CONSTRUCTION AND RELATED ENGINEERING
SERVICES
Karsten Steinfatt
Organization of American States
Trade Unit
First revision
December 4, 2001
The construction process involves a myriad of services activities that can be grouped into two
broad categories. The first category is commonly known as engineering design services. It
encompasses both architectural and engineering inputs, including project feasibility studies,
conceptual design, cost estimations, site planning, structural analysis, and preparation of detailed
drawings and specifications. The second category is composed of those services that make
physical construction possible, including activities relating to procurement of supplies,
mobilization of labor and equipment, and management of projects. Even though construction
firms often provide both types of service categories, this template focuses almost exclusively on
the second category (construction services), leaving the treatment of architectural and engineering
services to the template on professional services. It should be recognized, however, that the
supply of construction-related engineering services involves services provided by professional
engineers, and that there is considerable overlap between the two categories of services. For this
reason, a complete picture of policy and performance in construction and related engineering
services can only be obtained through a careful assessment of the data resulting from both this
template and the template on professional services.
Note: Unless otherwise specified, please give information for the latest year available and
indicate which year. Sections D, H, I, and J ask for time series data for the period 1990-2000. If
time series data are not available, please collect indicators for the years 1990, 1995, and 2000.
If insufficient space is provided, please attach additional information on separate sheets. Please
report all monetary values in their reported currencies.
A. Market Access
Commercial presence
1. Are there policy restrictions on new entry of construction firms?
Entry by any firm
 No
 Yes
If yes, total number of
firms allowed
Entry by foreign
firms
 No  Yes
If yes, total number of
foreign firms allowed
2. If entry is restricted, what are the reasons provided by the government?
 To give incumbent firms time to prepare for competition
 To increase government revenue from privatization or license fees
 Strategic activity reserved to the state
 Inadequate regulatory and supervisory capacity
 No perceived economic need for new construction firms
 Other: ________________________________________
1
3. Which of the following services are locally established foreign construction firms permitted to
provide?
 General construction work for buildings
 General construction work for civil engineering
 Installation and assembly work
 Building completion and finishing work
 Pre-erection work at construction sites and other work
4. Are foreign construction companies required to establish locally through a particular legal
form of establishment (i.e. subsidiary, branch, representative office)?
 No
 Yes
If yes, please specify the legal form of establishment that is required:
 Subsidiaries
 Branches
 Representative Office
If no, which of the following legal forms of establishment are allowed for foreign construction
firms?
 Subsidiaries
 Branches
 Representative Office
 All
5. Are foreign construction companies required to form one or more joint venture(s) with
domestic companies in order to provide services to the domestic market?
 No  Yes
6. Are there restrictions as regards the joint venture(s)/partnership(s)/association(s) that locallyestablished foreign construction firms can form with domestic firms?
 No
 Yes
7. Does the state hold exclusive rights in the construction of:
Highways
Bridges
Airports
Ports
Power plants
Water and sewage systems
Other: _______________
 No
 No
 No
 No
 No
 No
 Yes
 Yes
 Yes
 Yes
 Yes
 Yes
If yes, are there mechanisms (e.g. concessions) that allow for participation by:
Domestically-owned private companies
 No  Yes
If yes, please specify the type of mechanism
that exists:_____________
2
Foreign (locally established) companies
Foreign (non locally established) companies
 No  Yes
If yes, please specify the type of mechanism
that exists:_____________
 No  Yes
If yes, please specify the type of mechanism
that exists:_____________
8. Are there limitations on the contract amount accessible to locally established foreign firms?
 No
 Yes
If yes, please specify what the maximum contract amount is: _____________________
9. Are there restrictions on the use of the international/foreign name of a firm?
 No
 Yes
10. Are there restrictions on the temporary intra-firm transfer of:
 Construction machinery
 Technical and training manuals
 Engineering software and design tools
 Other: ___________
Movement of natural persons
11. Are there residency or nationality requirements for any of the following categories of
personnel employed by locally established foreign construction companies?
