The Decree provides detailed regulations and guidance on implementing certain provisions of the Construction Law regarding construction contracts.

 

 

DECREE

Detailed regulations and guidance on implementation of certain provisions

Regarding construction contracts under the Construction Law

 

Pursuant to the Law on Government Organization No. 63/2025/QH15;

Pursuant to the Construction Law No. 135/2025/QH15;

At the proposal of the Minister of Construction;

The Government issues this Decree detailing and guiding the implementation of certain provisions of the Construction Law regarding construction contracts.

 

PART I

GENERAL PROVISIONS

 

Article 1. Scope of Regulation

1. This Decree details certain provisions of the Construction Law regarding construction contracts, including:

a) Article 82 on classification, contents, and documentation of construction contracts;

b) Clause 4 of Article 83 on measures and levels of guarantee for the performance of obligations in construction contracts for public investment projects and PPP projects;

c) Clause 4 of Article 84 on methods, contents, and procedures for amending construction contracts;

d) Article 85 on suspension and termination of construction contracts;

đ) Article 87 on payment, settlement, and liquidation of construction contracts.

2. Measures for organizing and guiding the implementation of the Construction Law concerning requirements for the management and execution of contracts, subcontracts.

Article 2. Applicability

This Decree applies to tenderers, contractors, and other organizations and individuals related to the conclusion and management of construction contracts.

Article 3. Explanation of Terms

In this Decree, the following terms are understood as follows:

1. A tenderer is an organization or individual who enters into a construction contract with a contractor to carry out one, part, or all of the work in construction activities. The tenderer may directly enter into a contract or authorize another individual or legal entity to do so in accordance with the law.

2. A contractor is an organization or individual, or a combination thereof, who enters into a construction contract with a tenderer to carry out one, part, or all of the work in construction activities. The contractor may directly enter into a contract or authorize another individual or legal entity to do so in accordance with the law.

3. General conditions of a construction contract are documents attached to the construction contract that specify basic rights and obligations of the parties involved in the construction contract and other necessary contents.

4. Specific conditions of a construction contract are documents attached to the construction contract to further detail, adjust, and supplement certain provisions of the general conditions of the construction contract.

5. Schedules of a construction contract are documents attached to the construction contract to provide detailed specifications, clarify, and supplement certain contents of the construction contract. In cases where the schedule supplements the contents of the construction contract, it shall be deemed as an amendment to that clause in the contract.

6. Working days are calendar days, excluding Saturdays, Sundays, and holidays as prescribed by law.

7. Scope of work of the contract is the entire project, project component, product, service, and works that the contractor is obligated to perform according to the agreement of the contract.

8. Reasonable additional volume and work are parts of the volume and work outside the scope of the contract, which must be adjusted and supplemented during the contract execution and agreed upon by both parties.

9. Obligations of the contract are commitments that the parties must fulfill according to the agreement in the contract and the law to ensure that the construction contract product is carried out in accordance with quality, schedule, cost, and other requirements of the construction contract.

10. Work of the contract is the entire work that the contractor is obligated to perform to create and complete the contract product, meeting the requirements of the contract.

Article 4. Principles for entering into construction contracts, requirements for managing the implementation of construction contracts

1. The conclusion of construction contracts must comply with the provisions of Clause 2, Article 80 of the Construction Law, civil law regulations, other relevant legal regulations, and ensure the following principles:

a) For joint venture contractors, the division of workload and tasks in the joint venture agreement must be consistent with the capacity of each member of the joint venture;

b) In cases where the project owner enters into contracts with multiple main contractors to perform project works, the scope of work, progress schedule, and other related contents of each contract must ensure consistency and synchronization with the scope of work, progress schedule, and other related contents of the project, avoiding overlap;

c) In cases where the main contractor enters into subcontracts with subcontractors, the scope of work, progress schedule, and other related contents of the subcontracts must ensure consistency and synchronization with the scope of work, progress schedule, and other related contents of the main contract, avoiding overlap.

2. Within their rights, obligations, and responsibilities, the parties need to develop plans and organizational measures appropriate to the content of the concluded construction contract to achieve the agreements stipulated in the contract. Based on the specific requirements of each construction contract, the management and implementation of construction contracts include:

a) Time and progress management of the contract;

b) Quality management;

c) Quantity and price management of the contract;

d) Labor safety, environmental protection, and fire prevention management (if applicable);

e) Contract amendment management;

f) Other contents agreed upon by the parties in accordance with relevant legal regulations.

3. In cases where the parties agree on a representative to manage the implementation of the construction contract, the parties shall appoint and notify the other party about the representative, the scope, responsibilities, and authority of the representative to manage the implementation of the construction contract.

4. All suggestions, proposals, requests, and opinions of the parties during the management and implementation of the construction contract must be made in writing (as data messages for electronic transactions according to the law on electronic transactions). The content of the written suggestions, proposals, and requests must reflect the basis, grounds, effectiveness (if any) of the suggestions, proposals, and requests, and the deadline for responding according to the agreement in the contract.

a) In cases where the party receiving the suggestion, proposal, or request does not resolve it according to the agreement, they must bear responsibility and compensate for any resulting damage to the other party (if any);

b) For construction contracts in public investment projects, PPP projects, the party receiving the suggestion, proposal, or request must respond in writing whether to approve or not approve within the agreed deadline in the construction contract, but not exceeding seven working days from the date of receipt of the suggestion, proposal, or request; in cases of non-approval, the reasons must be clearly stated.

Suggestions, proposals, and requests of the parties during the management and implementation of the contract must be sent to the correct transaction address or information exchange address agreed upon in the construction contract.

5. For EPC, EP, EC contracts

a) The parties negotiate and clearly define the scope of work, design requirements, equipment supply, technology, and handover conditions; design, scope of work, and contract price must be uniformly controlled throughout the implementation process;

b) The contractor bears responsibility for the completeness and integration of design, equipment, and technology within the contract scope; the employer controls key milestones such as design, equipment supply, installation, testing, and handover; payment is linked to the results achieved at the main milestones of the contract;

c) Before proceeding with procurement of materials and equipment within the contract scope, the contractor establishes technical specifications, technology, origin requirements for the employer's comments or approval before procurement if the parties have agreed in the contract. The employer's comments or approval do not reduce the contractor's responsibility for material and equipment procurement as agreed in the contract. In cases where the parties do not agree in the contract, the contractor is responsible for complying with the approved design documents and technical specifications, technology, and origin of materials and equipment in the contract to proceed with procurement.

6. For construction contracts under special public investment projects; urgent and critical projects, the project owner may independently decide on the conclusion and management of construction contracts to ensure timeliness and flexibility suitable for project requirements (including the conclusion of framework contracts, phased contracts), ensuring progress, quality, and bearing responsibility for their decisions.

7. For construction contracts under public investment projects requiring the application or trial of new construction technologies, materials without national standards, the corresponding work scope, costs for applying and testing new technologies and building materials shall be implemented in accordance with the law on science and technology contracts and innovation.

8. For electronic transaction contracts in construction (construction contracts performed through electronic means according to the law on electronic transactions), the conclusion and management of construction contracts must comply with the law on electronic transactions.

Article 5. Basis for entering into construction contracts

1. The basis for entering into construction contracts includes: legal grounds, requirements regarding the scope and content of work to be performed, results of contractor selection (if applicable); results of contract negotiation and completion (if applicable) and other related documents.

2. For EPC, EC, EP contracts, in addition to the bases specified in Clause 1 of this Article, the basis for entering into the contract also includes the description, approved basic design or FEED design.

3. For turnkey contracts, in addition to the bases specified in Clause 1 of this Article, the basis for entering into the contract also includes project implementation tasks, investment policy (if applicable), approved pre-feasibility study report on investment construction (if applicable).

 

Chapter II

SPECIFIC PROVISIONS

 

Section 1

CLASSIFICATION, CONTENT AND CONTRACT DOCUMENTATION FOR CONSTRUCTION CONTRACTS

 

Article 6. Classification and scope of application of construction contracts

1. Based on the nature and content of the work to be performed, construction contracts are classified according to the provisions of Clause 1 of Article 82 of the Construction Law and specific provisions as follows:

a) Consulting construction contract (abbreviated as consulting contract) is a construction contract for performing one, several or all consulting works in construction activities.

b) Construction work contract (abbreviated as construction work contract) is a construction contract for performing construction work on projects, project components or construction tasks according to the design.

c) Contract for supply of materials and equipment installation in construction projects (abbreviated as material and equipment supply contract) is a construction contract for performing procurement and supply of materials and equipment according to technological design.

d) Design and supply of materials and equipment installation in construction projects contract (English: Engineering - Procurement, abbreviated as EP) is a construction contract for performing design and procurement and supply of materials and equipment according to technological design.

