Decree No. 32/2015/ND-CP on Management of Investment Construction Costs

DECREE

On the management of construction investment costs

___________

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Pursuant to the Law on Construction promulgated on June 18, 2014;

At the proposal of the Minister of Construction;

The Government promulgates the Decree on Management of Construction Investment Costs.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

1. This Decree stipulates the management of construction investment costs including total construction investment ceiling, construction budget estimate, construction tender budget estimate, construction norms, construction prices, construction price indices, project management and investment consulting costs, payment and settlement of construction contracts; payment and settlement of construction investment capital; rights and obligations of the investment decision-maker, investor, construction contractor, and consulting contractor in managing construction investment costs.

2. For construction projects using official development assistance (ODA) funds, if international treaties to which the Socialist Republic of Vietnam is a party provide different provisions from those of this Decree, the provisions of such international treaties shall be applied.

Article 2. Applicability

1. This Decree applies to agencies, organizations, and individuals related to the management of construction investment costs for projects using state budget funds and non-budget state funds as specified in Clause 1 and Clause 2 of Article 60 of the Construction Law.

2. Organizations and individuals may apply the provisions of this Decree to manage construction investment costs for projects using other types of capital.

Article 3. Principles of managing construction investment costs

1. Management of construction investment costs must ensure the investment objectives, project effectiveness approved, comply with the construction investment procedures as stipulated in Clause 1 of Article 50 of the Construction Law, and the available capital. Construction investment costs must be accurately calculated for each project, construction work, and construction tender, consistent with design requirements, technical guidelines, construction conditions, market prices at the time of cost determination, and the construction area.

2. The State manages construction investment costs through issuing, guiding, and inspecting the implementation of legal regulations; guiding methods for establishing and managing construction investment costs.

3. The investor is responsible for managing construction investment costs from the project preparation stage until the completion and operation of the project's works within the approved total investment ceiling of the project, including cases where the total investment ceiling is adjusted according to the provisions of Article 7 of this Decree. The investor may hire organizations or individuals with the required qualifications as stipulated in the Decree on Project Investment Management to establish, review, monitor, and manage construction investment costs.

4. Inspections, audits, and reviews of construction investment costs must be carried out based on the bases, contents, methods, and timing for determining the total construction investment ceiling, construction budget estimates, construction tender budget estimates, construction norms, construction prices, and construction price indices of the works agreed upon by the investment decision-maker and the investor, consistent with the stages of cost formation as stipulated in this Decree regarding the management of construction investment costs.

Chapter II

TOTAL CONSTRUCTION INVESTMENT CEILING

Article 4. Content of preliminary total investment cost and total investment construction cost

1. Preliminary total construction investment ceiling is an estimated construction investment cost of the project determined in accordance with the preliminary design scheme and other contents of the Feasibility Study Report for Investment Construction. The preliminary total construction investment ceiling includes the cost items specified in Clause 2 of this Article.

2. Total construction investment ceiling is the entire construction investment cost of the project determined in accordance with the basic design and other contents of the Feasibility Study Report for Investment Construction. The total construction investment ceiling includes compensation, support, and resettlement costs (if applicable); construction costs; equipment costs; project management costs; investment construction consulting costs; other costs; and contingency costs for additional volume and price escalation.

3. For projects that only require the preparation of an Economic and Technical Feasibility Study Report for Investment Construction, the total construction investment ceiling is the construction budget estimate of the works as stipulated in Article 8 of this Decree and compensation, support, and resettlement costs (if applicable).

4. The costs of the total construction investment ceiling are specifically defined as follows:

a) Compensation, support, and resettlement costs include land compensation costs, house compensation costs, construction costs on land, assets attached to land, and other compensation costs as prescribed; support amounts when the State recovers land; resettlement costs; organization costs for compensation, support, and resettlement; land use costs during the construction period (if applicable); costs for paying for existing infrastructure (if applicable), and other related costs;

b) Construction costs include demolition costs of existing structures, site leveling costs, construction costs of works and sub-works, temporary construction works, and auxiliary works serving construction;

c) Equipment costs include procurement costs for construction equipment and technology equipment; training and technology transfer costs (if applicable); installation, testing, and calibration costs; transportation and insurance costs; taxes and other related fees;

d) Project management costs include costs for organizing the implementation of project management tasks from the project preparation stage, project execution, and project completion and operation;

đ) Investment construction consulting costs include survey consulting costs, feasibility study report preparation costs (if applicable), economic and technical feasibility study report preparation costs, design costs, construction supervision consulting costs, and other related consulting costs;

e) Other costs include common item costs as specified in Point đ Clause 2 Article 8 of this Decree and costs not included in the contents specified in Points a, b, c, d, and đ of this Clause;

g) Contingency costs include costs for additional work volume and price escalation factors during the project implementation period.

Article 5. Preliminary determination of total investment amount, construction investment amount

1. The preliminary construction investment amount of the project is estimated based on the scale, capacity, or service capability according to the initial design scheme of the project and the unit cost of investment or cost data of similar projects regarding type, scale, and nature of the project, adjusted and supplemented with necessary costs.