Minimum number/percentage of
nationals/residents (please specify)
Members of the board of directors
Executives
Managers
Unskilled workers
Other staff (specify):
12. Identify the categories of intra-corporate transferees whose entry and stay is subject to labor
market tests





Members of the board of directors
Executives
Managers
Unskilled workers
Other staff (specify):
3
B. Ownership
13. Is private ownership in the provision of construction services allowed?
Existing firms
 No  Yes
Maximum private
equity permitted (%)
New firms
 No  Yes
Maximum private equity
permitted (%)
14. Is foreign ownership in the provision of construction services allowed?
Existing firms
 No  Yes
Maximum foreign
equity permitted (%)
New firms
 No  Yes
Maximum foreign equity
permitted (%)
C. Government Procurement1
15. In-House Construction
Does the government have an in-house construction department?
 No
 Yes
If yes, under what circumstances is the procuring entity required to resort to the in-house
procurement department?
 Value of services to be procured is low (please specify: ______________________)
 In-house construction department is lowest cost supplier
 Strategic projects (please specify:_____________________________)
 Procurement is confidential or sensitive (please specify: ____________________)
 Urgency (please specify: _____________________________)
 Other: _____________________
16. Foreign Participation in the Procurement Process
Can foreign companies participate in the procurement of construction services by:
Central entities
Sub-central entities
Local entities
State-owned enterprises
Locally established foreign
companies
 No  Yes
 No  Yes
 No  Yes
 No  Yes
Foreign companies with no
commercial presence
 No  Yes
 No  Yes
 No  Yes
 No  Yes
If yes, specify the thresholds, if any, that apply for:
Locally established foreign
companies
1
Foreign companies with no
commercial presence
The term “procurement” as used in this section refers to procurement of public construction works.
4
Central entities
Sub-central entities
Local entities
State-owned enterprises
In those cases where foreign companies are allowed to participate in the procurement process,
does the law restrict their role to acting as sub-contractors (as opposed to prime contractors)?
 No  Yes
17. How are invitations or solicitations to bid for a construction project made public?
 Published in an official gazette
 Published in a newspaper/magazine/journal
 Published in an official website
 Other: _____________________
17a. Are there requirements to make the invitation or solicitation to bid available in more than
one language?
 No
 Yes
If yes, please specify in which language(s): _____________________________________
18. Which of the following non-price criteria must procuring entities take into account during the
suppliers’ evaluation processes?
Attribute
Use of local materials
Licensing of technology to local firms
Investment in home country
Employment in home country
Other (please specify):
Taken into account during evaluation
process?
 No  Yes
 No  Yes
 No  Yes
 No  Yes
19. In evaluating procurement contracts, do procuring entities at the central, sub-central or local
levels grant price advantages to:
Domestically owned companies
Central entities
Sub-central
entities
 No  Yes
If yes, specify the amount of the price
advantage: _______
 No  Yes
If yes, specify the amount of the price
advantage: _______
Locally established foreign
companies
 No  Yes
If yes, specify the amount of the
price advantage: _______
 No  Yes
If yes, specify the amount of the
price advantage: _______
5
Local entities
State-owned
enterprises
 No  Yes
If yes, specify the amount of the price
advantage: _______
 No  Yes
If yes, specify the amount of the price
advantage: _______
 No  Yes
If yes, specify the amount of the
price advantage: ______
 No  Yes
If yes, specify the amount of the
price advantage: _______
20. Are entities required to publish, or provide to unsuccessful bidders, pertinent reasons for the
rejection of their bids?
 No
 Yes
21. Does the procurement law provide for a system of review of bidder complaints?
 No
 Yes
D. Market Structure
22. Share of construction in total GDP (1990-2000): _________
23. Total number of construction firms in the market: ______
24. Please list the characteristics of the 10 largest construction firms in terms of revenue (most
recent year available):
Name of
firm
Year of
establishment
Domestically
owned equity
(%)
Foreign
equity
(%)
Domestic
market
share
Ratio of
foreign
contracts to
total
contracts
Three principal
foreign markets
(if applicable)
25. Please provide the following information:
Number of fully state-owned construction firms: _____
Number of fully domestically owned2 private construction firms: _____
Number of foreign minority-owned3 construction firms: _____
2
3
Firms that are not state owned where the paid-up share capital is entirely held by domestic residents.
