The Construction Agreement Form is a vital legal instrument used in Indonesia to formalize construction project relationships between property owners/developers and contractors. This document is essential for any construction project in Indonesia, whether commercial, residential, or industrial, and must comply with Law No. 2 of 2017 on Construction Services and related regulations. The agreement comprehensively covers all aspects of the construction project, including technical specifications, financial terms, timeline, quality standards, and risk allocation. It incorporates specific Indonesian regulatory requirements such as building permits (IMB), environmental approvals, worker safety regulations, and local content requirements where applicable. The document serves as both a legal safeguard and a project management tool, ensuring clear understanding and alignment between all parties involved in the construction process.
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1. Parties: Identification of the contracting parties (Owner/Employer and Contractor), including their legal details and representatives
2. Background: Context of the agreement, project overview, and basis for the construction contract
3. Definitions: Detailed definitions of terms used throughout the agreement
4. Scope of Work: Detailed description of the construction works to be performed by the Contractor
5. Contract Price and Payment Terms: Contract sum, payment schedule, payment mechanisms, and related financial terms
6. Project Timeline: Construction schedule, completion dates, milestones, and provisions for extensions of time
7. Contractor's Obligations: Key responsibilities including workmanship, materials, compliance with laws, and safety requirements
8. Owner's Obligations: Responsibilities of the owner including site access, permits, and approvals
9. Quality Standards: Required quality levels, inspection procedures, and acceptance criteria
10. Health, Safety and Environment: HSE requirements, compliance with regulations, and safety management procedures
11. Variations: Procedures for handling changes to scope, price adjustments, and variation orders
12. Insurance and Indemnities: Required insurance coverage and indemnification obligations
13. Default and Termination: Events of default, remedies, and termination procedures
14. Dispute Resolution: Procedures for resolving disputes, including mediation and arbitration provisions
15. Force Majeure: Provisions for handling unforeseen events and their impact on the contract
16. General Provisions: Standard contractual provisions including notices, amendments, and governing law
1. Performance Security: Requirements for performance bonds or bank guarantees - used for larger projects or when required by regulations
2. Advance Payment: Terms for advance payments and their security - included when advance payments are agreed
3. Subcontracting: Rules and procedures for subcontracting - needed when subcontractors will be involved
4. Intellectual Property Rights: Protection of designs and technical documents - important for design-build contracts
5. Environmental Management: Specific environmental requirements - needed for environmentally sensitive projects
6. Local Content Requirements: Provisions for local material and labor usage - required for government projects or when specified by regulations
7. Defects Liability Period: Extended warranty provisions - typically included in larger construction projects
8. Site Conditions: Provisions dealing with unforeseen ground conditions - important for greenfield projects
1. Schedule 1 - Scope of Works: Detailed technical specifications and drawings of the construction works
2. Schedule 2 - Project Timeline: Detailed construction schedule with milestones and critical path
3. Schedule 3 - Bill of Quantities: Itemized list of materials, quantities, and rates
4. Schedule 4 - Payment Schedule: Detailed breakdown of payment terms, milestones, and amounts
5. Schedule 5 - Site Plan and Access Details: Site layout, access points, and temporary works areas
6. Schedule 6 - Quality Assurance Plan: Detailed quality control procedures and standards
7. Schedule 7 - HSE Requirements: Detailed health, safety, and environmental requirements
8. Schedule 8 - Forms and Certificates: Standard forms for variations, completion certificates, and other project documents
9. Schedule 9 - Insurance Requirements: Detailed insurance specifications and coverage requirements
10. Appendix A - Required Permits and Licenses: List of required regulatory approvals and permits
11. Appendix B - Key Personnel: List of key project personnel and their qualifications
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