If the review is not completed within the time limit due to the employer, it may be handled according to the contract
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The settlement period of the construction process can be divided according to the construction image progress node, so as to connect with the progress payment node
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In principle, process settlement shall be implemented for large and medium-sized engineering projects invested by the government
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On December 14, 2020, Jiangxi Provincial Department of housing and urban rural development issued a notice, printing and distributing the implementation opinions on promoting construction process settlement in housing construction and municipal infrastructure projects, which shall come into force as of the date below
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The Contractor shall timely complete the preparation of construction process settlement documents after the acceptance of the construction process settlement node project, and shall submit the construction process settlement documents and corresponding settlement materials to the employer within the time limit agreed in the contract; The employer shall complete the verification and confirmation of settlement in the construction process within the agreed period
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On September 17, 2020, Shandong Provincial Department of housing and urban rural development, Shandong Provincial Development and Reform Commission and Shandong Provincial Department of Finance jointly issued the guiding opinions on the implementation of construction process settlement in housing construction and municipal engineering (Trial), so as to shorten the settlement cycle and reduce the burden on enterprises by standardizing the settlement behavior
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Government investment projects shall not be funded by the construction unit
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Expenses such as visa, change and claim determined through negotiation between the employer and the Contractor shall be handled at the same time during the settlement of project construction.
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Emphasize the capital responsibility and guarantee responsibility of the construction unit to provide financial guarantee for the process settlement
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The construction unit shall have financial arrangements to meet the construction needs, and provide the construction unit with project payment guarantee
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Up to now, many places in China have implemented process settlement
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If the Contractor fails to submit the construction process settlement documents within the agreed time limit due to the contractor, the employer may carry out the construction process settlement activities according to the contract and the existing data
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As early as 2016, the opinions of the general office of the State Council on comprehensively tackling the wage arrears of migrant workers It is the first time to clearly require the full implementation of construction process settlement; In 2017, the Ministry of housing and urban rural development 《 In the opinions on strengthening and improving the supervision of project cost, it is once again proposed to implement the settlement system of project price and construction process; On December 24, 2019, the Ministry of housing and urban rural development issued the guiding opinions on Further Strengthening the supervision of bidding and tendering of housing construction and municipal infrastructure projects, which proposed to strictly enforce the management of contract performance and project changes, strengthen the management of project progress payment and project settlement, and the tenderee shall not take the unfinished audit as the reason for delaying project settlement and defaulting on project payment
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The government and state-owned investment projects shall not refuse or delay the process settlement and project payment on the grounds that the Completion Final Accounts audit has not been completed
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The settlement period of the construction process can be divided according to the construction time period or the construction image progress node
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The construction unit shall timely and fully allocate the labor cost in the project progress payment to the special account for migrant workers’ wages
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The employer and the contractor can organize or entrust qualified project cost consulting units to compile and review the construction process settlement
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At the same time, it is proposed to promote the settlement of construction process
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If there is no agreement on the handling time limit of settlement in the construction process in the contract, the time limit is 28 days
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The longest settlement payment period shall not exceed 60 days, and the payment period of labor cost shall not exceed one month
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In July 2020, the Ministry of housing and urban rural development issued the work plan for project cost reform, which made it clear: strengthen the supervision of project construction contract performance and price payment, guide the employer and the contractor to carry out project payment and settlement in strict accordance with the contract, and fully implement the price settlement and payment in the construction process
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Fully implement the project payment guarantee system to prevent project payment arrears
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If the employer fails to pay according to the time agreed in the contract, it shall bear the liability for breach of contract according to the contract
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Settlement period: it can be determined monthly or according to the image progress of the project
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The employer shall, within the time limit agreed in the contract, pay the settlement payment for the construction process in the proportion agreed in the contract, and the payment proportion of the settlement payment for the construction process shall be more than 80%
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Government invested projects shall ensure that the funds are paid in place on time in accordance with the relevant provisions of the state, and the unfinished audit shall not be used as a reason for delaying the settlement of project funds
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On July 23, 2020, Henan Provincial Department of housing and urban rural development issued the guidance on the implementation of project construction process settlement
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According to the Interim Measures for settlement of construction project price, the settlement scope of construction project price includes project advance payment, project progress payment and project completion price settlement
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Settlement and payment: the payment cycle of process settlement shall be consistent with the process settlement cycle agreed in the contract
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When the divisional works are accepted, in principle, the project payment settlement shall be completed simultaneously, and the settlement shall not be delayed in disguised form for reasons such as design change and project negotiation
The settlement of the construction process shall be implemented for the housing construction and municipal infrastructure projects and their ancillary facilities, as well as the supporting lines, pipelines and equipment installation projects newly started and with a construction contract construction period of more than one year
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The settlement period can be divided according to the construction image progress or construction time period, and it is clear that changes, visas, claims and other matters shall be included in the current process settlement
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On April 8, 2021, Shaanxi Province issued the notice on settlement during construction of housing construction and municipal infrastructure projects
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The construction process settlement shall be measured and priced for the qualified project according to the contract, the non controversial part shall be settled in the construction process on schedule, and the controversial part shall be handled according to the dispute resolution method agreed in the contract
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The so-called construction process settlement refers to the calculation, adjustment, confirmation and payment of the project price for the project contents (including on-site visa, project change, claim, etc.) completed within the agreed settlement period (time or progress node) according to the construction contract
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After completion, the process settlement results will not be audited again
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On September 23, 2020, the official website of the Ministry of housing and urban rural development issued the notice on implementing the primary responsibility for project quality of the construction unit, strictly implementing the primary responsibility for project quality of the construction unit
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Settlement basis: including but not limited to construction contract, supplementary agreement, letter of acceptance, construction drawings, project bidding documents, construction scheme, quantities of completed sub projects and measures, confirmed project changes, on-site visa, project claims and other data
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Source: the official website of the Ministry of housing and urban rural development and the websites of local housing and urban rural development departments have comprehensively sorted out the executive meeting of the State Council at the beginning of 2020, which clearly requires that process settlement be fully implemented in the field of engineering construction, and the promotion of replacing the margin of the construction unit with the letter of guarantee should be strengthened
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The construction unit shall provide a guarantee for the payment of the project funds
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The construction process settlement documents shall be signed by the registered cost engineer responsible for preparation and review, and stamped with the special seal for practice and the seal of the preparation unit
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The employer shall pay the settlement price during the construction process according to the procedures, time limit and proportion agreed in the contract
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Scope of application: the construction, decoration, installation of supporting lines, pipelines and equipment and municipal infrastructure projects of various housing buildings and their ancillary facilities with a contract period of more than one year (including this number), and the settlement of the construction process
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Strengthen contract management and reduce the workload of engineering construction change adjustment
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On March 16, 2021, Jilin Provincial Department of housing and urban rural development issued the implementation opinions on the implementation of construction process settlement in housing construction and municipal infrastructure projects
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The employer and the Contractor shall settle the construction process according to the construction process settlement node agreed in the contract
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The construction contract shall specify the settlement period of the construction process and the settlement method of the project progress payment
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Compared with completion settlement, the implementation of construction process settlement is mainly used to standardize construction contract management, avoid disputes between the employer and the contractor, save audit costs, effectively solve the “settlement difficulty” and prevent migrant workers from being paid in arrears from the source
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