
Benefits of WTO in Nepal: (a) Market access opportunities, (b) Policy
stability, (c) Attract foreign direct investment, (d) Gearing up domestic
institutional capability, (e) Benefits of positive discrimination and (f)
Establishment of trade and transit rights
WTO challenges for developing countries
• Improving national policies
• Amending some laws and developing new laws
• Changing trade administration attitude
• Human resource development and infrastructure development
• Quality control of goods and services
5.2 WTO perspectives
 5.3 Public Private Partnership (PPP)
• Definition: Funded and operated through a partnership of government and one
or more private sector companies
• Private party provides a public service or project
• Assumption: substantial financial, technical and operational risk in the project
• Enable public sector to harness expertise and experience
• Fundamental principle of PPP: Public service provision can be linked with profit
making business, which makes the operation of the public service provision
sustainable and efficient. Public gets the service at lower price due to risk sharing,
business gets profit, efficiency increases, government can invest tax in other areas
rather than in inefficient projects.
• Conditions for successful implementation of PPP:
– Government’s willingness, confidence & institutional capacity to adopt PPP
– Clear policy and clear legal provisions (acts, laws, rules, regulations)
– Society ready to accept reasonable profit as a justified
– Fair and transparent business environment
– Technical, financial and management capacity of private parties
• Status of PPP policies and programs in Nepal
– White paper on PPP, PPP Policy
• Reasons for low level of PPP implementation in Nepal
 5.4 Development versus Environmental Degradation
• Infrastructure construction and economic growth are not
synonymous with development.
• Development activities need to be sustainable.
• Development which results in environmental degradation is
unsustainable, and generates conflict.
• Development without environmental degradation is possible.
• Guidelines for project designs by considering environment
prepared
• Many government agencies now has environment section
• Globalization, food security policy, energy and climate change
and sustainable economic integration concepts are needed for
development with environmental sustainability
• Frontier thinking in sustainable development and human well-
being needed
• Ecological health and the positive relation between social and
economic wellbeing is maintained.
• The Environment Protection Act 2053 (Clause 7): nobody shall
create pollution in such manner as to cause significant adverse
impacts on the environment or likely to be hazardous to public life
and People's Health Protection Rules 2054 while practicing
engineering profession.
• Two important examinations are to be carried out before initiating
infrastructure projects: IEE and/or EIA
• initial Environmental Examination (lEE)
– A report on analytical study or evaluation to be prepared to
ascertain as to whether, in implementing a proposal, the proposal
does have significant adverse impacts on the environment or not,
whether such impacts could be avoided or mitigated by any means
or not
• Environmental Impact assessment (EIA)
– it is a report on detailed study and evaluation to be prepared to
ascertain as to whether, in implementing a proposal does have
significant adverse impact on the environment or not whether such
impact could be avoided or mitigated by any means or not for
construction of national high ways and main feeder roads.
 5.5 Addressing the Climate Change issues
• Climate Change (CC): sustained and gradual change in the nature of climate
parameters, like temperature, rainfall, humidity, and wind speed
• Science of CC: natural and anthropogenic; increase in green-house gas release
traps terrestrial radiation from escaping, resulting in rise in temperature, which
affects global circulation of air, and changes timing and intensity of rainfall.
• Effects of CC: rise in average and maximum air temperature, rise in night time
temperature, increase in intensity of rainfall, decrease in number of rainfall
days, increase in number of days with rainfall more than 100 mm, rise in
devastating flood and landslide events, Glacial Lake Outburst Flood, increase in
frequency and intensity of drought, increase in river bed rise and sedimentation
• Impact of CC: agricultural fields washed, reduced agriculture production,
damage to infrastructure due to flood and landslide, flash flood washing
people, GLOF damaging riverside settlements, villages under landslide,
desertification resulting in migration, increase in inundation and water borne
diseases, tree line going uphill, insects appearing in higher elevation and
spreading diseases
• Role of Electronics and Electrical Engineers in CC mitigation: increase in energy
efficiency – generation and use (LED bulb, motion detecting light bulbs, satellite
monitoring of forest fire, litigation support against exhaust, remote monitoring
of climate data using data loggers and relaying information, smart grid design,
decrease in energy loss in transmission, environmentally sensitive
developments, …
 5.6 Conflicts and Dispute management
• Conflict results when people have different (real or perceived)
value or approach on particular issue(s).
• Organizational Conflict: “Organizational Conflict is a state of discord
caused by the actual or perceived opposition of needs, values and interests
between people working together.”
Three approaches to organizational conflict
• Traditional approach (1930-40): Conflict is opposite of
cooperation, and is inherently bad, negative and harmful for
smooth functioning and progress of society, organization or a