đ) Design and construction work contract (English: Engineering - Construction, abbreviated as EC) is a construction contract for performing design and construction work on projects.

e) Material and equipment procurement and construction work contract (English: Procurement - Construction, abbreviated as PC) is a construction contract for performing procurement and supply of materials and equipment according to technological design for installation in construction projects and construction work on projects.

g) Design, material and equipment supply, and construction work contract (English: Engineering - Procurement - Construction, abbreviated as EPC) is a construction contract for performing works from design, procurement, supply of materials and equipment to construction work on projects and trial operation, acceptance, handover to the contracting party.

h) Turnkey contract (English: turnkey) is a construction contract for performing all works: feasibility study report preparation; design; procurement and supply of materials and equipment; construction work on projects; trial operation, acceptance, handover to the contracting party.

i) Other construction contracts are construction contracts for performing other works in construction activities outside those stipulated in points a, b, c, d, đ, e, g, h of this clause such as insurance contracts, mine clearance contracts.

2. According to the form of contract price, construction contracts are classified according to the provisions of Clause 2 of Article 82 of the Construction Law and specific provisions as follows:

a) Lump-sum contract is a type of construction contract where the contract price is determined at the time of contract conclusion and does not change throughout the contract execution period corresponding to the content, scope of work, technical requirements, product quality, progress schedule and other terms agreed upon by the parties in the contract, except for force majeure events, fundamental changes in circumstances, changes in the scope of work or other cases agreed upon by the parties in accordance with the law.

b) Fixed unit price contract is a construction contract where the unit price for performing works within the scope of the contract does not change during the contract execution period, except in the cases provided for in point b of Clause 2 of Article 24 of this Decree, force majeure, fundamental changes in circumstances or other cases agreed upon by the parties in accordance with the law.

c) Adjustable unit price contract is a type of construction contract where the unit price and contract price may be adjusted based on the agreements in the contract for the entire content of the work in the contract.

d) Time-based contract is a type of construction contract where the contract price is determined based on the unit price for a unit of time, hourly, daily, weekly or monthly wage agreed upon in the contract and reasonable additional costs agreed upon in the contract.

đ) Cost plus fee contract is a construction contract where at the time of contract conclusion, the parties agree that the contract price will be determined based on the necessary direct costs to perform the works within the scope of the contract and the management cost, general cost, profit of the contractor.

e) Output-based contract is a type of construction contract where at the time of contract conclusion, the parties agree that the contract price will be determined based on specific requirements regarding the quantity and quality of output products; contract payment value is based on the results of contract performance accepted in terms of quality and quantity of output products and other factors (if any).

g) Percentage-based contract is a construction contract where at the time of contract conclusion, the parties agree that the contract price will be determined as a percentage of the cost or value of the work to be performed.

h) Mixed contract is a construction contract where the contract price is determined based on a combination of the types of contract prices stipulated in points a, b, c, d, đ, e, g of this clause for different parts of the contract.

i) Other construction contracts are construction contracts where the contract price is agreed upon by the parties and does not fall under the forms of contract prices mentioned in points a, b, c, d, đ, e, g, h of this clause.

3. In addition to the types of contracts specified in Clauses 1 and 2 of this Article, construction contracts are also classified based on the relationship between the parties involved in the contract and other criteria consistent with international practices. Based on the relationship between the parties involved in the contract, construction contracts include the following types:

a) Main contractor contract is a construction contract concluded between the project owner and the main contractor;

b) Subcontractor contract is a construction contract concluded between the main contractor and the subcontractor, including cases where the subcontractor is designated by the project owner;

c) Internal assignment contract is a contract between the tendering party and the receiving party within an agency or organization;

d) Foreign element construction contract is a construction contract in which at least one of the contracting parties is a foreign organization or individual.

Article 7. Content of construction contracts; construction contract files and priority order of contract documents; information about construction contracts 1. The content of construction contracts shall be implemented in accordance with Clause 4 of Article 82 of the Construction Law. The construction contract files and the priority order of accompanying documents shall be implemented in accordance with Clause 5 of Article 82 of the Construction Law.

2. Information about construction contracts shall be recorded in the contract, including:

a) Type of contract, contract number, name of work, tender package name, project name (if applicable), construction location, and basis for concluding the contract;

b) Names of the contracting parties, representatives of the parties, business registration address or transaction address, tax code, business registration certificate (if applicable), bank account number, telephone, fax, email, time and place of contract conclusion, and other related information;

c) In cases where the receiving party is a joint venture contractor, full information of the members of the joint venture must be recorded according to the provisions of point b of this clause, including clearly identifying the lead member of the joint venture.

Article 8. Content and volume of work of construction contracts

1. The content and volume of work of construction contracts are the contents and volumes of work that the receiving party must perform according to the agreement of the parties, consistent with the scope of work of the contract, tender invitation documents or request documents, bid documents or proposal documents (if applicable); negotiation records (if applicable) and relevant legal documents.

2. Depending on the specific type of construction contract, the scope of work may include the following main tasks:

a) For consulting construction contracts: consulting on investment project planning, surveying, designing, reviewing, testing, managing costs, managing projects, supervising construction, consulting on building information modeling (BIM), green building consulting, and other related consulting services;

b) For construction execution contracts: executing construction works based on design documents provided or approved by the tendering party; technical instructions, technical requirements, and standards and regulations applicable; providing materials and equipment for construction; installing equipment; demolishing construction works; testing quality and some related tasks. The scope of work of construction execution contracts may include purchasing construction equipment; implementing detailed construction drawings after technical design according to the contract agreement;

c) For supply and installation contracts of materials and equipment: purchasing and supplying technology equipment; construction equipment (if applicable); installing into the construction works (if applicable); guiding usage, trial operation; operating, training, and transferring technology (if applicable) according to technological design;

d) For EPC contracts: implementing post-baseline design or front-end engineering design (FEED) and purchasing and supplying materials and technology equipment according to the design and technical standards. The scope of work of EPC contracts may include purchasing and supplying construction materials and equipment, installing equipment into construction works, and construction surveys serving design (if applicable);

đ) For EC contracts: implementing post-baseline design or front-end engineering design (FEED); executing construction works and related tasks as stipulated in point b of this clause; construction surveys serving design (if applicable);

e) For PC contracts: purchasing and supplying materials and equipment according to technological design for installation into construction works; executing construction works and related tasks as stipulated in point b of this clause;

g) For EPC contracts: implementing post-baseline design or front-end engineering design (FEED); supplying construction materials, materials, construction equipment, and technology equipment for installation into construction works; executing construction works; training and guiding operation, maintenance, repair; transferring technology; conducting no-load and load testing operations; other tasks according to the approved basic design or FEED description; construction surveys serving design (if applicable);

h) For turnkey contracts: preparing feasibility study reports; surveying, designing; supplying equipment and executing construction works; training and guiding operation, maintenance, repair; transferring technology; conducting no-load and load testing operations; handing over construction works ready for operation to the tendering party and other tasks according to the approved investment policy and investment project.

h) For turnkey contracts: prepare a feasibility study report; conduct surveys and designs; provide equipment and construct the project; train and guide operation, maintenance, repair, and overhaul; transfer technology; perform no-load and load test runs; hand over the project ready for operation to the contracting party, and other works in accordance with the approved investment orientation and investment project.

Article 9. Requirements for quality and technical application; acceptance and delivery of construction contract products

1. The agreement of the parties regarding quality, technical specifications; standards, guidelines (if any); origin and source applied to the construction contract product must comply with the provisions of laws on quality management, construction works, and maintenance of construction projects, relevant legal provisions, and meet the requirements of tender documents or request documents, bid documents or proposal documents (if any), negotiation records (if any), and related legal documents.

2. The agreement of the parties regarding acceptance and delivery of construction contract products

a) The parties shall agree in the contract on the works to be accepted and delivered; the basis for acceptance and delivery; procedures, timing for acceptance and delivery of completed works; personnel participating in acceptance and delivery; acceptance and delivery forms; regulations on signatories, acceptance and delivery records must comply with legal provisions.

The agreement of the parties must strictly comply with the provisions of laws on construction activity management, quality management, construction works, and maintenance of construction projects, and relevant legal provisions.

b) Contract products that are accepted and delivered must meet the requirements for quality, technical specifications, origin, and source as stipulated in Clause 1 of this Article.

c) For works that require acceptance before transferring to other works, the contractor must notify the client in advance to accept according to the legal provisions on quality management, construction works, and maintenance of construction projects.

d) For defective products (not meeting contract requirements), they must be inspected, evaluated, and rectified; if not rectifiable, they must be removed and replaced; except where the parties have agreed otherwise, ensuring compliance with legal provisions. The party causing the defect shall bear all costs related to rectification, replacement, testing, inspection (if any), and other costs related to rectifying defects, as well as the contract performance schedule.

Article 10. Time and progress of construction contract implementation

1. The effective period of the construction contract is the time from when the construction contract becomes effective until the parties have fully fulfilled their contractual obligations, including the time for performing additional works and contract termination procedures (if any); or the time when the contract is terminated according to legal provisions.

2. The implementation time of construction contract works is the period calculated from the date the contract becomes effective or the start date of work execution as agreed by the parties until all contract works are completed and accepted according to the contract agreement (including any extension periods stipulated in the contract); excluding warranty periods, author supervision periods, and contract termination procedures (if any). The implementation time of construction contract works is agreed upon by the parties in the construction contract. For construction contracts implementing tender packages in public investment projects, the implementation time of construction contract works is the tender package implementation time as prescribed by the law on bidding.

