Circular No. 84/2011/TT-BNNPTNT dated December 12, 2011 of the Ministry of Agriculture and Rural Development prescribing a number of contents of management of state budget-funded work construction investment projects managed by the Ministry of Agriculture and Rural Development

THE MINISTRY OF AGRICULTURE AND RURAL DEVELOPMENT

Circular No. 84/2011/TT-BNNPTNT of December 12, 2011, prescribing a number of contents of management of state budget-funded work construction investment projects managed by the Ministry of Agriculture and Rural Development

Pursuant to the Government’s Decrees No. 01/2008/ND-CP of January 3, 2008, defining the functions, tasks, powers and organizational structure of the Ministry of Agriculture and Rural Development, and No. 75/2009/ND-CP of September 10, 2009, amending Article 3 of Decree No. 01/2008/ND-CP;

Pursuant to November 26, 2003 Law No. 16/2003/QH11 on Construction;

Pursuant to November 29, 2005 Law No. 61/2005/QH11 on Bidding;

Pursuant to June 19, 2009 Law No. 38/2009/QH12 Amending and Supplementing a Number of Articles of Laws Concerning Capital Construction Investment;

The Ministry of Agriculture and Rural Development prescribes a number of contents of management of state budget-funded work construction investment projects managed by the Ministry as follows:

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation

This Circular prescribes the order of, procedures and responsibility and powers of the General Departments, Administrations and Departments under the Ministry and related organizations and individuals for, the management of work construction investment projects (below referred to as projects for short) funded by state budget capital (centralized budget capital and government bond capital) and managed by the Ministry of Agriculture and Rural Development.

This Circular does not govern ODA projects and sivilculture projects under the Prime Minister’s Decision No.73/2010/QD-TTg of November 6, 2010, promulgating the Regulation on management of investment in the construction of sivilculture works.

Article 2. Subjects of application

The General Departments, Administrations and  Departments under the Ministry and organizations and individuals involved in the management of state budget-funded projects managed by the Ministry of Agriculture and Rural Development.

Chapter II

ORDER OF AND PROCEDURES FOR IMPLEMENTING PROJECTS

Article 3. Investment policy

1. Elaboration of investment policy: Based on the approved sector development master plans and construction master plans, the Planning Department shall summarize and propose investment requests of units, gather comments of related units and the Deputy-Minister in charge, then submit them to the Minister for decision on investment policy.

2. Competence to approve investment policy: The Minister of Agriculture and Rural Development is competent to approve investment policy.

3. An investment policy decision has the following contents: project title, investor name; projected construction site; tasks; project scale; investment capital source; appraisal unit and the Ministry’s leading official in charge of the project.

Article 4. Investors and project management organizations

1. Investors shall be decided by the Minister upon approving investment policy. A project may have one or many investors.

2. For a multi-investor project, the Ministry shall assign one investor to act as coordinator to synthesize the whole project. Investors shall bear full responsibility for their assigned areas of management and coordinate with the coordinator-investor in the course of project implementation. If the coordinator-investor is the first to complete the handover and finalization, the Ministry shall appoint one among the remaining investors to act as coordinator.

3. In the stage of investment project formulation, the assigned coordinator-investor shall supply the project dossier (options, land area, construction schedule of work items) to localities as a basis for making compensation, support and resettlement plans.

Article 5. Formulation of investment projects and econo-technical reports

1. The investor shall organize the formulation of a plan (or tasks) for design survey consultancy in the stage of formulation of an investment project or econo-technical report, which must be consented in writing by the appraisal unit before it is approved.

