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Regulations of Fees and

Fees for Services


Architecture Professionals
College of Architects
Panamanian Society of Engineers and Architects

May 2007

Prepared by the College of Architects


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Architects Page1 of 48
May 23, 2007
Fees and Fees Regulation
Architecture Professionals
College of Architects
Panamanian Society of Engineers and Architects

Prepared by the Commission for the Regulation of Professional Fees and Fees for Architecture
coordinated by the Architects:
Manuel Choy and José Velarde
Drafting coordinated by the Architect:
Francisco J. Miguez P.
Reviewed by the following architects who are members of the commission:
(In alphabetical order)

Alberto Reyes Calama Jorge Vilas


Alfonso Pinzón Lozano José A. Cambric
Akriví Ruidiaz Magda Bernard
Francisco Barrios L. Rebeca Prado.
Gonzalo J. Neighborhoods D. Ricardo Arrue
Humberto Echeverria Valentin
Jaime Bermudez Monforte

Reviewed by the Architect:


Emilia Diez
President representing the Circle of Architects of Panama

Approved at the Ordinary Meeting of the College of Architects of the Panamanian Society
of
Engineers and Architects carried out on March 6, 2007

Director of the College of Architects


Architect Félix Guardia, Director

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May 23, 2007
Part 1
General Principles of Remuneration for
Professional Architectural Services

1 Legal basis and legal framework

Considering that:

Law number 15 of January 26, 1959, amended by law 53 of February 4, 1963,


which regulates the exercise of the engineering and architecture professions,
establishes that:

• Chapter I, Article 1: “To practice in the territory of the republic the


professions of Engineers and Architects and the activities of Surveyors and
Masters of Works, it is required to possess the Certificate of Suitability”

• Chapter 1, Article 9: “Every engineering or architectural work carried out


in the country must be, according to its nature, under the technical
responsibility of an engineer or an architect or a company that has suitable
professionals at its service.”

• Chapter II, Article 11: “For the purposes of this Law, a Technical Board of
Engineering and Architecture is created, composed of seven members and
two alternates, who will be suitable professionals.”

• Chapter II, Article 1, Section i: The powers of the Technical Board of


Engineering and Architecture will be: “To establish through consultation
with the Panamanian Society of Engineers and Architects and with
approval of the Executive Body, the minimum rate of professional fees for
engineering and architecture".

Decree number 175 of May 18, 1959, which approves the regulations of the
Technical Board of Engineering and Architecture, decrees that the following are
the powers of the Technical Board of Engineering and Architecture:

• Article I, Section 4, Section i: “Establish through consultation with the


Panamanian Society of Engineers and Architects, with Approval of the
Executive Body, the minimum rate of professional fees for engineering
and architectural services.”

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Resolution Number 183 of June 10, 1982 of the Technical Board of Engineering
and Architecture by which some measures are adopted in relation to Suitable
Professionals Responsible for Companies, Suitable Resident Professionals and
Suitable Professionals, who provide services in companies dedicated to branches
of Engineering and Architecture, establishes that:

• Literal F, The Professional fees referred to in the resolution will be


determined and calculated:

o For suitable professionals responsible to the Technical Board of


Engineering and Architecture in accordance with the minimum rate
approved by the Colleges of the Panamanian Society of Engineers
and Architects and according to the amount of works carried out by
the company in the field of specialization during the period of
execution of the work or professional service.

o For Suitable Professionals Resident Managers and Suitable


Professionals at the service of the company with the minimum rate
approved by the Colleges of the Panamanian Society of Engineers
and Architects, according to the specialization.

Decree number 257 of September 3, 1965, which regulates Law 15 of 1959,


establishes that:

o The Engineering and Architecture Technical Board will ensure


compliance with the minimum rate of professional fees for
engineering and/or architecture services and will apply the
corresponding sanctions to professionals who violate the
established rate.

2 General principles

2.1 Professional service standard


For editorial
convenience, the term
Architect has been Professional architectural services are framed in a standard of attention,
used in its masculine responsibility and care whose frame of reference is comparative. It is a service
form to
interchangeably
standard based on reasonableness of criteria, good faith in intentions, common
represent both the sense in decisions, good professional judgment and consistency in actions. It
masculine and is then understood that an architect has acted within the standard of the
feminine genders and
the plural .
profession when: “another suitable and competent architect, under equal
conditions, and subject to the same circumstances and environment, would
have acted

in the same way and manner.”

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2.2 Fundamental principle of remuneration for professional
architectural services

For the provision of professional architectural services, Architects have the


right to fair remuneration that compensates them for the costs they incur and
rewards them for the value they contribute, remunerating them with a profit
appropriate for the risk they incur and the effort they expend. apply. The
Architect's remuneration will be in accordance with the complexity, scope,
scope, circumstances and magnitude of the services performed, as well as the
quality, promptness and efficiency of execution, the technical capacity,
knowledge, resources and time required and, especially , due to the degree of
risk inherent in the services it provides and the professional, personal and
financial responsibility it assumes in relation to its services. This Regulation
of Rates and Fees establishes the base remuneration or minimum rates for
each type of service performed by the Architect in his liberal exercise of the
profession.

2.3 Hiring architectural services

The architectural services will be contracted based on the skills, capacity,


experience and merits of the Architect to carry out the required services and
not based on price, cost or a competition, contest or tender whose selection
criterion is totally or partially the price, costs or emolument of the services of
the Architect. It is based on the premise that the client's tacit and implicit
objective is to correctly, completely and timely carry out the required task or
project. The Client, whether private or a public entity, as a first order of
decision wishes to hire the appropriate Architect who has the qualifications,
knowledge, experience, competencies and merits necessary to perform the
professional services.

The Architect, by virtue of his certificate of professional suitability, is


responsible before society for providing regulated performance and within the
standard of professional service since he acts in practice as an agent of
technical protection of the State. In this sense, the Architect not only acts as
an advisor and consultant, providing technical knowledge and creativity for
the benefit of his Client and the project, but also plays a primary public role
of responsibility, protection and safeguarding before the citizens. Therefore,
it is in the best interest of the public that the professional services of the
Architect are complete, correct and sufficient, so the amount of his
remuneration cannot be a decision factor that interferes with the full
execution of his responsibility before the society.

In this way, market forces that stimulate competition based on price cease to
be a factor that could interfere with the performance of the guardianship
responsibilities that suitability grants to the Architect. Especially since before

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the law all Architects are equally skilled to practice the profession by virtue
of having professional qualifications accredited by the Technical Board of
Engineering and Architecture. In this sense, the State understands that for the
Architect to competently and fully carry out his function and the
responsibility before society that confers his suitability, he must have fair,
sufficient and appropriate remuneration for his effort, contribution and risk.

Furthermore, it is accepted that a large part of the services provided by the


Architect depend on environmental conditions, the performance of other
professionals and the intervention by the relevant authorities. These elements
of professional practice, which also involve a creative process that is difficult
to measure, are usually outside the sphere of control or influence of the
Architect and generate variability and uncertainty and make unpredictable the
resources that the Architect must provide in the execution of his professional
services. .

As a basic principle it is then understood that Architects must compete and be


hired based on merit for their skill, specialty, competence, understanding of
the Client's needs, qualifications, credentials, track record, past performance,
style, reputation, references, availability, resources, experience, specialty,
execution capacity and knowledge to perform the requested services and not
based on price, cost, rate, stipend, emolument or fee. Three modalities are
established to select professional architectural services:

C Comparative Selection. In the Comparative Selection modality, several


Architects are compared by their merits, competence, trajectory,
experience, and specialty, among other qualification factors (except price
or cost), and the selection is made by determining which Architect is the
most qualified to execute the project or perform the required professional
services.

C Architectural Competition. In the Architectural Competition modality,


Architects are invited to submit architectural solutions that resolve the
needs expressed by the applicant. Proposed solutions are evaluated for
their merits in solving the expressed needs and for their comparative
excellence as evidence of creativity and skill.

C Direct Selection . In this modality, the Architect is hired directly without


carrying out a comparison or a competition and said selection is not made
based on price, quote or cost of the services.

Price, costs, stipends, emoluments, fees or remuneration are not factors to be


used for the selection of the Architect.

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2.4 Remuneration for the liberal exercise of the profession

This Regulation of Rates and Fees for Professional Architectural Services


applies to regulate, through rates, the remuneration of the Architect in the
liberal exercise of the profession when acting in the capacity and capacity of a
consultant, advisor or designer as an independent professional, whether as a
natural person or legally, or individually or in accidental associations or in
teams and is hired by a Client. This Regulation of Rates and Fees for
Professional Architectural Services does not apply to salaries, such as in cases
where the Architect is a permanent or temporary employee or when he is
hired in the form of professional services where he has to comply with a
schedule and is find yourself subordinate to your employer's organizational
hierarchy as if you were an employee.

The Architect's rates developed in these regulations include all forms of


remuneration that may also be referred to as stipends, emoluments and fees.

Each Architect, in accordance with prevailing market conditions, is free to


establish and charge fees higher than the rates regulated here, but may never
quote, propose, tender or accept lower remuneration.

2.5 Taxes and fees

The rates indicated in these regulations exclude fees, levies or taxes that apply
to your professional services or that apply to procedures and approvals that
you must manage before governmental or autonomous entities as part of your
professional services. Exceptions from this exclusion are income tax and
educational insurance, as well as contributions to the Social Security Fund
that the architect must pay on a personal level.

