Decision No. 131/2007/QD-TTg dated August 09, 2007 of the Prime Minister promulgating the regulation on hiring of foreign consultants in construction activities in Vietnam

DECISION

PROMULGATING THE REGULATION ON HIRING OF FOREIGN CONSULTANTS IN CONSTRUCTION ACTIVITIES IN VIETNAM

THE PRIME MINISTER

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to the November 26, 2003 Construction Law;

At the proposal of the Minister of Construction,

DECIDES:

Article 1.-  To promulgate together with this Decision the Regulation on hiring of foreign consultants in construction activities in Vietnam.

Article 2.- This Decision takes effect 15 days after its publication in “CONG BAO.” To annul previous regulations contrary to the Regulation promulgated together with this Decision.

Article 3.- Ministers, heads of ministerial-level agencies, heads of government-attached agencies, presidents of provincial/municipal People’s Committees, and concerned organizations and individuals shall implement this Decision.

REGULATION

ON HIRING OF FOREIGN CONSULTANTS IN CONSTRUCTION ACTIVITIES IN VIETNAM

(Promulgated together with the Prime Minister’s Decision  131/2007/QD-TTg of August 9, 2007)

Article 1.- Scope of regulation, subjects of application

1. This Regulation provides for hiring of foreign organizations and individuals for provision of consultancy services in construction activities in Vietnam which cover construction planning, construction survey, elaboration of investment projects on work construction, work construction design, management of work construction investment projects, supervision of work construction, selection of contractors in construction activities and a number of other construction consultancy services in accordance with Vietnamese law.

2. When treaties to which the Socialist Republic of Vietnam is a contracting party or has acceded provide for the use of construction consultancy services differently, those treaties prevail. 

Article 2.- Principles for hiring foreign consultants

1. Based on quality requirements on construction consultancy service products, work construction project owners, agencies or organizations elaborating construction planning schemes shall propose the hiring of foreign consultants for provision of construction consultancy services when necessary.

2. Hiring of foreign consultants for provision of construction consultancy services must ensure the principles for competitiveness, cost saving and efficiency.

3. Hiring of foreign consultants is not permitted for provision of construction consultancy services related to state secrets; when necessary, the hiring must be approved by competent agencies.

4. Foreign consultants must fully satisfy capacity conditions relevant to the scope and content of hired construction consultancy services.

5. Hiring of foreign consultants must comply with this Regulation and Vietnam’s relevant laws.

Article 3.- Competence to decide on hiring of foreign consultants

1. Investment deciders shall decide on whether to hire and how to hire foreign consultants to provide construction consultancy services related to work construction investment projects.

2. Presidents of provincial/municipal People’s Committees shall decide on whether to hire and how to hire foreign consultants to elaborate construction planning schemes in their provinces or cities. The Minister of Construction shall decide on whether to hire and how to hire foreign consultants to elaborate construction planning schemes to be approved by the Prime Minister.

3. Hiring of foreign consultants must be specified in the investment decision, for work construction investment projects or in the decision to approve planning tasks, for construction planning schemes.

Article 4.- Forms of hiring foreign consultants

There are two forms of hiring foreign consultants: hiring of experts and hiring of organizations

1. Hiring of experts is to hire foreign individuals to provide construction consultancy services at the request of investment owners or agencies in charge of elaborating construction planning schemes.

2. Hiring of organizations is to hire foreign consultancy contractors or partnerships between foreign consultancy contractors and domestic consultancy contractors to provide construction consultancy services at the request of investment owners or agencies organizing the elaboration of construction planning schemes.

Article 5.- Requirements on foreign consultants’ capacity

1. Foreign consultants must provide and prove their legal person status and professional capacity when they participate in the selection of foreign consultants to provide construction consultancy services in Vietnam.

2. Bidding invitation dossiers for foreign consultants, apart from specifying capacity conditions required by Vietnam’s current law, must supplement the following capacity conditions for consultancy experts and organizations:

a/ Hiring of experts: Experts must possess a construction consultancy practice certificate; have at least 5 years of construction consultation practice and have completed at least three construction consultancy services of the same kind with that to be hired;

b/ Hiring of organizations: Consultancy organizations must have an operation registration certificate, legal person status, full financial capacity, adequate number of qualified experts and must have completed, as principal contractors, at least 3 construction consultancy services of the same kind with that to be hired.

Article 6.- Modes of selecting foreign consultants

1. Foreign consultants must be selected in compliance with Vietnam’s current bidding law and this Regulation.

2. For construction planning schemes which must be selected through a  contest, such contest must be organized prior to the selection of foreign consultants. The contest form and content shall be determined by the person competent to approve those construction planning schemes.

