The Agreement For Construction Work is a fundamental document used in the Indonesian construction industry to establish legally binding obligations between project owners and contractors. It is essential for any construction project in Indonesia and must comply with Law No. 2 of 2017 on Construction Services and related regulations. This agreement type is used when engaging contractors for building works, infrastructure development, or facility construction, providing comprehensive coverage of project requirements, technical specifications, payment terms, and risk allocation. The document incorporates local regulatory requirements, including permits, environmental compliance, worker safety, and local content requirements where applicable. It is structured to protect both parties' interests while ensuring project delivery meets Indonesian construction standards and legal requirements.
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1. Parties: Identification of the contracting parties, including their legal status and authority to enter into the agreement
2. Background: Context of the agreement and brief description of the construction project
3. Definitions: Definitions of key terms used throughout the agreement
4. Scope of Work: Detailed description of the construction work to be performed
5. Contract Price and Payment Terms: Agreement on price, payment schedule, and payment mechanisms
6. Timeline and Completion: Project schedule, milestones, and completion requirements
7. Contractor Obligations: Key responsibilities and obligations of the contractor
8. Employer Obligations: Key responsibilities and obligations of the employer
9. Materials and Workmanship: Standards for materials and quality of work
10. Health, Safety and Environment: Safety requirements and environmental compliance obligations
11. Insurance and Indemnity: Insurance requirements and indemnification provisions
12. Variations: Procedures for handling changes to scope or specifications
13. Testing and Commissioning: Requirements for testing and commissioning of completed works
14. Defects Liability: Defects liability period and remediation obligations
15. Force Majeure: Provisions for handling unforeseen circumstances
16. Termination: Grounds and procedures for contract termination
17. Dispute Resolution: Procedures for resolving disputes
18. Governing Law: Specification of Indonesian law as governing law
19. Notices: Communication procedures and contact details
20. General Provisions: Miscellaneous legal provisions including assignment, waiver, and severability
1. Design Responsibilities: Include when contractor has design obligations in addition to construction
2. Permits and Licenses: Detailed section when complex permitting is required or responsibilities need clarification
3. Site Conditions: Include when there are specific site challenges or unknown conditions to address
4. Subcontracting: Include when subcontracting is permitted and needs detailed regulation
5. Performance Security: Include when bank guarantees or performance bonds are required
6. Phase Completion: Include for projects with multiple completion phases
7. Intellectual Property: Include when design or innovative construction methods are involved
8. Local Content Requirements: Include when specific Indonesian local content requirements apply
9. Currency and Exchange Rate: Include for projects involving international payments
1. Technical Specifications: Detailed technical requirements and standards for the construction work
2. Bill of Quantities: Itemized list of quantities and prices for the work
3. Construction Drawings: Approved drawings and design documents
4. Project Timeline: Detailed project schedule with milestones
5. Payment Schedule: Detailed breakdown of payment terms and milestones
6. Site Information: Details about the construction site and conditions
7. Key Personnel: List of key personnel from both parties with roles and responsibilities
8. Forms and Procedures: Standard forms for variations, certifications, and other procedures
9. Insurance Requirements: Detailed insurance specifications and coverage requirements
10. HSE Requirements: Detailed health, safety, and environmental requirements
Authors
Relevant legal definitions
Clauses
Relevant Industries
Commercial Real Estate
Residential Construction
Industrial Construction
Infrastructure Development
Energy & Power Plants
Transportation
Healthcare Facilities
Educational Facilities
Retail Development
Hospitality & Tourism
Manufacturing Facilities
Mining Infrastructure
Oil & Gas Facilities
Telecommunications Infrastructure
Water & Waste Management
Relevant Teams
Legal
Construction
Project Management
Procurement
Health Safety Environment
Commercial
Operations
Engineering
Risk & Compliance
Finance
Quality Control
Relevant Roles
Project Director
Construction Manager
Contract Manager
Legal Counsel
Project Manager
Site Manager
Procurement Manager
Quality Control Manager
HSE Manager
Commercial Manager
Technical Director
Chief Engineer
Risk Manager
Compliance Officer
Finance Director
Operations Manager
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