3. The progress of construction contract implementation is a comprehensive and detailed plan reflecting completion milestones, acceptance, delivery times, and sequence of main works and products within the scope of the construction contract in the form of a progress chart, timeline diagram, or other formats agreed upon by the parties.

4. The contractor has the responsibility to prepare the progress of construction contract implementation for the client's approval as a basis for implementation if the parties have agreed.

a) In cases where there are deadlines for completing specific works, phases, or products of the contract, the parties must agree in the contract.

b) For construction contracts requiring phased implementation, in addition to the overall progress of the entire contract, detailed progress can be prepared for each phase.

c) For supply contracts of materials and equipment, the supply progress of materials and equipment must reflect key delivery milestones, including the quantity and type of equipment for each delivery batch.

d) For EC, EP, EPC contracts, and turnkey contracts, in addition to the overall and detailed progress for each phase, the contract progress must also reflect the progress for each type of work (investment project development, design, supply of materials and equipment, and construction works).

5. Encouragement is given to update and monitor progress using digital systems, project management software, or digital data platforms.

Article 11. Contract price for construction and scope of application

1. The contract price for construction is the amount of funds that the tendering party commits to pay to the contractor to perform the work according to safety, quality, progress, quantity requirements, payment conditions, advance payments under the construction contract, and other agreed requirements in the construction contract. The contract price for construction is determined based on the winning bid price or the results of negotiations and discussions on the construction contract between the parties.

2. The parties agree in the construction contract on the contents of the cost items (including contingency costs for risk factors, if any), types of taxes, fees, and charges (if any) included and not included in the contract price; the adjusted contract price must be consistent with the type of contract, the form of the contract price, and the agreement of the parties in the contract.

3. The scope of application of the forms of contract prices for construction specified in Clause 2 of Article 6 of this Decree is as follows:

a) Lump-sum contracts are widely applied in cases where during the organization of selecting contractors, negotiations, and contract conclusion, it is possible to clearly determine the volume and unit price or price for performing the works according to the requirements of the construction contract, with little likelihood of changes in volume or price fluctuations affecting input costs for contract performance; or in cases where the volume and unit price cannot be clearly determined but the parties involved in the contract have the ability to manage risks, manage changes, or identify the characteristics and features of the output product, including EC, EP, EPC, turnkey contracts, and other types of construction contracts.

b) Fixed-unit-price contracts are widely applied in cases where during the organization of selecting contractors, negotiations, and contract conclusion, it is possible to clearly determine the scope and content of the work, with little likelihood of price fluctuations affecting input costs for contract performance, but the actual quantity and volume of work cannot be accurately determined. The contract price at the time of contract conclusion is based on the quantity and volume of work, the fixed unit price agreed upon in the contract, and the contingency cost for potential additional work quantities and volumes, as stipulated by law.

c) Adjustable-unit-price contracts are widely applied in cases where during the organization of selecting contractors, negotiations, and contract conclusion, the parties involved in the contract do not have sufficient conditions to clearly determine the risk factors of price fluctuations affecting input costs for contract performance. The contract price at the time of contract conclusion is based on the quantity, volume, and quality of work, the unit price at the time of contract conclusion, including the contingency cost for potential additional work quantities and volumes, and the price escalation contingency cost (if any). The method of adjusting the unit price, the contract price for construction, and the price escalation contingency cost is agreed upon by the parties in accordance with the provisions of the law.

d) Time-based contracts are widely applied for construction consulting services or related works in construction activities when it is difficult to determine the scope and duration of service provision.

e) Cost-plus-fee contracts are widely applied in cases where during the organization of selecting contractors, negotiations, and contract conclusion, the parties do not have sufficient basis to determine the scope of work and necessary factors and input costs for performing the anticipated works under the contract. At the time of contract conclusion, the parties agree on management costs, common costs, and profit of the contractor; methods and ways to determine costs directly and related costs (if any) to perform the contract. Management costs, common costs, and profit of the contractor may be a fixed cost, a percentage of actual direct costs confirmed by the parties, or other forms agreed upon by the parties.

f) Output-based contracts are widely applied for work and services where at the time of contract conclusion, the parties can only determine the output product requirements of the contract, and payment is based on the acceptance of the contract performance regarding quality, quantity, and other factors. Specific requirements about quantity, quality of output, inspection and evaluation methods, determination of quality output compliance level, reduction in payment, price adjustment regulations (if any), and other contents are agreed upon by the parties in the contract.

g) Percentage-based contracts are widely applied for construction consulting services and insurance in construction activities. For public investment projects, percentage-based contracts are applied for insurance in construction activities.

h) Hybrid contracts are widely applied for contracts that can apply some forms of contract prices specified in points a, b, c, d, e, f, and g of this clause to different parts of the work within the scope of the contract.

Article 12. Advance payment under construction contracts

1. Advance payment under construction contracts is the amount of funds that the tendering party advances interest-free to the contractor for implementing works according to the contract.

2. The level of advance payment, number of advance payments, time of advance payment, advance payment guarantee, and recovery rate of advance payment through each payment shall be agreed upon by the parties in the construction contract, including cases where the contractor is a joint venture contractor. In cases involving a joint venture contractor, the advance payment to contractors within the joint venture shall be agreed upon in the construction contract or in the joint venture agreement.

3. In addition to the provisions of Clause 1 and Clause 2 of this Article, advance payment under construction contracts for public investment projects and PPP projects shall be regulated as follows:

a) Advance payment under the contract shall be implemented after the construction contract becomes effective and the tendering party has received the advance payment guarantee (in cases requiring such a guarantee) corresponding to the value of each type of currency agreed upon by the parties; specifically, for construction contracts, there must be a land clearance plan or a handover certificate (in whole or in part) issued by the organization responsible for land clearance handed over to the project owner in accordance with the contract.

b) The level of advance payment, number of advance payments, time of advance payment, and recovery rate of advance payment through each payment shall be clearly stated in the bidding documents, request for proposal, or draft construction contract sent to the contractor to serve as the basis for calculating the bid price and proposed price, and must be consistent with the ability to balance, arrange, and allocate capital to implement the contract.

c) For construction contracts with an advance payment value exceeding VND 100 billion, before the tendering party makes the advance payment to the contractor, the contractor must submit to the tendering party an advance payment guarantee with a value and currency equivalent to the advance payment amount. There is no mandatory requirement for an advance payment guarantee for construction contracts with an advance payment value of less than or equal to VND 100 billion and self-execution construction contracts including those carried out by community residents under target programs. and construction contracts executed in the form of self-execution including those carried out by community residents under target programs;

d) The advance payment guarantee must remain valid until the tendering party has recovered all the advance payment amounts. The value of the advance payment guarantee shall decrease proportionally with the amount of advance payment recovered through each payment between the parties or the value of the guarantee paid by the guarantor to the tendering party (if applicable).

e) The contractor must use the advance payment for its intended purpose and designated recipients.

f) For construction contracts requiring the production of large-value components, semi-finished products, or material reserves to ensure the schedule and progress stipulated in the contract, the parties shall agree on a plan for advance payment and the level of advance payment for these tasks (excluding the advance payment level specified in point g of this clause) to ensure the implementation schedule of the contract.

g) The level of advance payment shall not exceed 30% of the contract price at the time of conclusion (including any contingency if applicable). If it is necessary to make advance payments at a higher level for the contractor's deposit or prepayment to manufacturers or suppliers of materials and equipment according to the technological design to meet project requirements and other necessary cases, such actions must be approved by the investment decision-maker. For projects where the investment decision-maker is the Prime Minister, the decision to set a higher advance payment level than 30% shall be made by the Minister, Head of a ministerial-level agency, or Chairman of the People's Committee of a province.

h) Minimum advance payment level for consulting contracts: 15% of the contract price for contracts valued above VND 100 billion; 20% of the contract price for contracts valued up to VND 100 billion.

i) Minimum advance payment level for construction contracts: 10% of the contract price for contracts valued above VND 500 billion; 15% of the contract price for contracts valued from VND 100 billion to VND 500 billion; 20% of the contract price for contracts valued below VND 100 billion.

j) Minimum advance payment level for supply contracts of materials and equipment, EPC, PC, and EPC contracts, turnkey contracts, and other types of construction contracts: 10% of the contract price.

k) Where the parties agree on an advance payment level higher than the minimum advance payment level mentioned above, the portion of the contract price corresponding to the advance payment exceeding the minimum advance payment level shall not be subject to price adjustment from the date of advance payment (including cases of multiple advance payments).

l) The advance payment shall be gradually recovered through each payment, the recovery rate for each payment shall be agreed upon by both parties and recorded in the contract but must ensure that the advance payment is fully recovered when the cumulative payment value (including advance payment and payment for completed work volume) reaches 80% of the concluded contract price.

Article 13. Ensuring the Performance of Obligations under Construction Contracts

1. The performance of obligations under construction contracts shall be carried out in accordance with the provisions of Article 83 of the Construction Law.

