The Subcontractor Agreement is essential for businesses operating in Indonesia that need to delegate specific work packages to specialized contractors while maintaining compliance with local regulations. This document is commonly used across various industries including construction, manufacturing, and services, where specialized expertise or additional workforce capacity is required. The agreement must comply with Indonesian labor laws, particularly Law No. 13 of 2003 on Manpower and Minister of Manpower and Transmigration Regulation No. 19 of 2012 on outsourcing requirements. It typically includes comprehensive provisions for work scope, payment terms, performance standards, HSE requirements, and dispute resolution mechanisms, while addressing specific Indonesian regulatory requirements such as local content rules and labor protection measures.
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1. Parties: Identification of the main contractor and subcontractor, including their complete legal names, registration numbers, and registered addresses
2. Background: Context of the agreement, including reference to the main contract and the basis for subcontracting
3. Definitions: Definitions of key terms used throughout the agreement
4. Scope of Work: Detailed description of the work to be performed by the subcontractor
5. Term and Timeline: Duration of the agreement and key project milestones
6. Payment Terms: Compensation, payment schedule, invoicing requirements, and payment methods
7. Obligations of the Subcontractor: Key responsibilities, deliverables, and performance standards expected from the subcontractor
8. Obligations of the Main Contractor: Main contractor's responsibilities including provision of information, materials, or access required
9. Quality Standards: Required quality standards, inspections, and acceptance criteria
10. Health, Safety and Environment: HSE requirements and compliance with relevant regulations
11. Insurance and Indemnity: Required insurance coverage and indemnification obligations
12. Confidentiality: Protection of confidential information and trade secrets
13. Termination: Grounds and procedures for contract termination
14. Dispute Resolution: Process for resolving disputes under Indonesian law
15. Governing Law: Specification of Indonesian law as governing law and jurisdiction
16. General Provisions: Standard legal provisions including notices, amendments, and severability
1. Intellectual Property Rights: Required when the subcontracted work involves creation or use of intellectual property
2. Equipment and Materials: Needed when specific equipment or materials are provided by either party
3. Performance Bond: Include when security for performance is required
4. Force Majeure: Detailed force majeure provisions for projects particularly susceptible to external disruptions
5. Employee Management: Required when subcontractor's employees will work on-site or interface with main contractor's employees
6. Environmental Protection: Additional environmental requirements for environmentally sensitive projects
7. Local Content Requirements: Needed when project must comply with Indonesian local content regulations
8. Currency and Exchange Rate: Required for international subcontractors or contracts with foreign currency elements
1. Schedule A - Scope of Work: Detailed technical specifications and work breakdown structure
2. Schedule B - Bill of Quantities: Itemized list of work items and their quantities
3. Schedule C - Rates and Prices: Detailed pricing structure, rates, and payment terms
4. Schedule D - Project Timeline: Detailed project schedule, milestones, and deadlines
5. Schedule E - HSE Requirements: Detailed health, safety, and environmental requirements and procedures
6. Schedule F - Quality Assurance Plan: Detailed quality standards, testing procedures, and acceptance criteria
7. Schedule G - Key Personnel: List of key personnel and their qualifications
8. Appendix 1 - Required Permits and Licenses: List of required regulatory permits and licenses
9. Appendix 2 - Insurance Requirements: Detailed insurance requirements and coverage limits
10. Appendix 3 - Forms and Templates: Standard forms for progress reports, invoices, and other regular submissions
Relevant legal definitions
Clauses
Relevant Industries
Construction
Manufacturing
Oil and Gas
Mining
Infrastructure Development
Technology and IT Services
Engineering
Telecommunications
Industrial Services
Energy
Transportation
Property Development
Relevant Teams
Legal
Procurement
Operations
Commercial
Risk Management
Project Management
Health Safety Environment
Quality Assurance
Finance
Compliance
Technical Services
Relevant Roles
Project Manager
Contract Manager
Legal Counsel
Procurement Manager
Operations Director
Commercial Manager
Risk Manager
Construction Manager
Site Supervisor
HSE Manager
Quality Control Manager
Finance Manager
Technical Director
Compliance Officer
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