2.6 Bonds, sureties and insurance

The rates established in these regulations do not include the costs of bonds,
guarantees, bonds or professional liability insurance or compensation policies
for professional malpractice or civil liability.

2.7 Withholdings and interest

The rates established in this regulation are calculated under the premise that
payments to the Architect are made in full and integrated with the periodicity
of progress of the Architect's work and professional services and that no
withholdings or partial discounts are made. In the event that the Client
requires partial withholding of payments accrued by the Architect, the
Architect's fee must be adjusted to compensate the Architect for the time
value of the money withheld. In these cases, the maximum legal interest rate

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applicable to short-term loans on credit cards in the local market will be used
to adjust the Architect's remuneration.

2.8 Inflation Adjustments

The rates denominated in absolute terms or in Balboas in this regulation will


remain in force during the year in which the regulation is issued. In
subsequent years, unless these rates are replaced by others, an automatic
escalation will be applied taking as a factor for the escalation the Consumer
Price Index for each year published by the Comptroller General of the
Republic or, failing that, the official inflation indicator applicable to the
Republic of Panama officially issued by the State.

2.9 Commissions on the value of materials and supplies

It is prohibited for the Architect to request or receive commissions, stipends,


perks, discounts, payments or royalties, in currency or in kind, for the
specification, recommendation or representation by brand or manufacturer in
the design, plans and specifications of materials, equipment or components.
for the project.

2.10 Intellectual property

The result of the Architect's professional practice, because it is a creative


activity that integrates science, art and technique, is the intellectual property
of its creator and, as such, is protected by the laws that deal with the matter.

The plans, drawings, graphs, infographics, sketches, models and documents


resulting from the work of the Architect, which define or outline the work in
any of its stages, cannot be modified or used by the Client, nor by other
professionals – without the consent author's express – if his professional fees
have not been paid.

Intellectual property occurs in each of the contractual stages (preliminary


studies, preliminary project and construction plans), including the technical
specifications, the budget, the work schedule, the bidding documents and is
extensive to the different components of these stages. , conception, analysis
and designs. Intellectual property cannot be sold or traded. The right to use is
sold or transferred and, even when the author gives up that use, he does not
lose intellectual property.

In this sense, the rates listed here do not include the transfer of intellectual
property and only transfer to the Client the right to use the product delivered
by the Architect for promotion, inspection, sale, construction, maintenance,
operation and exclusive and legitimate use of the project. . The physical

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products of professional services, such as plans, sketches, models,
specifications among other documents and instruments of professional
practice, in any format, are for the sole and exclusive use of the project for
which they were created and cannot be transferred or used in other projects or
for purposes other than those for which they were created.

The Architect reserves the custody and ownership of the plans and other
documents considered original prepared by him, which contain the seals,
signatures or approvals of entities that processed or approved them. The
professional fees listed here include the Architect providing the Client with a
reproducible copy of those originals that he reserves custody and ownership
of.

2.11 Pro Bono Work and Donation of Professional Services

The Architect may partially or totally donate his or her professional services
without violating these Fee Regulations as long as the donations are made
bona fide to relatives within three degrees of consanguinity or three degrees
of affinity and to legally registered non-profit organizations and when it is
reliably proven. the legitimacy of the donation. The donation cannot be
quoted as a reduction, discount or reduction of the established rates.

2.12 Payment in kind

The Architect may accept full or partial payment of his fees in kind. The
value of the asset used to pay the Architect must be valued at the commercial
value realizable at the time of the transfer of the asset to the Architect. The
value of the asset must be adjusted to reflect the additional cost that the
Architect must incur to sell it or convert it to its currency equivalent.
Accepting payment in kind is at the discretion of the Architect.

2.13 Homologation with rates for other disciplines

In accordance with the provisions of Law June 15, 1959, as amended by Law
53 of February 4, 1963 and its regulations, there are professional services that
can be performed either by Architects or by some engineering disciplines. In
cases where the rates of other disciplines for similar services are higher than
the rates indicated in these regulations, the rates of the other disciplines will
apply to the Architect's services.

Part 2

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DESCRIPTION OF PROFESSIONAL
ARCHITECTURE SERVICES

1 Architect's professional services

To establish the rates for the Architect's professional services, the services are
grouped into three categories of services: (1) Preliminary Services, (2)
Comprehensive Architectural Design Services and (3) Complementary
Services.

2 Preliminary services.
The Architect's services detailed below are considered preliminary because
they are executed in the form of an exploratory consultation or advice prior to
the signing of a formal contract for comprehensive Architectural Design
services or Complementary services.

2.1 Initial Customer Service. Receive the Client in the Architect's


office and dedicate the time and attention necessary to understand their needs
and requirements, to present qualifications and to respond to their request for
professional services.

2.2 Visual inspection of the project site. Visually inspect the project
site if necessary to prepare a proposal for professional services.

2.3 Preparation of a service proposal. Prepare a written proposal for


professional services in response to the Client's request. This proposal does
not include sketches, graphic concepts or designs and is limited to presenting
an understanding of the project as a basis for the future preparation of a
design program or a professional services plan. The proposal includes a draft
contract for professional services.

2.4 Communication of the proposal and contract. Assist the Client


in the Architect's office to present, explain, clarify and communicate the
content and scope of the proposal and the professional services contract.

The Architect shall be compensated for these preliminary services in


accordance with the Hourly Rates plus the Refundable Rates.

established in this regulation.

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3 Comprehensive Architectural Design Services
Comprehensive Architectural Design Services have been defined as those that
completely and comprehensively group the actions of architectural
programming, design, development of plans and specifications, drafting of
construction documents, plans approval procedures and advice to the Client
on the project. before and during construction. Comprehensive Architectural
Design Services will be remunerated with rates structured based on value 1
project estimate (see Table 2).

The rates for Comprehensive Architectural Design Services include only the
professional services of the Architect, architectural technicians, draftsmen and
the Architect's administrative and support team, as well as the resources and
supplies necessary to execute these services. Rates for Comprehensive
Architectural Design Services do not include:

3.1 Technical services, such as surveying, topography, surveys,


prospecting, inspections, soil studies, surveys, environmental studies,
among others

3.2 Engineering services, such as structural or civil design, electrical or


mechanical design, industrial and controls or systems design and electronic
design, among other types of engineering design that may be necessary in
the project.

3.3 Analytical services, such as economic studies, appraisals, feasibility


studies, financial studies, risk studies, due diligence and zoning change,
among others.

3.4 Support services such as mockups,


perspectives, infographics, videos, animations, renderings virtual,
functional models,
mathematical or static, photography or photomontages, commercial or
advertising graphics.

3.5 Legal services that may be required to manage or process project


approvals or requirements before relevant government agencies.

3.6 Fees for approval, management or processing of plans before the


pertinent government entities.

These services excluded from the rates for comprehensive architectural design
services will be governed by the rates that apply to each one.

When the Client so requests, the Architect may manage and contract the
1 The value of the project is understood to be all the costs required for its construction and start-up until its
occupancy permit, including services, materials, labor, supplies, consumables, taxes and fees, but with the
exception of the cost of the land and the financial costs.

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additional services needed. In such cases, the Client will reimburse the
Architect for the cost of the service contracted by the Architect plus the
applicable administration and contracting fee.

Comprehensive Architectural Design Services are segmented into five


components that are usually developed in sequential stages: (1) architectural
concept and programming, (2) design and preliminary project, (3)
development of construction plans, technical specifications and other
construction documents , (4) advice in the bidding process and (5) advice 2
during construction. The professional services of the Architect that are not
specifically included within the Comprehensive Architectural Design Service
are considered Complementary Services and the Architect must be specifically
and additionally remunerated for each of them.

3.1 Concept and architectural programming stage . The Architect's


services at this stage include:

3.1.1 Meetings and conversations with the Client to know, understand


and agree on their needs and project requirements.

3.1.2 Advice to the Client in relation to the programmatic needs of the


project.

3.1.3 Manage and present to the Client technical and economic


proposals for professional architectural design services and for each of
the technical and engineering disciplines that must intervene in the
project. Advise the Client in relation to the proposals presented by the
different professional designers from the technical and engineering
disciplines.

3.1.4 Research and presentation to the Client of municipal rules,


regulations, restrictions, permits, zoning and legislation applicable to the
project.

2 This advice during construction does not involve inspection or regular visits to the construction site. It is
limited to giving advice and clarifying aspects related to the plans and specifications prepared by the architect.

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3.1.5 Drafting the project design program and meetings to clarify,


define and agree on the final project design program.

Deliverable Product: At this stage the architect must deliver a proposal


for professional services that includes: (1) detail, description, scope and
scope of the professional services, (2) description of the project, (3)
approach and criteria to apply, ( 4), applicable rates and amounts (5)
work program and calendar, (6) draft contract for professional services.

3.2 Design and Preliminary Project Stage. The Architect's services at


this stage include:

3.2.1 Develop the conceptual design and schematic sketches of


operation and form. Present the concept, sketches, diagrams and
drawings of the project to the Client.

3.2.2 Adjust and complete the final design program.

3.2.3 Approval and adjust the conceptual design to the Client's


observations and recommendations. Present the final revised concept to
the Client for approval.