project. Conflict is equated to dysfunction and destructive, and
must be avoided. It results from poor communication,
disagreement, lack of trust, and low management skill.
• Human Relations approach (1950-70): Conflict is inevitable and
can be beneficial, if managed properly. It is not inherently bad.
• Inter-actionist approach: Conflict makes an organization
dynamic, and helps in finding best solution to problems. On-going
manageable level of conflict should be encouraged as it prevents
organization from being static. So conflict is good.
5.6.1 Levels and sources of conflict
Levels of Conflict
• Intrapersonal conflict: conflict within self due to
differences in goal, role, and personal values
• Interpersonal conflict: between two or more
persons; can be due to differences in goal, role,
values, culture, communication gap
• Intergroup conflict: between two or more groups
of people
• Inter-organizational conflict: between two or
more organizations
• International conflict: between two or more
nations
 5.6.2 Levels and sources of conflict
Sources of Conflict in an organization (or a project)
• Personal differences/Personality clash: When the ideas, values, culture
and customs of a person (or persons) are incompatible with other persons
of an organization.
• Goal and role incompatibility: When the ideas, values, culture and
customs of a person (or persons) are incompatible with the goal of an
organization or assigned role of the person in the organization.
• Organizational climate and change: When the work environment and
rules of an organization are unpredictable, and when the rules or
managers or owner of the organization suddenly changes.
• Gender and other social differences: When the work environment and
rules are designed to favor employees from a particular socio-cultural
background or particular gender.
• Availability and access to resources: When the availability of resources
becomes too limited and/or unevenly distributed. When access to
resources is uneven.
• Communication gap: When there is communication gap between
organization and its employees.
 5.6.3 Conflict resolution methods: avoidance,
diffusion, containment, confrontation
• Avoidance: avoid conflict, ignore conflict, “time will heal” approach; in
this method the management will try to create a situation where conflict
does not occur, for example by hiring workers from similar socio-cultural
background. If conflict occurs, the management will wait for the situation
to calm down, rather than taking any proactive situation.
• Diffusion: distraction and defuse into multiple sectors; bring in “other”
issues so that the main reason from the conflict becomes less important
or one of the many issues; bring in other stakeholders..
• Containment: conflict contained within certain people, and resolved
through discussion and bargaining, in closed meetings, in the hope to
resolving the conflict before it goes out of control or before it expands.
• Confrontation: conflict brought in front of all concerned, conflict
resolution through open dialogue, face-to-face meeting, open bargaining,
and resorting to legal process, if needed.
 5.6.4 Dispute resolution methods: conciliation,
mediation, adjudication, arbitration, and litigation
• Conciliation: Mutually agreed terms and conditions, “give
and take” approach, without direct involvement of
outsiders (mediator), even though the mediator assists in
bringing the parties together.
• Mediation: similar to conciliation, but with direct
involvement of outsiders (mediator). The mediator
facilitates, and intervenes, if needed, in conflict
resolution process (as per Mediation Act 2068).
• Arbitration: Resolution through certified licensed
professional arbitrators, using the clauses of acts and
regulations, after thoroughly investigating the issues of
conflict. The arbitrators are normally selected, by mutual
consent, from panel of experts.
• Litigation: Resolution through court, as per prevailing
laws, acts, rules, regulations, and legal precedents of a
country.
 5.6.5 Dispute resolution methods:
adjudication and arbitration as per PPA
Disputes are inevitable in construction projects and in engineering professional
works. Dispute resolution procedures are normally mentioned in the conditions of
contract. The Public Procurement Act 2063 (PPA 2063, Chapter 7, Section 58) and
Public Procurement Rules 2064 (PPR 2064, Chapter 12) have provisions for dispute
resolution.
If the parties in dispute cannot resolve the dispute through mutual consensus
(amicable settlement), then, as per Section 129 of PPR 2064,
• For works of value up to Rs. 100 million, disputes can be settled by sole
adjudicator (निर्णयकर्तण).
• For works of value above Rs. 100 million, disputes shall be settled by a Dispute
Resolution Board (DRB) consisting of three members (one from private party,
one from public entity and one agreeable to both, Clause 130-2).
• If the parties cannot settle dispute through adjudicator or DRB, then the
dispute can be resolved through arbitration (मध्यस्थकर्तण) or litigation (court),
PPR, Section 135.
• The adjudicator is a related technical expert with at least 5 years of experience.
• Remuneration of the adjudicator will be borne equally by the private party
and public entity.
 5.6.5a Dispute resolution methods:
adjudication and arbitration
Adjudication:
• The adjudication is “a quick and relatively inexpensive way
of resolving a dispute, whereby an impartial third party
adjudicator decides the issues between the parties”.
• The following are the characteristics of adjudication.
– It is a mechanism of dispute resolution.
– An independent third party, called adjudicator, awards the
decision
– Quicker and inexpensive mechanism of dispute resolution,
compared to arbitration and litigation, normally taking less
than 30 days after submission all relevant documents.