2. The total construction investment amount is determined according to one of the following methods:

a) Determined from the volume of construction calculated according to the basic design and other necessary requirements of the project. Among which:

- Compensation, support, and resettlement costs are determined based on the volume of compensation, support, and resettlement required by the project and relevant state policies;

- Construction costs are determined based on the volume of construction work groups, types, structural units, or parts of the works and the corresponding comprehensive construction prices for construction work groups, types, structural units, or parts of the works measured, calculated, and some related costs predicted;

- Equipment costs are determined based on the quantity, type, or system of equipment according to the selected technological and technical solutions and equipment, purchase prices matching market prices, and other related costs;

- Project management costs and construction investment consulting costs include the contents and are determined according to Articles 23 and 25 of this Decree;

- Other costs are determined by standard rates (percentages) or by budget estimates or forecasts or using databases of similar completed projects;

- Contingency costs for unforeseen work are determined by a percentage of the total components of costs already identified above. Contingency costs for price escalation factors are determined based on the duration of the project implementation, capital allocation plans, and annual construction price indices suitable for the type of construction project, taking into account domestic and international price fluctuations;

b) Determined according to the unit cost of construction works:

The total construction investment amount is determined based on the volume, area, capacity, or service capability according to the basic design and the corresponding published unit cost of investment suitable for the type and level of the construction project, the time of establishing the total investment amount, the construction project investment area, and other costs consistent with specific project requirements;

c) Determined from data on costs of similar completed or ongoing projects:

The total construction investment amount is determined based on the scale of the building floor area, capacity, or service capability according to the design of the project, structural units of the project, and cost data of similar completed or ongoing projects with the same type, level, scale, capacity, or service capability. Cost data usage requires conversion, calculation about the time of establishing the total investment amount, the construction project investment area, and adjustment, supplementation of other costs consistent with the specific conditions of the project, works;

d) Combining the methods prescribed in Points a, b, and c Clause 2 of this Article.

3. For projects that only require preparation of the Economic and Technical Report for Construction Investment, the construction project budget portion within the total construction investment amount is determined according to the provisions of Article 9 of this Decree.

Article 6. Review and Approval of the Total Investment Amount for Construction

1. Review of the total construction investment amount is carried out concurrently with the review of the construction investment project. Contents of the review of the total construction investment amount include:

a) The appropriateness of the method for determining the total construction investment amount with the characteristics, nature, technical and technological requirements of the project;

b) Checking the completeness of the volumes used to determine the total construction investment amount; the rationality and compliance with state regulations and guidelines for costs used to calculate and determine costs within the total construction investment amount;

c) Determining the value of the total construction investment amount after the review is completed. Analyzing the reasons for increases or decreases and evaluating the assurance of investment efficiency of the project according to the determined total construction investment amount after the review;

2. For projects that only require preparation of the Economic and Technical Report for Construction Investment, the review contents are implemented as prescribed in Clause 2 of Article 10 of this Decree.

3. Authority for reviewing the total investment amount for construction:

a) For national key projects, the State Appraisal Council established by the Prime Minister shall organize the review;

b) Projects using state budget funds shall be reviewed by the specialized agency responsible for construction at the appropriate level;

c) For projects using non-budget state capital, the specialized agency under the person deciding on investment shall organize the review;

d) For projects implemented through project contracts, public-private partnership contracts with state contributions, the competent state agency shall organize the review.

4. Authority to review the total construction investment amount for projects that only require preparation of the Economic and Technical Report for Construction Investment:

a) For projects using state budget capital, the specialized agency on construction according to the division of authority shall organize the review;

b) For projects using non-budget state capital, the specialized agency under the person deciding on investment shall organize the review.

5. The specialized agency on construction according to the division of authority, the person deciding on investment may invite organizations and individuals with expertise and experience to participate in reviewing the total construction investment amount or request the investor to select organizations and individuals with the necessary conditions to manage construction investment costs according to the Decree on project investment construction management to conduct preliminary reviews of the total construction investment amount as the basis for review and approval. For Class A projects or Class B, C projects with complex technology or high technology application, the investor organizes the preliminary review of the total construction investment amount as the basis for review and approval.

6. The person deciding on investment approves the total construction investment amount together with the approval of the project. The approved total construction investment amount is the maximum cost that the investor is permitted to use to implement the construction investment project.

7. The dossier for reviewing the total investment ceiling for construction is part of the dossier for reviewing the project investment dossier according to Clause 2, Article 56 of the Construction Law and the Decree on managing construction investment projects that only require the preparation of an economic-technical report. The review and verification results of the total investment ceiling shall be prepared in accordance with the model prescribed by the Ministry of Construction.

Article 7. Adjustment of the total investment ceiling for construction

1. The approved total investment ceiling for construction may be adjusted in accordance with Clause 5, Article 134 of the Construction Law. The investor decision-maker approves the adjusted total investment ceiling for construction.

2. The adjusted total investment ceiling for construction includes the previously approved total investment ceiling plus (or minus) the increased (or decreased) value. The increased (or decreased) value must be verified and reviewed to serve as the basis for approving the adjusted total investment ceiling.

3. In cases where only the structure of cost items, including contingency costs, is adjusted without changing the value of the previously approved total investment ceiling for construction, the project owner organizes the adjustment, reports to the investor decision-maker, and bears responsibility for the adjustment.

4. If all contingency costs within the previously approved total investment ceiling for construction, including contingency costs for inflation factors, have been utilized, and if the construction price index published by the competent state agency from the time the project was implemented until the adjustment date is higher than the construction price index used in the previously approved total investment ceiling, the project owner shall organize the determination of additional contingency costs due to inflation factors.