2. Contents of an investment project or econo-technical report must satisfy the current law-prescribed requirements and the following requirements:

a/ Complying with the socio-economic development master plan, sector development master plan, construction master plan and November 29, 2005 Environmental Protection Law No. 52/2005/QH11. In case the project is not included in the approved sector master plan, complying with the provisions of Clause 3, Article 6 of Decree No.12/2009/ND-CP; and preparing designing and technological options as a basis for selecting the optimum ones; ensuring safety in work construction and operation, storm, flood and explosion prevention and combat and environmental protection; and assuring socio-economic efficiency;

b/ Having a compensation, support and resettlement plan approved under law;

c/ Drawing up a plan and estimating a budget for flood and storm prevention and combat for the work, which will be included in the section on other expenditures in the total investment in work construction (if necessary).

Article 6. Competence to appraise and approve investment projects and econo-technical reports

1. The General Departments, Administrations and Departments shall act as units to appraise investment projects as assigned by the Minister in his investment policy approval decisions.

The appraisal units shall propose verification consultancy units (if necessary) right in the stage of project formulation for verification of parts or all of the project contents and submit them to the investment decider for decision, serving as a basis for investors to take subsequent steps.

2. The investor shall organize appraisal of construction drawings and estimates for econo-technical reports before submitting them to the investment decider for approval.

3. The competence to approve investment projects and econo-technical reports: The Minister is competent to approve group-A projects and projects important for the sector’s development and assign his deputies to approve the remaining projects.

Article 7. Adjustment of investment projects

1. Adjustment of projects

An investment project may be adjusted only in one of the following cases: It is affected by a natural disaster such as earthquake, storm, flood, tsunami, enemy attack or other force majeure incidents; there arise elements which yield higher efficiency for the project; there is a change in the construction master plan which directly affects the project location, scale, characteristics and objective;

If the design of the work or a work item of the project changes as compared to the approved base design or the arising volume exceeds the reserve expenditure percentage for the volume of the work or work item in the total investment amount of the project, the investor shall report it to the investment decider for consideration and decision.

2. Upon adjustment of an investment project, the investor shall report on the investment supervision and assessment (except for projects requiring no investment supervision and assessment).

Article 8. Competence to appraise and approve designs and estimates

1. The investor shall appraise and approve the technical design, construction drawings and estimate in conformity to the approved base design and comply with the following provisions:

a/ For matters noted in the decision approving the investment project, work designing solutions must be reported to the appraisal unit for comment before approval. For a work with complicated technical requirements or applying new technology, the investor shall report them to the investment decider before approving the design;

b/ For econo-technical reports, the work estimate concurrently serves as the total investment amount. The work estimate also includes compensation, support and resettlement (if any) expenses and will be approved by the investment decider. If it is necessary to adjust the estimate while the estimated value does not exceed the approved estimated value, the investor may itself organize the appraisal and approval; if it exceeds the estimated value or the adjustment of construction drawings alters the objective, tasks and location of the approved project, the investor shall report such to the investment decider for consideration and decision.

2. Estimate of expenses in the stage of project formulation:

The investor shall formulate, appraise and approve the expense estimate together with the project tasks (or designing survey plan) in the stage of investment project formulation in accordance with the investment policy approved by the Minister and with applicable laws. The tasks and these expense estimates serve as a basis for the investor to select a counseling contractor for the project under the Law on Bidding.

Before the approval, the investor shall report the tasks and designing survey plan to the Ministry (via the appraisal unit).

3. After the approval, the investor shall send the approval decision enclosed with the appraisal report and all verification reports to the Ministry (via the appraisal unit) within 7 working days for summarization, monitoring and examination.

Chapter III

BIDDING

Article 9. Bidding plan

1. When dividing bidding packages, the investor shall base on the technical characteristics and implementation sequence to ensure the comprehensiveness of the project as well as rational scale of each bidding package suitable to the capabilities of domestic contractors and ensure maximum competitive conditions for domestic enterprises to receive contracts and create jobs for local laborers.

2. International bidding may be organized only when domestic commodities, supplies and equipment or domestic contractors cannot meet the requirements of bidding packages or when these commodities, supplies and equipment cannot be produced at home. International bidding may not be organized for EPC (engineering, procurement and construction) bidding packages for projects in which Vietnamese contractors can provide services, supply commodities and carry out construction activities.