• The Public Works Directive (PPD) and the Public

Procurement Act (PPA 2063, Section 58) have provisions
for dispute resolution through adjudication.
 5.6.5b Dispute resolution methods:
adjudication and arbitration
Arbitration
• The arbitration is a formal mechanism of dispute resolution conducted outside a
court, as per Arbitration Act 1999. The following are the advantages of arbitration
over litigation.
• It is a private alternative to formal court procedure: voluntary in nature
• The arbitrators are technical experts; can result in creative solutions
• Faster conclusion, within 120 days after submission of documents (Section 24)
• Less expensive
• No public hearing, so low publicity and less stress (which is normally preferred by
the parties)
• Less confrontational and formal, hence more convenient to the parties of dispute
• Can appeal against decision in Appellate Court within 15 days (Section 21-2)

• The PPA 2063 has recognized arbitration as a means of dispute resolution.

Arbitration Act 1999 (Section 17) governs the arbitration procedure in Nepal. The
Nepal Arbitration Council 1991 has been providing arbitration services in Nepal.
However, in Nepal, most of the disputes go to court, or settled out of court
through mutual consent, even after arbitration, by ignoring the arbitrators’
decisions.
 5.6.6 Conflict versus Dispute
Conflict Dispute
Long term serious disagreement, non- Short term disagreement, over specific
specific issues issued, can be resolved

Non-negotiable issues Negotiable issues

Involves principle, values, ego, belief, Involves amount, money
interest
Conflict does not turn into dispute, unless Disputes, if unsettled, can convert into
intervened. conflict

Each side is fundamentally opposed to the specific disagreement concerning a

success of the other and will not compromise matter of fact, law or policy in which a
their own values at the risk of allowing those claim or assertion of one party is met
they despise to achieve even the slightest with refusal, counter-claim or denial by
victory (Burton, 1990) another;
Win-win scenario can be compromised.
 Self Test
• Define conflict and explain the sources (causes) of conflict.
• Discuss different levels of conflict.
• Discuss different methods of conflict resolution.
• Differentiate between conflict and dispute.
• Discuss dispute resolution methods. Which method is better:
adjudication or arbitration?
• What are the major differences between mediation and
adjudication?
• Which method of conflict resolution is preferred by private
parties, and why?
• What are the major sources of dispute in an infrastructure
development related construction project in (a) a remote area
of Nepal, and (b) in urban areas?
• Discuss the potential sources of conflict in (a) a high dam
hydropower project, (b) fast tract highway, (c) broad gauge
railway through mid-hills of Nepal, (d) international airport in
Nijgadh, (e) multi-purpose water resources development
project, (f) land pooling project for planned city development
 Professional Ethics in Engineering
Case Studies Involving Professional Ethical Issues (4 hours)