5. If the adjusted total investment ceiling for construction pursuant to Clause 1 of this Article increases or decreases the scale (group) of the project, the project management will still be carried out according to the scale (group) of the project that was approved before the adjustment.

Chapter III

CONSTRUCTION ESTIMATE

Section 1

CONSTRUCTION ESTIMATE

Article 8. Contents of the construction estimate

1. The construction estimate is the entire necessary cost for constructing the project determined at the implementation stage of the project in accordance with technical design, construction drawings, and the work requirements of the project.

2. The contents of the construction estimate include construction costs, equipment fees, project management costs, construction investment consulting costs, other costs, and contingency costs, which are specified as follows:

a) Construction costs include direct costs, common costs, pre-tax income, and value-added tax.

b) Equipment costs include procurement costs for construction equipment and technology, training and technology transfer costs, installation, testing, calibration costs, and other related costs.

c) Project management costs include the costs prescribed in Clause 2, Article 23 of this Decree to organize project management from the project preparation phase, implementation phase, and completion phase to put the project into operation.

d) Construction investment consulting costs include surveying, designing, construction supervision costs, and other related consulting costs.

e) Other costs of the project include general item costs and costs not included in the contents specified in Points a, b, c, and d of this Clause. General item costs include costs for temporary housing and construction site management, costs for moving construction equipment and labor forces to and from the site, labor safety costs, traffic safety costs serving construction (if applicable), costs for protecting workers' health and the surrounding environment, costs for restoring the site and infrastructure affected by construction (if applicable), material testing costs by contractors, and other related costs.

f) Contingency costs of the project include costs for unforeseen work volumes and contingency costs for inflation factors during the construction period.

3. For projects with multiple construction works, the project owner may determine the total construction estimate to manage costs. The total construction estimate is determined by summing up the individual construction estimates and related costs of the project.

Article 9. Determination of Construction Project Budget Estimate

1. The construction project budget estimate is determined based on the calculated quantities from technical design, construction drawing design, technical instructions, work requirements to be carried out for the project, and construction norms and construction prices of the project.

2. Costs in the construction project budget estimate are determined as follows:

a) Construction costs include direct costs for materials, labor, and construction machinery, which are determined based on the quantities of construction works and tasks measured and calculated from technical design drawings, construction drawing design, technical instructions, work requirements to be carried out for the project, construction prices of the project, and common costs, pre-tax income, value-added tax, which are determined based on cost norms issued or announced by competent state agencies;

b) Equipment costs are determined based on the quantities, types, and specifications of equipment from technology design, construction design, and corresponding equipment purchase prices. Training, technology transfer, installation, testing, calibration costs, and other related costs are determined through budget estimates or cost projections;

c) Project management costs are determined according to the provisions of Clause 3, Article 23 of this Decree;

d) Investment consulting costs for construction projects are determined according to the provisions of Clause 3, Article 25 of this Decree;

đ) Other costs are determined based on percentage norms (%) or projections or budget estimates or contract values already signed;

e) Contingency costs for unforeseen work volumes are calculated as a percentage (%) of the total costs specified in Points a, b, c, d, and đ of this Clause. Contingency costs for price escalation are calculated based on the length of the construction period, capital allocation plans, and construction price indices suitable for the type of construction project, taking into account domestic and international price fluctuations.

Article 10. Review and Approval of Construction Project Budget Estimates

1. The review of construction project budget estimates is conducted concurrently with the review of technical design and construction drawing design.

2. Contents of the review of construction project budget estimates include:

a) Checking the consistency of construction work quantities, types, and quantities of equipment in the budget estimate with those calculated from construction design and technology;

b) Verifying the accuracy and reasonableness of the application and implementation of budget norms, construction prices of the project, and other relevant regulations in determining the items of costs in the construction project budget estimate;

c) Determining the value of the reviewed construction project budget estimate and recommending the budget estimate value for the competent authority to consider and approve. Evaluating the increase or decrease in cost items, analyzing the reasons for the increase or decrease compared to the proposed construction project budget estimate value for review.

3. Authority for reviewing and approving construction project budget estimates is implemented according to the provisions of the Decree on project investment construction management.

4. For national key projects, group A, B, and C projects with complex technology or high-tech applications, specialized construction agencies at the appropriate level, and the investment decision-maker require the project investor to select qualified cost management consulting organizations according to the provisions of the Decree on project investment construction management to conduct preliminary reviews of construction project budget estimates as a basis for the review before submitting to the competent authority for approval.

5. The approved construction project budget estimate serves as the basis for determining the tender package price in the contractor selection plan and negotiating and signing construction contracts in cases of designated tenders, if applicable. If the tender package price in the contractor selection plan is determined based on the total investment amount, the tender package price will be updated according to the approved construction project budget estimate.

6. The review documents of the budget estimate are part of the review documents of technical design, construction drawing design, and construction project budget estimate as stipulated in the Decree on project investment construction management. The results of the review and preliminary review of construction project budget estimates are prepared according to the prescribed format of the Ministry of Construction.

Article 11. Adjustment of Construction Project Budget

1. The approved construction project budget may only be adjusted in the following cases:

a) Adjusting the total investment cost according to the provisions of Article 7 of this Decree;

b) Changing or supplementing the design without contravening the basic design or changing the cost structure within the approved construction project budget, including contingency costs, but not exceeding the approved total investment cost.