2. Measures and levels of ensuring the performance of obligations under construction contracts for public investment projects and PPP projects are stipulated as follows:

a) Ensuring the performance of obligations under construction contracts includes ensuring the performance of the contract, ensuring payment, provisional advance guarantee, and warranty guarantee.

b) Ensuring the performance of obligations under construction contracts shall be implemented through guarantee measures, deposits, and other security measures prescribed by law; the parties shall prioritize the application of guarantee measures.

In cases where the pledge method or the tenderer retains the payment amounts to ensure the contractor's performance of obligations under the contract, the guarantor shall enjoy interest arising from the pledge amount and such retained amounts.

c) In cases stipulated in Clause 2, Article 68 of the Bidding Law, there is no need to implement the contract performance guarantee.

For construction contracts under PPP projects, the proof of financial capacity to perform construction contracts by the tenderer shall be carried out through credit supply contracts or loan agreements with financial institutions; the measures to ensure the performance of payment obligations shall be implemented according to the agreement of the parties and relevant laws.

đ) The level of contract performance guarantee shall be determined within the range of 2% to 10% of the construction contract price; if a higher level of contract performance guarantee exceeding 10% is required to prevent risks, it shall be implemented in accordance with the provisions of the law on bidding.

The contractor shall not reclaim the contract performance guarantee in cases where they refuse to perform the contract after the contract becomes effective; delay in progress due to the contractor's fault but refusing to extend the validity period of the contract performance guarantee and other breaches that require the recovery of the contract performance guarantee as agreed by the parties and in compliance with the law.

The tenderer must return the contract performance guarantee to the guarantor after the contractor has fulfilled all obligations under the contract or has transferred to warranty obligations and the tenderer has received the warranty guarantee for construction contracts requiring warranty work as prescribed.

e) The level of provisional advance guarantee shall be implemented in accordance with point c, Clause 3, Article 12 of this Decree.

g) The level of warranty guarantee for construction works and the procedures for returning the warranty guarantee shall be implemented in accordance with the Government's Decree detailing certain contents regarding quality management, construction, and maintenance of construction works. The contractor may only be refunded the warranty guarantee for the contract product after the warranty period ends and the tenderer confirms the completion of the warranty work.

It is encouraged for contractors to commit to extending the warranty period of the contract product beyond the warranty period specified in the tender documents or request documents. In such cases, the parties must specifically agree in the contract on the content, scope, security measures, and related matters concerning the warranty activities of the contract product for the extended warranty period.

h) If the contractor is a joint venture, each member must submit a guarantee for the performance of obligations under the construction contract to the tenderer, corresponding to the value and obligations of each member that must be secured. If the joint venture members agree that the lead contractor of the joint venture will submit the guarantee for the performance of obligations under the contract, the lead contractor of the joint venture will submit the guarantee to the tenderer; the implementation of the guarantee obligation of each member in the joint venture towards the lead contractor of the joint venture shall be carried out according to the joint venture agreement between the parties.

Article 14. General rights, obligations, and responsibilities of parties to construction contracts

1. The parties to construction contracts have rights, obligations, and responsibilities as prescribed by the Construction Law, relevant laws, and agreed upon in the contract, ensuring compliance with legal provisions.

2. The tendering party and the contractor shall notify the other party in writing about the rights and responsibilities of their representatives for managing the implementation of the contract, including contract management consultants (if any). When the parties change their representatives for managing the implementation of the contract, they must inform the other party in writing. In particular, if the contractor changes its representative for managing the implementation of the contract or key personnel, such changes must be approved by the tendering party if the parties have agreed on this requirement.

3. In addition to the provisions of Clauses 1 and 2 of this Article, the parties to construction contracts have specific rights, obligations, and responsibilities as stipulated in Articles 15 and 16 of this Decree corresponding to the type of work in the construction contract.

Article 15. Rights, Obligations, and Responsibilities of the Tendering Party

1. Rights of the Tendering Party

a) Request the contractor to hand over all relevant files and documents related to the contract product according to the contents of the concluded contract;

b) Refuse unreasonable proposals or suggestions that do not comply with the agreement in the contract within the time limit agreed upon in the contract and as provided by law;

c) Inspect the quality and progress of work within the scope of the contract, the manufacturing base for equipment components, semi-finished products (if any) of the contractor without hindering the normal operations of the contractor;

d) Refuse acceptance and handover of products that do not conform to the agreement in the contract;

đ) Have ownership and usage rights to advisory products as agreed in the contract.

2. Obligations and Responsibilities of the Tendering Party

a) Maintain confidentiality regarding information related to the contract as stipulated in the construction contract or by law;

b) Review and approve lists of subcontractors meeting the required qualifications not included in the construction contract upon the contractor's proposal;

c) Provide timely documentation, materials, tools, machines, and equipment related to the contract (if any) and as required by relevant laws; address the contractor's requests within the agreed timeframe during the contract implementation period;

d) Ensure conditions for commencing construction works in accordance with regulations, copyright for advisory products with copyright (if any), and organize acceptance and handover of contract products;

đ) Pay interest to the contractor for delayed payments as prescribed in Clause 5 of Article 28 of this Decree and as agreed in the contract;

e) Cooperate with the contractor in training, technology transfer, installation guidance, operation, and usage;

g) For EPC, EC, EP contracts established through negotiations and selection of EPC, EC, EP contractors based on approved basic design or FEED design: promptly review, assess, approve, or submit to competent authorities for assessment and approval subsequent construction designs following the basic design or FEED design as agreed in the contract and as provided in the Government's detailed regulations on certain provisions of the Construction Law concerning construction activity management;

h) For turnkey contracts: in addition to the obligations and responsibilities specified in points a, b, c, d, đ, e of this clause, the tendering party also has the obligation and responsibility to accept feasibility study reports and economic-technical reports for authorized persons to assess and approve or assess and approve within their authority.

Article 16. Rights, Obligations, and Responsibilities of the Contract Accepting Party

1. Rights of the Contract Accepting Party

a) Propose to the Contract Granting Party regarding additional quantities outside the contract; change and adjust construction measures after being approved by the Contract Granting Party to accelerate progress, ensure quality, safety, and efficiency of the project based on the agreed contract price;

b) Refuse to perform the contract when the Contract Granting Party has not met all conditions stipulated in the concluded contract and relevant laws;

c) Propose changes to the conditions for providing consulting services for the benefit of the Contract Granting Party or when factors affecting the quality of consulting products are discovered;

d) Request the Contract Granting Party to inspect and accept the product of the construction contract;

đ) Request the Contract Granting Party to pay interest on delayed payments as prescribed in Clause 5, Article 28 of this Decree and as agreed in the contract;

2. Obligations and Responsibilities of the Contract Accepting Party

a) Maintain confidentiality regarding information related to the contract as stipulated in the construction contract or by law;

b) Safeguard and return to the Contract Granting Party the documents and working tools provided by the Contract Granting Party according to the contract upon completion of the work (if applicable); immediately notify the Contract Granting Party in writing about incomplete information, insufficient materials, and non-compliant working tools that affect the completion of the work;

c) Provide sufficient manpower, materials, machinery, equipment, and other related material conditions as stipulated in the contract; design construction drawings (in case the Contract Accepting Party performs the design of construction drawings) to carry out the works as stipulated in the concluded contract;

d) Receive and manage the construction site, safeguard the base points, benchmarks, and boundaries of the project; keep construction diaries; coordinate with other contractors working on the same site;

đ) Move materials, machinery, equipment, and other assets out of the site within the specified period after the project has been inspected and handed over or the contract terminated as prescribed in Article 27 of this Decree, except where otherwise agreed in the contract; restore the site according to the agreement in the contract;

e) Provide complete technical information, hand over equipment ensuring quantity, quality, type, origin, location, time, and packaging, transportation, storage, and preservation requirements as stipulated in the contract; bear responsibility for compensating losses and additional costs arising from their own faults, except where otherwise agreed;

g) Ensure that technological equipment does not infringe intellectual property rights as prescribed by law and be responsible for disputes arising therefrom, except where violations arise from designs or data provided by the Contract Granting Party; the parties have the obligation to promptly inform each other of third-party complaints related to intellectual property rights and must bear responsibility if they fail to immediately inform the other party of such complaints against technological equipment once they become aware or should have become aware of them;

h) The Contract Accepting Party must notify the Contract Granting Party in advance for a certain period agreed by both parties regarding the delivery time of equipment; the delivery time of equipment shall not be less than 21 days for construction contracts under public investment projects or PPP projects;

i) Guide installation, operation, maintenance; training (if agreed) and cooperate in testing the technological equipment;

k) For EPC, EC, EP contracts established through negotiation and selection of EPC, EC, EP contractors based on approved basic design or FEED design: Prepare detailed construction designs following the basic design or FEED design for submission to the Contract Granting Party or authorized authority for review and approval, ensuring compliance with legal regulations; for EPC, EC, EP contracts under public investment projects or PPP projects, excluding construction budgets of projects or project components within the scope of the EPC, EC, EP contract;

l) For turnkey contracts: In addition to the obligations and responsibilities stipulated in points a, b, c, d, đ, e, g, h, i of this clause, the Contract Accepting Party of a turnkey contract also has the obligation to prepare Feasibility Study Reports, Technical-Economic Reports, participate in project defense together with the Contract Granting Party before the authorized authority, and complete the contract product according to the requirements of the Contract Granting Party consistent with the agreements in the contract.