6.0 Case Studies Involving Professional Ethical Issues

6.1 Copyrights and Patent Protection
6.2 Personal Data Privacy
6.3 Industrialization and Environmental protection
6.4 Risk/Benefit considerations in public transportation
6.5 Engineers and the military
6.6 Science and technology for medicine
6.7 Engineers in international development
6.8 Arbitration

Prof. Dr. Hari Krishna Shrestha

Nepal Engineering College
Changunarayan, Bhaktapur

August 2017
Updated: August 12, 2017
 6.1 Copyrights and Patent Protection
6.1.1 A fresh water resources engineering graduate (Engineer A) is
approached by a Department of Groundwater (DoG ) senior engineer.
The DoG engineer asks Engineer A to conduct a district-wide study of
groundwater-surface water inter-link in Palpa, and provides a sample
of a report to be produced. Engineer A finds that the sample report is
based on a superficial study, with all the data taken from USA, and
requests money to visit Palpa and collect field data. The DoG engineer
refuses, saying that they got the project from low bid, asks Engineer A
to prepare the report based on assumed data and assures that
Engineer A will not face problem since the contract to conduct the
study was obtained by a consulting firm registered in DoG engineer’s
spouse’s name, the DoG engineer himself is responsible to check the
report quality, and Engineer A’s name will not be in the report.
• List all the options for Engineer A.
• Separate the options into moral, ethical, and legal categories.
• Analyze each option based on ethics and risk to Engineer A.
6.1.1 List of options for Engineer A.
• Follow the suggestions of the DoG engineer (use data from
textbooks to prepare report)
• Visit the site at Engineer A’s own expense, and prepare good report
based on field data.
• Collect and study previous reports of the same area which provides
related data and prepare report based on secondary information.
• Refuse to be involved in the work and return the sample report to
DoG Engineer.
• Accept the assignment, secretly record further conversations with
the DoG engineer and report the case to CIAA, with proof.
• Publish an article in newspaper/magazine about the case, with the
name of the DoG engineer.
 6.1.2 Breach of intellectual property rights & copyrights
• Weak IPR laws bane for foreign investment; Published: March 14, 2017; by PUSHPA RAJ ACHARYA
• Owing to trademark dispute with a local firm, Kansai Paint mulling over pulling out from Nepal
• At a time when the government has been harping on foreign investment in a bid to advance Nepali economy, one of the reputed foreign joint ventures
is mulling over retracting its investment from Nepal as a consequence of intellectual property rights (IPR) dispute with a local firm.
• A Japanese foreign investment in Nepal, Kansai Paint, which entered Nepal in 2012 in joint venture with Nepal’s Shalimar Paints, has failed to obtain
trademark from the Department of Industry (DoI). This is because capitalising on the weak intellectual property rights (IPR) laws in the country, a local
investor had registered a firm under the name ‘Kansai Nerolac Paint Nepal Pvt Ltd’ at the Office of Company Registrar and had applied for trademark
before the foreign joint venture.
• The local firm — Kansai Nerolac Paint Nepal Pvt Ltd, which is run by Goyal Group — is in no way related to the Kansai Paint.
• Since Nepal is a member of World Intellectual Property Organisation (WIPO), it is a pity that the country was unable to identify even a globally reputed
brand like Kansai. The country may lose foreign investment worth Rs 350 million of the Kansai Paint, which entered the country through its Indian
subsidiary Kansai Nerolac Paints India, as the DoI has scrapped the application of the foreign joint venture to obtain trademark of its own name.
• As per Pradip Koirala, director general of DoI, the authorised agency under the Ministry of Industry to enforce Patent, Design and Trademark Act, the
department had scrapped the application of the foreign venture as per the provision of law that provides favourable treatment on ‘first come, first
served’ basis. He, however, admitted that the laws need to be amended to lure foreign investment citing foreign firms are sensitive in regard to
intellectual property rights.
• The globally renowned Kansai Paint had purchased 68 per cent stake of Nepal’s Shalimar Paints through its Indian subsidiary Kansai Nerolac Paints
India and registered a company Kansai Paints Nepal Pvt Ltd. However, the foreign joint venture had faced a court case from the local company —
Kansai Nerolac Paints Nepal Pvt Ltd. The Supreme Court, some four months back, had issued a verdict in favour of the local firm citing that it had
registered the company prior to the foreign joint venture.
• The local firm, which is producing paints under the brand of Nerolac and Kansai, again filed a case at the DoI and the DoI also scrapped the application
of foreign joint venture and refused to issue the trademark it had sought. The foreign joint venture also faced unfavourable decision from the Patan
High Court, where it had filed a case seeking protection of its trademark. As per the court’s decision, the company has to change the name of its