The investor must not employ foreign laborers when local laborers are capable of performing the bidding packages.

3. For bidding packages valued within the limit for which contractor appointment is permitted under government regulations, the investor, when proposing the contractor appointment, shall clearly state the urgency and specifics of the contractor appointment and ensure that the contractor appointment is more effective than open bidding by justifying the factors of time, economy and quality and other socio-economic factors.

4. If it is necessary to adjust the contents of bidding packages in the bidding plan, the investor shall carry out procedures for adjusting the bidding plan in accordance with applicable laws.

Article 10. Bidding preparations

1. The investor shall formulate and approve the bidding dossier or requirement dossier:

a/ The bidding dossier must state important requirements (prerequisites) serving as a basis for disqualification of bids. The bidding dossier or dossier of requirements must have every two adjoining pages stamped before it is issued. It may not set conditions to limit the competitive participation of contractors. It must provide specific guidance on specifications and sealing of bids, stating that a bid must be typewritten or printed in non-erasable ink, be paginated and have every two adjoining pages affixed with the stamp of the contractor or its lawful representative, and copies of a bid must be made from the original bid;

b/ The bidding dossier or dossier of requirements must put forth a requirement on price quotations in Vietnam dong for domestic expenses; price quotations can be made in foreign currencies only for spending items (commodities, services) of foreign origin which cannot be supplied at home and must be imported by contractors;

c/ The decision approving the bidding dossier or dossier of requirements of the investor must specify criteria for evaluating bids or proposal dossiers.

2. Within 3 working days after approval, the investor shall send the approval decision enclosed with the appraisal report (together with their electronic files in Times New Roman font) to the Ministry (via the appraisal unit) for monitoring and examination.

Article 11. Organization of bidding and contract

1. The investor may not hold a bidding when the construction ground and capital source for performance of bidding packages are not yet available.

2. By the time of organizing a bidding, the investor shall approve the bidding package estimates according to regulations. If the bidding package estimates (excluding reserve amounts) are higher than the approved bidding package prices in the bidding plan, these estimates will replace the bidding package prices to serve as a basis for bid evaluation and the procedures for adjusting the bidding package prices in the approved bidding plan are not required to be carried out, provided that the excessive amount lies within the percentage limit of the reserve value of the work item concerned in the total investment amount (including quantitative reserve and inflation reserve); if it exceeds the reserve value of the work item, the investor shall report thereon to the investment decider for consideration and approval before implementation.

3. Within 1 working day after opening the bids, the investor shall send the minutes on the bid opening to the Ministry (via the appraisal unit) for summarization and monitoring.

4. Within 3 working days after approval, the investor shall send the decision on approval of the bidding result or contractor appointment result, enclosed with the report on evaluation of bids or dossiers of proposals, and the report on the bidding result appraisal to the Ministry (via the appraisal unit) for summarization and monitoring.

5. The contract concluded between the investor and contractor must contain specific agreements on cases of adjusting the contract, contractual price, contractual schedule, and order, scope and method and grounds for adjustment of the contractual price.

During the performance of a contract, if finding it necessary to adjust the design and estimates to suit the practical situation of the construction site and market price, the investor, before signing annexes on contractual adjustments or supplements, shall approve the estimate for the arising work volume and adjusted unit prices. If the adjusted contractual price is higher than the bidding package price (+) plus the percentage (%) of the reserve value of the work item concerned in the total investment amount (including the quantitative reserve and inflation reserve), the investor shall report it to the investment decider for consideration and approval before implementation.

6. The investors shall list contractors and related stakeholders that violate the law on bidding or contracts in construction activities and periodically report these lists to the Ministry.

Article 12. Examination and handling of petitions on bidding

1. Examination of bidding: The appraisal unit shall assume the prime responsibility for examining bidding activities of investors according to bidding regulations.