Article 17. Resolution of Construction Contract Disputes

1. The selection of methods to resolve construction contract disputes as stipulated in Clause 5, Article 86 of the Construction Law shall be agreed upon by the parties. When resolving disputes, the parties must respect the contractual agreements and commitments made during the performance of the contract, ensuring objectivity, equality, and cooperation.

2. During the dispute resolution process, the parties have the responsibility to continue performing their contractual obligations for work not affected by the disputed content; they may not interrupt the performance of the contract except in cases of force majeure or at the request of the competent authority, or in other cases where the suspension of the construction contract is temporarily allowed as provided in point a, b, Clause 2, Article 26 of this Decree.

3. The application of the model for resolving disputes according to international practice (referred to as the dispute resolution board) as stipulated in point b, Clause 5, Article 86 of the Construction Law is as follows:

a) The parties shall specifically agree in the contract on the time of establishment of the dispute resolution board (which can be formed immediately after signing the contract, operate continuously during the contract's execution, or after the dispute arises), the number, criteria, qualifications, and experience of the board members participating, consistent with the requirements of the contract, the nature, and content of the construction work; the binding effect of the decision, recommendation to resolve the dispute; the procedure for selecting board members and the subsequent procedures and formalities when one party disagrees with the decision, recommendation to resolve the dispute;

b) Members participating in the dispute resolution board must ensure objectivity, independence, and lack of conflict of interest with the parties;

c) Costs paid to the members of the dispute resolution board and related expenses shall be borne equally by each party, unless otherwise agreed by the parties.

Article 18. Risks, Force Majeure Events, and Fundamental Changes in Circumstances

1. The parties shall specifically agree on the responsibilities for managing and handling risks of each party concerning foreseeable risks (including price fluctuation risks, construction conditions, mobilization of machinery and equipment, volume risks, and other risks) or unforeseeable risks that may occur during the contract's performance, causing damage, additional costs, delay in contract performance, or affecting the performance of the parties' obligations under the contract.

2. Force majeure events and fundamental changes in circumstances shall be implemented in accordance with Article 13 of the Construction Law. In the contract, the parties shall agree on the procedures, formalities, and responsibilities for handling such events: notification in writing; assessment of the impact on the performance of the contract's obligations; proposal to amend, suspend, terminate, settle, or liquidate the construction contract (if applicable).

3. In case of abnormal price fluctuations exceeding the forecasting ability of the parties at the time of contract formation, which may cause serious damage to one party and significantly affect the performance of the concluded contract:

a) Based on the nature, content of the work, and specific conditions of the contract (time of contract signing; volume already implemented; remaining volume to be executed; scope, volume, work affected, and measures applied by the affected party); the parties must analyze and assess the impact of price fluctuations compared to the time of contract formation, the loss of each party in continuing or terminating the contract, and compare with the provisions of Article 13 of the Construction Law to serve as the basis for considering and deciding to amend the contract in accordance with Clause 2, 3, Article 84 of the Construction Law, ensuring harmonization of interests and risk sharing between the parties;

b) The method, content, and procedures for amending the construction contract shall be carried out in accordance with Section 2 of this Decree.

4. During the execution of the construction contract, if one party cannot perform or fully perform its obligations under the contract due to force majeure or fundamental changes in circumstances, it must have the responsibility to notify the other party in writing and propose a solution to prevent, minimize, and handle arising risks.

Article 19. Subcontracting Contract

1. A main contracting contract may include multiple subcontracting contracts; the use of subcontractors shall be agreed upon by the parties in the main contracting contract. When concluding a subcontracting contract, the main contractor must comply with the following provisions:

a) Only enter into a subcontracting contract within the capacity of the subcontractor;

b) The main contractor shall be responsible to the project owner for the progress, quality, labor safety, environmental protection, errors, and works carried out by subcontractors;

c) For construction contracts under public investment projects, the assignment of subcontractors to perform one or several contents of the contract work shall be carried out in accordance with the legal provisions on bidding; in cases where subcontractors not listed in the subcontractor list attached to the contract are used, such use must be approved in writing by the project owner.

2. Subcontractors designated by the project owner (if any)

a) A subcontractor designated by the project owner is a subcontractor designated by the project owner for the main contractor to hire as a subcontractor when the main contractor fails to meet the requirements stipulated in the concluded contract regarding safety, quality, and progress after being requested by the project owner;

b) For construction contracts applying subcontractors designated by the project owner, the parties involved in the contract must specifically agree and record in the contract about the situations in which the project owner can designate subcontractors;

c) The main contractor has the right to refuse a subcontractor designated by the project owner if the designation of the subcontractor by the project owner does not fall within the cases agreed upon by the parties in the contract; the work that the main contractor and subcontractor are currently performing still complies with the agreements in the contract or there is sufficient basis to believe that the subcontractor designated by the project owner cannot meet the requirements stipulated in the contract;

d) For construction contracts under public investment projects and PPP projects, the project owner's designation of a subcontractor shall not change the contract price already concluded with the main contractor. The project owner designates a subcontractor in cases permitted by the subcontract agreement; the designation of a subcontractor brings benefits to the project and avoids waste.

3. The project owner may make direct payments to the subcontractor based on the proposal of the main contractor and the agreements in the contract.

4. The subcontractor has the rights, obligations, and responsibilities of the recipient party according to this Decree and other relevant laws.

Article 20. Insurance and Warranty of Construction Contracts' Products

1. Compulsory insurance in construction activities shall be implemented in accordance with Article 10 of the Construction Law and the detailed regulations on insurance conditions, premium rates, and minimum insurance amounts for compulsory insurance. In the contract, the parties agree on each party's responsibility for purchasing insurance.

2. The parties agree in the contract on the conditions, duration of warranty for the products of the contract; the level of warranty guarantee; the form of warranty guarantee and the return of the warranty guarantee after the warranty period ends. The recipient party is responsible for providing warranty in accordance with the agreements in the contract and the detailed regulations of the Government Decree on certain aspects of quality management, construction implementation, and maintenance of construction works. If the recipient party does not carry out the warranty within the agreed period in the contract or carries it out but does not ensure the quality and progress as required, the assigning party has the right to use the warranty guarantee to hire another organization or individual to carry out the warranty or to carry it out themselves if they meet the capacity conditions.

3. Measures and levels of warranty guarantees for construction contracts under public investment projects and PPP projects shall be implemented in accordance with Clause 2 of Article 13 of this Decree.

Article 21. Complaints during the performance of construction contracts

1. Complaints during the performance of construction contracts under this Decree shall be understood as when one party discovers that the other party performs incorrectly or fails to fulfill obligations according to the contract, it has the right to request the other party to perform the contents of the contract correctly. At that time, the discovering party has the right to complain about the other party regarding this matter.

2. When one party makes a complaint, the other party must present specific grounds and evidence to clarify the complained contents.

3. Each party's complaints must be sent to the correct transaction address or information exchange address agreed upon by the parties in the contract.

4. In addition to the provisions of Clause 1, Clause 2, and Clause 3 of this Article, for construction contracts under public investment projects and PPP projects, within a maximum of seven days from the date of receipt of the complaint, the receiving party must respond in writing to the complaining party, clearly stating acceptance or non-acceptance of the complained content; if not accepted, the reasons must be stated clearly.

5. Complaints not resolved by the participating parties in the contract will be resolved according to the dispute resolution procedures stipulated in the agreement of the parties and Article 17 of this Decree.

 

Section 2

METHODS, CONTENTS AND PROCEDURES

AMENDMENT OF CONSTRUCTION CONTRACTS

 

Article 22. Contents, methods, and procedures for amending construction contracts

1. Amending a contract is the act of the parties to the contract agreeing to adjust and supplement one or more contents compared to the concluded contract. Contract amendment may be carried out in cases prescribed in Clause 2 of Article 84 of the Construction Law. The contents of the amendment of construction contracts prescribed in Clause 1 of Article 84 of the Construction Law may include one or more of the following:

a) Adjustment of volume, progress, implementation time, unit price, contract price;

b) Change and adjustment of construction design;

c) Change and adjustment of requirements for content, scope of work, technology, product quality, advance payment conditions, payment; ensuring contractual obligations, insurance, warranty of construction contract products;

d) Amendment on the type of contract, form of contract price, price adjustment method, data sources for adjusting the contract price, and other related contents;

đ) Other contract contents agreed upon by the parties in accordance with the provisions of the law.

2. The parties agree specifically on the contents, scope, and cases allowed for contract amendment; the process and procedures for amending the contract. The adjustment of volume, adjustment of unit price and contract price, adjustment of implementation time and progress are detailed in Articles 23, 24, and 25 of this Decree.

