The Basic Construction Contract serves as a foundational legal document for construction projects in Indonesia, designed to comply with Indonesian law, particularly Law No. 2 of 2017 on Construction Services and related regulations. This contract type is suitable for straightforward construction projects where parties need a clear, comprehensive agreement that covers essential elements without the complexity of specialized construction contracts. It includes standard provisions for scope of work, payment terms, timelines, quality standards, and dispute resolution, while incorporating mandatory requirements under Indonesian construction law. The document is structured to protect both parties' interests while ensuring practical functionality in the Indonesian construction industry context.
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1. Parties: Identification and details of the contracting parties (Owner/Employer and Contractor)
2. Background: Context of the agreement and brief description of the construction project
3. Definitions and Interpretation: Definitions of key terms and rules for interpreting the contract
4. Scope of Works: Detailed description of the construction works to be performed
5. Contract Price and Payment: Amount payable, payment schedule, and payment terms
6. Time for Completion: Project timeline, completion date, and milestone dates
7. Contractor's Obligations: Key responsibilities and duties of the contractor
8. Owner's Obligations: Key responsibilities and duties of the owner
9. Materials and Workmanship: Quality standards and specifications for materials and work
10. Health, Safety and Environment: HSE requirements and compliance obligations
11. Variations: Process for handling changes to the scope of work
12. Inspections and Testing: Requirements for quality control and acceptance
13. Defects and Warranties: Defect liability period and warranty obligations
14. Insurance and Indemnity: Insurance requirements and indemnification provisions
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. General Provisions: Miscellaneous legal provisions including notices, amendments, and assignments
1. Performance Security: Required when bank guarantees or performance bonds are needed
2. Advance Payment: Used when advance payments are part of the payment structure
3. Subcontracting: Include when subcontracting is permitted and needs to be regulated
4. Intellectual Property Rights: Required when design or proprietary technology is involved
5. Site Conditions: Include for projects where ground conditions or site access are significant factors
6. Liquidated Damages: Include when specific compensation for delays needs to be pre-agreed
7. Environmental Management: Required for projects with significant environmental impact
8. Local Content Requirements: Include when local content regulations apply to the project
1. Schedule 1 - Scope of Works: Detailed technical specifications and drawings
2. Schedule 2 - Project Timeline: Detailed construction schedule and milestones
3. Schedule 3 - Bill of Quantities: Itemized list of quantities and prices
4. Schedule 4 - Payment Schedule: Detailed payment terms and milestone payments
5. Schedule 5 - Site Information: Site details, access points, and conditions
6. Schedule 6 - Technical Standards: Applicable technical standards and specifications
7. Schedule 7 - Forms of Certificates: Templates for various certificates (completion, payment, etc.)
8. Schedule 8 - HSE Requirements: Detailed health, safety, and environmental requirements
9. Appendix A - Required Insurance: Details of required insurance coverage
10. Appendix B - Key Personnel: List of key personnel from both parties
Relevant legal definitions
Clauses
Relevant Industries
Construction
Real Estate Development
Infrastructure
Commercial Property
Industrial Development
Residential Development
Mining
Energy
Manufacturing
Hospitality
Relevant Teams
Legal
Operations
Construction
Procurement
Commercial
Risk Management
Project Management
Technical Services
Facilities Management
Contract Administration
Relevant Roles
Project Manager
Construction Manager
Contract Administrator
Legal Counsel
Chief Operating Officer
Procurement Manager
Site Manager
Quality Control Manager
Commercial Director
Risk Manager
Technical Director
Development Manager
Facilities Manager
Operations Manager
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