What is an Administrative Contract?

Administrative contracts share the same essence as contracts in general, being legal documents signed between participating parties.

Contracts in civil relationships and labor relations are established based on the agreement and consensus (regarding rights and obligations) of the involved parties to achieve the ultimate goal of the said civil or labor relationship. In this context, the parties are in an equal position.

Similarly, an administrative contract is also an agreement between the participating entities in the contract, but one of the entities will be a state administrative agency - representing public authority - in the legal capacity of a public legal entity. In certain cases, the state agency holds certain "privileges" over the other party in determining the content of the contract. The content of an administrative contract may involve or bear characteristics of civil, labor, or economic relationships.

Vietnamese law currently lacks specific regulations or clear definitions regarding administrative contracts. In practice, we can encounter several types of contracts with different names but sharing the essence of administrative contracts, such as:

- Contract for hiring out-of-quota officials (drivers, security guards). This contract is established based on labor recruitment regulations in state agencies. It differs from a labor contract (as per labor law provisions) in that: Besides the provisions of labor law, the signing of an out-of-quota official recruitment contract must also adhere to regulations on officials; individuals recruited to work in state agencies must comply with the laws governing officials.- Contracts for the provision of materials and technical support to state agencies. Herein, the supplier can be any individual or organization providing materials and technical support to the state agency according to the mandatory requirements and conditions of the requesting party. In certain cases, the requesting party (e.g., police, military) may impose confidentiality about the location, time, and transportation route, which the supplier must adhere to.- Build-Operate-Transfer (BOT) contract, a type of contract signed between the authorized state agency and an investor for constructing infrastructure projects. After completion, the investor is allowed to operate it for a certain period. Upon the end of the operation period, the investor transfers the facility without compensation to the authorized state agency.

Administrative contracts hold significant meaning and play a vital role in the life of the state and society, especially in state administrative activities:

- Firstly, the emergence of administrative contracts contributes to changing the methods and forms of operation of public authorities, particularly state administrative agencies.- Secondly, the introduction of administrative contracts facilitates the development of public services, separating public service provision activities from public authority activities to reduce unnecessary costs for the state budget, decrease the workforce in the state apparatus, and ensure the transparency of public authority and public service provision activities.- Thirdly, the use of administrative contracts in state administrative activities brings public authority closer to civil society, allowing civil society to develop, enhancing the accountability of public authorities towards individuals and organizations, and fostering a reciprocal responsibility relationship between the state and its citizens.- Fourthly, when certain civil, labor contracts, or administrative decisions are "transformed" into administrative contracts, it ensures stricter enforcement of the contract due to the public authority of the public legal entity as a party in the contract relationship.- Fifthly, resolving disputes in the performance of administrative contracts will reduce economic and financial harm to the state, individuals, and organizations compared to resolving civil or economic disputes.

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