3. The method and formula for adjusting unit prices and contract prices are agreed upon by the parties in the contract in accordance with the provisions of the law or applying widely used adjustment formulas according to international practice, suitable for the nature, content, scope of work, type of contract price, currency of payment, and specific provisions on managing cost risk factors in construction contracts.

4. For construction contracts under public investment projects and PPP projects, contract amendments must ensure compliance with the provisions of Clause 3 of Article 84 of the Construction Law. The procedure for amending construction contracts is as follows:

a) The party proposing the contract amendment sends a document to the other party regarding the proposed amendment content and accompanying files and documents (if any); clearly stating the basis and grounds for the proposed amendment, assessing the impact of the contract amendment on implementation time, progress, contract price, product quality, and other necessary contents;

b) Within seven working days, the party receiving the proposal for contract amendment has the responsibility to reply to the proposing party; if it does not agree with the proposed contract amendment, it must notify the other party in writing, clearly stating the reasons for not agreeing with the proposed contract amendment;

The parties proceed to negotiate the contents to be amended and conclude an amendment contract document as the basis for implementation. If the parties cannot negotiate the contents of the contract amendment, the tendering party is responsible for organizing the implementation of these works in accordance with the relevant laws on bidding and related laws;

d) In case the contract amendment leads to the need to adjust the investment policy, Feasibility Study Report, construction design implemented after approval, construction investment costs (total investment limit, construction budget, tender package budget,...), survey tasks and plans, design tasks, supervision, and other related contents, then the tendering party must organize the adjustment of these contents in accordance with the regulations before concluding the contract amendment document.

Article 23. Adjustment of Quantity and Work in Construction Contracts

1. The parties to the contract shall specifically agree on the cases where quantity and work can be adjusted, the scope and procedures for adjusting quantity and work.

2. For construction contracts under public investment projects or PPP projects, the adjustment of quantity and work in construction contracts shall be regulated as follows:

a) For lump-sum contracts, the quantity and work in the contract may be adjusted in cases of reasonable increase or decrease in quantity and work due to changes in the scope of work of the contract at the request of the tendering party or proposal of the contractor accepted by the tendering party, or in cases of force majeure events or fundamental changes in the performance environment of the contract as stipulated in Clause 1 and 2, Article 13 of the Construction Law affecting the performance of the contract.

b) For fixed unit price contracts and adjustable unit price contracts: The quantities and works with unit prices already determined in the contract shall be settled based on the actual completed quantities (increased or decreased compared to the quantities in the contract) that have been inspected. In cases of supplementing reasonable quantities and works without unit prices in the contract, the parties shall negotiate, calculate, and supplement the contract. If no agreement can be reached, the implementation of additional quantities and works shall be carried out in accordance with the law; the selection of contractors to implement additional quantities and works for construction contracts under public investment projects or PPP projects shall be conducted in accordance with the law on bidding.

c) In cases where the adjustment of quantity and work among members of a joint venture contractor does not change the contract price of the construction contract, the tendering party shall decide based on the agreement and consensus of the joint venture members and their respective capabilities and experience, ensuring safety, quality, efficiency, time, and progress of contract performance.

3. For reasonable additional quantities and works, the parties to the contract shall agree and unify the unit price or principles and methods for determining the unit price and adjusting the unit price as stipulated in Article 24 of this Decree as the basis for amending the contract before implementing these additional quantities and works. For construction contracts under public investment projects or PPP projects, if no agreement can be reached, the selection of contractors to implement additional quantities and works shall be carried out in accordance with the law on bidding.

Article 24. Adjustment of Unit Price and Contract Price in Construction Contracts

1. The parties to the contract shall specifically agree on the cases where the unit price and contract price in construction contracts can be adjusted according to Clauses 2 and 3, Article 84 of the Construction Law. The method of adjusting the unit price and contract price must be consistent with the nature of the work, type of contract price, payment currency, and agreed upon by the parties.

2. For construction contracts under public investment projects or PPP projects, in addition to the provisions of Clause 1 of this Article, the adjustment of unit prices of works in construction contracts and the adjustment of contract price shall be implemented according to Clause 3, Article 84 of the Construction Law and the following regulations:

a) The adjustment of unit prices of works in construction contracts applies to quantities of work for which the parties agreed at the time of contract conclusion that the unit price could be adjusted.

b) In cases where the actual quantity of work performed increases or decreases by more than 20% of the corresponding quantity recorded in the contract, and simultaneously affects a change of over 0.25% of the contract price and 1% of the unit price to perform the work, the parties shall agree to determine new unit prices for these quantities according to the principle agreed in the contract regarding new unit prices for these quantities for settlement. The new unit price shall apply to the portion of the actual quantity performed exceeding 120% of the quantity recorded in the contract; in cases where the actual quantity of work performed decreases by more than 20% of the corresponding quantity recorded in the contract, the new unit price shall apply to the entire actual quantity of work completed and inspected.

c) In cases where the actual quantity of work performed increases or decreases by less than or equal to 20% of the corresponding quantity recorded in the contract, the unit price in the contract, including the unit price already adjusted according to the contract agreement (if any), shall be applied for settlement.

d) In cases where there are additional quantities of work without unit prices in the contract, the parties shall agree to determine new unit prices for these additional quantities of work without unit prices in the contract for settlement according to the principle agreed in the contract.

đ) The adjustment of unit price and contract price shall be carried out using direct offset methods or adjustment by price adjustment factor (Pn) as prescribed in the Appendix attached to this Decree.

In a construction contract, both direct offset methods and adjustment by price adjustment factor (Pn) may be combined. Pn may be applied to the entire contract or project item; group or type of work or cost factors; if not applied to the entire contract, the parties must agree on a formula to determine Pn for specific project items; groups or types of work or cost factors.

e) Sources of price information or price index sources, methods for adjusting contract price must be consistent with the content, nature of work, cost structure, type of contract price, and must be specifically agreed and stipulated in the contract. In cases where the database, price information, or construction price index published by the Ministry of Construction or provincial People's Committee is inconsistent or unavailable, the tendering party shall organize the determination of prices or construction price indices in accordance with the law on construction investment cost management, or refer to prices or indices issued or announced by the Ministry of Finance or other competent authorities.

For costs arising abroad, the parties may agree to use databases, price information, or indices issued or announced by competent authorities or organizations in the place where the costs arise.

g) The management and settlement of the adjusted price value agreed upon specifically in the contract by the parties do not require the conclusion of an amendment agreement to the contract.

Article 25. Adjustment of Time and Progress of Construction Contract Execution

1. The parties to the contract shall agree specifically on the cases where time, progress of execution, and deadlines for completion of specific works and products under the contract may be adjusted, and the responsibilities of each party for damages caused by extending the time, progress of execution, and deadlines for completion of specific works and products under the contract.

2. For construction contracts under public investment projects or PPP projects, if the adjustment of time or progress of execution of the contract leads to exceeding the project implementation period, the investor must report to the investment decision-maker for consideration and decision on adjusting the project implementation period before the parties agree to adjust the time and progress of execution of the contract.

 

Section 3

TEMPORARY SUSPENSION AND TERMINATION OF CONSTRUCTION CONTRACTS

 

Article 26. Temporary Suspension of Construction Contracts

1. The temporary suspension of construction contract execution shall be carried out in accordance with the provisions of Clause 1, 3, and 4 of Article 85 of the Construction Law.

2. In addition to the provisions of Clause 1 of this Article, the temporary suspension of construction contracts for public investment projects or PPP projects shall be regulated as follows:

a) The contractor may temporarily suspend the execution of the construction contract in the case where the client fails to pay the value of the payment phase agreed upon by the parties beyond 28 days from the due date of payment as stipulated at Point l, Clause 4 of this Decree, except in cases where the parties have other agreements;

b) One party may temporarily suspend the execution of the contract when the other party does not fulfill the obligation to ensure the performance of obligations under the construction contract as provided for in Article 83 of the Construction Law and the provisions of Article 13 of this Decree;

c) The party temporarily suspending work under the contract must notify the other party in writing, specifying the reasons for the suspension. The notification period must be agreed upon in the construction contract, not exceeding 28 days, except in cases of force majeure events affecting the performance of the contract. Both parties have the responsibility to negotiate and resolve to continue performing according to the agreed contract terms. If the party temporarily suspending the contract does not notify or the reason for suspension does not comply with the contract provisions, it must compensate the other party for losses as stipulated in Clause 2 of Article 86 of the Construction Law.

Article 27. Termination of Construction Contracts

1. The termination of construction contracts shall be carried out in accordance with the provisions of Clause 2, 3, and 4 of Article 85 of the Construction Law.

2. Serious breach of contractual obligations as provided for in the Civil Code leading to the aggrieved party having the right to terminate the construction contract unilaterally or to terminate the performance of the construction contract includes:

a) The contractor or the client establishes or performs a transaction to transfer the construction contract to another individual or organization without the consent of the other party;

b) The contractor refuses to perform the work according to the contract or continuously fails to perform the work for 56 consecutive days, seriously affecting the progress of contract execution and failing to ensure the project implementation time, except in cases where the parties have other agreements;

c) Work under the contract is suspended for more than 56 consecutive days due to the fault of the client and there is no valid reason;

d) The client fails to pay the contractor beyond 56 days from the due date of payment as agreed in the contract, except in cases where the parties have other agreements;

đ) Other breaches as agreed or as prescribed by law that serve as grounds for terminating the construction contract or unilaterally terminating the performance of the contract.

