1. Definition and characteristics of general engineering contracting

The engineering general contracting (EPC) model originated in the United States in the 1980s and has rapidly developed and matured in the international engineering construction market. It has now It has become an internationally accepted method for organizing and implementing engineering construction projects. According to the different links involved in the value chain, the general engineering contracting model can be mainly divided into the following models:

1

"Engineering, Procurement and Construction" general contracting (EPC): the contractor is responsible Work on the entire process of engineering project design, procurement, construction and installation, and deliver projects that are qualified for use to owners. This is the most typical general contracting model.

2

"Design and Build" general contracting (DB): The contractor is responsible for the design and construction services of the engineering project.

3

"Design and Procurement" general contracting (EP): The contractor is responsible for the design and procurement of the project, and may also provide consulting services to the owner during the construction stage, or be responsible for construction management . The construction of the project is contracted by other contractors.

4

"General Contracting" (GC): The contractor is mainly responsible for construction and installation and does not participate in other links in the value chain.

5

"Turnkey" project general contracting (Turnkey): It is an extension of EPC project general contracting. It can be extended forward to feasibility study and backward to start-up operation. .

Compared with other models of construction project management, the EPC model has the following characteristics:

Using a fixed-price contract

EPC The contract adopts a fixed-price contract, that is, the final settlement price of the project is the total contract price plus possible adjustments. Under normal circumstances, it is rare for the owner to allow the contractor to adjust the contract price due to changes in costs. Adjustments can only be made when the owner changes the scope of construction, construction content, etc. Therefore, the EPC model places high demands on the contractor's quotation capabilities and risk management capabilities. In actual operation, in order to reasonably control the risks of lump sum contracts, the EPC model is generally used for projects with clear construction scope, construction scale, construction standards, functional requirements, etc.

The owner or the entrusted owner's representative manages the project

Under the EPC model, the owner mainly binds the general contractor through the general engineering contract to ensure the realization of the project goals. In this model, the owner does very little management work, and generally manages the project himself or entrusts the owner's representative. Under normal circumstances, the owner's representative will be considered to have all the rights agreed by the owner under the contract to complete the tasks assigned to him by the owner. The owner rarely interferes or basically does not interfere with the contractor's specific work, and only coordinates and controls the general contracting project in an overall, principled and targeted manner.

The contractor bears most of the risks

Under the EPC model, the general contracting enterprise bears most of the responsibilities and risks. The general contractor needs to be responsible for the safety, quality, and safety of the project. Fully responsible for progress and cost. 2. Definition and service scope of full-process engineering consulting

The definition and service scope of full-process engineering consulting are described in the pilot work plans for full-process engineering consulting in some provinces.

The "Hunan Province Whole-Process Engineering Consulting Pilot Work Plan" issued by Hunan Province mentions:

"Full-process engineering consulting means that the owner will provide engineering consulting services during the project construction process. The entire project is entrusted to a company, which provides engineering consulting services such as project planning, feasibility studies, environmental impact assessment reports, engineering surveys, engineering design, project supervision, cost consultation and bidding agency. ”

Fujian Province’s pilot plan lists the service contents of full-process engineering consulting:

Full-process engineering consulting services include but are not limited to project decision-making and planning, preparation of project proposals and feasibility study reports, Project management activities such as overall project implementation planning, project management, approval and construction management, survey and design management, planning and design optimization, project supervision, bidding agency, cost consultation, post-evaluation and cooperation with audit, may also include planning, survey and design and other engineering design activities.

This means that a project construction can adopt the general contracting model, or a project management company can be entrusted to supervise it at the same time. Enterprises that provide full-process engineering consulting services use their professional knowledge in management, technology, law, etc. to accept the owner's entrustment and provide guarantees for the smooth progress of the project through supervision, management and consulting services for the general contractor. It is conducive to the healthy development of the general engineering contracting market.