The Construction Service Contract serves as the primary agreement between a principal/owner and a construction contractor for the execution of construction projects in Indonesia. This document is essential for any construction project falling under Indonesian jurisdiction and must comply with Law No. 2 of 2017 on Construction Services and related regulations. It is used when engaging contractors for various construction works, from commercial buildings to infrastructure projects, and includes comprehensive provisions for project execution, risk allocation, regulatory compliance, and dispute resolution. The contract incorporates mandatory Indonesian legal requirements while maintaining international best practices in construction contract administration. It addresses crucial elements such as local content requirements, construction permits, worker safety standards, and environmental regulations specific to the Indonesian construction industry.
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1. Parties: Identification of the contracting parties including their legal details and representatives
2. Background: Context of the agreement and brief description of the project
3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the contract
4. Scope of Works: Detailed description of construction works to be performed
5. Contract Price and Payment Terms: Price, payment schedule, invoicing requirements, and payment mechanisms
6. Timeline and Completion: Project schedule, milestones, completion criteria, and delay consequences
7. Contractor Obligations: Key responsibilities including quality standards, safety requirements, and regulatory compliance
8. Client Obligations: Client's responsibilities including site access, permits, and approvals
9. Materials and Equipment: Requirements for materials, equipment standards, and procurement obligations
10. Health, Safety and Environment: HSE requirements and compliance with Indonesian regulations
11. Quality Assurance: Quality standards, inspection procedures, and testing requirements
12. Variations: Procedures for handling changes to scope, price, or timeline
13. Insurance and Indemnities: Required insurance coverage and indemnification provisions
14. Force Majeure: Definition and consequences of force majeure events
15. Default and Termination: Events of default, remedies, and termination procedures
16. Dispute Resolution: Dispute resolution mechanisms including governing law and jurisdiction
17. General Provisions: Standard boilerplate clauses including notices, assignment, and amendments
1. Design Responsibilities: Include when contractor has design obligations in addition to construction
2. Financing Arrangements: Include when specific project financing terms affect construction obligations
3. Performance Security: Include when bank guarantees or performance bonds are required
4. Intellectual Property: Include when design or innovative construction methods involve IP rights
5. Local Content Requirements: Include when specific Indonesian local content requirements apply
6. Defects Liability: Include when extended warranty or defects liability period is required
7. Interface Management: Include when coordination with other contractors is required
8. Environmental Management: Include for projects with significant environmental impact
1. Schedule 1 - Scope of Works: Detailed technical specifications and drawings
2. Schedule 2 - Project Timeline: Detailed project schedule with milestones
3. Schedule 3 - Price Schedule: Detailed breakdown of contract price and payment milestones
4. Schedule 4 - Key Personnel: List of key personnel and their qualifications
5. Schedule 5 - Site Information: Site details, access points, and conditions
6. Schedule 6 - Forms and Procedures: Standard forms for variations, certificates, and reports
7. Schedule 7 - Equipment and Materials: Specifications for major equipment and materials
8. Schedule 8 - HSE Requirements: Detailed health, safety, and environmental requirements
9. Schedule 9 - Quality Assurance Plan: Detailed quality control procedures and standards
10. Schedule 10 - Insurance Requirements: Detailed insurance specifications and certificates
Relevant legal definitions
Clauses
Relevant Industries
Construction
Infrastructure
Real Estate Development
Industrial Construction
Commercial Construction
Residential Development
Mining
Energy
Transportation
Public Works
Relevant Teams
Legal
Operations
Procurement
Commercial
Project Management
Construction
Risk Management
Health Safety Environment
Quality Assurance
Finance
Technical Services
Contract Administration
Relevant Roles
Project Manager
Construction Manager
Contract Administrator
Legal Counsel
Commercial Director
Chief Operating Officer
Procurement Manager
Risk Manager
Technical Director
Site Manager
Quality Assurance Manager
HSE Manager
Finance Director
Claims Manager
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