Firms where foreigners hold under 50% of the paid-up share capital of the firm.
6
Number of foreign majority-owned4 construction firms: _____
E. Regulation
26. Characteristics of regulator
Name of regulator:
Year of establishment:
% of Regulator’s finances from:
License and other fees: _____
Budgetary allocation: _____
Other (specify): _____
Is the regulator independent of the relevant Ministry(ies)?
 No  Yes
Number of professional staff employed by Regulator: _______
27. Licensing
a) If the number of providers is not restricted by policy, specify the types of licenses that
providers must obtain in order to operate in the domestic market; the body(ies) responsible
for issuing the licenses; whether the license is required by domestic or foreign companies (or
both); whether foreign construction companies are subject to different or additional licensing
conditions from domestic companies; and whether the validity of the license is restricted
temporally or geographically. Use the list below to fill in the column on “main conditions.”
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Payment of license fee (indicate amount)
Minimum capital (indicate amount)
Tax declaration
Bank references
Deposit of a cash bond (indicate amount)
Experience in the field of construction (specify)
Information on projects performed during the past x years (specify)
Certificates assessing conformity with quality assurance systems
Enrolment in a professional or trade register
Proof of the professional qualifications of the staff member(s) primarily responsible
for providing the services
11. Other (specify)
Type of
license
Issuing
body
Required by?
 Domestic
 Foreign
 Domestic
 Foreign
 Domestic
 Foreign
4
Main
conditions
Specify any
additional
conditions for
foreign suppliers
Validity
restricted
temporally?
Validity
restricted geographically
 No
Yes
 No
Yes
 No
Yes
 No
Yes
 No
Yes
 No
Yes
Firms where 50% or more of the paid-up share capital of the firm is held by foreigners.
7
b) If the number of providers is limited by policy, through what mechanism are licenses
allocated?
 First come, first served basis
 Competitive bidding
 Discretionary decision by the issuing body
 Other:_______________________________
28. Prior to and during the performance of a construction contract, construction companies must
fulfill certain regulatory requirements specific to that particular contract. The table below lists 3
common categories of regulations faced by construction companies. For each one of them,
specify the level (central, sub-central, local) at which they are administered, and indicate whether
foreign construction companies are subject to different requirements from domestic companies.
For those regulations that are administered and applied at the sub-central or local levels, answer
the questions by referring to a state/province/municipality of your choice. Please note that this
question focuses on regulations that must be fulfilled in the context of a particular construction
project, not regulations that apply horizontally to all construction service providers.
Type of regulation
Level of government
(check as many as
apply)
Building regulations and technical
requirements
 Central
 Sub-central
 Local
 Central
 Sub-central
 Local
 Central
 Sub-central
 Local
Building permits and inspection
Registration of proprietors,
contractors and professionals
Different requirements for
domestic and foreign
companies? (If yes, please
specify);
 No  Yes
 No
 Yes
 No
 Yes
29. Are there restrictions on the purchase of land by nationals and/or foreigners?
 No
 Yes
If yes, provide a brief description of the restrictions currently in place, the reasons provided by
the government, and explain whether the restriction applies to foreigners only?
Brief description of the
restriction
Reason provided by government
Applies to foreigners only?
 No
 No
 No
 Yes
 Yes
 Yes
30. Are fees and remunerations resulting from the provision of services in one of the following
areas currently regulated?
 General construction work for buildings
8
 General construction work for civil engineering
 Installation and assembly work
 Building completion and finishing work
 Pre-erection work at construction sites and other work
31. Are professional bodies or industry associations involved in specifying prices or establishing
pricing guidelines?
