Circular No. 11/BXD-VKT guides the organization and operation of the Construction Project Management Board.

CIRCULAR

OF THE MINISTRY OF CONSTRUCTION

Guidelines for the organization and operation of the Project Management Board

Pursuant to the Construction Management Regulation issued together with Decree No. 385/HĐBT dated November 7, 1990 of the Council of Ministers (now the Government);

Pursuant to Circular No. 01/TTLB dated March 9, 1991 of the Ministry of Construction - State Planning Committee - Ministry of Finance - State Bank of Vietnam on implementing the Construction Management Regulation issued together with Decree No. 385/HĐBT dated November 7, 1990 of the Council of Ministers;

To fulfill the responsibility for improving the construction management machinery as stipulated in Directive No. 171/TTg dated December 16, 1992 of the Prime Minister on combating corruption, waste, and loss in basic construction;

The Ministry of Construction provides guidelines on the organization and operation of the Project Management Board as follows:

I. GENERAL PROVISIONS

1. The Project Management Board (referred to as PMB) is an organizational entity with legal personality, representing the project sponsor to manage the construction of basic construction projects within the scope of duties, powers, and responsibilities set forth in this Circular.

2. There are the following types of PMBs:

a. Regional PMB: implements construction management work for specialized projects of a Ministry, agency equivalent to a Ministry, or a central government agency (collectively referred to as a Ministry) within a specific territorial area.

b. Local specialized PMB: implements construction management work for a type of specialized project (industrial and civil, transportation, water resources) within the administrative boundaries of a province or centrally governed city (collectively referred to as a province) or within a concentrated construction area within the province.

c. PMB of a single project: Only manages the construction of important state projects.

d. Consulting design and construction organizations performing construction management tasks: Consulting design and construction organizations holding a permit for construction management issued by the competent authority may also enter into economic contracts with the project sponsor or PMB to undertake construction management tasks.

3. Construction management of state-owned projects shall be carried out by the PMB according to current regulations, policies, and laws. For projects with investment capital of up to 100 million dong, simple construction techniques, and uncomplicated technology (including renovation, expansion, repair, and new construction), the project sponsor may undertake construction management themselves but must comply with state regulations on design preparation, budget review, and final settlement of the project.

II. DUTIES, POWERS, AND RESPONSIBILITIES OF THE PMB
OF THE PMB

1. The PMB has the following duties:

Representing the project sponsor to sign economic contracts in basic construction to implement the construction of projects managed by itself from the preparatory stage to the completion of investment construction and final settlement of the entire project.

Reviewing and approving project designs and budgets before submitting them to the competent authority for approval and ensuring timely submission of these documents according to the schedule.

Organizing the establishment of unit prices for projects, comparing with projects that have individual unit prices established.

Handling land-related procedures, implementing land clearance, and applying for construction permits.

Preparing investment capital plans and financial plans for projects for the project sponsor to submit to the investment authority for approval.

Organizing bidding or selection processes for the supply of equipment and construction works.

Organizing the transportation and storage of project technological equipment.

Supervising the implementation of signed economic contracts.

Inspecting construction quality, confirming completed volumes, and handling payment procedures. In cases of additional volumes, the PMB must request the design and construction organizations to explain and determine appropriate measures and recommend solutions to the project sponsor (including both over-budget and under-budget situations).

Organizing the inspection of construction quality, acceptance of projects, and handover of completed projects for use.

Implementing annual and total final settlements of project investment capital, submitting them to the competent authority for approval.

2. The PMB has the following rights:

Suspending construction activities if construction quality does not meet technical standards and specifications and does not satisfy the requirements of approved design documents.

Not confirming completed work volumes for payment if the contractor's proposal is found to be incorrect or non-compliant with acceptance requirements.

Recommending measures to improve project quality or ensure construction progress, including amending or replacing contract terms if necessary.

3. The Project Management Board is responsible for:

The legality of project design and budget documents and other legal documents of projects managed by it.

The volume and quality of construction installation and other construction works at projects that have been accepted.

Ensuring the completion of all construction projects according to the approved schedule and handing over completed projects for use within the specified time frame.

The completeness and accuracy of project completion documents.

If the above requirements are not fully met and the duties and powers of the PMB as stipulated in Points 1 and 2 of this section are not properly executed, the PMB Director will be subject to administrative penalties, compensation for damages, and legal liability.

III. ORGANIZATION AND OPERATIONS OF THE PMB

1. A regional PMB of a Ministry is established by that Ministry according to territorial areas comprising one or more provinces or cities. The number of regional PMBs depends on the number of projects, the volume of construction work, and the investment activity range of the Ministry.

A regional PMB can manage all types of projects or only manage the construction of a specific type of project of the Ministry within its operational area.

A regional PMB may contract to manage construction of projects in its operational area belonging to another Ministry or local government if they fall within its specialized field.

2. The local specialized construction management board established by the provincial People's Committee operates according to its specialized field (industrial and civil, transportation, water conservancy) and is directly led by the local specialized construction department.

