Acceptance of completed construction works upon repair and renovation: Obligations of project owners and common legal risks

In practice, when engaging contractors to carry out repair and renovation works, many project owners tend to assume that the legal responsibilities related to the acceptance of completed works primarily rest with the contractors. However, under Vietnamese construction laws, the project owner remains the principal party responsible for organizing the acceptance of completed works, preparing the completion dossier, and carrying out the relevant procedures before the project is put into operation and use. Within the scope of this article, the author analyzes the obligations and key legal issues that project owners should pay particular attention to in relation to the acceptance of completed construction works when hiring contractors for repair and renovation activities. 

1. Organization of acceptance  

1.1 Responsibility for organizing acceptance 

Regardless of whether the project owner engages a contractor to carry out the construction works, the project owner remains responsible for organizing and directly participating in the acceptance of the completion of all work items and the construction works before they are put into use, provided that all statutory conditions are satisfied, including:⁹ 

• Construction jobs have been fully performed under the approved design dossier; 

• Acceptance of construction jobs, parts and phases during construction has been fully carried out; 

• Results of experiments, examination, inspection, testing and trial operation are up to technical requirements as stated in construction designs; 

• Compliance with regulations on fire prevention and fighting, environmental protection during construction, and other relevant specialized laws. 

1.2 Participants in the acceptance process 

The project owner must ensure that the acceptance of completion of construction items or construction works is conducted with the full participation of all relevant parties as required by law, and that such participants duly sign the acceptance minutes.¹⁰ Specifically, the participants include: 

• Legal representatives of the project owner or an authorized person; 

• Legal representatives of the construction supervision contractor and chief supervisor; 

• Legal representatives, site managers, or project managers of main construction contractors; or legal representatives, site managers or project managers of each member of the joint venture, in case of joint venture contractors; 

• Legal representatives and chief designers of the design contractor when requested by the project owner; 

• Legal representatives of the competent authority to sign the project contract or an authorized person in case of investment in the PPP form. 

Where the composition of participants in the acceptance process does not comply with applicable legal requirements, the project owner may be deemed to have conducted acceptance in violation of the prescribed order and procedures. For such violation, the project owner may be subject to an administrative fine ranging from VND 20,000,000 to VND 40,000,000.¹¹ 

2.  Inspectionof acceptance of completed construction works

Under Vietnamese laws, the following construction works are subject to inspection of acceptance upon completion by the competent state authority:¹² 

• Construction works of important national projects; large-sized works involving complicated technical requirements specified in Appendix VIII of Decree No. 06/2021/ND-CP; 

• Construction works using public investment funds; 

• Construction works having great impacts on community safety and interests in accordance with regulations on management of construction investment projects other than the two categories mentioned above. 

In practice, foreign-invested enterprises leasing factories commonly carry out repair and renovation work to meet their production and business needs. Such enterprises should note that industrial construction works classified as Grade III or higher are deemed to have a great impact on community safety and interests and therefore are subject to inspection of acceptance by the competent authority prior to being put into operation or use in accordance with applicable laws. 

Note: At least 15 days prior to the expected date of acceptance of completion for special-grade or grade-I works, or at least 10 days for other works, the project owner must submit one (01) dossier requesting inspection of acceptance, in accordance with Appendix VI of Decree No. 06/2021/ND-CP, to the competent authority.¹³ 

Failure by the project owner to submit a written request to the competent construction authority for inspection of acceptance as required may result in an administrative fine ranging from VND 20,000,000 to VND 40,000,000. In addition, the project owner may be compelled to submit such request within ten (10) days from the date of issuance of the administrative sanction decision.¹⁴ 

3. Quality management dossier to be requested from the construction contractor

As the project owner is required to organize the preparation of the construction completion dossier in accordance with Appendix VIb of Decree No. 06/2021/ND-CP prior to putting any construction item or the construction work into operation or use,¹⁵ the project owner should require the construction contractor to hand over in full the quality management dossiers that the contractor is obligated to prepare and retain during the construction process. Such dossiers include but not limited to the following documents: 

• As-built drawings of the construction work and/or construction items; 

• Documents evidencing the origin and quality standards of materials and equipment, including: certificates of origin, product labels, declarations of applicable standards for products and goods; certificates of conformity, declarations of conformity, and notices of receipt of conformity declarations issued by competent authorities; and certificates of standard conformity (if any), in accordance with the Law on Product and goods quality; 

• Monitoring, measurement, and testing results obtained during the construction process (if any); 

• Minutes of acceptance of construction works, and acceptance of construction parts or construction stages (if any) during the construction process; 

• Results of verification testing, quality inspection of the construction work, and structural load-bearing capacity tests (if any); 

• Quality management dossiers for equipment installed in the construction work, as prescribed in Article 12.5 of Decree No. 06/2021/ND-CP; and 

• Daily construction report. 

In the event of failure to retain the construction completion dossier, or to retain a complete set of documents as required by law, the project owner may be subject to an administrative fine ranging from VND 20,000,000 to VND 40,000,000, and may be required to retain or supplement the required documentation in full.¹⁶ 

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^{(9) Article 123.3 of the Construction Law 2014; Article 23.1 of Decree 06/2021/ND-CP.} 

^{(10) Article 23.7 of Decree 06/2021/ND-CP.}

^{(11) Article 18.1 and Article 4.3 of Decree 16/2022/ND-CP.}

^{(12) Article 1.45 of the amended Construction Law 2020; Article 24.1 of Decree 06/2021/ND-CP.}

^{(13) Article 24.6 of Decree 06/2021/ND-CP.}

^{(14) Articles 18.1 and Article 4.3 of Decree 16/2022/ND-CP.}

^{(15) Article 26.1 of Decree 06/2021/ND-CP.}

^{(16) Article 21 and Article 4.3 of Decree 16/2022/ND-CP.} 

Disclaimers:

This article is for general information purposes only and is not intended to provide any legal advice for any particular case. The legal provisions referenced in the content are in effect at the time of publication but may have expired at the time you read the content. We therefore advise that you always consult a professional consultant before applying any content.

For issues related to the content or intellectual property rights of the article, please email cs@apolatlegal.vn.

Apolat Legal is a law firm in Vietnam with experience and capacity to provide consulting services related to Construction and contact our team of lawyers in Vietnam via email info@apolatlegal.com.

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