3.2.4 Develop the preliminary project plan and manage its approval
process before the relevant authorities.

Deliverable Product: At this stage the architect must at least deliver:


(1) five copies of preliminary project plans approved by the relevant
entities, (2) design program.

3.3 Construction Document Development Stage The Architect's


services at this stage include:

3.3.1 Develop the construction plan. It includes coordinating technical


and design aspects with design professionals from other disciplines on
the project. Coordination meetings with professionals from other
disciplines will be held in the offices or place of office or workshop of
the Architect.

3.3.2 Prepare (1) written reports and progress presentations to the


Client, (3) minutes of meetings and telephone communications, and (3)
administrative functions of the construction plan development process.

3.3.3 Prepare and present to the Client an estimated budget not


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Regulation of Architectural Professional Fees and Fees

breakdown of the direct and indirect construction costs of the project.

3.3.4 Write and develop Construction Documents that may include


technical specifications of the project, general conditions and special
conditions of the construction contract, among others.

3.3.5 Manage the plan approval process before the relevant


government entities.

Deliverable Product: At this stage the architect must deliver at least:


(1) five printed copies of final construction plans approved by the
relevant entities, (2) five copies of project technical specifications, (3)
five copies of the project reports. design of each technical and
engineering discipline on the project, (4) project budget, and (5) a
reproducible set of plans.

3.4 Bidding or contracting stage of construction. The Architect's


services at this stage include:

3.4.1 Advise the Client on the tender process and provide a list of
potential builders.

3.4.2 Manage the process of calling for construction proposals which


may include issuing plans and specifications to bidders, issuing
addendums, receiving and presiding over the opening of proposals,
writing a report on the results of the bidding and advising the Client
regarding the aspects technical conformation to the project of the
proposals.

Deliverable Product: At this stage the architect must at least deliver:


(1) five copies of the issued addendums and (2) bidding report.

3.5 Construction stage. The Architect's services at this stage include:

3.5.1 Answer questions that arise in relation to the plans,


specifications and other documents developed by the Architect.

3.5.2 Advise the Client in relation to the finishes, materials,


equipment, materials and systems of the project developed and specified
by the Architect.

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3.5.3 Manage the review and approval of project finishes, materials,


equipment and systems developed and specified by the Architect.

3.5.4 Carry out the design actions and development of plans that are
necessary to complete, clarify or rectify aspects of the project that were
part of their contractual responsibility with the Client.

3.5.5 Periodically visually review the project during its construction


and inform the Client in writing about aspects of the project that are
relevant to the interests and rights of the Architect and the Client. This
review service is intended to ensure that design criteria and conception
are preserved and is not intended to replace formal inspection or quality
control and assurance management, which is considered an independent
service.

Deliverable Product: At this stage, the architect must at least deliver


periodic reports as necessary to bring to the client's attention aspects
that are relevant in terms of cost, quality and execution time of the
project.

4 Complementary Professional Services


This section lists in abbreviated and general form the Complementary
Professional Services that the Architect can execute separately from the
Preliminary Services and the Comprehensive Architectural Design Services.
These Complementary Services have been grouped according to the stage or
cycle of the project in which they are usually required. The rates for
Comprehensive Architectural Design Services listed in Table 2 do not include
Complementary Services. In his proposed fee for Complementary Services,
the Architect must be remunerated in such a way that includes: (1) direct and
indirect costs of executing the services, (2) indirect administrative costs, (3)
remuneration for the Architect's personal time and ( 4) utility. The
complementary services that the Architect performs in the scope of his
professional practice are listed below.

4.1 Project administration and management

4.1.1 General project or construction administration


4.1.2 Hiring and administration of technical and engineering
disciplines during the design process and development of plans
and specifications.
4.1.3 Review, verification and quality control of documents Prepared
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construction, contract and project.


4.1.4 Consulting on regulations, management and procedures with
government agencies.
4.1.5 Coordination of data and information provided by the owner
4.1.6 Project schedule development and administration
4.1.7 Development of budgets and preliminary project cost estimates.

4.2 Pre-design and concept stage services

4.2.1 Development of the strategic plan for buildings, properties, fixed


assets, facilities and infrastructure.
4.2.2 Development of the design program and description of project
needs
4.2.3 Spatial schematics and volumetric graphic relationship.
4.2.4 Operation, process and flow diagrams.
4.2.5 Survey, measurement and drawing of existing structures and
buildings.
4.2.6 Condition studies and expert pathology of existing structures and
buildings.
4.2.7 Studies of economic and financial feasibility and cost benefit,
shadow price or profitability.
4.2.8 Project financing plan and cash flow schedule.

4.3 Project Site Development Services

4.3.1 Evaluation, comparison and site selection studies for projects.


4.3.2 Site development planning.
4.3.3 Detailed site utilization studies.
4.3.4 Site infrastructure studies.
4.3.5 Technical coordination and administration of Environmental
Impact Studies.
4.3.6 Consulting, management, processing and investigation of zoning
change.
4.3.7 Coordination technique and administration
of studies
soil conditions and geotechnics.
4.3.8 Coordination technique and administration
of surveying,
field measurements, landmark marking and topography.

4.4 Design services

4.4.1 Architectural design (Different from comprehensive


architectural services)

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architectural design3 )
4.4.2 Development of construction plans.
4.4.3 Design and distribution of furniture and equipment.
4.4.4 Management and approval process of the construction plan.
4.4.5 Interior design and decoration.
4.4.6 Gardening, landscaping and external setting design.
4.4.7 Writing and development of technical specifications.
4.4.8 Drafting and development of construction contract documents.

4.5 Builder negotiation, bidding and contracting services

4.5.1 Drafting and development of tender documents.


4.5.2 Organization and administration of the bidding process and act,
competition.
4.5.3 Drafting and development of addendums to construction
contracts.
4.5.4 Selection of possible bidders and evaluation for prequalification
of bidders.
4.5.5 Evaluation and analysis of tender proposals.
4.5.6 Homologation of specifications and proposals.
4.5.7 Assistance, advice and coordination of construction contract
negotiation.
4.5.8 Drafting and development of the construction contract

4.6 Contract administration and construction management


services.

4.6.1 Total administration and technical direction of construction4


4.6.2 Risk and mitigation studies.
4.6.3 Administration of the approval process of materials and
products.
4.6.4 Coordination of payments, audit of disbursements and financial
administration of the project.
4.6.5 Scheduling of works and development of Gantt or PERT
programs for the construction process.
4.6.6 Drafting change orders.
4.6.7 Project security management.
4.6.8 Evaluation of the builder's quality and safety plans.
4.6.9 Inspection, Assurance and quality control of construction.
4.6.10 Arbitration, mediation and technical representation.
3
It is understood that within a project design activities may be carried out by other Architects other than those
who develop Comprehensive Architectural Design Services.
4
Includes the technical direction of construction and responsibility for the management and control of financial
resources.

3for the project


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Regulation of Architectural Professional Fees and Fees

4.6.11 Administration of subcontractors and suppliers.


4.6.12 Purchases of materials, equipment and finishes.
4.6.13 Project completion management and administration services
4.6.13.1 Management and processing of public service
connections.
4.6.13.2 Final inspection and completion of slopes.
4.6.13.3 Equipment and systems test administration.
4.6.13.4 Closing of documentation and contract.
4.6.13.5 Management and processing of occupancy permits.

4.7 Technical inspection and construction quality control and


assurance services.

The Works Inspection and Quality Control and Assurance services


similarly apply to technical inspection when it is interchangeably
contracted by the promoter, the owner, the buyer, the builder or any
interested party of the project. The technical inspection and quality
control and assurance services will only execute the functions of
observing, documenting and reporting on the inspected and quality and
safety aspects of the project and their objective is to recommend actions
based on technical criteria that must be decided by those with
contractual or legal authority over the project.

These services do not include the Architect acting legally as an agent or


representative of the contractor. The inspection services indicated here
apply to the technical and professional field that grants the suitability of
the Architect where the components related to other disciplines such as
engineering will be inspected by qualified professionals in each of these
disciplines. The inspection fee includes the coordination by the architect
of the other technical and engineering disciplines involved in the
inspection but does not include the costs of fees for these disciplines.
Inspection, assurance and quality control services by the Architect may
include the following:

4.7.1 Prepare an inspection and quality assurance and control plan.


4.7.2 Coordinate, direct and supervise the implementation of a plan
comprehensive inspection and quality assurance and control,
as well as coordinating the inspection team that could be made
up of other technical and engineering disciplines.
4.7.3 Review the Quality Control Plan, materials, shop drawings and
as-built plans submitted by the builder.
4.7.4 Inspect visually and using instruments

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measurement that project components meet specified


contractual requirements.
4.7.5 Verify the progress of the construction process and
recommend whether or not to approve accounts, claims and
changes.
4.7.6 Inspect personal safety during the construction process.
4.7.7 Write daily inspection reports and weekly progress reports.
4.7.8 Carry out the final inspection of the project.

Inspection and quality assurance or quality control functions do not


include the following:

4.7.9 Design, surveys or as-built plans.


4.7.10 Procedures or procedures before government or private
entities.
4.7.11 Manage, direct, coordinate or supervise the project or carry out
any part of construction.
4.7.12 Act as the owner's agent with the authority to make decisions
as if he were the owner. The inspector's responsibility is
strictly technical and is limited to observing, documenting,
informing, advising and recommending actions that must be
decided and authorized by the owner.
4.7.13 Professional fees and direct or indirect costs of other technical
or engineering disciplines that are required to inspect the
project.

