Vietnam: How shall the value of the construction contract package be determined from October 01, 2019?

Currently, the construction contract package value is the approved value mentioned in the contractor selection plan as the basis for contractor selection. The construction contract package value is all the necessary costs calculated correctly and sufficiently to execute a contract.

According to Decree No. 68/2019/NĐ-CP of Vietnam’s Government, the total construction investment, construction estimate of the project, work construction estimate and construction estimate that have been approved serve as the basis for determination and approval of the contract package value. The value of the construction contract package shall be determined as follows:

- If the estimate of construction contract package is available, the value of the construction contract package is determined on the basis of the approved estimate of construction contract package;

- If the estimate of construction contract package is not available, the value of the construction contract package is determined according to the cost structure of the estimate of construction contract package on the basis of the cost items in connection with the scope of the contract package specified in the total construction investment, construction estimate of the project and work construction estimate that have been approved.

- The cost contingency specified in the construction contract package shall be determined in accordance with the contract format used for the contract package in the contractor selection plan.

Note:

- If the actual time for contractor selection is different from that specified in the project execution plan, the investor shall update the value of the construction contract package according to the market prices 28 days before the date of bid opening.

- If the updated value of the construction contract package is higher than the approved value and exceeds the total construction investment of the project, the investor shall adjust type and origin of equipment to ensure quality and technical requirements but set appropriate prices so that the total investment is not exceeded, and notify the investment decider for decision. (The investment decider shall decide to use the contingency cost when determining or updating the contract package value)

View more details at Decree No. 68/2019/NĐ-CP of Vietnam’s Government, effective from October 01, 2019.

Thu Ba

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