 No
 Yes
32. Are foreign construction companies required to train local staff?
 No
 Yes
33. Which of the following government programs are available to construction companies?
Program
 Direct payments
 Tax breaks
 Preferential access to credit
 Below-market interest rates
 Export financing
 Government-provided risk insurance
(including inflation protection programs)
 Underwriting of feasibility studies
 Reimbursement of bid preparation costs
 Other: _______________
Available to foreign construction companies
established locally?
 No  Yes
 No  Yes
 No  Yes
 No  Yes
 No  Yes
 No  Yes
 No
 No
 No
 Yes
 Yes
 Yes
34. Public consultation and transparency
a) Which of the following are consulted in advance of regulatory decisions?
 Service providers
 Consumer groups
 User industries
 Other: _____________________
b) How are laws and regulatory decisions made public?
 Published on the regulator’s website
 Published in an official gazette
 Other: _____________________
F. Regional Integration Agreements in Construction Services
9
35. Please indicate if there are any preferential arrangements affecting construction services, and
list the preferential measures.5 Note that agreements affecting government procurement of
construction services should be listed under section C. above.
Name of
agreement
Partner
country(ies) in
agreement
Date of entry
into force
Preferential measures
G. Past and Future Changes in Policy
36. Please indicate major changes in market access policies, ownership rules, and regulation
since 1985 (e.g., liberalization of the foreign investment regime, introduction of regulatory
reform and administrative simplification programs, reforms of procurement laws and regulations,
etc.). If possible, attach copies of laws and regulations.
Area of policy change (market
access, ownership or
regulation)
Year of
change
Brief description
37. Please indicate announced or anticipated changes in the same areas.
Area of policy change (market
access, ownership,
government procurement, or
regulation)
Anticipated
date
Description of change
H. Employment
38. Main indicators (for the years 1990-2000).
How many people are employed in the construction sector? __________
5
Please specify how the treatment of construction companies of member countries of the agreement differs
from the treatment of companies of non-member countries.
10
What share of the total labor force is directly employed in this sector? __________
What share of workers is employed by foreign-owned operators providing construction
services? __________
What share of the construction labor force is employed directly by the government (including
state-owned construction firms)? __________
What is the annual average wage in this sector?________
If available, please attach time series data on these employment indicators separately. If time
series data from 1990 to 2000 are not available, please collect indicators for the years 1990, 1995
and 2000.
H. Trade and Investment
39. Investment indicators (for the years 1990-2000)
What is the total value of the foreign contracts awarded to locally established firms?
__________
What is the total value of domestic contracts awarded to foreign firms? __________
What is the total amount of investment in construction services? __________
What is the total amount of foreign direct investment in this sector? __________
What is the total stock of foreign direct investment in this sector? __________
If time series data from 1990 to 2000 are not available, please collect indicators for the years
1990, 1995 and 2000.
I. Prices and Access to Construction Services
40. Please provide information on the value per square meter of new buildings completed6 for
the latest year available. For a comprehensive assessment of construction sector performance, it
would be extremely useful to have historical data on this indicator. If time series data are
available, please attach them separately for the period 1990-2000 (preferably electronically).
All buildings
Value7 per square meter
Residential buildings8
Value per square meter
Industrial buildings9
Value per square meter
“New” construction refers to the erection of an entirely new structure, whether or not the site on which it
is built was previously occupied. Extensions (i.e. enlargement of existing buildings by which space is
added) are generally included under new construction. “Building” is defined as an independent structure
comprising one or more rooms or other spaces, covered by a roof, enclosed with external walls or dividing
walls, which extend from the foundation to the roof and intended for residential, industrial, commercial,
educational, etc. purposes.
7
“Value” refers to the value actually paid for a completed building. The value of land is not included.
8
A building should be regarded as residential when the major part of the building (i.e. more than half of its
floor area) is used for dwelling purposes. Other buildings should be regarded as non-residential.
9
All buildings which are used to house the production, assembly and warehousing activities of industrial
establishments, i.e. factories, plants, workshops, etc.
6
11
Commercial buildings10
Value per square meter
Educational buildings11
Value per square meter
Health buildings12
Value per square meter
Other buildings13
Value per square meter
41. Please list all major civil engineering projects (roads, bridges, airports, power plants) in
excess of USD 7 million completed in your country during the past five years.
