The Letter Of Intent To Award Construction Contract is a critical document in Indonesian construction projects that bridges the gap between contractor selection and final contract execution. It is typically issued after the completion of a tender process and internal approval procedures, but before the signing of the main construction contract. This document serves multiple purposes: it confirms the selection of the winning contractor, outlines key commercial terms and conditions precedent, and provides a framework for moving forward with contract finalization. Under Indonesian law, particularly considering Law No. 2 of 2017 on Construction Services and the Indonesian Civil Code, while this document indicates a serious intention to proceed, it generally does not create a binding commitment to award the contract. It is commonly used in both private and public construction projects throughout Indonesia, particularly for medium to large-scale developments where formal procurement processes are required.
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1. Letter Header: Company letterhead, date, reference number, and formal addressing to the selected contractor
2. Project Identification: Clear identification of the construction project, including project name, location, and reference to the tender process
3. Bid Reference: Reference to the contractor's submitted bid, including bid number and date
4. Intent Statement: Clear statement of intent to award the contract, subject to conditions
5. Contract Value: Statement of the accepted bid amount and any applicable taxes
6. Key Terms Summary: Brief overview of key contract terms including scope, timeline, and major deliverables
7. Conditions Precedent: List of conditions that must be met before formal contract award
8. Timeline: Expected timeline for contract finalization and project commencement
9. Closing and Signature: Formal closing, authorized signature block, and company stamp
1. Performance Security Requirement: Details of any required performance bonds or guarantees, included when specific security instruments are required
2. Insurance Requirements: Specific insurance requirements that need to be secured before contract award, included when insurance requirements are complex or unusual
3. Local Content Requirements: Specific requirements for local content or partnership, included when project falls under Indonesian local content regulations
4. Validity Period: Specific period for which the letter of intent remains valid, included when there's a need to set a deadline for conditions to be met
5. Confidentiality Statement: Statement regarding confidentiality of the letter and process, included when dealing with sensitive projects or information
1. Schedule A - Scope Summary: Brief summary of the agreed scope of works from the bid
2. Schedule B - Price Breakdown: Summary of the accepted price components and payment terms
3. Schedule C - Key Personnel: List of key personnel proposed in the bid and accepted by the client
4. Schedule D - Project Timeline: High-level project milestone schedule
5. Appendix 1 - Required Documents: List of documents required for contract finalization
6. Appendix 2 - Insurance Requirements: Detailed insurance requirements and minimum coverage amounts
Relevant legal definitions
Clauses
Relevant Industries
Construction
Infrastructure
Real Estate Development
Industrial Development
Energy
Mining
Transportation
Healthcare
Education
Hospitality
Commercial Development
Residential Development
Public Works
Telecommunications
Manufacturing
Relevant Teams
Legal
Procurement
Project Management
Construction Management
Commercial
Operations
Risk & Compliance
Business Development
Technical Services
Contract Administration
Executive Management
Relevant Roles
Project Director
Construction Manager
Procurement Manager
Contract Manager
Legal Counsel
Chief Executive Officer
Managing Director
Project Manager
Commercial Director
Technical Director
Head of Development
Chief Operating Officer
Tender Manager
Risk Manager
Compliance Officer
General Manager Construction
Development Director
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