4.8 Construction financial or risk inspection services.

Financial or Risk Inspection services are usually contracted by the entities


that finance the project, such as banks and credit institutions, and the entities
that provide guarantees, bonds, sureties and insurance for the project, such as
insurers, sureties. and reinsurers. The Financial and Risk Inspection Services
aim to address all aspects of the construction process that may have an impact
on the profitability of financing and insurance, that put the recovery of loans
at risk or increase the probability of accidents. In this sense, the Financial or
Risk Inspection focuses on:

• Verify that disbursements from the project's financial entities


are applied correctly, timely and completely to the work.
• Verify that no aspect of the construction of the project may
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interim or mortgages on the property.


• Verify that the activities and situation of the builder,
contractors, suppliers and technical inspectors do not increase
the risk of the project, do not adversely impact its value, do not
delay it or put the recovery of financing at risk.
• Verify that the construction site is kept safe for participants
and that there are no unmitigated risks that could increase the
risk on insurance policies and guarantees.

Deliverable Product: At this stage the architect must at least:

4.8.1 Develop a financial and risk inspection plan


4.8.2 Coordinate the financial and risk inspection with the technical
inspection and quality control of the builder and suppliers.
4.8.3 Inspect visually and using measuring instruments that the project
components comply with the specified contractual requirements.
4.8.4 Verify the progress of the construction process and recommend
whether or not to approve accounts, claims and changes.
4.8.5 Inspect personal safety during the construction process.
4.8.6 Write daily inspection reports and weekly progress reports.

4.9 Post construction services.

4.9.1 Expert reports, certifications and damage pathology studies.


4.9.2 Warranty inspection.
4.9.3 Development of as-built plans.
4.9.4 Post-contractual evaluation.

4.10 Special services.

4.10.1 Mockups and three-dimensional models of the project.


4.10.2 Graphic or artistic representations of the project.
4.10.3 Photography or video of the project.
4.10.4 Review and advice on a construction plan, technical
specifications and contract documents.
4.10.5 Administration of the design process and development of
construction plans and technical specifications.
4.10.6 Digital animations, infographics, virtual or video
representations.
4.10.7 Project life cycle analysis.

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4.10.8
4.10.9 Appraised and valued properties.
4.10.10 Analysis of value, profitability and cost benefit of the project.
Coordination and administration of energy efficiency studies.
4.10.11 List of quantities of materials, time or equipment.
4.10.12 Consulting and risk analysis for demolition.
4.10.13 Promotion and sale of the project.
4.10.14 Services related to tenant eviction and release.

4.10.15 Calculation of materials for bidding.


Part 3
Fees for professional architectural services

1 Types of Rates
This regulation establishes four types of remuneration for the Architect
through rates: (1) Value-Based Rate, (2) Hourly Rate, (3) Reimbursable Costs
plus Fee and (4) Standard Rate.

C Rate based on Value. The Value-Based Fee applies to the set of


comprehensive services in which the remuneration for the Architect's
professional services is fairly represented by a proportion of the Project
Value.

C Hourly Rate. The Hourly Rate applies to professional services that have an
indefinite scope, duration or scope or to those services where the limits,
schedule and objectives cannot be determined or agreed upon in advance or
where the Client requires maximum flexibility to adjust the price. program
at any time. In these cases, the Architect's professional services are best
represented by remuneration in which a pre-established rate per hour of
work remunerates the Architect for the value he contributes and
compensates him for the costs and risks he incurs. The hourly rate
proportionally includes the costs of resources that the architect uses to do
his or her work.

C Costs plus Refundable Fee. The Refundable Fee applies to those


incidental, contingent, unpredictable or complementary services performed
by the Architect for which he must recover the costs incurred plus an
appropriate remuneration for his effort.

C Standard Rate. The Standard Rate is global and is denominated in official


currency. It applies to those works and services of a recurring nature that are
generally well defined and for which an absolute and standard amount has
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been identified that remunerates the Architect for the value he contributes
and compensates him for the costs he incurs.

All rates detailed in these Rate Regulations must be considered the minimum
or Base Rates, with which the Architect's professional services must be
remunerated. Modifiers will be applied to the Base Rate to adjust it for: (1)
experience of the Architect, (2) specialty of the Architect, (3) distance of services,
(4) acceleration of services, (5) repetition of designs and ( 6) project complexity.

2 Rates based on the value of the project

2.1 Fee for comprehensive architectural design services


according to Project Value

The rates listed in Table 2 represent the minimum remuneration that the
Architect must receive for his Comprehensive Architectural Design
Services.

Table 2: Rates for Comprehensive Architectural Design Services based


on the Value of the Project
% of Project Value
PROJECT TYPE

Single-family residence, semi-detached row


1 or duplex, or cabins with Project Value up 15%
to B/.50,000.00

Single-family residence, semi-detached row


or duplex, or cabins with a Project Value 15% of the first B/.50,000 plus 12%
2
greater than B/.50,000.00 but less than of the rest up to B/.100,000
B/.100,000.00

Single-family residence, semi-detached row 15% of the first B/.50,000 plus 12%
2 or duplex, or cabins with a Project Value of the incremental amount up to
greater than B/.100,000.00 B/.100,000 plus 8% of the Project
Value over B/.100,000.00

3 Residential buildings up to four stories tall 8%


and without vertical transportation systems.

Residential buildings with vertical


4 transportation systems and multi-residential 8%
complexes.

5 Industrial buildings and workshops. 8%

6 Galleys, warehouses, sheds, hangars, 5%


warehouses and sheds.

7 5%
Office buildings and parking buildings

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8 Malls 6%

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Table 2: Rates for Comprehensive Architectural Design Services in


function of Project Value
% of Project Value
PROJECT TYPE

9 Mixed buildings, (commercial, residential, 9%


offices, industrial or institutional) or
specialized/dedicated buildings (see table 3)

Landscaping, gardens, parks and outdoor decoration

10.1 Gardens up to 100m 2 25%

Gardens of more than 100m 2 up to 25% of the Project Value for the
10.2 first 100 m 2 plus 20% for the
200m 2
remaining area up to 200 m 2
25% of the Project Value for the
10
first 100 m 2 plus 20% for the
10.3 Gardens of more than 200m 2 remaining area up to 200 m 2 plus
17% for the area greater than 200
m2
10.4 Parks, squares and landscape and 15%
setting on an urban scale

10.5 Golf Courses 20%

11 Urban developments and urban design 4%


(excludes residences)

12 Remodeling, modifications, alterations, 10%


reforms and additions.

13 Restorations and enhancement of historical 12%


or heritage buildings

14 Interior design 15%

15 Furniture 25%
Shop windows, showcases, displays, kiosks,
16 temporary or mobile structures, fairs and 20%
stages,
The minimum rate that will apply for Comprehensive Architectural Design Services that involve the management
of approval of plans before municipal and state entities will be B/.3,500.00 for complete plans and B/.B/.1,000.00
for minor plans typified by the authorities as miscellaneous .

Table 3 lists the typologies in which mixed building projects are


classified, which may include commercial, residential, office, specialized
or dedicated functions.

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Table 3: Types of mixed buildings (commercial, residential, industrial,


institutional or office) or specialized/dedicated buildings

1 Churches, monasteries, convents, lodges, temples and buildings for


ecclesiastical, cult or religious functions.

2 Schools, kindergartens, colleges, universities, and buildings for teaching and


teaching functions.

3 Cemeteries, crypts, mausoleums, crematoriums and buildings for funerary


functions.

4 Airports, bus terminals, parking lots, port buildings, fuel dispensing stations and
buildings for transportation service functions.

5 Museums, aquariums, marinas, galleries, theaters, libraries, clubs, cinemas and


buildings for fun or entertainment activities and functions.

6 Restaurants, bars, nightclubs, casinos, entertainment centers, inns, canteens


and buildings for food and beverage sales functions.

7 Hotels, hostels, resorts, pensions, second-hand houses, motels, cabins, hostels


and buildings for accommodation and lodging.

8 Silos, barns, chicken coops, stables, corrals and buildings for agricultural
service functions.

9 Gyms, stadiums, arenas, swimming pools, arenas, fields and other buildings for
sports functions

Hospitals, clinics, nursing homes, laboratories, health centers and posts,


10 sanatoriums, asylums, rest centers, punishment centers, hospitals and buildings
for biological, medical or veterinary functions.

11
Prisons, jails, reform schools and buildings for prison or confinement functions.

12 Buildings for government or municipal management functions.

13 Buildings for banking, credit or financial functions.

14 Buildings for communication functions such as radio stations, television plants,


call centers, among others.
15 Any other specialized building not listed

2.2 Rates for the design of urbanizations, residential


distributions, condominium communities, subdivision and
urban parceling.

Table H Rates for the design of urbanizations, residential subdivisions,


condominium communities, subdivision and urban parceling.

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% of Project Value
PROJECT TYPE

Urbanizations, residential distributions,


1 communities, residential complexes in horizontal 4%
property, subdivision and urban parceling with
Project Value up to B/.1,000,000.00.