2. The adjusted construction project budget includes the approved construction project budget plus (or minus) the increased (or decreased) value. The increased (or decreased) value must be reviewed and appraised to serve as the basis for approving the adjusted construction project budget.

3. The investor shall organize the determination of the adjusted construction project budget as the basis for adjusting the contract price, tender package price, and total investment cost.

4. In cases where only the cost item structure is adjusted without changing the approved construction project budget value, including contingency costs, the investor shall organize the adjustment.

5. The authority to review and approve the adjusted construction project budget shall be carried out in accordance with the provisions of the Decree on Construction Investment Project Management.

Section 2

BUDGET OF TENDER PACKAGE FOR CONSTRUCTION

Article 12. General Provisions on Tender Package Construction Budget

1. The tender package construction budget is determined for each tender package, consistent with the plan for selecting contractors, the approved construction project budget, and is implemented before organizing the selection of construction contractors.

2. The tender package construction budget includes the construction work tender package budget; the procurement tender package budget for materials and equipment installation into the project; the investment consulting tender package budget; and the mixed tender package budget.

3. The investor organizes the determination and updating of the tender package construction budget, implements the review and approval to replace the tender package construction budget price recorded in the approved plan for selecting contractors, serving as the basis for preparing the Invitation to Bid or Request for Proposal and evaluating the selection of construction contractors.

4. The investor may hire organizations or individuals with the necessary qualifications to manage costs, as stipulated in the Decree on Construction Investment Project Management, to carry out the determination, updating, and reviewing of the tender package construction budget before approval.

Article 13. Construction Work Tender Package Budget

1. The construction work tender package budget is the total necessary cost to implement construction works, tasks, items, and projects within the scope of the construction work tender package. The contents of the construction work tender package budget include construction costs, common item costs, and contingency costs.

2. Construction costs are determined based on the volume of work required for the tender package and the construction unit price, defined as follows:

a) The volume of work required for the tender package includes the measured and calculated volumes of construction works when determining construction costs in the construction project budget and other updated and supplementary volumes (if any) determined from the design drawings, construction methods for separate works and projects requiring construction method designs, technical instructions, and related technical requirements of the tender package.

b) The construction unit price is the total necessary cost (including direct costs, common costs, pre-tax income, and value-added tax) to implement a unit volume of construction work corresponding to the required volume of work for the tender package. The construction unit price is updated based on the unit prices in the construction budget, consistent with the regional market price level for construction projects, relevant state policies at the time of determining the tender package budget, and related technical instructions and technical requirements of the tender package.

3. Common item costs are determined based on cost standards published by competent state authorities or estimated costs or by budget.

4. Contingency costs in the construction work tender package budget are determined as a percentage of the costs already determined in the tender package budget and the duration of the tender package but shall not exceed the percentage of contingency costs in the approved construction project budget.

Article 14. Budget for procurement packages of materials and equipment installation in construction projects

1. The budget for procurement packages of materials and equipment installation in construction projects includes costs for purchasing construction equipment and technological equipment; training and technology transfer costs (if applicable); installation, testing, calibration costs; transportation and insurance costs; taxes and related fees, and contingency costs.

2. Procurement costs for materials and equipment are determined based on the quantities and amounts of materials and equipment required for procurement in the package and the unit prices of materials and equipment, defined as follows:

a) The quantities and amounts of materials and equipment required for procurement include the quantities and amounts of materials and equipment that have been measured, calculated when determining equipment costs in the construction project budget, and updated, supplemented (if any) from design, technology, technical guidelines, and relevant technical requirements of the package.

b) Unit prices of materials and equipment include purchase prices, transportation costs, insurance costs, and related taxes and fees. Purchase unit prices of materials and equipment are determined based on unit prices in the construction project budget, consistent with market price levels in the construction project area, relevant state policies at the time of determining the procurement package budget, and technical guidelines and relevant technical requirements of the package.

3. Installation, testing, and calibration costs for equipment include cost items determined as in the construction project implementation budget.

4. Contingency costs in the procurement package budget are determined as a percentage (%) of the already determined costs in the procurement package budget and the duration of the procurement package but shall not exceed the percentage (%) of contingency costs in the approved construction project budget.

Article 15. Budget for consultancy procurement packages in investment and construction

1. The budget for consultancy procurement packages in investment and construction is the cost to perform one or several consultancy works in investment and construction in accordance with the scope of work required for the package.

2. The content of the consultancy procurement package budget includes consultant fees, management costs, other costs, pre-tax income, taxes, and contingency costs. For consultancy procurement packages for construction survey and specialized construction testing, the content of the consultancy procurement package budget includes cost items similar to those in the construction project implementation budget.

3. The consultancy procurement package budget is determined based on consultancy costs in the construction project budget and updated, supplemented with relevant volumes and state policies affecting costs (if any) at the time of preparing the consultancy procurement package budget.

4. Contingency costs in the consultancy procurement package budget are determined based on the characteristics and nature of the consultancy work, progress of implementation but shall not exceed the percentage (%) of contingency costs already determined in the construction project budget.

5. For construction survey and design procurement packages for construction projects at level II or higher, the consultancy procurement package budget also includes costs for purchasing professional liability insurance for investment and construction consultancy.

6. For consultancy procurement packages that must be implemented before approving the total investment ceiling and construction project budget, the consultancy procurement package budget is determined based on the scope of work to be performed.

