Building Contractor Contract Template for Indonesia

The Building Contractor Contract is a crucial legal document used in the Indonesian construction industry to formalize the relationship between project owners and contractors undertaking construction works. This document type is essential for compliance with Indonesian construction law, particularly Law No. 2 of 2017 on Construction Services and related regulations. It is typically used for both commercial and residential construction projects, incorporating mandatory local content requirements, environmental standards, and safety regulations specific to Indonesia. The contract provides comprehensive coverage of project specifications, timeline, payment terms, quality standards, and dispute resolution mechanisms, while ensuring alignment with Indonesian civil law principles and construction industry practices. This Building Contractor Contract is particularly important as it incorporates specific Indonesian regulatory requirements that may differ from international construction contract standards, making it essential for both domestic and international contractors operating in Indonesia.

1. Parties: Identification of the employer/owner and the contractor, including their complete legal names, registration numbers, and addresses

2. Background: Context of the construction project, including brief description of the project and the parties' intentions

3. Definitions and Interpretation: Detailed definitions of terms used throughout the contract and rules for contract interpretation

4. Scope of Works: Detailed description of the construction works to be performed by the contractor

5. Contract Price and Payment Terms: Amount payable, payment schedule, payment conditions, and invoicing requirements

6. Project Timeline: Commencement date, completion date, milestones, and provisions for extensions of time

7. Contractor's Obligations: Key responsibilities including workmanship, materials, compliance with laws, and safety requirements

8. Employer's Obligations: Key responsibilities including site access, permits, approvals, and provision of necessary information

9. Quality and Standards: Required quality standards, inspections, testing procedures, and acceptance criteria

10. Variations: Process for requesting, approving, and implementing changes to the scope of works

11. Health and Safety: Safety requirements, compliance with regulations, and accident prevention measures

12. Insurance and Indemnities: Required insurance coverage and indemnification obligations of both parties

13. Performance Security: Requirements for performance bonds or bank guarantees

14. Defects Liability: Defects notification period, remediation process, and warranties

15. Force Majeure: Definition of force majeure events and their consequences

16. Termination: Grounds for termination, termination process, and consequences

17. Dispute Resolution: Process for resolving disputes, including mediation and arbitration procedures

18. Governing Law: Specification of Indonesian law as governing law and jurisdiction

19. General Provisions: Standard clauses including notices, assignment, and entire agreement