Urbanizations, residential distributions, 4% of the first B/.1,000,000.00 plus 3%


2 communities, residential complexes in horizontal of the Project Value over
property, subdivision and urban parceling with B/.1,000,000.00
Project Value greater than B/.1,000,000.00.

Regardless of the value of the Project, the minimum rate that will apply for the design services of urbanizations,
residential distributions, condominium communities, subdivision and urban parceling will be B/.10,000.00.

2.3 Fee for preparation and estimate of project budget.

In accordance with the Client's requirements and the consultant's


recommendations and depending on the convenience and degree of
precision required, two procedures can be followed for the preparation of
the estimated project cost budget.

2.3.1 Rate for Budget by Work Units (parametric) . The budget by


Work Units includes a cost estimate of the different work units that make
up the construction process, such as excavation, site work, foundations,
structure, masonry, electrical system, plumbing system, different
finishes, among others. . The quantities of each work unit are calculated
based on the construction plan and market unit prices are used to estimate
the cost of each of them. The calculation of these unit prices corresponds
to a study and research developed by the Architect, in such a way that the
estimated costs are representative of the Value of the Project. The budget
thus estimated will include indirect costs, financing costs and profits to
form a comprehensive and complete estimate. A fee of 0.5% of the
Project Value is established for the services of developing the Budget by
Work Units.

Regardless of the Value of the Project, the minimum rate that will apply
for Budget services by Work Units will be B/.1,000.00.

2.3.2 Rate for Detailed Budget . The budget by Work Units includes a
cost estimate of the different components of each of the work units of the
construction process, so that the different materials to be used and their
quantity, the market unit prices and, in general, all the detailed aspects of
the cost of the work. The quantities of each work unit are calculated
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based on the construction plan in accordance with the expected


performance of the components, both materials and consumables,
services and labor incorporated into the construction process. The prices
of materials and inputs will be market prices and the cost of labor will be
estimated based on analysis of performance and productivity for each
task, with current prices and salaries. The budget thus estimated will
include itemized indirect costs, social benefits, taxes, fees, financing
costs and utilities to form a comprehensive and complete estimate. A rate
of 1% of the Project Value is established for the services of developing
the Budget by Work Units.

Regardless of the Value of the Project, the minimum rate that will apply
for Detailed Budget services will be B/.1,500.00.

2.4 Fee for construction scheduling services.

The fee for construction scheduling services includes the determination


of the list of activities and the execution times of the activities that make
up the execution of the project, as well as the relationship, dependency
and sequence between activities and the optimal determination of the
time per phases and total execution. The critical execution path and the
variants or options will be identified. This service must include the
identification of resources and construction methods, early and late times
for each activity and must be presented with a GANT type bar chart and
a PERT type precedence diagram.

A fee of 1% of the Project Value is established for construction


scheduling services. Regardless of the Value of the Project, the minimum
rate that will apply for Construction Programming services will be
B/.1,500.00.

2.5 Fee for real estate appraisals and appraisals.

The rate for property, land and building appraisal services and real estate
appraisals in general will be B/.1.50 per

each b/.1,000.00 of the estimated value of the property5 appraised.

2.6 Fee for architectural concept design and development


services.

The rate for design and architectural concept development services will
be 20% of the rate stipulated for Comprehensive Architectural Design
Services. Regardless of the Project Value, the minimum rate that will
apply for Concept Design and Development services will be B/.2,500.00.
5 Property Value includes the appraised market value of the land and the improvements built on it.

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This rate applies when architectural concept design and development


services are contracted separately and in isolation from the
Comprehensive Architectural Design Services or the Preliminary Design
and Development Services. The fee will be calculated based on the
estimated Project Value established at the time of the beginning of the
architectural concept design process.

This rate does not include management or approval by the authorities of


the preliminary project plan. This fee does not include the architect
granting the Client authorization to hire another architect to develop the
construction plan. The authorization fee for the Client to hire another
architect to develop the preliminary project based on the concept will be
10% of the fee stipulated for Comprehensive Architectural Design
Services

2.7 Fee for design and preliminary project development services.

The rate for Preliminary Design and Development Services will be 30%
of the rate stipulated for Comprehensive Architectural Design Services.
Regardless of the Value of the Project, the minimum rate that will apply
for Concept Design and Development services will be B/.3,500.00. The
rate will be calculated provisionally based on the estimated Project Value
at the time of the beginning of the design process and will be definitively
set when the estimated Project Value is determined at the time of the
completed preliminary project.

This fee includes approval of the preliminary project plan by the


competent authorities. This fee does not include the architect granting the
Client authorization to hire another architect to develop the construction
plan. The authorization fee for the Client to hire another architect to
develop the construction plan based on the approved preliminary project
will be 15% of the fee stipulated for Comprehensive Architectural
Design Services

2.8 Rate for technical inspection and construction quality


assurance and quality control services

Technical inspection and quality assurance or control services refer to


those that are carried out during the construction of the work and usually
until its completion. The rate for Technical Inspection and Construction
Quality Assurance and Control Services will be equal to the rate for
Comprehensive Architectural Design Services established for each type
of project. In cases where the complex nature of the project requires the
architect to apply greater resources or time to the inspection, then the fee
will be complemented by the Hourly Rate applied to the additional
estimated time of services plus the Reimbursable Costs incurred.
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2.9 Rate for technical inspection services for final acceptance.

The technical inspection for final acceptance of a project is that


inspection that is usually contracted by the Client as buyer, end user,
owner or lessor, so that the Architect inspects and verifies the finished
building, house or apartment prior to its delivery by the builder. and final
acceptance by the Client. This Technical Inspection for Final Acceptance
is separate and independent from the technical inspection that the
promoter, owner or builder usually carries out during the construction of
the project. This inspection is visual and with non-destructive
measurement instruments. Does not include sample collection or
laboratory tests. It includes becoming familiar with the plans and
specifications of the project, which must be provided by the Client.

The fee for Final Acceptance Technical Inspection Services will be in


accordance with Table D.

TABLE 4. Rate for technical inspection services for final acceptance.


Project area Fee per square meter of project area to be
inspected
1
B/.3.00 per square meter. Applies to closed,
Inspections of buildings of less semi-closed constructions, rooftops, indoor
than 500 square meters in area. parking, etc.

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TABLE 4. Rate for technical inspection services for final acceptance.


Project area Fee per square meter of project area to be
inspected
2
Inspections of up to 1,000 square B/.3.00 per square meter for the first 500 square
meters of area. meters and B/.2.00 for the rest up to 1,000
square meters
3 Inspections of more than 1,000
square meters of area. B/.3.00 per square meter for the first 500 square
meters plus B/.2.00 per square meter
incremental up to 1,000 square meters and
B/.1.50 for the rest
4
Inspections of exterior pavement B/.0.50 per square meter of pavement when the
areas (roads, sidewalks, parking inspection is a complementary part of the
lots, sidewalks, streets, curbs, inspection of a closed area.
gutters, shoulders, etc.) built on
B/.1.00 per square meter when only exterior
natural soil.
pavement is inspected.
5 B/.4.00 per square meter.
Inspections of sloped roof areas
over which the Architect must
walk to inspect.

The area applicable to the rate refers to the area measured in plan and includes usable
areas and areas occupied by walls, equipment and other components of the building.
The fee includes inspection of the exterior envelope, walls, components and ceilings of
the inspected areas.
Regardless of the area of the project to be inspected, the minimum rate that will apply
for technical inspection services for final acceptance will be B/.600.00.

2.10 Fee for warranty technical inspection services.

The technical guarantee inspection is that inspection that the Client


contracts as a promoter, buyer, user, owner or lessor, so that the Architect
inspects and verifies the building, house or apartment at the end of its
guarantee period. This inspection is separate and independent from the
technical inspection that the promoter, owner or builder carries out
during the construction of the project and the final acceptance technical
inspection. This inspection is visual and with non-destructive
measurement instruments. Does not include sample collection or
laboratory tests. It includes becoming familiar with the plans and
specifications of the project, which must be provided by the Client.

The fee for technical warranty inspection services will be in accordance


with Table K.

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TABLE 5. Fee for warranty technical inspection services.


Project area Fee per square meter of project area to be
inspected

1 Inspections of less than 500 B/.4.00 per square meter


square meters
2
Inspections of up to 1,000 square B/.4.00 per square meter for the first 500 square
meters meters and B/.3.00 for the rest up to 1,000
square meters
3 Inspections of more than 1,000
B/.4.00 per square meter for the first 500 square
square meters
meters plus B/.3.00 per incremental square
meter up to 1,000 square meters and B/.2.00 for
the rest
4
Inspections of exterior pavement B/.0.50 per square meter of pavement when the
areas (roads, sidewalks, parking inspection is a complementary part of the
lots, sidewalks, streets, curbs, inspection of a closed area.
gutters, shoulders, etc.) built on
B/.1.00 per square meter when only exterior
natural soil.
pavement is inspected.
5 B/.4.00 per square meter.

Inspections of sloped roof areas


over which the Architect must
walk to inspect.

The area applicable to the rate refers to the area measured in plan and includes usable
areas and areas occupied by walls, equipment and other components of the building.
The fee includes inspection of the exterior envelope, walls, components and ceilings of
the inspected areas.
Regardless of the area of the project to be inspected, the minimum rate that will apply
for technical inspection services for final acceptance will be B/.1,500.00.
In multi-story buildings, the area of all floors will be added to calculate the rate.