Article 16. Budget for Hybrid Tender Packages

1. The budget for the design and construction tender package (referred to as EC) includes the budgets for works as stipulated in Article 15 and Clause 13 of this Decree.

2. The budget for the procurement of materials and equipment and construction tender package (referred to as PC) includes the budgets for works as stipulated in Article 14 and Clause 13 of this Decree.

3. The budget for the design-procurement of materials and equipment-construction tender package (referred to as EPC) includes cost items for design, procurement of materials and equipment, and construction within the approved total investment limit of the construction project.

4. The budget for the project preparation-design-procurement of materials and equipment-construction tender package (turnkey) includes cost items within the approved total investment limit of the construction project as specified in points b, c, d, đ, e, and g of Clause 4, Article 4 of this Decree.

Chapter IV

CONSTRUCTION COST INDEX AND BUILDING COSTS

Section 1

CONSTRUCTION STANDARDS

Article 17. Economic and Technical Standards

1. Economic and technical standards include basic standards and construction budget estimate standards.

2. Basic standards include material usage standards, labor standards, machine and construction equipment productivity standards. Basic standards are used to determine the construction project budget standards.

3. Construction project budget standards are the necessary consumption levels of materials, labor, machines, and construction equipment determined in accordance with technical requirements, construction conditions, and specific construction methods to complete a unit volume of construction work.

4. Economic and technical standards serve as the basis for managing construction investment costs.

Article 18. Cost Standards

1. Cost standards include percentage-based standards and value-based standards.

2. Cost standards serve as the basis for determining construction costs, project budget costs for certain types of work, investment construction costs including project management costs, investment construction consulting costs, general costs, pre-tax income, common item costs, and other costs.

Article 19. Management of Construction Standards

1. The Ministry of Construction guides the method of establishing construction project budget standards and publishes construction standards.

2. Based on the method of establishing construction project budget standards as stipulated in Clause 1 of this Article, specialized ministries managing construction projects, provincial People's Committees organize the establishment and publication of construction standards for specialized tasks of their sectors and localities after obtaining the agreement of the Ministry of Construction. Annually, they send published construction standards to the Ministry of Construction for monitoring and management.

3. Construction standards published as stipulated in Clauses 1 and 2 of this Article serve as the basis for investors to use, apply, and refer to when determining the total investment limit, construction project budget, and managing investment construction costs.

4. For construction works not included in the system of published construction project budget standards or already included but not suitable for the technical requirements, construction conditions, and specific construction methods of the project, the following actions shall be taken:

a) Investors organize the determination of new construction project budget standards, adjusted construction project budget standards, or the application of similar construction project budget standards from ongoing and completed projects, serving as the basis for managing investment construction costs.

b) For construction tenders using state budget funds that implement direct award procedures, investors must report to the investment decision-maker for review and approval before implementation; for construction projects under investment projects decided by the Prime Minister, the Minister of the relevant sector or the Chairman of the provincial People's Committee decides.

5. Investors may hire qualified cost management consulting organizations as stipulated in the Decree on Project Investment Construction Management to establish, adjust, and audit construction project budget standards as specified in Clause 4 of this Article.

Section 2

CONSTRUCTION WORK PRICES AND CONSTRUCTION PRICE INDEX

Article 20. Construction Project Cost

1. The construction project cost includes:

a) Detailed unit prices for construction works are determined for specific construction tasks of the project, serving as a basis for preparing the construction budget estimate;

b) Comprehensive construction costs are determined for groups, types of construction tasks, structural units, or parts of the project, serving as a basis for preparing the construction budget estimate and the total investment limit for construction.

2. Detailed unit prices for construction works are determined based on the construction norms of the project, material and component prices, labor costs, machinery and equipment rental costs, and other necessary cost factors consistent with the market price level in the construction area at the time of determination and relevant regulations, or are determined based on market prices.

3. Comprehensive construction costs are determined based on the consolidation of detailed unit prices for construction works of the project.

Article 21. Management of Construction Project Costs

1. The project sponsor bases on the method of determining construction project costs as guided by the Ministry of Construction, technical requirements, conditions, and specific construction measures of the project to organize the determination of detailed unit prices for construction works, comprehensive construction costs of the project, serving as a basis for preparing the construction budget estimate, the total investment limit, and managing construction investment costs.

2. The project sponsor may hire organizations or individuals with sufficient capacity as stipulated in the Decree on Construction Investment Project Management to perform tasks or parts of tasks related to the determination and review of construction project costs.

Article 22. Construction Cost Index

1. The construction cost index reflects the degree of fluctuation in construction project costs over time, serving as a basis for determining and adjusting the total investment limit, construction project costs, construction project budget estimates, construction tender budget estimates, construction contract prices, conversion of construction investment capital, and management of construction investment costs.

2. The construction cost index includes the construction cost index by type of project, by cost structure (including the construction work cost index, the construction equipment cost index, the other cost index), and cost factors (including the construction material cost index, the construction labor cost index, the construction machinery and equipment cost index).

3. The Ministry of Construction guides the method of determining the construction cost index and publishes the national construction cost index. The People's Committee of the province assigns the Department of Construction to determine various types of construction cost indices as specified in Clause 2 of this Article based on the method of determining the construction cost index guided by the Ministry of Construction, regularly publish them monthly, quarterly, and annually, and send them to the Ministry of Construction for monitoring and management. The funds for collecting data, calculating, and publishing construction cost indices in provinces and centrally-administered cities are allocated from the annual local budget.

