New circulars regulate construction contracts

The Ministry of Construction issued Circular 09/20111/TT-BXD on June 28, establishing templates for construction contracts using 30 per cent or more of State capital, including funds from the State budget, official development assistance (ODA), State development credit, credit capital guaranteed by the State, and investments by State-owned enterprises.

The construction contract templates attached to Circular 09 guide the relationship between investor and contractor and between general contractor and subcontractor, and they include equipment installation contracts. The accompanying regulations on contract prices and payments vary depending on the type of contract, and a single contract may include various types of services and be subject to different regulations.

Regulations on contractual provisions, work volume, hiring consultants, advance payments, performance security, warranty, payment time limits, installment payments, suspension and termination of the contract, and other provisions are expressly subjected to Government Decree No 48/2010/ND-CP of May 2010. The new circular takes effect on August 15.

On the same day, the ministry also issued Circular 08/2010/TT-BXD, establishing a contract template for consultancy in construction works using 30 per cent or more State capital, including surveys, financial and investment consultancy, consultancy on preparation of technological reports or feasibility studies for construction works, and design consultancy.

Circular No 08 includes a construction consultancy contract template which can be modified by investor and contractor based on the specific consulting work to be offered for tender.

The circular also requires contracts to specify work volume, requirements of quality and quantity, payment provisions, contract performance security (if any), settlement, term, and termination. This circular also takes effect on August 15. – VNS

Tags: Vietnam Construction, Vietnam construction sector