product because the local firm has already captured the brand of reputed Kansai Nerolac Paint in the Nepali market.
• Due to all these reasons, the foreign investors are now thinking about exiting from Nepal, according to sources. Nepali partners of the foreign joint
venture have also backed this claim. “Kansai Paint, which came to Nepal through its Indian subsidiary after signing of bilateral investment promotion
and protection agreement (BIPPA) with India during the premiership of former prime minister Baburam Bhattarai, has been left red-faced in Nepal,”
said Ashok Vaidya, who is a Nepali partner of the foreign joint venture.
• Kansai Paint, originally from Japan, has set up factories in 25 countries and is selling its product under its own name. Due to the country’s weak IPR
laws, this case will establish a false precedence among potential foreign investors in Nepal, according to Vaidya. “The country will not only lose foreign
investment, there are chances it will also lose its reputation across the globe if the foreign investors withdraw investment from Nepal.”
• The foreign joint venture Kansai has been providing direct employment to 100 individuals and contributing revenue worth Rs 500 million to the
government every year. Kailash Chandra Goyal, who has been operating the local firm under the name of ‘Kansai Nerolac Paint Nepal Pvt Ltd’ and
producing paints under the brand name of Nerolac and Kansai refused to comment on the matter.
 6.2 Personal Data Privacy
• The US government asked the details of phone calls and emails of a seven persons
it suspects as anti-nationals from a Europe based communication company, with a
branch in the USA. The company refused, citing its policy of protecting personal
privacy provision of its client, and requests to provide legal documents from US
court for it to submit the data. The US government informed that the suspects are
planning to conduct a major crime and needs the information immediately.
However, the company was adamant, also cited European and US laws prohibiting
disclosure of personal data without a court subpoena. A major criminal incident
occurred two weeks later and one person died; the US government arrested
several persons including all the seven whose communication details it sought;
and accused the communication company of collusion in the crime. The court
found only one of the seven persons guilty of the crime.
• A) Was it right for the US government to demand the personal data of all the
persons it suspects of plotting a crime, without submitting subpoena?
• B) Was it right for the company to refuse to cooperate with the demands of a
legitimate government?
• C) Do you agree that the company assisted the criminals by not providing the
personal data to the US government?
• D) Should the company assume responsibility for the crime?
• E) Since one of the seven suspects was found to be involved in the crime, do you
consider the demand of the US government to provide personal data of all the
seven suspects justified?
• F) Do you consider the European and US laws prohibiting disclosure of private data
to a legitimate government without a court subpoena needs to be amended?
• G) Do you consider the company liable for the breach of the right to life of the
person who died in the incident?
 6.3 Industrialization and Environmental protection
The Environment Protection Act compliance monitoring team is about to visit a major
electronics industry, which was accused of dumping its lead based hazardous materials in a
dug well which contaminated the groundwater and posed health hazard to the local
residents. The manager of the industry asked the MIS officer to change the data in its system
to show that it is complying with all the existing laws of hazardous waste dump. The MIS
officer refused, saying that the data is available in many locations within the system, someone
else may have downloaded the data which may eventually get in the hands of the monitoring
team, and that it is unethical to change the data. When the MIS officer was asked again to do
the same act, he demanded the order in written form. The manager informed that the
potential penalty of the breach of the law can severely damage the industry’s financial
condition and its image, and industry may be bankrupt. He promised that if the changes are
made in the database and they are successful in averting penalty, the industry will install
water treatment plant, provide the clean water to the local residents, and also install proper
hazardous waste management system thereafter; this will be in the benefit of the industry,
the local residents, and the industry’s employees.
A) Do you consider the demand of the manager moral and ethical?
B) Was it OK for the MIS Officer to ask for the written order?
C) Since changing the data seems to benefit of all the parties, should the MIS Officer comply to the
demand?
D) If the MIS Officer did not comply, and the industry went bankrupt, what is the degree of
responsibility of the MIS Officer for the joblessness of the employees?
E) If you are the MIS Officer, what would you do in this condition, and why?
6.4 Risk/Benefit considerations in public transportation
• USA: In 2014, 32,675 people were killed in 29,989 crashes, an average of 96
