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Construction Operating Agreement Template for Indonesia

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Key Requirements PROMPT example:

Construction Operating Agreement

"I need a Construction Operating Agreement under Indonesian law for a 500-bed private hospital project in Jakarta, where the contractor will also operate the facility's maintenance systems for 10 years after completion in March 2025."

Document background
The Construction Operating Agreement is a specialized contract used in Indonesia when a project requires integrated management of both construction and operational phases. It is particularly relevant for complex infrastructure, industrial, or commercial projects where the same entity or related entities handle both construction and subsequent operation. The agreement must comply with Indonesian law, particularly Law No. 2 of 2017 on Construction Services, and addresses crucial elements including construction standards, operational requirements, risk allocation, regulatory compliance, and performance metrics. This document type is commonly used in projects requiring continuity between construction and operation phases, ensuring smooth transition and clear accountability throughout the project lifecycle. It incorporates specific Indonesian regulatory requirements including local content provisions, environmental compliance, and necessary permits and licenses.
Suggested Sections

1. Parties: Identification of the contracting parties, including their legal status and registration details

2. Background: Context of the agreement, project overview, and parties' intentions

3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the agreement

4. Scope of Work: Detailed description of construction and operational services to be provided

5. Term and Extensions: Duration of the agreement and conditions for extension

6. Construction Requirements: Specific construction standards, methodologies, and compliance requirements

7. Operating Standards: Standards and requirements for facility operation post-construction

8. Permits and Licenses: Requirements for obtaining and maintaining necessary permits

9. Payment Terms: Payment structure, mechanisms, and conditions

10. Performance Security: Requirements for performance bonds and other security arrangements

11. Health, Safety and Environment: HSE requirements and compliance standards

12. Risk and Insurance: Risk allocation and required insurance coverage

13. Force Majeure: Definition and consequences of force majeure events

14. Default and Termination: Events of default and termination procedures

15. Dispute Resolution: Procedures for resolving disputes including jurisdiction choice

Optional Sections

1. Foreign Investment Provisions: Required when foreign investment is involved, addressing specific requirements under Indonesian investment law

2. Land Access and Rights: Include when land rights need to be secured or clarified

3. Financing Arrangements: Required when project financing is part of the agreement structure

4. Local Content Requirements: Include when specific local content obligations apply to the project

5. Technology Transfer: Required when technology transfer is part of the project scope

6. Community Development: Include when community development obligations are part of the project requirements

7. Environmental Management Plan: Required for projects with significant environmental impact

8. Change in Law Provisions: Include for long-term agreements to address regulatory changes

Suggested Schedules

1. Technical Specifications: Detailed technical requirements and standards for construction and operation

2. Site Plan and Drawings: Plans, drawings, and technical documentation of the facility

3. Performance Standards: Specific performance metrics and requirements

4. Payment Schedule: Detailed payment terms, milestones, and calculations

5. Equipment and Materials: List of required equipment and materials with specifications

6. Key Personnel: List of key personnel and their qualifications

7. Forms of Certificates: Template certificates for completion, acceptance, etc.

8. Forms of Bonds and Guarantees: Templates for required bonds and guarantees

9. HSE Requirements: Detailed health, safety, and environmental requirements

10. Insurance Requirements: Detailed insurance specifications and coverage requirements

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



















































































Clauses















































Relevant Industries

Infrastructure

Real Estate

Industrial Manufacturing

Energy

Mining

Healthcare

Education

Transportation

Telecommunications

Hospitality

Retail

Warehousing and Logistics

Relevant Teams

Legal

Operations

Construction

Engineering

Commercial

Procurement

Risk and Compliance

Finance

Health Safety and Environment

Project Controls

Quality Assurance

Relevant Roles

Project Director

Construction Manager

Operations Manager

Legal Counsel

Contract Manager

Chief Engineer

Technical Director

Risk Manager

Compliance Officer

Commercial Manager

Procurement Manager

HSE Manager

Finance Director

Project Control Manager

Quality Assurance Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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