2.11 Rate for financial construction inspection services based on


the value of the project.

The rate for financial inspection services will be 60% of the applicable
rate for technical inspection and construction quality assurance and
quality control services.

2.12 Fee for construction management services based on


Construction Value

The rate for construction management services will be as detailed in


table X:

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TABLE 6 Rates to remunerate the Architect for construction


management services
Construction Value % of Construction Value

Projects whose Construction


1 Value is less than 25% of Construction Value
B/.100,000
Projects whose value is greater
2 25% for the first B/.100,000 plus 20% for the
than B/.100,000 but up to
rest up to B/.500,000
B/.500,000.
25% for the first B/.100,000 plus 20% for the
Projects whose annual value is
3 value between B/.100,000 and B/.500,000 plus
greater than B/.500,000 but up to
18% for the incremental value up to
B/.1,000,000.
B/:1,000,000
25% for the first B/.100,000 plus 20% for the
Projects whose annual value is value between B/.100,000 and B/.500,000 plus
4 greater than B/.1,000,000 but up 18% for the incremental value up to
to B/.2,000,000. B/:1,000,000 plus 16% for the value up to
B/.2,000,000
25% for the first B/.100,000 plus 20% for the
Projects whose annual value is value between B/.100,000 and B/.500,000 plus
5 greater than B/.2,000,000 but less 18% for the incremental value up to
than B/.10,000,000. B/:1,000,000 plus 16% for the value up to
B/.2,000,000 plus 15 % for the incremental
value up to B/.10,000,000
25% for the first B/.100,000 plus 20% for the
value between B/.100,000 and B/.500,000 plus
Projects whose annual value is 18% for the incremental value up to
5
greater than B/.10,000,000 B/:1,000,000 plus 16% for the value up to
B/.2,000,000 plus 15 % for the incremental
value up to B/.10,000,000 plus 10% for the rest

3 Hourly rate for professional services

An Hourly Rate is established as an alternative remuneration mechanism


for the Architect. The Architect may use the Hourly Rate modality to
price any type of professional service provided. This type of fee is
established mainly for professional consultations that typically involve
eventual advice on a specific matter, which the Client requests from the
Architect to obtain a qualified opinion. However, the Hourly Rate will
also apply for all types of services and will also have priority as a
mechanism to adjust Value Rates and Standard Rates in exceptionally
complex cases and projects in which the Architect has to provide
substantially more time and resources. than those normally contemplated
under Value Rates or Standard Rates.

The use of Hourly Rates is recommended for consultations and services


that are preliminary, unscheduled, vague in scope and scope, urgent,
sporadic, complementary or contingent, which are not predictable or

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difficult to quantify in advance or in advance. which requires maintaining


maximum flexibility and freedom of action for changes.

The Architect's Hourly Work Rates have been established to include his
indirect costs, the opportunity value of the time he uses, the value that the
Architect contributes with his services, the risk he incurs, his indirect
costs and his profit. The Hourly Rate is personally applicable to the
specific time of the Architect and is not a rate per hour of work of the
firm or the team, it is a Rate per hour per personal work of the architect.
The Hourly Rate does not include direct costs of supplies, materials,
tickets, tolls, fees for procedures, transportation, maintenance, lodging,
travel expenses, consumables, salaries, benefits and expenses of other
experts, consultants, advisors, assistants and other personnel require.
Costs not included in the Hourly Rate will be assessed as reimbursable
costs to which the Reimbursable Rate will be applied, which will consist
of the reimbursement of the costs incurred plus a fee calculated as a
percentage of the costs incurred.

The Architect will perform these services based on a unit value based on
the time of execution by the Architect and his staff. Table 6 lists the
minimum recommended rates for personal services by the Architect and
his staff.

TABLE 7 Rates per hour of service or per consultation depending on the


method of performing the service

Rate in Balboas per hour or


fraction of services or
Responsibility and role of the consultations
Architect From Out of
In office
distance office

Principal designer architect, president architect of


1 the firm, executive architect of the highest 50.00 80.00 100.00
hierarchy, partner architect or managing architect
of the firm.

2 Lead architect, supervisor, administrator, 40.00 60.00 80.00


coordinator or project manager.

3 30.00 55.00 70.00


Associate architect, or member of the project team.

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TABLE 7 Rates per hour of service or per consultation depending on the


method of performing the service

Rate in Balboas per hour or


fraction of services or
Responsibility and role of the consultations
Architect From Out of
In office
distance office

Chief architect of the drawing and development


4 workshop of plans or leader-specialist drafter of 30.00 55.00 70.00
specifications

5 Architect, developer of plans or drafter of 25.00 40.00 55.00


specifications

Architectural technicians in functions such as


6 draftsman, architectural infographic, plan developer 20.00 30.00 40.00
and support for the Architect's practice.

• Remote consultations include those carried out by telephone, video conference, email, fax,
regular mail, telex or similar means.

• The minimum out-of-office rate is the equivalent of two hours. For out-of-office rates, the time
the architect spends on the round trip also applies. For remote and office consultations, the
minimum rate is equivalent to one hour. There are no fractions.

• The fee for remote consultations or services applies for each instance of remote consultation
when the consultation is resolved orally, usually by telephone, in the same call or in a
subsequent call. This fee does not include office or out-of-office time and resources that the
Architect or his staff must use to investigate, prepare and respond to the remote
consultation. For any research work derived from a telephone consultation, the office or out-
of-office rate will apply, or a mixture of both as the case may be. When the consultation
requires the application of in-office or out-of-office fees, then the remote consultation fee will
not apply.

• In the event that the Architect, to resolve remote queries, incurs reimbursable costs, such as
long-distance calls or transportation or travel expenses, among others, to resolve the
queries, then the fees for reimbursable costs will be added to these.

Administration fee of Services and Costs


Refundable

As part of his professional services, the Architect may agree with the
Client that in specific areas he will be remunerated through a percentage
rate based on the cost incurred. These costs are called Reimbursable
Costs. In this type of remuneration, the Client will reimburse the
Architect for the cost of all the services provided and supplies provided,
plus a fee calculated as a percentage of the costs incurred. The items
covered by Value Rates or Hourly Rates may not be remunerated through
Rates for Administration of Services and Reimbursable Costs.

This Fee for Administration of Services and Reimbursable Costs has


been developed to apply to costs that are usually not predictable or
quantifiable, that are sporadic and contingent and that are generally
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expected to vary throughout the performance of professional services and


therefore Therefore, they are not included in the Value Rates, Hourly
Rates and Standard Rates.

A rate of 20% of the costs is established as remuneration of the Architect


for the administration, management, processing, coordination and
management of said costs. This rate is applied to direct costs and
disbursements and remunerates the Architect for his creative,
organizational and technical contribution, for the risk he assumes and
gives him a reasonable profit for his effort. In general terms, the
following cost items will be governed by the Rate for Administration of
Services and Reimbursable Costs, among others:

• Materials and supplies for professional services such as:


stationery, supplies and consumables.
• Transportation and communication costs such as: tickets, tolls,
travel expenses, lodging, food, tips, food, and long distance and
international calls.
• Professional services such as: surveying, topography, engineering
designs, models, infographics, models, photographs, tests, special
studies and laboratory tests.
• Procedures, taxes and fees.
• General services contingents, such as copies,
printing, developing, binding, reproduction and translation.

5 Standard Rates

5.1.1 Fee for Responsibility and functions of the Suitable


Professional responsible for the Company

The Architects who assume responsibilities before the Technical Board


of Engineering and Architecture (JTIA) as a Suitable Professional
Responsible for the Company6 In accordance with the Resolution of the
Technical Board of Engineering and Architecture #183 of June 10, 1982,
they will receive professional fees commensurate with the responsibility
and risk they assume under these regulations. These professional fees
shall be separate and distinct from any other remuneration, emolument,
salary, stipend or compensation that

6 It also applies to Technical Responsible Professionals as regulated in Section 9 of Resolution 268 of February
21, 1990 of the Technical Board of Engineering and Architecture.

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received, directly or indirectly, for personal services or professional


services of any kind, such as directing, supervising or managing
construction. In this sense, for exercising the responsibility of a Qualified
Professional Responsible for a Company, a minimum rate of B/2,500.00
per calendar year is established with escalation in accordance with Table
7.

TABLE 8 Rates to remunerate the Architect for acting as a Qualified


Professional Responsible for the Company.
Rate per year
Scale of the company's activity in terms of
the Value of the Projects executed during
the year.
1 Projects whose annual value is less than B/.100,000.00 B/.2,500.00 per year
Projects whose annual value is greater than
2 B/.3,500.00 per year
B/.100,000.00 but up to B/.500,000.00

Projects whose annual value is greater than


3 B/.5,000.00 per year
B/.500,000.00 but up to B/.1,000,000.00

Projects whose annual value is greater than B/.1,000,000


4 B/.7,500.00 per year
but up to B/.2,000,000.00

5 Projects whose annual value is greater than B/.15,000.00 per year


B/.2,000,000.00 but less than B/.50,000,000.00

5 Projects whose annual value is greater than B/.25,000.00 per year


B/.50,000,000.00 but less than B/.100,000,000.00

B/.25,000.00 more
Projects whose annual value is greater than B/.1.00 for each
5 B/.5,000.00 of annual
B/100,000,000.00
construction value
above
B/.100,000,000.00

The rate for the year will be calculated progressively based on the total value of the
projects contracted by the company during the year. Applies only to projects to be built
in the Republic of Panama.
In the case of construction projects whose execution spans more than one year, the
rate will be calculated proportionally to the portion of value executed in the year.