2. Handling of petitions on bidding:

a/ The bid solicitor and investor shall assume the prime responsibility for settling petitions on bidding under their competence;

b/ The appraisal unit shall assume the prime responsibility for settling petitions on bidding which fall under the jurisdiction of the investment decider.

Chapter IV

MANAGEMENT OF CONSTRUCTION QUALITY, PROGRESS AND SAFETY

Article 13. Management of construction survey quality

1. Before conducting construction surveys, the investor shall formulate and approve construction survey tasks and technical options according to regulations. For the stage of formulating investment projects or econo-technical reports, the investor shall comply with the provisions of Clause 1, Article 5 of this Circular.

2. The investor shall supervise construction survey activities as follows:

a/ Organizing a team to regularly supervise survey activities and managing survey records from the time the survey starts till it concludes according to regulations;

In case of topographical and geological complications which require additional survey as compared to the approved plan, the investor shall report them to the investment decider for consideration and decision;

b/ Testing construction survey results according to regulations. After testing and accepting construction survey results, the investor shall manage the construction survey records and preserve the system of topographical markers and geological drilling specimens for serving subsequent steps.

Article 14. Management of quality of construction designs

1. The investor shall organize the formulation, appraisal and approval of construction designs according to regulations and bear responsibility before law for the quality of construction designs, covering:

a/ Results of appraisal and approval of technical designs and construction drawings must be recorded in writing (appraisal reports and approval decisions), showing the following contents: conformity of the technical design with the base design, conformity of construction drawings with the previous-step design; reasonability of work structure solutions; compliance with applicable norms and standards; evaluation of work safety level; reasonability of the selected technological chain and equipment for the work with technological requirements; compliance with regulations on environment, fire prevention and fighting, storm and flood prevention and combat;

b/ If the investor hires a consultant to verify part or all of the above contents for use as a basis for appraisal, the verification report must fully reflect the required contents. Design verification organizations and consultants must be fully capable and answerable to law and the investor for verification results;

c/ For designing to select equipment, technological chains or animal breeds or plant seeds (referred collectively to as commodities):

In the stage of technical designs and construction drawings, the quality standards of commodities, conditions on commodity quality certification, the system of commodity quality management, and quality inspection of commodities during their use must be put forth.

The selected commodities must be relevant to the project objectives and compatible with the existing system (for renovation and upgrading projects) and also meet the requirements of the current standards and regulations;

d/ The technical design and construction drawing dossiers comprise design explanation, design drawings, relevant survey documents, work maintenance processes and work construction estimates. Particularly for water reservoirs, the investor shall formulate the process of reservoir water regulation and the process of operating the valve system before accommodating water in the reservoirs for organizing the regulating operation in a safe and efficient manner and include them in the work handover dossiers.

2. The investor shall formulate, appraise and approve technical designs or construction drawings in conformity with the approved base designs. If the technical designs or construction drawings change as compared to the base designs, the provisions of Clause 1, Article 7 of this Circular must be complied with.

Article 15. Construction quality management

1. The investor shall organize management of construction quality of all work items from the time they are constructed to the time they are tested for acceptance and put into operation, ensuring their quality, efficiency and compliance with current regulations; and be answerable to law for damage due to non-observance of regulations on construction quality management.

2. The unit managing the use of the work shall appoint officers to join the investor in organizing the project formulation, designing, monitoring, managing, supervising, testing and accepting to put the work into operation. The appointed persons are those who will participate in the subsequent management and use of the work or those with professional qualifications suitable to the project’s characteristics. Where a newly constructed work has no official unit to manage its use, the investor shall report such to the provincial-level People’s Committee of the locality where the work is located for appointment of a work use-managing unit and nomination of officers to participate in the management and supervision.

3. Safety management of works during construction

The investor shall assume the prime responsibility for, and coordinate with contractors in, maintaining safety of the works in the course of construction and adjacent structures under current regulations.

Annually before the flood season, the investor shall formulate and approve plans to prevent and combat floods and storms for works and maintain their safety. Funds for storm and flood prevention and combat comply with Article 5 of this Circular.