4. For projects not included in the list of construction cost indices published by the Department of Construction and construction projects passing through multiple provinces and centrally-administered cities, the project sponsor bases on the method of determining the construction cost index guided by the Ministry of Construction to organize the determination of construction cost indices and decide on their application to the project.

5. The project sponsor may hire consulting organizations with sufficient capacity as stipulated in the Decree on Construction Investment Project Management to collect data and calculate the construction cost indices as specified in Clause 4 of this Article, serving as a basis for determining and managing construction investment costs.

Chapter V

PROJECT MANAGEMENT COSTS AND CONSTRUCTION INVESTMENT CONSULTANCY FEES

Article 23. Project Management Costs

1. Project management costs are necessary expenses for organizing the implementation of project management tasks from the project preparation stage, project execution, and completion of construction to put the project works into operation and use.

2. The contents of project management costs include salaries of project managers; wages paid to workers under contracts; allowances; bonuses; collective welfare; contributions (social insurance; health insurance; unemployment insurance; trade union fees, other deductions as prescribed by law for individuals receiving salaries from the project); application of science and technology, information system management of works, training to enhance the capacity of project managers; payment for public services; office supplies; information, propaganda, communication; organization of meetings related to the project; travel expenses; rental; repair, purchase of assets serving project management; other expenses and contingency costs.

3. Project management costs are determined based on the standard rate percentage (%) published by the Ministry of Construction or through budget estimates or using databases of similar completed projects consistent with the form of project management organization, project implementation time, scale, and characteristics of project management work.

4. In cases where the project sponsor hires consulting firms to manage projects funded by state capital outside the state budget and projects with special characteristics, individual projects, the consulting management cost is determined through budget estimates based on the content and volume of project management work agreed upon between the project sponsor and the consulting firm in the project management contract.

5. For small-scale renovation and repair projects as stipulated in the Decree on Project Management for Investment Construction, and projects involving community participation, if the project sponsor uses its specialized machinery to manage the project, the project management costs are determined through budget estimates as provided in Clause 3 of this Article.

Article 24. Management of Project Management Costs

1. For projects funded by state capital, project management costs determined according to Clause 3 of Article 23 of this Decree are the maximum costs for managing the project. Project management costs are managed based on annual budgets consistent with the tasks and management work of the project and relevant policies.

2. If some preparatory project tasks are carried out ahead of schedule, the management costs for these tasks are determined through budget estimates and are supplemented into the project management costs.

3. Project management costs are adjusted in cases permitted to adjust the project according to Clause 1 of Article 61 of the Construction Law.

Article 25. Investment Construction Consulting Costs

1. Investment construction consulting costs are necessary expenses for implementing investment construction consulting tasks from the project preparation stage, project execution, and completion of construction to put the project works into operation and use.

2. The contents of investment construction consulting costs include expert fees, management costs of consulting organizations, other costs including the use of information systems for works, professional liability insurance for construction surveying and design work at level II and above, pre-tax profit, taxes, and contingency costs. For construction surveying and specialized construction testing consulting tasks, consulting costs include items such as construction costs in the construction work budget.

3. Investment construction consulting costs are determined based on the standard rate percentage (%) published by the Ministry of Construction or estimated costs according to similar completed project consulting tasks or determined through budget estimates.

4. The costs of hiring foreign experts to perform certain types of consulting tasks are determined through budget estimates consistent with regulations of competent authorities and international practices.

Article 26. Management of Investment Construction Consulting Costs

1. The investment construction consulting costs determined according to Clause 3, Article 25 of this Decree shall serve as the basis for determining the investment construction consulting costs within the total investment ceiling, project budget estimate, contract price determination, and investment cost management. Before organizing the selection of contractors to perform investment construction consulting work, the investor must organize the preparation of the bidding package budget estimate for investment construction consulting work in accordance with Article 15 of this Decree as the basis for selecting contractors.

2. The approved budget estimate for investment construction consulting costs is the maximum cost for implementing investment construction consulting work and can only be adjusted when there is a change in the scope of work and the implementation schedule of the investment construction consulting work. Investment construction consulting costs are managed through construction consulting contracts.

3. In cases where the investor and the Project Management Boards have the necessary capacity conditions as prescribed, they may undertake some investment construction consulting tasks and supplement the actual costs of these consulting tasks into the project management costs.

Chapter VI

PAYMENT AND SETTLEMENT OF CONSTRUCTION INVESTMENT FUNDS

Article 27. Payment of Construction Contracts

Advance payments, payments, and payment documentation for construction contracts shall be carried out in accordance with the provisions stipulated in the Decree detailing construction contracts.

Article 28. Payment of Construction Investment Funds

1. Within seven working days from the date of receiving complete payment documentation as prescribed, the investment payment agency shall be responsible for paying the investment funds based on the payment request of the investor or the lawful representative of the investor, based on the assigned capital plan.

2. The investor or the lawful representative of the investor shall be responsible for the unit prices, quantities, and values proposed for payment in the payment request documentation; the investment payment agency shall not be responsible for the unit prices, quantities, and values proposed for payment in the payment request documentation of the investor or the lawful representative of the investor. During the payment process, if any errors are discovered in the payment request documentation, the investment payment agency shall notify in writing for the investor or the lawful representative of the investor to supplement and complete the documentation.