This rate does not include or cover professional services, procedures,


procedures or costs incurred by the Architect as a result of judicial, civil
or criminal actions whose cause was attributable to actions or omissions
of the legal entity for which he or she exercises the responsibility of
Qualified Responsible Professional. of Company or whose cause was
attributable to third parties.

5.1.2 Fee for Responsibility and functions of a Qualified Resident

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Professional

Architects who assume responsibilities before the Technical Board of


Engineering and Architecture (JTIA) as Resident Qualified Professional
in accordance with JTIA Resolution #183 of June 10, 1982 and
Resolution #150 of September 3, 1997 will receive fees professionals
commensurate with the responsibility and risk they assume in compliance
with this regulation. These professional fees will be separate and
different from any other remuneration, salary, stipend, emolument or
compensation received, directly or indirectly, for personal services or
professional services of any type.

In this sense, for exercising the responsibility of Qualified Resident


Professional, a minimum fee of B/2,500.00 is established per project or
for each year or fraction that its execution lasts with escalation in
accordance with what is stipulated in table 8. Project Value is understood
to mean the entire cost of the project, except for the value of the land,
which would be under the responsibility of the Qualified Resident
Professional.

TABLE 9 Rates to remunerate for acting as a Qualified Resident


Professional.
Project construction value Fee per project or per
project year

1 Project whose construction value is less than B/.2,500.00


B/.100,000.00

2 Project whose construction value is greater than B/.3,500.00


B/.100,000 but up to B/.500,000.00

3 Project whose construction value is greater than B/.5,000.00


B/.500,000 but up to B/.1,000,000.00

4 Project whose construction value is greater than B/.7,500.00


B/.1,000,000 but up to B/.2,000,000.00

5 Project whose construction value is greater than B/.15,000.00


B/.2,000,000 but less than B/.50,000,000.00

6 Project whose construction value is greater than B/.25,000.00


B/.50,000,000.00 but less than B/.100,000,000.00
7 Project whose construction value is greater than
B/100,000,000.00
B/.25,000.00 plus B/.1.00
for each B/.5,000.00 of
construction value above
B/.100,000,000.00
This rate does not include or cover professional services, procedures,
procedures or costs that the Architect incurs as a result of judicial, civil
or criminal actions whose cause was attributable to actions or omissions

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of the natural or legal person for whom he or she exercises the


responsibility of Professional. Ideal Resident.

5.1.3 Fee for survey, measurement, measurement, cubing and


development of plans of existing conditions.

For the services of surveying, measuring, cubing and developing plans of


existing conditions of constructed areas and buildings, the greater of (1)
what is established in Table M, (2) the hourly rate applied to the time
required to perform the services plus the reimbursable costs incurred or,
(3) B/.500.00 per plan sheet.

TABLE 10. Fee for services for surveying, measuring and developing
plans of existing conditions.
Scale according to survey Rate per square meter
area.
1 B/.6.00 per square meter

Surveys of less than 500 square


meters of floor area
2
B/.6.00 per square meter for the first 500 square
Surveys of up to 1,000 square meters and B/.5.00 for the rest up to 1,000
meters of plant area square meters
3
B/.6.00 per square meter for the first 500 square
Surveys of more than 1,000 meters plus B/.5.00 per incremental square
square meters of plant area meter up to 1,000 square meters and B/.4.00 for
the rest
4 B/.6.00 per square meter of vertical surface

Surveys of vertical surfaces such


as elevations, facades, walls,
partitions, divisions and walls.
5
Survey of vertical and plan A rate 50% higher than lines 1, 2 and 3 above
surfaces for three-dimensional applies.
isometric rendering

5.1.4 Fee for workshop drawing development services.

For shop drawing development services, the greater of: (1) 10% of the
Construction Value of the components that are the subject of the shop
drawing or (2) the hourly rate applied to the time required to perform the
services will apply. plus reimbursable costs incurred or, (3) B/.500.00 per
plan sheet.

5.1.5 Fee for as-built plan development services.

For as-built plan development services, the greater of: (1) 20% of the rate
for comprehensive architectural design services established for each type
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of project or (2) the hourly rate applied to the time required to complete
the plan will apply. perform the services plus the reimbursable costs
incurred or, (3) B/.500.00 per plan sheet.

5.1.6 Fee for use of Architect's references in quotes or tenders

The Architect has the right to be remunerated for the use of his name and
references within any proposal made by third parties, whether for a
contest, tender, quote, request for qualifications or price request. The rate
for this remuneration will be in absolute terms no less than B/.250.00.

5.1.7 Fee for participating in proposals and contests

In any invitational or open design contest, a stipend must be awarded to


contestants who comply with the terms of the contest and submit their
proposal but whose proposal is not chosen or declared the winner. The
purpose of the stipend is to compensate the Architect for the effort and
direct and indirect resources applied in his participation without granting
him utility or profit. The stipend must be the same for all participants
regardless of the place they occupied in the competition evaluation. The
stipend is set at 0.001% of the value stipulated in the competition.

5.1.8 Fee for management and processing of Occupation Permit

In cases where an Architect is required to carry out the management and


processing of the Occupation Permit, a base rate of B/2,500.00 or
0.005% of the Project Value, whichever is greater, will be applied to this
service. This fee does not guarantee the success of the process and
assumes that the project meets the requirements to be awarded the
Occupation Permit by the relevant entities. In the event that the project is
not eligible to receive the Occupancy Permit, the fees will be adjusted
with the Hourly Rate to compensate the architect for the additional effort
that must be made. This rate is subject to adjustments for experience in
professional practice and adjustments for

distance.

5.1.9 Fee for expert and attestation services

The Base Fee to act as an expert or expert witness by any State body in
judicial proceedings, or by a private party, whether in criminal or civil
proceedings, will be the greater of: (1) B/2,000.00 per case or (2) the
Hourly Rate applied to the time required to perform the services plus any
reimbursable costs incurred. This rate includes:

• Inspections of the site subject to the expert action, including


inspections to ensure evidence.

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• Expert report
• Appearance before a court hearing to make a statement.

This rate is subject to modification due to experience and specialty in


professional practice and modifications due to distance. This rate does
not include additional costs incurred by the Architect due to traveling to
distant places or requiring support services, such as: supplies, materials,
tickets, tolls, fees for procedures, transportation, maintenance, lodging,
travel expenses. , consumables, salaries, benefits and expenses of other
experts, consultants, advisors, assistants and other personnel as required.
These costs not included in the rate for expert and attestation services
will be assessed as reimbursable costs to which the Reimbursable Rate
will be applied, which will consist of the reimbursement of the costs
incurred plus a fee calculated as a percentage of the costs incurred.

5.1.10 Zoning change management fee

The Base Rate to carry out the zoning change process before the Ministry
of Housing and other relevant state entities will be B/2,500.00 or 0.01%
of the value of the lot of land, whichever is greater. This fee does not
guarantee the success of the zoning change request and is only limited to
carrying out the required procedures. This rate is subject to adjustments
for experience in professional practice and adjustments for distance.

5.1.11 Fee for review of plans and specifications

The fee to review, inspect and carry out quality control on plans and
specifications is B/.80.00 per preliminary project plan sheet and
B/.100.00 per construction plan or plan sheet.

as built and B/4.00 per page7 of technical specifications.

5.1.12 Fee for participation in evaluation committees for contests,


proposals or tenders

The Fee to participate in evaluation committees of contests, proposals or


tenders will be the greater of: (1) B/.1.00 per thousand Balboas of the
awarded Value of the Tender or (2) B/.400.00.

6 Modifiers to the Base Rate


6.1 Base Rate Modifier for experience and specialization

The Base Rates apply to Architects with less than five years of professional
practice and without specialization. When the Architect has five or more years
of professional practice or has a specialization, the modifiers indicated in Table
7 Refers to each side of sheets up to 8.5” by 14”.

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11 will apply: these modifiers will apply to the Base Rates Based on Value,
Hourly Rates and Refundable Rates.

Table 11. Modifiers to the base rates to adjust for the experience and
specialization of the Architect measured by the years of professional
practice for his or her specialization

Without
Professional Practice Time A specialization
With Specialization B

Less than five years of professional 5% increase on the


1 practice
Minimum base rate
base rate
5% increase on the 8% increase on the
2 Five to ten years of professional practice base rate base rate
From eleven to 15 years of professional 10% increase on the 13% increase on the
3 practice base rate base rate
15% increase on the 18% increase on the
4 More than 15 years of professional practice base rate base rate
A The Time of Professional Practice is defined as the time elapsed since the Architect received his
Certificate of Professional Suitability issued by the Technical Board of Engineering and Architecture.
B The increase over the base rate applies when the specialization is relevant and applicable to the
project. The specialization can be executive, by career, or academic at the postgraduate, master's or
doctoral level.

