Decree 95: Adjustment of Prices and Quantities in CPTPP Procurement Contracts

Decree 95: Adjusting the price and volume of CPTPP procurement bidding contracts (illustrative image)

Decree 95/2020/ND-CP stipulates the adjustment of price and volume of CPTPP procurement bidding contracts. The contract price adjustment must be clearly defined in the contract in terms of the content of the adjustment, principles and timing of the adjustment, and input data used to calculate the adjustment.

For contracts with adjustable unit prices, the contract must clearly specify the following details:

- The timing for calculating the original unit price (usually determined 28 days before the bid closing date) to serve as a basis for determining the difference between the winning unit price and the adjustable unit price;- The input data used for calculating the unit price adjustment, including the price index as announced by the General Statistics Office or the construction price index announced by the Ministry of Construction or the provincial People's Committee;- The method and formula for calculating the unit price adjustment: The determination of the method and formula for calculating the unit price adjustment must be based on scientific grounds, suitable for the nature of the bidding package. Encouraged is the application of widely used international market methods such as the templates stipulated by the International Federation of Consulting Engineers, guidelines from the World Bank, and the Asian Development Bank.

For construction service packages, in case the volume of construction services arises outside the initial contract but within the objective of the bidding documents, due to unforeseen circumstances that need to be carried out to complete the construction service package as required by the bidding documents and without exceeding the approved package price, the investor and contractor shall calculate, negotiate, and sign an additional contract appendix. If it exceeds the approved package price, the additional volume outside the contract may only be adjusted if the total value of the arising construction volume does not exceed 50% of the original contract value, and must be reviewed and decided by the competent authority prior to signing the supplementary contract appendix. For arising volumes outside the scope of the signed contract without an agreed unit price therein, the contracting parties must agree on the unit price to perform this volume of work in accordance with construction law regulations. If no agreement is reached, the arising work volume shall form a new bidding package, and the selection of contractors shall follow the current regulations.

For goods procurement packages, consulting services, and non-consulting services, in case of arising volumes of goods or services within the optional additional procurement, the investor and contractor shall sign a supplementary contract appendix. The investor may only supplement the volume of goods and services within the optional additional procurement upon determining the funding source for this volume.

Details are available at Decree 95/2020/ND-CP effective August 24, 2020.

Ty Na

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