Brief description of
Value
Date of
Principal
Is the contractor a
the project
completion
contractor
foreign majority
owned firm?
 No  Yes
 No  Yes
 No  Yes
 No  Yes
 No  Yes
Please, provide the name and contact information of the respondent of this questionnaire, or of a
specialist from whom we can obtain clarifications if necessary.
Name________________________________________________________________________
Telephone_____________________________________________________________________
Fax__________________________________________________________________________
E-mail address:_________________________________________________________________
10
Office buildings and all buildings which are intended for use primarily in wholesale, retail and service
trades, i.e., hostels, restaurants, shops, warehouses, public garages, etc.
11
All buildings which are intended for use directly in the instructional activities, furnishing academic and
technical courses, i.e., schools, universities, etc. as well as museums, art galleries, libraries, etc.
12
All buildings which are primarily engaged in providing hospital and institutional care, i.e., hospitals,
infirmaries, sanatoria, etc.
13
Buildings which are not included in any of the above classifications, i.e., public, religious, amusement,
sport, recreational and community buildings, non-residential farm buildings, etc.
12
Annex
Additional Questions on Government Procurement
Procurement Process
A1. Are there requirements for publication of annual notices of planned procurement?
 No
 Yes
If yes, specify how these notices are made public.
 Published in an official gazette
 Published in a newspaper/magazine/journal
 Published in an official website
 Other: _____________________
A2. Are the criteria for award of contracts made available in advance to potential suppliers?
 No
 Yes
A3. Are there any charges for obtaining the full set of tender documents?
 No
 Yes
If yes, specify how these charges are set:
A4. Do national procurement laws and regulations establish a minimum time frame for the
preparation and submission of bids?
 No
 Yes
If yes, please specify what the minimum time frame is: ________________
A5. In cases where procuring entities maintain permanent lists of qualified suppliers, are these
entities required by law to publicize the existence of such lists?
 No
 Yes
A6. Are permanent lists of qualified suppliers open for participation by:
Foreign (locally established)
Foreign (non locally
Domestic companies
companies
established) companies
 No  Yes
 No  Yes
 No  Yes
A7. Are potential suppliers required to obtain any of the licenses specified under question 27 in
order to participate in the procurement process?
13
 No
 Yes
If yes, specify which licenses:
A8. Do national procurement laws and regulations express preference for performance
characteristics and international standards in defining how procuring agencies must draft
procurement requirements or technical specifications?
 No
 Yes
A9. Are there legal requirements for successful foreign bidders to sub-contract certain elements
of a construction project to domestic companies?
 No
 Yes
A10. As a rule, is the successful bidder required to make a deposit or guarantee prior to
commencing the construction work?
 No
 Yes
If yes, specify the amount of the deposit or guarantee:
A11. Do procurement laws and regulations identify open tendering (as opposed to sole-source
procurement or restricted tendering) as the “normal” or “preferred” procurement method?
 No
 Yes
If yes, which factors warrant the use of sole-source or restricted tendering?
 No satisfactory offers have been obtained in the open or selective procedure
 Tenders submitted have been collusive
 Service is available only from one source or from a limited number of bidders
 Procuring entity is unable to provide complete technical specifications
 Value of services to be procured is low
 Unforeseen circumstances making additional construction services necessary which cannot be
separated from the initial order
 Urgency
 Procurement is confidential or sensitive (please specify: ____________________)
 Open tendering is not in the public interest (please specify: __________________)
 Other: _____________________
A12. Are there requirements to maintain minutes or a record of the procurement
proceedings?
 No
 Yes
If yes, are these records available for consultation by unsuccessful bidders?
14
 No
 Yes
A13. Is a monitoring and oversight body of government procurement currently in place?
 No
 Yes
If yes, specify the following:
Name of body:
Year of establishment:
Is the body itself involved in procurement decision-making
(e.g. by conducting procurement proceedings or by having
ex officio seats on the tender committees of individual
ministries or other procuring entities)?
Number of professional staff:
 No
 Yes
15