How to control prepayment risk in construction enterprises

The key for construction enterprises to control the risk of prepayment lies in the safety of prepayment recovery and prevent prepayment from becoming default. Therefore, construction enterprises must strengthen contract control and visa management. First, choose reliable partners. For projects with a large amount of funds, the construction enterprise must first strictly examine the credit status of the partner, namely Party A, including the authenticity of the project and the registration of Party A, the source and availability of project funds, past performance, performance ability and social reputation. In the process of project operation, it is best to hire a professional lawyer as the project legal adviser to understand the above situation. The specific investigation of the first funded project includes the following aspects: 1, the legality of the project, 2, the purpose of the project, 3, the nature of the project land, 4, whether the project land is mortgaged, 5, the development prospect of the project, 6, the investigation of Party A. Second, carefully grasp the amount of advance payment. Construction enterprises should carefully calculate the amount of advance funds and do what they can. If the amount of advance payment is not agreed in the contract, but the lower limit or proportion of advance payment is agreed. In this case, the construction enterprise should carefully calculate the advance payment amount, fully predict the market risk, and prevent the substantial increase of the advance payment amount due to the price increase of materials. Third, strict contract signing management to avoid non-graduation disputes. In the process of contract performance, we should strictly exercise the visa right stipulated in the contract and standardize the operation process. In the process of project construction, prevent everyone from running away from business and signing contracts with others (such as purchasing and renting personnel, materials, machinery, etc.). ). Fourth, strive for the project payment guarantee of the construction unit. Although it is generally difficult to win the bid under the current conditions, as long as it can win the bid, it is very secure for the construction unit to recover the advance payment. Such as the construction unit to land use rights or other real estate as a guarantee to provide security. Fifth, be good at exercising the priority of compensation for the project price. Construction enterprises should submit construction settlement materials in time, do a good job of signature and evidence collection, and claim the priority of compensation within the statutory time limit. When the court hears the prepayment dispute, it generally regards the prepayment clause as valid. If there is interest in the prepayment clause, the bank loan interest shall be borne according to the fact that the prepayment is formed. Therefore, although construction enterprises use capital or advance funds to carry out construction, the monthly progress and payment of quantities should be declared according to normal quantities. After examination and confirmation by the supervisor and the construction unit, it will be used as the basis for the advance payment amount and interest prosecution in case of dispute. For more information about the author, please visit Meng Shengxiang, a lawyer recommended by Chongqing Law Express, practicing in Chongqing Kunde Law Firm, and the chief lawyer of Omni-directional Law Network. During his many years of practicing as a lawyer, he has been widely involved in litigation and arbitration in civil, criminal and administrative fields, as well as commercial legal affairs such as companies, construction projects, real estate and patent infringement. , and accumulated rich practical experience and professional knowledge in various fields, and gradually moved towards the road of professional development. Now he is mainly engaged in theoretical and practical research on criminal defense, construction engineering and patent infringement business.