Principles for the Application of EPC Contracts

Circular 30 has specifically listed the principles when applying EPC contracts as follows:

- Based on the characteristics, nature, and scale of each project, EPC package, and the provisions of law, the competent authority decides on the investment and decides to apply the EPC contract form for construction projects, packages and is responsible before the law for the effectiveness of the construction investment project.- The EPC contract is only applied to construction projects, packages that need to shorten the implementation time; construction projects, packages with high technical and technological requirements and must ensure synchronization from the design stage, equipment supply, construction implementation to the operation training, and project transfer stage.- The contractor executing the EPC contract must meet the conditions regarding experience, financial capacity, professional competence, and operational capacity for the entire scope of work required by the EPC contract, including capabilities in: design, equipment supply, training service provision, operation, technology transfer, and construction implementation according to the provisions of construction investment law and the requirements of the bidding documents. The EPC contractor must not subcontract more than 60% of the workload within the scope of the EPC contract.- The cost management of the EPC contract must not exceed the signed EPC contract price according to the agreements in the EPC contract.- The design dossier of the projects, packages applying the EPC contract must meet the legal requirements.- The signing and management of the implementation of the EPC contract must comply with the provisions of law regarding construction contracts.

See details Circular 30/2016/TT-BXD which takes effect from February 20, 2017.

-Thao Uyen-

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