Project Management Agreement (Construction) Template for Indonesia

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Key Requirements PROMPT example:

Project Management Agreement (Construction)

"I need a Project Management Agreement (Construction) under Indonesian law for a 30-story commercial building development in Jakarta, with project commencement planned for March 2025 and specific provisions for green building certification compliance."

Document background
The Project Management Agreement (Construction) is a critical document used when engaging professional project management services for construction projects in Indonesia. It is particularly relevant for medium to large-scale construction projects where specialized project management expertise is required to ensure successful project delivery. The agreement must comply with Indonesian construction laws, particularly Law No. 2 of 2017 on Construction Services and its implementing regulations. It typically includes detailed provisions for project planning, monitoring, coordination, quality control, and reporting, while addressing specific Indonesian requirements such as local content rules and licensing. The document is essential for establishing clear lines of authority, risk allocation, and performance standards between the project owner and the project management consultant, while ensuring all activities align with local regulatory requirements and industry standards.
Suggested Sections

1. Parties: Identification of the Project Owner and the Project Management Consultant, including their legal details and representatives

2. Background: Context of the agreement, brief description of the construction project, and the basis for engaging the project management services

3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules of interpretation

4. Appointment and Scope of Services: Formal appointment clause and detailed scope of project management services to be provided

5. Project Manager's Obligations: Comprehensive list of duties, responsibilities, and standards of performance expected from the Project Manager

6. Client's Obligations: Responsibilities and obligations of the client, including provision of information and access

7. Project Timeline: Project phases, milestones, and completion dates

8. Fees and Payment Terms: Fee structure, payment schedule, and invoicing procedures

9. Personnel and Resources: Requirements for key personnel, staffing, and resources to be provided

10. Reporting and Communication: Reporting requirements, meeting schedules, and communication protocols

11. Changes and Variations: Procedures for handling changes to scope, timeline, or fees

12. Quality Management: Quality standards, control procedures, and compliance requirements

13. Liability and Indemnification: Allocation of risks, liability limitations, and indemnification provisions

14. Insurance: Required insurance coverage and minimum limits

15. Intellectual Property: Ownership and usage rights of project documents and materials

16. Confidentiality: Protection of confidential information and trade secrets

17. Term and Termination: Duration of agreement, renewal terms, and termination provisions

18. Dispute Resolution: Procedures for resolving disputes, including mediation and arbitration

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

20. General Provisions: Standard boilerplate clauses including notices, assignment, and severability

Optional Sections

1. Force Majeure: Provisions for handling unforeseen circumstances - particularly relevant in areas prone to natural disasters or political instability

2. Anti-Corruption and Compliance: Required when working with government entities or international organizations with strict compliance requirements

3. Environmental Management: Important for projects with significant environmental impact or when required by local regulations

4. Local Content Requirements: Necessary when project must comply with Indonesian local content regulations

5. Security Requirements: Required for projects in sensitive locations or involving critical infrastructure

6. Technology and Systems: Relevant when specific project management software or systems are to be used

7. Subcontracting: Required when the Project Manager may need to subcontract certain services

8. Performance Bonds: Important for high-value projects or when required by financing arrangements

Suggested Schedules

1. Schedule 1 - Scope of Services: Detailed breakdown of project management services and deliverables

2. Schedule 2 - Fee Schedule: Detailed fee structure, rates, and payment milestones

3. Schedule 3 - Project Timeline: Detailed project schedule, milestones, and critical paths

4. Schedule 4 - Key Personnel: List of key personnel, their roles, qualifications, and time commitment

5. Schedule 5 - Reporting Requirements: Templates and specifications for required reports

6. Schedule 6 - Client's Requirements: Detailed technical and operational requirements for the project

7. Schedule 7 - Quality Management Plan: Detailed quality management procedures and standards

8. Appendix A - Power of Attorney: Authorization documents for representatives of both parties

9. Appendix B - Insurance Certificates: Copies of required insurance policies

10. Appendix C - Forms and Templates: Standard forms for change orders, progress reports, and other routine documents

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries

Construction

Infrastructure

Real Estate Development

Industrial Development

Commercial Property

Government & Public Sector

Energy & Resources

Healthcare

Education

Hospitality

Retail

Transportation

Relevant Teams

Legal

Operations

Project Management

Construction

Commercial

Procurement

Risk & Compliance

Technical Services

Business Development

Contract Administration

Finance

Relevant Roles

Project Director

Construction Manager

Project Manager

Contract Manager

Commercial Director

Legal Counsel

Chief Operating Officer

Development Director

Technical Director

Risk Manager

Procurement Manager

Construction Director

General Counsel

Chief Executive Officer

Facilities Manager

Operations Manager

Industries
Law No. 2 of 2017 on Construction Services: The primary law governing construction services in Indonesia, including project management. Sets out requirements for construction service providers, contract requirements, and professional standards.
Government Regulation No. 22 of 2020: Implementation regulation for Law No. 2/2017, detailing specific requirements for construction project implementation, including project management roles and responsibilities.
Law No. 18 of 1999 on Construction Services: While largely superseded by Law No. 2/2017, some provisions remain relevant for interpretation and historical context of construction regulations.
Indonesian Civil Code (KUHPerdata): Contains fundamental contract law principles applicable to all agreements in Indonesia, including provisions on formation and enforcement of contracts.
Minister of Public Works Regulation No. 07/PRT/M/2019: Standards for Construction Services including technical requirements and guidelines for project management in construction.
Law No. 13 of 2003 on Manpower: Relevant for labor aspects of construction project management, including workforce requirements and health and safety obligations.
Government Regulation No. 50 of 2012: Regulates Occupational Safety and Health Management Systems (SMK3) implementation in construction projects.
Presidential Regulation No. 16 of 2018: Governs procurement of goods and services, particularly relevant if the project involves government entities or public infrastructure.
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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