The local specialized construction management board operates throughout the province or within a specific area of the province and may enter into contracts to manage construction projects of central construction agencies located in the locality.

3. A construction management board for a particular project shall be established by the competent ministry responsible for investing in that project to manage large-scale and technically complex construction projects which regional construction management boards cannot undertake.

A construction management board for a project shall only be established after the project has been recorded in the plan for preparatory construction and shall be dissolved no later than six months after the entire project has been handed over for production and use.

4. The aforementioned construction management boards must register (according to the form attached to this Circular) with the Ministry of Construction (for specialized and local construction management boards).

5. A construction management board shall have a director and may have one or two deputy directors to assist the director in managing and operating the board's affairs.

The director of a construction management board must hold a university degree (in construction engineering, construction economics, or technology related to the project's specialty) or higher, have experience in construction management, and be appointed and relieved from duty by the project investor. The director of a construction management board is responsible to the investor and the competent ministry for all activities of the board.

The chief accountant of a construction management board must hold a university degree in accounting finance and be appointed and relieved from duty according to the current chief accountant system.

Technical and operational staff of a construction management board must hold a vocational high school or university degree meeting the requirements of their assigned tasks.

6. The operating funds of a construction management board are derived from the construction management fee of the project managed by the board. This fee is set as a percentage of the estimated value of construction works in the total approved project budget estimate. For the year 1993, temporarily, it will be based on the ratio specified in Appendix 1 attached to this Circular. The construction management board must prepare a detailed budget for the use of these funds to submit for approval by the competent ministry. In cases where the funds calculated according to the above ratio are not fully utilized, the construction management board must remit the difference to the state budget.

The construction management board may also use these funds to pay for consulting design organizations and construction management contracts already signed (if any).

IV.IMPLEMENTATION

1. Based on this Circular, ministries and provinces shall immediately implement the establishment of construction management boards at the ministry and local levels, complete the reorganization of construction management boards under their management no later than June 30, 1993, and report the results to the Ministry of Construction for reporting to the Government.

2. For ongoing construction projects, if they are completed before June 30, 1993, the existing construction management boards shall continue to operate; if construction continues beyond this date, the management of the projects shall be transferred to newly established construction management boards.

For construction projects initiated after the issuance of this Circular, they must be handed over to new construction management boards.

3. This Circular takes effect from the date of signature and is uniformly applied nationwide for basic construction projects funded by state-owned capital, replacing Circular No. 751/UB/TT dated October 12, 1985, of the State Basic Construction Management Council.

Ministries, ministerial-level agencies, government-affiliated agencies, provincial People's Committees, and centrally-administered city People's Committees shall guide and supervise the implementation of this Circular. If deemed necessary, relevant ministries managing construction, the People's Committee of Hanoi City, and Ho Chi Minh City may coordinate with the Ministry of Construction to issue specific regulations on the organization and operation of construction management boards according to the characteristics of construction project management in each sector and locality.

APPENDIX 1

RATIO FOR CALCULATING CONSTRUCTION MANAGEMENT COSTS OF PROJECTS PERCENTAGE %
COMPARED TO THE ESTIMATED VALUE OF CONSTRUCTION WORKS IN THE TOTAL APPROVED BUDGET ESTIMATE
OF THE PROJECT

Note:

1. In cases where the approved estimated value of construction works falls within the ranges listed in the table above, the ratio for calculating construction management costs shall be determined by interpolation within the corresponding range.

2. For projects with an estimated value of construction works exceeding 1000 billion VND, the competent ministry and the investor shall negotiate with the Ministry of Construction to determine the ratio for calculating construction management costs.

(Registration form for the organization and operation of the construction management board attached to Circular 11/BXD-VKT)

REGISTRATION FORM FOR THE ORGANIZATION AND OPERATIONS OF THE CONSTRUCTION MANAGEMENT BOARD

SOCIALIST REPUBLIC OF VIETNAM

Independence-Freedom-Happiness

Date...month...year...

Name of the Construction Management Board:

Decision number: date month year

Managing Authority:

by signed

Main office location:

Bank account: Number: Bank (treasury)

Telephone: Fax:

Within administrative boundaries:

Scope of Activities

Managing construction projects:

According to the main task assigned:

According to contractual capacity:

Duration of operations: from date month year

Staff

Director: (Name, academic qualification Specialty)

Deputy Directors

1. (Name, academic qualification Specialty)

2. (Name, academic qualification Specialty)

Chief Accountant: (Name, academic qualification Specialty)

Technical and operational staff:

Total: people

Among them: Engineers: people

Vocational High School: people

Management capacity

Number of projects: Projects

Largest project scale: VND

Total investment capital of managed projects: VND

Confirmation by the Director of the Construction Management Board

(Major Technical Specifications and Other Information)

Investor (signature)

(Signature, stamp) (stamp)

Department of Construction where the main office is located;

Place of filing:

Ministry of Construction

File in the Office

Note: During the course of operations, if there are changes, the Construction Management Board must register supplementary information at the end of the year./.

Note: During the course of operation, if there are any changes, the Management Board must register supplementary information at the end of the year./.