REALWorld Law

Construction

'Fixed price contracts'

Is it possible for parties to enter into a construction contract where the price to be paid to the contractor is fixed?

Thailand

Thailand

Yes. The parties are able to fix the price for the entire work whereby the price is stipulated in the construction contract. Consequently, the contractor will take the risk of increasing costs, including materials and labour. This usually occurs in regard to public procurement.

Alternatively, payment in a construction contract may be split into separate stages. This usually occurs in regard to private procurement.