In order to stabilize the order of the construction market, eliminate the social contradictions caused by the abnormal fluctuation of the price of building materials, and effectively safeguard the legitimate rights and interests of the employer and the contractor, according to the contract law of the people’s Republic of China, the measures for the administration of contracting and contracting valuation of construction projects (Order No.
The bidder shall comprehensively consider the price risk factors and calculate the corresponding risk costs when bidding and quotation to avoid blind quotation.
On July 25, 2019 and May 19, Shaanxi Provincial Department of housing and urban rural development issued the notice on the guidance on price risk control of building materials, which made it clear that: 1.
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The construction contract must clearly stipulate the price risk control terms of main building materials, and shall not adopt unlimited risk and all risk to specify the content and scope of material price risk in the contract terms.
On November 1 in Shanghai, the market management station of Shanghai Building Materials Industry issued the guiding opinions on Further Strengthening the prevention and control of market price fluctuation risk of human resources and machines for construction projects, which made it clear that for engineering projects that have signed engineering construction contracts but have not yet been settled, both parties shall negotiate and sign supplementary agreements with reference to the following guiding opinions.
1、 Pay close attention to the fluctuation of building materials market, guide and standardize contract performance, and the construction administrative departments at all levels should actively cooperate with the development and reform and market supervision departments at the same level to establish a price collection linkage mechanism, and pay close attention to the changes in building materials prices.
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Project cost management organizations at all levels shall strengthen the mediation of building materials price disputes.
In order to maintain the order of the construction market, ensure the quality and safety of the project, reasonably determine and effectively control the project cost, effectively ensure the legitimate rights and interests of both parties and ensure the smooth implementation of the project.
The construction contract must clearly stipulate the price risk control terms of main building materials, and unlimited risk shall not be adopted All risks specify the content and scope of material price risk in the contract terms.
If the scope of main materials, price risk range and adjustment methods are not agreed or unclear in the contract, the employer and the contractor may negotiate and sign a supplementary agreement in accordance with Article 9 of the measures for the preparation and management of budget prices of construction materials in Hunan Province (xjj [2018] No.
If the contract stipulates the scope and range of risk, it shall be implemented in accordance with the contract.
If the scope and range of risk are not agreed or unclear in the contract, the employer and the Contractor shall negotiate to reasonably share the risk and sign a supplementary agreement.
When signing the construction contract, the employer and the Contractor shall reasonably agree on the risk range of price fluctuation of main materials and the adjustment method after exceeding the range, so as to ensure the smooth implementation of the project.
Strengthen risk management, guide and standardize the market transactions and contract performance of all parties involved in the construction.
3、 Strengthen the price monitoring and dispute mediation of building materials to maintain fairness, justice and social stability.
2、 Improve risk awareness and reasonably determine the price of building materials.
133 of the people’s Government of Shaanxi Province), combined with the actual situation of our Province, and following the principles of objectivity, fairness and impartiality, The following guiding opinions on material price risk are put forward: 1.
If the construction contract has agreed not to adjust the price of main materials or agreed that the Contractor shall bear unlimited material price risk, it will be unfair to one party of the contract.
94), housing and urban rural development bureaus of districts and cities, Yangling Demonstration Zone, Xixian new area, Hancheng City, Shenmu city and Fugu County, and relevant units: Recently, due to the influence of many factors in the international and domestic market, The market price of steel and other main materials in our province fluctuates greatly, which has a great impact on the construction project.
Multiple provinces and cities shall be civilized and clear: unlimited risk and all risks shall not be used to specify the content and scope of material price risk in the contract terms.
During the implementation of the construction project, the employer and the Contractor shall enhance risk prevention awareness and fully consider the impact of the price change of building materials on the implementation of the project during the construction period.
The tenderee shall consider the impact of price fluctuation on the project cost when preparing the terms of the bidding documents and the bidding control price.
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According to the requirements of code for valuation with bill of quantities of construction projects (gb50500-2013), the employer and the Contractor shall not include unlimited risks or all risks in the unit price or total price of the bill agreed in the bidding documents and the contract.
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Project cost management institutions at all levels should strengthen the dynamic monitoring of the price of building materials, adjust the release cycle, make full use of information-based methods to increase the release frequency, and timely calculate and release the market reference prices of main materials such as cement, gravel and concrete, Provide support for reasonable determination and effective control of project cost.
The employer and the Contractor shall enhance the awareness of price risk prevention of main materials, and fully consider the impact of material price fluctuation on project cost, project quality and construction safety.
If it is not agreed or unclear in the construction contract, the employer and the Contractor shall supplement or sign a supplementary agreement on the basis of negotiation.
If the scope, risk range and adjustment method of main materials are agreed in the construction contract, it shall be implemented in accordance with the contract.
In strict accordance with the relevant regulations on project cost dispute mediation and the principle of “seeking truth from facts, objectivity and impartiality”, quickly mediate the disputes related to the price of building materials proposed by the employer and the contractor, maintain fairness, justice and social stability, and ensure the smooth implementation of the project construction.
According to the measures for the administration of contracting out and contracting valuation of construction projects (Order No.
If the contract stipulates to adopt fixed price lump sum without adjusting the fluctuation of market price, when the price change of labor, materials, construction machinery and other factors constitutes a change of circumstances specified in article 533 of the civil code of the people’s Republic of China, both parties shall negotiate and sign a supplementary agreement based on relevant provisions and actual conditions and the principle of good faith and fairness to share risks reasonably.
Notice of Hunan Provincial Department of housing and urban rural development on strengthening the price risk control of building materials Xjjh [2019] No.
On October 27, Hunan Provincial Department of housing and urban rural development issued the guiding opinions on Further Strengthening the price risk prevention and control of building materials, which proposed that the developer and the contractor could negotiate and sign a supplementary agreement under four circumstances.
Source: Recently, local housing and construction departments have experienced great fluctuations in the market price of building materials, which has a great impact on construction projects.
Notice on the guidance on price risk control of building materials (SJF [2021] No.
149, municipal and state housing and urban rural development bureaus and relevant units: in recent years, with the continuous increase of national efforts to protect the ecological environment and the continuous strengthening of environmental pollution supervision, the market of building materials in our province has changed, the price of building materials fluctuates greatly, and the prices of sandstone, cement and concrete have increased to varying degrees, It has seriously affected the normal performance of the construction contract.
The agreed risk range of the price of main materials shall be controlled within 5%.
In case of abnormal fluctuation of market price, both parties shall negotiate and sign a supplementary agreement, which shall be implemented in accordance with the supplementary agreement.
16 of the Ministry of housing and urban rural development) and the measures for the administration of construction project cost in Shaanxi Province (Order No.
16 of the Ministry of housing and urban rural development) and the measures for the administration of construction project cost in Hunan Province (Order No.
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If the contract has agreed not to adjust the price of main materials or agreed that the Contractor shall bear unlimited material price risk, when the rise and fall of main materials is too large, the employer and the Contractor shall negotiate and sign a supplementary agreement on price adjustment of main materials based on the principle of seeking truth from facts and fairness.
129).
192 of the provincial people’s Government) And other relevant regulations, combined with the actual situation of our province, and based on the principle of seeking truth from facts, fairness and rationality, the following guiding opinions are put forward, which should be carefully implemented.
The type of main materials shall be agreed by the employer and the contractor in the contract, and the risk range agreed on the price of main materials shall be controlled within 5%..
During the performance of the contract, when the rise and fall of main materials is too large, the employer and the Contractor shall negotiate and sign a supplementary agreement on the price adjustment of main materials based on the principles of seeking truth from facts, fairness and impartiality.
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