Article 16. Management of construction progress

1. Based on the work completion deadline, the schedule in the bid, the minutes of contract negotiation and conclusion, capital allocation plan and ground clearance schedule after the conclusion of the contract, the investor shall approve detailed construction schedules for individual work items and bidding packages.

a/ For new work items or bidding packages, the investor shall approve the detailed construction schedules formulated by the contractor after the conclusion of the contract.

For work items or bidding packages to be implemented in subsequent years, the investor shall approve detailed construction schedules for remaining items and volumes in January every year;

b/ Within 7 working days after the approval, the investor shall send the schedule approval decisions enclosed with the schedules (detailed construction schedule and human resource, equipment and materials mobilizing schedule) to the Ministry (via the appraisal unit) for summarization, monitoring, examination and direction.

2. The investor shall organize supervision of construction progress against the approved detailed construction schedules.

If the adjustment of the contractual schedule results in a longer project completion deadline, the investor shall report it to the investment decider for consideration and decision.

Article 17. Hand-over and putting of works into operation

1. Works or work items, after being completely constructed with guaranteed quality, must be handed over to the managing unit for efficient use and avoidance of damage and degeneration. The investor shall hand over them to the use-managing unit according to regulations.

2. The use-managing unit shall accept and manage the operation of the work with efficiency. Particularly for major work items of an irrigation reservoir, the investor shall organize grassroots-level tests before handing them over to the use-managing unit, and compile dossiers to be submitted to the Ministry for decision on the tests and hand-over to the provincial-level People’s Committee (of the locality where the work is located) for management under Article 8 of the Government’s Decree No. 72/2007/ND-CP of May 7, 2007, on safety management of dams.

Chapter V

PAYMENT AND FINALIZATION

Article 18. Payment of work construction investment capital

1. The investor shall organize the test of and payment for completed volumes (including arising volumes) for the contractor under the contract and monthly send summarization reports on the project’s implementation result and disbursement of capital to the project.

2. The investor shall make advances to the contractor and recover the advances according to regulations. For other cases, the investor shall report them to the investment decider for consideration and decision.

Article 19. Finalization of work construction investment capital

1. Competence for finalization of projects invested under the Ministry’s decisions: The Minister shall authorize the approval of finalizations of completed projects to:

Deputy-ministers to approve the finalizations of group-A projects and group-B projects with a total investment level of over VND 200 billion each.

The director of the Finance Department to approve the finalizations of group-B projects with a total investment level of under VND 200 billion each and group-C projects invested under the Ministry’s decisions (excluding projects invested by units attached to the General Departments, of which the finalizations shall be approved by the General Department Directors under the Minister’s authorization).

General Department Directors to approve the finalizations of group-B projects with a total investment level of under VND 200 billion each and group-C projects invested by attached units of their General Departments.

2. Agencies verifying the finalizations of completed projects

For projects invested under the Ministry’s decisions, the Finance Department shall act as key body for verification of the finalizations of completed projects (with the participation of appraisal units and the Planning Department) before submitting them to the Ministry for approval (excluding projects invested by attached units of General Departments of which the finalizations are approved by the General Department Directors under the Minister’s authorization).

General Department Directors shall organize verification of the finalizations of completed projects, for projects of which the finalizations are approved by the General Department Directors under the Minister’s authorization.

Chapter VI

IMPLEMENTATION PROVISIONS

Article 20. Organization of implementation

1. The Planning Department shall guide the units to make written proposals on investment projects, summarize investment policy and allocations of annually planned capital and submit them to the Minister for approval; coordinate with the project appraisal units in submitting investment projects (both newly formulated and adjusted) to the Ministry for approval; and assume the prime responsibility for reporting on the supervision and general assessment of biannual and annual investments to the Ministry of Planning and Investment according to regulations.