3. In the selection of foreign consultants, when many foreign consultancy organizations and individuals satisfy required capacity conditions, priority is given to organizations or individuals that commit to training domestic consultants that join them in providing construction consultancy services in order to improve the latter’s professional level.

Article 7.- Management of expenses for hiring foreign consultants

1. Expenses for hiring foreign consultants for construction consultancy services must be determined in conformity with the hiring party’s payment capacity, ensuring reasonable production costs. These expenses are used within the project’s total investment according to regulations.

2. Expenses for hiring foreign consultants are determined according to person-per-month estimates (according to international practice) or by percentage. Estimates of costs to hire foreign consultants is the aggregate expenses necessary to complete the hired construction consultancy service, including expenses for experts and other related expenses, including payable taxes according to current law.

a/ Expenses for experts are determined based on the number of experts and each expert’s working time corresponding to his/her base salary and expenses calculated based on the expert’s base salary such as social expense, management expense, profit, allowance and insurance expense. The number of experts and each expert’s working time are determined based on the volume of work to be done, work schedule requirement, professional level and each expert’s capability to handle work. The level of experts’ base salary and expenses calculated based on their base salaries must be based on consultancy organizations’ audited financial operation reports or on experts’ salary level stated in expert hiring contracts which have been performed within the latest three years;

b/ Other expenses cover travel expenses of experts, expenses for working offices, expenses for meetings and workshops and other expenses (if any);

c/ Payable taxes determined according to Vietnam’s current law.

The Ministry of Construction shall guide the determination of expenses for hiring foreign consultants in accordance with this Regulation.

3. In case of designation of a foreign consultancy contractor, the investor shall organize the calculation and appraisal of the expenses for hiring foreign consultants and submit them to the investment decider (or the authorized person, for projects to be decided by the Prime Minister) for approval. Provincial/municipal People’s Committees shall approve expenses for hiring foreign consultants to elaborate construction planning schemes in their provinces or cities. Agencies in charge of elaborating construction planning schemes to be approved by the Prime Minister shall approve expenses for hiring foreign consultants.

4. Investors of work construction projects and agencies in charge of elaborating construction planning schemes may hire capable consultancy organizations to appraise estimates of expenses for hiring foreign consultants prior to approval of these estimates.

Article 8.- Management of contracts on hiring of foreign consultants 

1. Foreign consultants must be hired through consultancy contracts signed between consultancy contractors and investors of work construction investment projects or agencies in charge of elaborating construction planning schemes.

2. Contents of contracts on hiring of foreign consultants must comply with Vietnamese law. Apart from main contents stipulating the scope of work, implementation time, completed product, contracts on hiring of foreign consultants must specify the number and quality of consultants.

3. When a foreign consultancy contractor sets up a partnership with a domestic consultancy contractor or employs a domestic consultancy contractor as a subcontractor, in addition to prescribed contract contents, contracts on hiring of foreign consultants must clearly state the scope and volume of work as well as implementation costs of each contractor in the partnership or of the principal contractor and the subcontractor.

4. Investors of work construction investment projects and agencies in charge of elaborating construction planning schemes are responsible for supervising the consistency of the provisions of contracts on hiring of foreign consultants with the actual use of experts, arrangement of experts’ working positions and time; volume, progress and quality of completed construction consultancy service products which are used as the basis for work take-over and payment for contracts on hiring of foreign consultants.

5. Contract prices for hiring foreign consultants and contract provisions serve as the basis for investors of work construction investment projects or agencies in charge of elaborating construction planning schemes to pay the consultant contractor.

6. Expenses for hiring foreign consultant must be paid in compliance with current regulations and specific provisions of contracts for hiring of foreign consultants.

Article 9.- Management of foreign consultancy contractors

1. After being selected to provide construction consultancy services in Vietnamese territory, foreign consultancy contractors shall observe Clause 4, Article 7 of the Construction Law and the Prime Minister’s Decision 87/2004/QD-TTg of May 19, 2004, on the Regulation on management of operation of foreign contractors in the construction domain in Vietnam.

2. In the course of providing construction consultancy services involving construction criteria and norms, foreign consultancy contractors shall comply with the provisions of Vietnamese law on application of construction criteria and norms. When foreign construction criteria and norms are applied, such application must comply with relevant current legal documents.

3. Foreign consultancy contractors may not trade their contracts in any form. In the course of supervising contract performance, if contract breach or trading is detected, it shall be handled according to current regulations.

Article 10.- Organization of implementation

1. The Ministry of Construction shall guide, and handle problems arising in, the implementation of this Regulation.

2. Ministries, ministerial-level agencies, government-attached agencies, and provincial/municipal People’s Committees shall send annual reports on the implementation of this Regulation to the Ministry of Construction for sum-up and report to the Prime Minister.