per day. The number of deaths, and deaths relative to the total population,
has declined over the last two decades. From 1979 to 2005, the number of
deaths per year decreased 14.97% while the number of deaths per
capita decreased by 35.46%. The 32,479 traffic fatalities in 2011 were the
lowest in 62 years (1949).
• Nepal: According to Nepal Police records, 1,356 people died in road
accidents in the fiscal 2008-09, 1,734 in 2009-10, 1,689 in 2010-11, 1,837 in
2011-12, 1,816 in 2012-13, 1,786 in 2013-14 and 2004 in 2014-15. At least
1,305 road fatalities were reported in the first 10 months of the current
fiscal. On an average, 1,800 persons die in road accidents in Nepal every
year. Police say road accidents are on the rise due to increased vehicular
traffic. A fairly large number of accidents go unreported, because the parties
involved settle the matter themselves. (August 4, 2017, THT)
Based on the information given above answer the questions.
• A) What is the trend of fatal road accidents in Nepal versus USA?
• B) Considering that the population of the USA is 330 Million, and vehicle
ownership is 1 vehicle per 1.3 person, compare the numbers given above in
terms of fatalities per million population and fatalities per number of
vehicles; the total number of vehicles registered in Nepal, including
motorbikes, is about 2 million.
• C) As an electronics engineer, what role can you play in reducing risk of fatal
road accidents in Nepal?
6.4 Risk/Benefit considerations in public transportation
• The Public Transportation Entrepreneur Association (PTEA)
demanded 15% rate hike in bus fare when the diesel price went up by
10%. PTEA claimed that the risk and benefit associated with operation
of public buses is linked with diesel price; as fuel price rise risk
increase (higher investment for lower return) and benefit decrease
(lower seat occupancy). So to compensate for rise in risk and drop in
benefit, the bus fare needs to be raised by higher percentage.
• The Government of Nepal (GoN) did not agree with the PTEA logic.
GoN said that the bus fare is based on fuel, vehicle maintenance, tyre
wear and tear, lubricants and oils, driver and helper’s wages, bank
loan, and profit on investment. Since the price of only one of the
parameters has increased, it is unfair and unethical to increase bus
fare by more than 2%.
• GoN refused the PTEA demand saying that the diesel price is not
linearly related with diesel price. The PTEA threatened to call a strike
if their demands are unmet within 48 hours. Eventually a technical
committee was formed to settle the dispute, and appointed you as
the decision maker. Prepare your report which addresses all the
issues raised by PTEA and GoN, electronic monitoring of seat
occupancy, and a design to automatically revise bus fare in similar
situations in the future so that the risk and benefit in operation of
public transport is transparent.
 6.5 Engineers and the military
• The Nepalese Army (NA) has already established a
medical college and planning to run an engineering
college. The NA is engaged in disaster Risk
Management and construction of fast track highway
and also planning to invest in hydropower sector in
Nepal.
• (a) if you are an engineer working for the NA, what
suggestion would you give to the decision makers for
further expansion of the NA in other sectors where
engineering services are needed?
• (b) if you are an engineer working in a private sector
in hydropower development and/or highway sector,
what is your suggestion/opinion on the gradual
expansion of the NA in the sectors traditionally
handled by the private sector engineering firms?
 6.6 Science and technology for medicine
• An insurance company asked for the medical records of one
of its clients, claiming that the patient has unreported a
pre-existing condition, and hence ineligible for
reimbursement of expenses. The hospital administrator
asked you, the IT Officer, to provide the records. You asked
the part-time doctor who checked the patient; the doctor
refused to allow you to submit the report, citing patient
confidentiality provision. The administrator then asked you
to make a copy of the report and submit to him or reveal
him the password of the hospital MIS system. The
administrator also threatens to take disciplinary action
against you if you did not act accordingly.
• A) What are your options in this situation? Which options
are ethical and which ones are unethical?
• B) Is there any way to fulfil the administrator’s demand
without compromising patient confidentiality?
• C) As a professional engineer, what should you do in this
situation?
 6.6 Science and technology for medicine
• Many governments have banned stem cell research
or erected obstructions in SC research.
Stem cell research thus raised difficult questions:
Does life begin at fertilization, in the womb, or at birth?
Is a human embryo equivalent to a human child?
Does a human embryo have any rights?
Might the destruction of a single embryo be justified if it provides a
cure for a countless number of patients?
Since embryonic stem (ES) cells can grow indefinitely in a dish and
can, in theory, still grow into a human being, is the embryo really
destroyed? http://learn.genetics.utah.edu/content/stemcells/scissues/