3. In cases where there is no basis for terminating the contract, the aggrieved party does not unilaterally terminate the performance of the contract or terminate the contract, and the parties do not have other agreements, if one party in the construction contract arbitrarily fails to perform the contract, it falls under the category of breach of obligation and must bear civil liability, including the responsibility to continue performing obligations as prescribed by the Civil Code and relevant laws.

4. In cases where the client or contractor goes bankrupt or is dissolved, the rights and obligations of the parties shall be implemented in accordance with the agreements suitable to the law or the decisions of the competent court for bankruptcy resolution or the authority for dissolution resolution.

5. The notice period specified in Clause 3 of Article 85 of the Construction Law is 28 days, except in cases where the parties have other agreements. The notice content must clearly state the reasons, basis, and grounds for terminating the contract. If the party terminating the contract fails to notify and causes damage to the other party, it must compensate the other party for the loss.

6. In the construction contract, the parties shall agree and unify on the period for moving all materials, personnel, machinery, equipment, and other assets owned by the contractor out of the construction site from the date of contract termination. In cases where the parties cannot agree and unify, the client shall decide the period for the contractor to move all materials, personnel, machinery, equipment, and other assets owned by them out of the construction site. After this period, if the contractor has not completed the movement, the client shall implement the provisions of the Civil Code regarding the handling of property left behind by others.

7. The construction contract ceases to be effective from the date of termination, and the parties must complete the contract liquidation procedures within the agreed period in the contract, but not exceeding 56 days from the date of the termination notice, except in cases where the parties have other agreements. Specifically, for construction contracts under public investment projects or PPP projects, the liquidation period shall be implemented in accordance with Point b, Clause 3 of Article 31 of this Decree.

Outside the above period, if one party does not proceed with contract liquidation, unilateral contract liquidation shall be carried out in accordance with Clause 1 of Article 31 of this Decree.

Section 4

PAYMENT, SETTLEMENT, AND LIQUIDATION

OF CONSTRUCTION CONTRACTS

 

Article 28. Payment of Construction Contracts

The payment of construction contracts shall be carried out in accordance with the provisions of Clause 2, Article 87 of the Construction Law and the following regulations:

1. The form of payment shall be agreed upon by the parties in the contract, ensuring compliance with relevant laws.

2. The currency used for payment shall be implemented according to the provisions of Point c, Clause 2, Article 87 of the Construction Law. In cases where the parties agree to make payments in multiple currencies, they must clearly specify the corresponding contract price for each type of currency in accordance with the tender documents or request documents, bid documents or proposal documents, and negotiation records (if any).

3. In cases where the contractor is a joint venture, the payment to contractors within the joint venture shall be agreed upon in the construction contract or in the joint venture agreement.

4. For construction contracts under public investment projects, PPP projects, in addition to the provisions of Clauses 1, 2, and 3 of this Article, the following provisions shall apply:

a) The number of payments, payment stages, and payment times shall be agreed upon by the parties in accordance with the content of the work and the progress of the contract. When making payments according to the agreements in the contract, the parties do not need to sign supplementary contract appendices, except in cases of additional work not included in the contract;

b) If at the time of payment, the parties do not have sufficient grounds to determine the payment value (lack of data to adjust unit prices or contract prices; insufficient time to determine product quality), the payment value may temporarily be determined based on the unit price or contract price at the time of contract conclusion, and when the conditions for determining the payment value are met, the tenderer must pay the contractor according to the provisions of Clause 4 of this Article;

c) For lump-sum contracts: payment shall be made according to the percentage of the contract price or project price, component project price, or volume of work corresponding to the payment stages agreed upon in the contract; detailed completion volume confirmation shall not be required during payment, except in cases of additional volumes outside the scope of the contract;

d) For fixed unit price and adjustable unit price contracts: payment shall be based on the actual completed volume (including increased or decreased volumes, if any) accepted for each payment and the unit price in the contract or the adjusted unit price according to the agreements in the contract;

đ) For time-based contracts: payment shall be as follows: the consultant fee shall be determined based on the agreed consultant salary and related costs in the contract multiplied by the actual working time accepted (by month, week, day, hour). Other expenses outside the consultant fee shall be paid according to the payment method stipulated in the contract;

e) For cost-plus contracts: payment shall be based on the actual costs determined according to the method agreed upon in the contract to perform the contract plus the contractor's profit level as agreed in the contract;

g) For output-based contracts: the payment value shall be determined based on the actual accepted value corresponding to the payment stage agreed upon in the contract, plus or minus the increase or decrease in payment value specified in the contract based on the output results;

h) Percentage contracts: the payment value shall be determined based on the percentage recorded in the contract or the modified percentage according to the contract provisions (if any) multiplied by the accepted work value (for insurance contracts, it is multiplied by the project value);

i) For combined price contracts: payment must be made in accordance with the payment provisions for construction contracts set forth in Points c, d, đ, e, g, h of this Clause;

k) Payments for additional volumes (outside the contract) without unit prices in the contract shall be carried out according to the contract agreements or supplementary contract agreements that the parties have agreed upon before implementation and must comply with relevant legal provisions;

l) The maximum payment period is 14 working days from the date the tenderer receives all valid payment documents in accordance with the contract agreement, except as provided in Point m of this Clause;

m) For construction contracts under projects using ODA funds or foreign bank loans, the payment period shall be implemented according to international treaty provisions. When agreeing on payment periods, the parties must base their agreement on international treaty provisions and the capital investment payment procedures stipulated by law to ensure consistency in the contract;

5. The tenderer has the responsibility to fully and timely pay the contractor according to the agreements in the contract. If the tenderer delays payment, interest must be paid on the delayed amount corresponding to the delay period. The late payment interest rate shall be agreed upon in the contract; if there is no agreement, it shall be determined according to the overdue interest rate published by the commercial bank where the contractor opens a payment account, corresponding to the delayed payment periods.

Article 29. Payment Documents for Construction Contracts

1. Payment documents for construction contracts shall be prepared by the contractor in accordance with each type of construction contract, contract price, and agreements within the contract (including forms, if any) and shall be confirmed by representatives of the client or consulting representatives (if any) and representatives of the contractor. The components of payment documents (including forms, if any) shall be agreed upon by the parties corresponding to the type of construction contract.

For construction contracts under public investment projects or PPP projects, the main components of payment documents are stipulated in Clauses 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, and 12 of this Article.

2. Components of payment documents for lump-sum contracts

a) Certificate of quantity and work acceptance completed during the payment period; this certificate of quantity acceptance confirms the completion of the project, project component, or work volume in accordance with the scope of work required to be performed according to the design (for construction contracts) or consultancy tasks (for consultancy contracts) without the need for detailed confirmation of completed volumes.

b) Table calculating the value of additional works outside the scope of the concluded contract (if any).

c) The contractor's payment request must include the following contents: the value of the completed work volume according to the contract, the value of additional work volumes (if any), deduction of advance payments, and the payment value requested in the subsequent phase after offsetting these amounts.

3. Components of payment documents for fixed unit-price contracts

a) Certificate of actual quantity and work acceptance completed (increased or decreased compared to the quantity in the contract) during the payment period;

b) Table calculating the value of works without unit prices in the contract (if any), including both the quantity and unit price for these works;

c) The contractor's payment request must include the following contents: the value of the completed work volume according to the contract, the value of additional work volumes (if any), deduction of advance payments, and the payment value requested in the subsequent phase after offsetting these amounts.

4. Components of payment documents for adjustable unit-price contracts

a) Certificate of actual quantity and work acceptance completed (increased or decreased compared to the quantity in the contract) during the payment period;

b) Table calculating the adjusted unit price (also called the payment unit price) in accordance with the agreement in the contract, table calculating the value of works without unit prices in the contract (if any), including both the quantity and unit price for these works;

c) The contractor's payment request must include the following contents: the value of the completed work volume according to the contract, the value of additional work volumes (if any), deduction of advance payments, deductions according to the contract provisions, and the payment value requested in the subsequent phase after offsetting these amounts.

5. Components of payment documents for time-based contracts

a) Certificate of actual working hours or attendance sheet (monthly, weekly, daily, hourly) corresponding to the results of work in the payment period. In cases where additional work arises during implementation that requires the supplementation of experts not covered by the contract, the parties must agree on and unify the remuneration before implementation, ensuring compliance with relevant laws. At that time, the payment documents must include a table calculating the value of additional works (if any) outside the scope of work required to be performed according to the contract;

b) The contractor's payment request must include the following contents: the value of work completed according to the contract, the value of additional works (if any), deduction of advance payments, and the payment value requested in the subsequent phase after offsetting these amounts.

6. For construction contracts involving equipment supply work, the completed volume can be based on invoices, certificates, bills of lading, equipment acceptance and handover certificates, and other related documents.