3. Strictly prohibited are the establishment by investment capital payment agencies and project owners of provisions contrary to the law in the payment of investment capital for construction projects.

Article 29. Settlement of Construction Investment Funds

1. All construction projects using state budget funds and non-budget state funds must undergo settlement of construction investment funds upon completion.

2. The settled investment costs are all legitimate costs incurred during the investment construction process to bring the project's works into operation and use. Legitimate costs include all expenses incurred within the scope of the project, design, approved budget estimates; signed contracts; including adjustments and supplements approved according to regulations and within the appropriate authority. For projects using state budget funds, the settled investment costs must fall within the approved total investment ceiling or adjusted ceiling.

3. The investor is responsible for preparing the Settlement Documentation of Construction Investment Funds and converting the completed construction project investment after acceptance and handover for use to submit to the investment decision-maker for approval no later than nine months for national key projects and Group A projects, six months for Group B projects, and three months for Group C projects from the date of project completion and operation. Six months after the settlement approval decision for the completed project, the investor is responsible for settling debts, finalizing the project account at the investment payment agency.

For independent works or components completed and put into use under the construction investment project, if immediate settlement is necessary, the investor shall report to the investment decision-maker for consideration and decision.

4. For construction investment projects using state budget funds, after the end of the fiscal year, the investor shall carry out settlement and use of investment funds according to the fiscal year as prescribed by the Ministry of Finance.

5. Investors who fail to settle as prescribed in Clause 3 of this Article shall be subject to administrative penalties as stipulated in the Decree on Administrative Penalties in Construction Activities; Real Estate Business; Mineral Exploration and Building Materials Business; Infrastructure Technical Management; Housing Development and Office Management.

6. Authority to Approve Settlement of Investment Funds:

a) For national key projects and other important projects decided by the Prime Minister to invest in:

- Assign the superior management agency of the Project Owner to approve the final settlement of component projects using state budget capital;

- The Project Owner shall approve the final settlement of component projects not using state budget capital.

b) For the remaining projects, the investment decision-maker is the person authorized to approve the settlement of investment funds.

Chapter VII

RIGHTS AND OBLIGATIONS OF THE INVESTMENT DECISION-MAKER, INVESTOR, AND CONSTRUCTION CONTRACTORS IN MANAGING INVESTMENT COSTS

IN CONSTRUCTION

Article 30. Rights and Obligations of the Investment Decision Maker

1. The investment decision maker has the following rights:

a) Approve or authorize approval of the total investment amount, construction project budget; adjusted total investment amount, adjusted construction project budget;

b) Decide on the bid package price in the plan for selecting contractors, type, form of contract;

c) Agree to implement the selection of consulting organizations managing investment costs that meet the conditions stipulated in the Decree on project management to conduct a review of the total investment amount, construction project budget as the basis for evaluation and approval;

d) Other rights related to cost management as prescribed by other relevant laws.

2. The investment decision maker has the following obligations:

a) Ensure sufficient investment capital to pay for the project, works according to the approved time frame and progress;

b) Approve the final account of investment capital within the prescribed deadline;

c) Other obligations related to cost management as prescribed by other relevant laws.

Article 31. Rights and Obligations of the Project Owner

1. The investor has the following rights:

a) Decide on the method of determining the total investment amount. Adjust the structure of expense items within the total investment amount without exceeding the approved total investment amount;

b) Adjust and approve the adjusted construction project budget without exceeding the approved construction project budget;

c) Organize the review or audit, approve the bid package construction budget as the basis for preparing the tender invitation document or request document to select contractors;

d) Decide on the application and use of construction norms, construction project prices when determining the construction project budget, construction price index for projects, construction bid packages;

đ) Hire consulting organizations managing investment construction costs that meet the conditions stipulated in the Decree on project management to carry out the preparation, audit, control, and management of investment construction costs;

e) Have the right to claim compensation or initiate legal proceedings under the law to claim compensation for damages caused by the delay in the payment of investment capital by the settlement agency;

g) Agree to changes in construction methods, technical requirements proposed by contractors but must ensure quality, progress, safety, environmental protection, and not change the value of the signed contract. Control changes during the construction process of the project related to changes in construction project investment costs or accelerating the construction progress;

h) Agree to proposals for changes in materials, construction materials proposed by design consultants or construction contractors but must ensure technical, aesthetic, quality, construction progress based on the value in the signed contract;

i) Carry out some investment construction advisory tasks when meeting the conditions stipulated;

k) Other rights related to cost management as prescribed by other relevant laws.

d) Organizing the determination of construction prices; construction price indices for the project, construction tender packages;

đ) Provisionally paying, settling, and finalizing contracts according to the provisions in the signed contracts with contractors;

b) Organize the preparation of the construction project budget, adjusted construction project budget for submission to the competent authority for examination and approval;

c) Determine new construction project budget norms or adjustments as the basis for managing investment construction costs;

h) Organizing the preparation of the Final Account Report for completed construction investment projects according to the provisions of Article 27 of this Decree;

i) Purchasing insurance for projects that are required to purchase insurance or authorizing contractors to purchase insurance through construction contracts;

k) Other obligations related to cost management as prescribed by other relevant laws;

l) Providing project data information as requested by the state management agency; coordinating or organizing the collection of cost management information as requested by the state management agency.

h) Prepare the Final Account Report of Construction Investment Capital for completed projects in accordance with Article 29 of this Decree;

i) Purchase insurance for projects where insurance purchase is required;

k) Other obligations related to cost management as prescribed by other relevant laws.

