Costs incurred when performing package contracts of construction and installation

Thu, 23 May 2019 16:23:00  |  Print  |  Email   Share:

 (Chinhphu.vn) – When applying for a package contract, the bid price must include all costs for risk factors and cost of inflation that may occur during the performance of the contract.

The Danang Power Company Co., Ltd is implementing a number of construction contracts in the form of package contracts, selecting contractors in the form of open bidding in the country. However, in the process of implementing the contract, some problems have not been clearly defined and specified in the relevant legal documents.

Through the receiving and responding system to enterprises' recommendations, the Company would like to request to handle some of the following problems:

1.   1. A number of work items are shown in the construction drawing design attached to the bidding documents but not in the contract price table, not in the bid invitation as well as the approved total cost estimate. Thus, are these work items under the responsibility of the contractor who signed the package contract? How should additional costs be incurred for these work items to ensure adequate procedures?

2.    2. A number of work items are included in the contract price table but the volume is insufficient compared to the construction drawing design attached to the bidding dossier. So does the difference in volume be under the responsibility of the contractor who signed the package contract? How does the cost incurred for this volume difference need to be handled?

Regarding this issue, The Ministry of Planning and Investment responds as follows:

Clause 1 Article 62 of the Bidding Law stipulates that a package contract is a fixed-price contract for the entire duration of the contract. The payment for the package contract is made many times during the implementation or a lump sum payment upon the completion of the contract. The total amount paid by the contractor until the completion of contractual obligations equals the price stated in the contract. When applying for a package contract, the bid price must include all costs for risk factors and cost of inflation that may occur during the performance of the contract.

In the case stated in the content of Danang Power Company Limited, when applying a package contract, the payment of the workload under the signed contract must comply with the above provisions. . In addition, in the process of negotiating and finalizing contracts, related parties should review the workload table according to the approved design; If the bidder or the bid solicitor discovers the table of quantities and work volumes not yet accurate compared to the design, the bid solicitor shall report to the investor for consideration and decision on the adjustment of work volume to ensure compatibility with design.

When applying a package contract, the investor is responsible for the accuracy of the quantity and workload. In case of using a consultancy contractor to make a design dossier, a bidding documents, a dossier of request, in the contract between the investor and the procuring entity and the consultancy contractor, there must be regulations on the responsibilities of the contractors. inside of the handling and compensation for the calculation of the wrong quantity and volume of work (Point d and Point d, Clause 1, Article 62 of the Bidding Law).

By: Online Newspaper of the Government / Translator: HaiYen-Bizic

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