7. For construction contracts involving difficult-to-determine consultancy work completion volumes (completion volumes are only relative in nature), the completed volume will be determined based on the documents, materials, or products completed by the contractor and confirmed by the client as appropriate to the payment period agreed upon in the contract.

8. Components of payment documents for cost-plus contracts

a) Certificate of actual quantity and work acceptance completed;

b) Table confirming actual direct costs recognized by the parties and the value of management costs, common costs, and profit of the contractor in accordance with the agreement in the contract;

c) The contractor's payment request must include the following contents: the value of actual direct costs incurred to complete the works in the contract, deduction of advance payments, and the payment value requested in the subsequent phase after offsetting these amounts.

9. Components of payment documents for outcome-based contracts

a) Certificate of actual quantity of work completed; this certificate is based on the documents, materials, or products completed by the contractor in accordance with the requirements of the contract confirmed by the client;

b) The contractor's payment request must include the following contents: the value of the completed outcome-based work volume according to the contract, adjustment value (if any), deduction of advance payments, and the payment value requested after offsetting these amounts.

10. Components of payment documents for percentage contracts

a) Certificate of actual quantity of work completed (increased or decreased compared to the quantity in the contract) during the payment period; this certificate is based on the documents, materials, or products completed by the contractor confirmed by the client corresponding to the payment phases (times) agreed upon in the contract;

b) Table calculating the value of additional works (if any) outside the scope of the work required to be performed according to the contract;

c) The payment proposal of the contractor shall include the following contents: The value of the completed works accepted according to the contract, the value of additional work (if any), deduction of advance payments, the amount of the payment proposal after offsetting these items, confirmed by representatives of both the contracting party and the contractor.

11. For construction contracts under combined pricing, the payment documentation shall be carried out in accordance with the corresponding provisions set forth in Clauses 2, 3, 4, 5, 6, 7, 8, 9, and 10 of this Article.

12. In cases of interim payment as stipulated in point b, Clause 4, Article 28 of this Decree, the contracting party shall base on each specific interim payment case to decide on the interim payment documentation, ensuring the principle that only documents not yet meeting the conditions specified in the contract shall be temporarily confirmed; for documents already meeting the confirmation conditions, the payment documentation must be complete as agreed in the contract and in accordance with Clauses 2, 3, 4, 5, 6, 7, 8, 9, 10, and 11 of this Article.

13. In addition to the main documents mentioned in Clauses 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, and 12 of this Article, for construction contracts using ODA funds, preferential foreign loans from sponsors, the payment documentation must also comply with the agreements and international treaties regarding ODA funds, preferential foreign loans signed between the Government of Vietnam and sponsors, and the regulations of the Government of Vietnam on managing and utilizing ODA funds and preferential foreign loans.

14. The contracting party, relevant agencies, organizations, and individuals involved in contract payment shall not impose requirements for payment documentation contrary to the agreement in the contract and the provisions of this Decree to obstruct payment as agreed in the contract.

Article 30. Settlement of Construction Contracts

The settlement of construction contracts shall be carried out in accordance with the provisions of Clauses 1, 3, and 5 of Article 87 of the Construction Law and the following provisions:

1. The settlement documentation of construction contracts shall be prepared by the contractor in accordance with the type of construction contract, contract price, and agreements in the contract (including forms, if any), confirmed by representatives of the contracting party or consulting representatives (if any) and representatives of the contractor. In cases of unilateral contract settlement as stipulated in Clause 1 and Clause 5 of Article 87 of the Construction Law, the unilaterally settling party shall prepare the settlement documentation of the contract; the components of the settlement documentation of the contract shall be in accordance with the agreements in the contract and the provisions of this Decree.

The main components of the settlement documentation and the settlement deadline for construction contracts belonging to public investment projects and PPP projects are stipulated in Clause 2 and Clause 3 of this Article.

2. The settlement documentation includes the following main documents:

a) Completion acceptance record for all work within the scope of the contract and additional work outside the scope of the contract;

b) Calculation table of the settlement value of the construction contract (called A-B settlement), specifying the value of work completed according to the contract; the value of additional work (if any) outside the scope of the contracted work, the value already paid or temporarily paid, and the remaining value that the contracting party is responsible for paying to the contractor;

c) Completion documentation, construction project progress log for contracts involving construction work;

d) Other documents as agreed in the contract.

3. The maximum settlement period for construction contracts is 60 days from the date when all work under the contract has been completed and accepted according to the contract agreement; for large and complex construction contracts, the settlement period may be extended, but not exceeding 120 days.

4. In cases where the contractor is a joint venture, the settlement of the contract value corresponding to the scope of work of each contractor in the joint venture shall be implemented as agreed in the construction contract.

Article 31. Liquidation of Construction Contracts

1. The liquidation of construction contracts shall be carried out in accordance with the provisions of Clause 1, 4, and 5 of Article 87 of the Construction Law. In cases stipulated in Clause 5 of Article 87 of the Construction Law, the liquidation of the contract shall be carried out by the party unilaterally terminating the contract in accordance with the agreements in the contract.

2. Construction contracts may be liquidated in the following cases:

a) The parties have fulfilled all obligations under the concluded contract;

b) The construction contract is terminated according to the provisions of Clause 2 of Article 85 of the Construction Law.

3. In addition to the provisions set forth in Clause 1 of this Article, the liquidation of construction contracts for public investment projects and PPP projects shall be regulated as follows:

a) The parties may agree that the contract automatically becomes void upon completion of all obligations under the concluded contract or establish a liquidation record. If the parties agree to establish a liquidation record, the contractor has the obligation to prepare it for confirmation by the client;

b) The maximum period for liquidating a construction contract is 45 days from the date when all obligations under the contract have been completed or the construction contract is terminated according to the provisions of Clause 2 of Article 85 of the Construction Law; in cases where the construction contract is large-scale and complex, the liquidation period may be extended, but not exceeding 90 days.

 

Chapter III

IMPLEMENTING PROVISIONS

 

Article 32. Effectiveness

1. This Decree shall take effect from July 1, 2026.

2. The following legal normative documents shall cease to be effective from the date this Decree takes effect:

a) Decree No. 37/2015/NĐ-CP dated April 22, 2015 of the Government detailing construction contracts; Decree No. 50/2021/NĐ-CP dated April 1, 2021 of the Government amending and supplementing some articles of Decree No. 37/2015/NĐ-CP dated April 22, 2015 of the Government detailing construction contracts;

b) Article 9 of Decree No. 35/2023/NĐ-CP dated June 20, 2023 of the Government amending and supplementing some articles of decrees under the management of the Ministry of Construction.

Article 33. Transitional Provisions

1. For construction contracts under public investment projects and PPP projects, the following shall apply:

a) In cases where tender documents or request documents have been approved but not yet issued or draft construction contracts have not been sent to the contractor, the relevant contents related to the construction contract shall be revised to comply with the provisions of this Decree;

b) In cases where tender documents or request documents have been issued or draft construction contracts have been sent to the contractor, if there are changes to the contents related to the construction contract to comply with the provisions of this Decree, all bidders who have purchased/received tender documents or request documents must be notified to amend their tender documents or proposal documents accordingly;

c) In cases where bidding has been closed, there is no need to revise the contents related to the construction contract in the tender documents or request documents; during the negotiation, discussion, and completion of the construction contract, the parties shall agree and apply the provisions of this Decree, ensuring compliance with the bidding laws and other relevant laws. In cases where the parties cannot reach an agreement, the provisions of the tender documents or request documents shall continue to be implemented;

d) For construction contracts that have been concluded and are being implemented before this Decree takes effect, they shall be implemented according to the provisions on construction contracts and bidding laws before this Decree takes effect, except for cases provided for in Clause 7 of Article 95 of the Construction Law.

2. For construction contracts at other projects that have been concluded and are being implemented before this Decree takes effect, the parties shall consider and agree to apply the provisions of this Decree, ensuring compliance with the construction laws and other relevant laws. In cases where the parties cannot reach an agreement, the provisions of the construction contract laws and other relevant laws at the time of conclusion shall be implemented.

Article 34. Implementation Organization

1. Subjects when establishing, reviewing, and approving tender documents and request documents containing contents related to construction contracts; negotiating, concluding, and managing the implementation of construction contracts must comply with the provisions of this Decree; organize the storage of contract files in accordance with regulations; provide information to serve inspection, examination, and audit work; bear responsibility under the law and the investment decision-maker for the management and implementation of construction contracts.

2. The Ministry of Construction shall guide and inspect the implementation of legal provisions on construction contracts and publish model construction contracts for organizations and individuals to refer to during the establishment and management of contract implementation; organize dissemination, training, and capacity building in contract management.

3. Encourage organizations and individuals to refer to and use the model contract conditions of reputable professional associations (such as FIDIC, NEC) in the establishment and implementation of construction contracts; when referring to and using them, the parties shall consider adjusting the contract contents to comply with Vietnamese laws.

4. The Minister, Head of a ministerial-level agency, Chairman of the People's Committee of a province or centrally governed city, and relevant organizations and individuals are responsible for implementing this Decree.