2. The Work Construction Management Administration shall:

a/ Guide the order and procedures for capital construction investment, covering the formulation and appraisal of projects; bidding (consultancy, construction and installation, procurement of commodities); management of investment expenditures on work construction; and management of construction quality, and relevant regulations;

b/ Act as the key body for appraisal of projects and project-bidding plans; inspect and urge investors on construction progress and quality; oversee and assess investment work; coordinate with the General Departments, Administrations and Departments in testing completed works for operation as assigned by the Minister;

c/ Assume the prime responsibility for, and coordinate with the units under the Ministry in, giving opinions on base designs of group-A projects as assigned by the Ministry;

d/ Advise the Minister on the management of construction quality of works falling under the Ministry’s state management;

e/ Guide and inspect the observance of econo-technical norms in capital construction investment; scrutinize, formulate, appraise and submit to the Ministry for promulgation or promulgate by itself the system of econo-technical norms related to capital construction for application within the sector;

f/ Summarize the work of bidding and management of construction quality of works under investment projects managed by the Ministry according to regulations.

3. The General Departments, Administrations and Departments assigned to act as key bodies in project appraisal and management of project implementation shall:

a/ Act as key bodies for appraisal of projects and project-bidding plans; inspect and urge investors on construction progress and quality; oversee and assess investment work; test completed works for hand-over, operation and use as assigned by the Ministry;

b/ Assume the prime responsibility for, and coordinate with units under the Ministry in, giving opinions on base designs as assigned by the Ministry;

c/ Guide and inspect the observance of econo-technical norms related to capital construction investment, which fall under their management; scrutinize, formulate and submit to the Ministry for promulgation or promulgate by themselves systems of econo-technical norms for application within the sector;

d/ Annually report to the Ministry (via the Planning Department) on results of implementation of and disbursement of capital to projects assigned by the Ministry;

e/ Report on the work of bidding and management of construction quality according to regulations for projects assigned by the Ministry to the Ministry (via the Work Construction Management Department for summarization);

f/ General Department Directors shall organize verification and approval of finalizations of completed projects as authorized by the Minister.

4. The Organization and Personnel Department shall assume the prime responsibility for, and guide the General Departments, Administrations, Departments and units attached to the Ministry in, setting up a Group-A Project Steering Committee (if necessary) and organizations assisting the Minister in managing projects under law.

5. The Science, Technology and Environment Department shall guide investors in applying national standards and technical regulations according to law; assume the prime responsibility for, and coordinate with the General Departments, Administrations, Departments and units attached to the Ministry in, establishing science councils or technical councils for projects (if necessary).

It shall assume the prime responsibility for appraising equipment procurement and science and technology projects regarding their compliance with current technological and environmental regulations and their reasonability.

It shall guide and assume the prime responsibility for appraising environmental impact assessment reports of projects.

6. The Finance Department shall guide the finalization of capital construction investment funds from state budget capital sources according to fiscal years and the finalization of completed projects; and verify and approve the finalizations of completed projects under the Minister’s authorization.

7. Investors shall comply with the provisions of this Circular and current regulations.

a/ To make reports on construction progress, implementation results and capital disbursement every month, quarter, six months and year according to regulations of the State and the Ministry;

b/ To make reports on investment supervision and assessment: monthly reports and reports upon adjustment of projects to the Ministry; quarterly, biannual and annual reports on group-A or higher-grade projects to the Ministry and the Ministry of Planning and Investment according to regulations;

c/ To make periodical reports on bidding activities; make general lists of contractors and other stakeholders that commit violations of the bidding law and contracts in their construction activities and regulations on construction quality every six months, year and upon completion of work construction.

Article 21. Effect

1. This Circular takes effect 45 days after its signing. All previous regulations of the Ministry of Agriculture and Rural Development which are contrary to this Circular are hereby annulled.

2. Any problems arising in the course of implementation should be promptly reported in writing to the Ministry (via the Works Construction Management Department) for consideration and settlement.-

Minister of Agriculture and Rural Development
CAO DUC PHAT