The Build Agreement serves as the primary contractual document for construction projects in Indonesia, governed by Law No. 2 of 2017 on Construction Services and related regulations. This agreement is essential for any significant construction project, whether commercial, residential, or infrastructure-related, where a formal contractual relationship between an owner/employer and a contractor is required. The document comprehensively addresses all aspects of the construction process, from project initiation to completion and defects liability period, incorporating specific Indonesian regulatory requirements, local building codes, and industry standards. It includes detailed provisions for payment mechanisms, quality control, safety requirements, and dispute resolution procedures, while ensuring compliance with local content requirements and environmental regulations. The Build Agreement is particularly crucial as it must align with Indonesia's civil law system and specific construction industry regulations, making it distinct from common law jurisdiction construction contracts.
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1. Parties: Identification of the contracting parties including the owner/employer and the contractor, with their complete legal details
2. Background: Context of the agreement, including project overview and parties' intentions
3. Definitions: Detailed definitions of terms used throughout the agreement
4. Scope of Work: Detailed description of the construction work to be performed, including general obligations of the contractor
5. Contract Price and Payment Terms: Agreement on price, payment schedule, payment mechanisms, and related financial terms
6. Project Timeline: Construction schedule, completion dates, and milestone deadlines
7. Materials and Workmanship: Standards for materials, quality requirements, and workmanship expectations
8. Variations and Changes: Procedures for handling changes to scope, specifications, or other contract terms
9. Site Access and Conditions: Terms regarding access to the construction site and site-related obligations
10. Testing and Completion: Requirements for testing, commissioning, and completion certification
11. Defects Liability: Contractor's obligations regarding defects and warranty period
12. Insurance and Securities: Required insurance coverage and performance securities
13. Force Majeure: Provisions for handling unforeseen circumstances and their impact
14. Termination: Grounds and procedures for contract termination
15. Dispute Resolution: Mechanisms for resolving disputes between parties
16. Governing Law: Specification of Indonesian law as governing law and relevant jurisdictional matters
1. Environmental Compliance: Required when project has significant environmental impact or requires environmental permits
2. Local Content Requirements: Needed when project must comply with Indonesian local content regulations
3. Intellectual Property Rights: Required when design or technology transfer is involved
4. Consortium Provisions: Needed when contractor is a consortium or joint venture
5. Step-In Rights: Required for large projects with financing arrangements
6. Anti-Corruption Provisions: Detailed provisions required for government projects or large-scale developments
7. Health and Safety Requirements: Detailed section needed for high-risk construction projects
8. Security Requirements: Required for projects in sensitive locations or with specific security needs
1. Schedule 1 - Technical Specifications: Detailed technical requirements and specifications for the construction work
2. Schedule 2 - Site Plan and Drawings: Architectural and engineering drawings, site plans and layouts
3. Schedule 3 - Bill of Quantities: Detailed breakdown of quantities and prices for construction elements
4. Schedule 4 - Payment Schedule: Detailed payment milestones and amounts
5. Schedule 5 - Construction Program: Detailed timeline of construction activities and milestones
6. Schedule 6 - Key Personnel: List of key personnel from both parties involved in the project
7. Schedule 7 - Forms of Securities: Templates for bank guarantees and other required securities
8. Schedule 8 - Insurance Requirements: Detailed insurance requirements and coverage limits
9. Schedule 9 - Permits and Licenses: List of required permits and responsibilities for obtaining them
10. Appendix A - Quality Assurance Plan: Detailed quality control and assurance procedures
11. Appendix B - HSE Requirements: Health, safety, and environmental requirements and procedures
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