Article 32. Rights and Obligations of the Contractor for Cost Management Consulting Services

1. The contractor for cost management consulting services for investment construction projects shall have the following rights:

a) To provide consulting services for cost management tasks in accordance with their capacity and scope of operation as prescribed in the Decree on Project Management for Investment Construction Works;

b) Request the Project Owner and related parties to provide information and documents necessary for cost management consulting services work;

c) Refuse to perform requests outside the scope of cost management consulting services tasks as stipulated in the signed contract;

d) Require the Project Owner to pay costs according to the signed contract; be entitled to payment of interest on delayed payments;

đ) Other rights as prescribed in the cost management consulting services contract and other relevant laws;

2. The contractor for cost management consulting services for investment construction projects shall have the following obligations:

a) Perform cost management consulting services tasks as stipulated in the signed contract;

b) Bear legal responsibility before the law and the Project Owner for the results of cost management consulting services and compensate for damages caused to the Project Owner (if any) as prescribed by the Contract Law and other relevant laws;

c) Not to disclose information and documents related to cost management activities performed by themselves without permission from the project owner or competent authority;

d) Other obligations as prescribed in the contract and other relevant laws;

Article 33. Rights and Obligations of the Construction Contractor

1. The construction contractor shall have the following rights:

a) To determine construction norms, construction prices, and other related costs when determining bidding prices to participate in bidding;

b) During the construction phase, change construction methods but still ensure quality, progress, safety, and environmental protection after obtaining approval from the Project Owner or its authorized representative without changing the value of the signed contract;

c) Independently use advance payments and payments for completed construction volumes to serve construction works;

d) Propose and agree with the Project Owner on construction norms, unit prices for construction works arising during the implementation of the contract;

đ) Demand payment of interest on delayed payments; be compensated for losses due to delayed site handover and other losses not attributable to the contractor;

e) Other rights as prescribed in the contract and other relevant laws;

2. The construction contractor shall have the following obligations:

a) Purchase insurance for construction workers on-site;

b) Compensate the Project Owner and related parties for damages caused by the contractor's fault (if any) as prescribed by the Contract Law and other relevant laws;

c) Other obligations as stipulated in the contract and other relevant laws.

Chapter VIII

STATE MANAGEMENT OF INVESTMENT CONSTRUCTION COSTS

Article 34. Ministry of Construction

The Ministry of Construction is the agency responsible for unified state management of investment construction costs and shall be responsible for:

1. Provide detailed guidance on the content, methods for determining and managing investment construction costs including preliminary total investment cost, total investment cost, construction budget estimate, construction norms, construction price, project management fee and investment consulting fee, construction price index, measurement of construction volume, machinery and equipment rental price, adjustment of total investment cost, adjustment of construction budget estimate, determination of labor unit price, conversion of investment capital, and cost control in investment construction;

2. Publish construction norms, norms for calculating machinery and equipment rental costs, norms for project management fees and investment consulting fees, construction prices, investment capital per unit of construction, national construction price index, and other economic-technical indicators;

3. Inspect and supervise the implementation of regulations on managing investment construction costs;

Article 35. Ministry of Finance

1. Guide the settlement and finalization of construction investment capital. Regulations on managing and using revenues from project management activities of project owners and project management boards funded by state budget;

2. Prescribe fee levels and guide the management and use of fees for project appraisal, design, construction budget estimates, and other fees (if any);

3. Inspect and supervise the settlement and finalization of construction investment capital for projects funded by state budget and non-budget state capital.

Article 36. Ministries and Provincial People's Committees

1. Ministries and Provincial People's Committees shall establish and publish construction cost estimates for specialized and specific tasks under their jurisdiction based on the method for setting construction cost standards guided by the Ministry of Construction, after reaching consensus with the Ministry of Construction.

2. Provincial People's Committees shall guide the establishment and management of investment construction costs; publish construction material prices, labor unit prices, machinery and equipment rental rates, construction price indices, and project construction unit prices that align with local market conditions, and inspect compliance with regulations governing the management of investment construction costs within their jurisdictions.

Chapter IX

IMPLEMENTING PROVISIONS

Article 37. Transitional Provisions

1. For investment construction projects approved before this Decree takes effect but have not yet commenced or are currently underway, cost management activities shall be carried out in accordance with the provisions of Government Decree No. 112/2009/NĐ-CP dated December 14, 2009, concerning the Management of Investment Construction Costs.

2. For investment construction projects that have been prepared and reviewed but not yet approved before this Decree takes effect, cost management activities shall be adjusted and supplemented to comply with the provisions of this Decree.

Article 38. Organization of implementation

1. This Decree shall take effect from May 10, 2015, and replace Government Decree No. 112/2009/NĐ-CP dated December 14, 2009, concerning the Management of Investment Construction Costs.

2. Ministers, Heads of ministerial-level agencies, Heads of government agencies, Chairpersons of provincial and centrally-administered city People's Committees, Heads of political organizations, political-social organizations, occupational political-social organizations, and other relevant organizations and individuals shall be responsible for implementing this Decree.

3. The Ministry of Construction shall lead and coordinate with related ministries and sectors to assume responsibility for guiding the implementation of this Decree./.