6.2 Base Rate Modifier for acceleration of services

When the Client requires the Architect to execute the services through
accelerated or expedited procedures, or with “ Fast Track ” type methodologies or
in Preliminary Construction Permit modalities or by any system that allows
construction to begin without the finished construction plan and documents. or with
preliminary, provisional, partial or contingent permits, then the Architect must
apply an increase of 20% to the established Base Rates.

6.3 Base Rate Modifier for execution of services in distant areas

When the Client requires the Architect to execute professional services or


design a project for a location distant from their office or usual place of work,
the base rate will be modified with an increase of 10%. This increase is to
compensate the Architect for the additional work in coordination and remote
communication, transfer risk, effort and resources to be used locally, and
profits in compensation for greater use of his time. The Base Rate modifier for
the execution of services in distant areas does not include the direct
incremental and incidental costs incurred by the Architect for performing a
service in a distant area, such as: supplies, materials, tickets, tolls, fees for
procedures. , transportation, maintenance, lodging, travel expenses,
consumables, salaries, benefits and expenses of other experts, consultants,
advisors, assistants and other personnel as required. These costs will be
assessed as reimbursable costs to which the Reimbursable Rate will be
applied, which will consist of the reimbursement of the costs incurred plus a
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fee calculated as a percentage of the costs incurred.

6.4 Base Rate Modifier for repetition of designs

The base rate for comprehensive architectural design services authorizes the
Client to construct only the building designed and developed in the plans and
specified in the other instruments developed by the Architect. In all cases and
specifically in urbanization projects, residential complexes, condominium
communities, or development of multiple homes of any type, the fee for
comprehensive architectural design services authorizes the Client to construct
a single building or residential unit of each model, configuration and designed
type8 . In the event that the Client wishes to build more than one residential
unit using fundamentally the same design, even when this or the plans are
modified, then he must acquire for this purpose an authorization from the
Architect called a License of

Repetition.

In the case of residential buildings, the rate for repetition of a residential


design also applies to projects that can be called housing, residential blocks,
apartment buildings, apartments, lofts , row houses, duplexes , semi-detached
houses, cabins or homes. in general, in which the design developed in the plan
will be built more than once. The residential building can be single-family,
two-family or multi-family. For repetition purposes, a residential building is
considered to be that unit that constitutes an integral, continuous and
indivisible structure projected in the original design. When the buildings or
blocks are joined together by common elements such as hallways and
corridors, which join them without modifying the planimetry of the block
itself, the block will be taken as a unit of repetition and the common elements
will be added as the first unit of repetition. . When blocks are grouped with
common access elements that make it necessary to planimetrically modify the
typical isolated block, the set of blocks related to each other will be considered
as the repetition unit.

In this sense, a single-family home is considered a unit, a duplex that includes


two homes is considered a unit, as is an apartment building, and a row of semi-
detached houses is considered a residential unit. The addition of additional
floors or floors to a building is not considered a repetition of the design. The
repetition fee will be applied in two types of cases:

• Case 1: When the projected number of repetitions of residential units is


evident on the plan of a development or subdivision, by lot count or
otherwise. In such case the rate will apply from the beginning for all
repetitions identified in the plan regardless of whether they are planned or
8 For the purposes of distinguishing a repetition of a design from a different design, buildings that differ in
elements of decoration, ornamentation, finishes, textures, colors, coatings or in other minor aspects of
dimensions or proportion that do not substantially change the original integral design and its operation.

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scheduled to be built immediately or in phases.

• Case 2: When repetitions of a design were to be carried out in another place


and under different and subsequent conditions than those of the original
plan. As in the case of extensions or expansions of urbanizations or the case
of new urbanizations in which the design prepared for a previous project
would be used. The repetition fee remunerates the Architect for use of his
intellectual property and does not include services to adapt the repeated
building to its new site and context. Any adaptation of an existing design
will be governed by the rates for Comprehensive Architectural Design
Services.

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% of the Base Rate for Comprehensive


Architectural Design Services, Conceptual
Table 12. Rates for multiple repetitions Design Services or Preliminary Design and
of residential units Development Services

less than More from B/. More than B/:


Project Value Range B/.50,000.00 50,000.00 to B/. 100,000.00
100,000.00

1 From rep 1 to rep 10 10% 8% 5%

2 From repetition 11 to repetition 50 7% 5% 3%

3 From repetition 51 to repetition 100 4% 3% 2%


4 From repetition 101 onwards 2% 1.5% 1%

6.5 Application of modifiers

The base rate will be adjusted in accordance with the application of the
modifiers.

Table 13: Application of Modifiers to Base


Rates Rate Modifiers

Specialization

Acceleration
Types of Base Rates
Experience

Repetition

Distance
Inflation

1 Rates per project value

1A Comprehensive Architectural Design OR OR OR OR OR


Services
Design services for urbanizations,
residential distributions, condominium
1B
communities, subdivision and urban OR OR OR OR OR
parceling
1C Project Budget Estimation and Preparation
Services OR OR OR
1D Construction scheduling services OR OR OR
1E Real estate appraisal and appraisal OR
1F services
Architectural concept design and
development services OR OR OR
1G Preliminary design and development
services OR OR OR OR
1
HOU Technical inspection and construction
R quality assurance and quality control OR OR OR OR
services based on the value of the project
1I Financial construction inspection services
based on the value of the OR OR OR

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Table 13: Application of Modifiers to Base


Rates Rate Modifiers

Specialization

Acceleration
Types of Base Rates

Experience

Repetition

Distance
Inflation
project.
1J Final Acceptance Technical Inspection
Services OR OR OR
1K Technical warranty inspection services OR OR OR
1L Construction Management Services based
on Construction Value
OR OR OR OR
2 Hourly rate for professional services OR OR OR OR
3 Fees for services and reimbursable costs OR OR OR
4 Standard rates
4A Responsibility and functions of the Suitable
Professional responsible for the Company OR OR OR
4B Responsibility and functions of a Qualified
Resident Professional OR OR OR OR OR
4C
Survey, measurement and development of OR OR OR OR
existing condition plans services
4D Shop drawing development services OR OR OR OR
4E As-Built Plan Development Services
OR OR OR OR
4F Use of Architect's references in quotes or
tenders OR OR OR
4G Participate in proposals and contests OR OR OR
4H Expert and attestation services OR OR OR OR
4I Zoning change management OR OR OR OR
4J Review of plans and specifications OR OR OR OR

Part 3
DEFINITION OF TERMS

• Architect. The Architect is the natural person with a Certificate of Professional


Suitability to practice architecture issued by the Technical Board of
Engineering and Architecture. It also applies to the legal entity, registered with
the Technical Board of Engineering and Architecture and authorized by it to
carry out architectural work.

• Customer . It is the natural or legal person that hires the professional services
of an Architect.

• Specifications . The specifications or technical specifications are the integral

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document that complements the construction plan and serves to indicate the
qualities, characteristics, quality requirements, standards, tolerances of the
project.

• Professional fees. Remuneration of the Architect to compensate him for his


costs, risk, creativity, work and responsibility before the law. Also called
emoluments, stipends

• Architect's Office. It is the site and venue where the Architect serves his
Clients and carries out his design work and development of plans and
specifications. It is the office, workshop or office where it usually carries out its
services and where it is professionally domiciled for the purposes of serving its
clients.

• Conceptual plan. The conceptual plan includes a graphic representation with


sketches and sketches of the project at a macro and general level of detail. Its
purpose is to evaluate alternative solutions, refine the design program, identify
limits and restrictions, estimate an overall cost, and serve as the basis for a
prefeasibility study.

• Preliminary Project Plans. The Preliminary Plan is the drawings of the project
in sufficient detail and definition to allow the project to be understood in all its
relevant elements. The preliminary project plan is the graphic representation of
the architectural solution that responds to the design program. It has sufficient
detail to serve as a basis for preparing a parametric cost estimate. The
preliminary project plan is the document of the same name that is approved by
municipal entities. It has enough detail to serve as the framework for a
feasibility study.

• Construction plans. The Construction Plan is the drawings of the project in


complete and sufficient detail that are used to carry out the construction of the
project. It has all the detail necessary to estimate a detailed and specific budget
and execution program for construction. It is the official document that is
stamped and signed by the architect and that is used to process the construction
permit before the municipal authorities.

• Architectonic program. Also called design program or project program. It is


the narrative description in the form of a written document that describes the
needs, objectives, requirements, functions and characteristics of the project and
that serves as a basis for the design of the first sketches and the preliminary
project. The architectural program precedes the conceptual drawing of the
project.

• Professional Practice Time . It is the time elapsed to the present since the date
on which the Architect received his Certificate of Professional Suitability from
the Technical Board of Engineering and Architecture.

• Project Value . It is the total estimated construction cost of the project. This
cost excludes the cost of the land, the design, plans and specifications,
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construction financing interest and the building permit fee. Includes direct and
indirect costs of materials, ITBMS and other taxes and fees, infrastructure,
labor, supplies, consumables, services, plans and specifications, furniture and
equipment incurred for the construction of the building until it is completed and
suitable for occupation or usufruct in accordance with the law. The Project
Value includes the costs of all the constituent elements of the work, whether
these are supplied by the builder, subcontractors, by the owner or by third
parties, regardless of their origin, whether in the nature of purchase, transfer or
donation, whether in money or in kind.

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