• What are the roles of an electronics engineer in addressing

these questions?
 6.7 Engineers in international development

Engineers without Border

Policy Intervention
Sustainable, balanced, justified development
Site specific research for reliable design: bio-physical aspects
Access to the fruit the development: affordability
Energy – Water – Food Nexus
Culture and Disaster Sensitive Development
Conflict free development: local livelihood, benefit sharing
 6.7 Engineers in international development
• You are assigned to design an integrated circuit /
hydropower dam for a project in a country
which is considered hostile to your country.
• A) Should you accept the assignment and do
your best professional work for the project?
• B) Should you accept the assignment and
secretly and deliberately introduce bug in the
program, or introduce weak section so that the
project will eventually fail and result in a
disaster?
 6.8 Arbitration
•The project you are involved in from the contractor’s
side is in dispute with the consultant and client. The
client refused payment even after completion of work
citing 30-days delay in work completion. The delay was
due to initial 5-day strike by the contractor’s workers,
immediately followed by a 6-day national strike by a
political party. The contractor claimed that it could have
completed the work if there was no national strike,
which resulted in the workers returning home and also
resulted in unavailability of construction materials in
time, and hence not responsible for the delay; the client
cited workers’ strike as the main cause of delay.
•Which method of dispute resolution would you prefer –
arbitration or litigation?
•Prepare your logic for full payment claim.
 Arbitration Committee
formed in Melamchi Dispute:
CMC vs. Megatech
भेरम्ची आमोजनाको भूर ठे केदाय य
सहामक ठे केदायफीच बुक्तानी बफफादराई
सल्टाउन ऩऺहरूको अनुयोधभा खानेऩानी
भन्त्रारमका सहसचचव अचनरबद्र
खनारको संमोजकत्वभा भूर ठे केदाय य
सहामक ठे केदायहरूका तपफवाट १/१ जना
प्रचतचनचध यहने गयी ३ सदस्मीम
भध्मस्थकताफ सचभचत गठनगने आऩसी
सहभचत बए फभोजजभ हहजो एक सचभचत
गठन गरयएको छ । मो कचभटीरे
ऩऺहरूफीच आऩसी सहभचतका आधायभा
बुक्तानी बफफाद सल्टाउने चसपारयस गने य
सोही वभोजजभ सभस्मा मथाचिघ्र
सभाधान हुने अऩेऺा सफै सयोकायवाराको
यहे को छ ।
Facebook Post of Mr. Bhim Upadhyay,
Secretary, Ministry of Water Supply and
Sanitation, August 11, 2017
 Some basic guidelines in analyzing case studies
• Read the question carefully, paying attention to adjectives.
• Analyze the case from ethical, moral, social, legal and
professional angles, and assign role/responsibilities of each
party involved in the case.
• Base your analysis, wherever appropriate, on professional
code of conduct of NEC, NEA, FCAN, SCAEF, IEEE, CAN, or any
other professional organization. Specifically mention code, if
you can.
• Many cases involve conflict of interest (COI); if the case you
are dealing with is related to COI, specifically mention it.
• If specific laws are applicable, perform legal analysis and
mention the law, and specific sections/clause(s).
• Make your recommendations impartially, thinking of you as
an impartial judge, considering existing social, technical, legal
and professional codal provisions.
Sample Case studies (i): A client came to a designer and asked to design a multistoried building. The soil
type of the proposed site was found not suitable for that type of structure. The designer hesitated to
design the building. The client said that he actually was not going to build that structure. He wanted to
collect money from outside sources showing that designed as a proposal for his venture and wanted to
utilize that money in other business. Explain the roles of the client and the designer in the perspective of
professional ethics.

Your answer should address the following issues.

Role of Client and Designer (a) Is the intention of the client legal? (b) Is the intention of the client moral?
(c) Is the intention of the client ethical?

Morally, ethically, and legally, what should the designer do after knowing the real intention of the client?
Should the client be penalized for telling the “real intention” to the designer?
Should the designer refuse to design? If yes, why? If no, why?
Should the designer refuse to design and just keep quite?
Should the designer just submit a design and keep quite because what the client does with the design is
none of the designer’s business?
Should the designer design with piles (or other suitable foundation design) to make the structure suitable
for the type of soil?
Since the client is not going to build the structure anyway which does not increase hazard from the
building to anyone, what is wrong in just providing a design, as a hypothetical case?
Should the designer refuse to design and inform the government officials about the client’s intention?
Should the designer refuse to design and inform the media, or write an article in the newspaper, about the
intention of the client?
As long as the design is structurally sound, is the designer responsible (morally, ethically, legally) for what
the client does with the design?
Sample Case studies (ii) A recently built simply supported RCC roof slab of a single storied poultry farm in
Chitwan, collapsed and killed all the chickens in the farm. The farm owner blamed the labor contractor for
the defective work. The contractor denied and accused the client for providing low quality and inadequate
amount of steel bars for the roof slab. The farm owner then asked for compensation from the steel bar
supplier (for inferior quality bars) and the consultant (for improper supervision during construction). The bar
supplier defended herself by saying that the farm owner bought the cheapest bar from her which has no
guarantee. The consultant reported that the cause of the roof collapse is the use of very dirty water in
mixing the concrete, which was provided by the farm owner and used by the contractor despite objections
from the consultant’s site supervisor.
Analyze the situation carefully and decide which party (client, contractor, and consultant) is more
responsible or less responsible for the roof collapse. Explain your decision with reference to the Code of
Conduct of NEC and FCAN.
Things to notice before assigning degree of responsibility:
Client: (a) Did only labor contract with the contractor, supplied materials on her own, (b) Supplied low
quality steel bars (thinks all steel bars are same), (c) Supplied inadequate quantity of steel bars (shows no
faith in design details), (d) Supplied dirty water for concrete mixing, despite objections from consultant
(thinks water quality unrelated to concrete quality)
Contractor: (a) Worked with low quality steel bars, knowingly. Thought that contractor is not responsible for
material quality since it is only labor contract. (b) Tied inadequate numbers of steel bars (increased steel bar
spacing), knowingly. Thought that contractor is not responsible for material quantity since it is only labor
contract. (c) Used very dirty water to mix concrete, knowingly, despite objections from consultant.
Consultant: (a) Did not or could not stop client from supplying low quality steel bars, (b) Did not stop
contractor from tying inadequate number of steel bars, (c) Did not or could not stop client and contractor
from use of very dirty water to mix concrete, (d) Reported the problems only after roof collapse and client’s
compensation claim