The Subcontractor Agreement (Construction) is essential for construction projects in Saudi Arabia where specialized works need to be delegated to qualified subcontractors. This document is used when a main contractor wishes to engage a subcontractor to perform specific construction works while maintaining overall project responsibility to the project owner. The agreement must comply with Saudi Arabian law, including the Government Tenders and Procurement Law, Saudi Building Code, and Sharia principles. It typically includes detailed specifications of works, payment structures, timelines, quality requirements, and risk allocation. The document is particularly important for ensuring compliance with local regulations including Saudization requirements, labor laws, and HSE standards. It provides a clear framework for managing the subcontractor relationship while protecting both parties' interests under Saudi jurisdiction.
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1. Parties: Identification of the main contractor and subcontractor, including commercial registration details
2. Background: Context of the main contract and subcontracting relationship
3. Definitions and Interpretation: Key terms used in the agreement and rules of interpretation
4. Scope of Works: Detailed description of the subcontracted works and deliverables
5. Contract Price and Payment Terms: Payment amount, schedule, and mechanisms including VAT considerations
6. Duration and Timeline: Project schedule, milestones, and completion dates
7. Subcontractor Obligations: Key responsibilities including labor, materials, equipment, and compliance requirements
8. Main Contractor Obligations: Support, access, and coordination responsibilities
9. Quality and Standards: Required quality levels and applicable construction standards
10. Health, Safety and Environment: HSE requirements and compliance with Saudi regulations
11. Labor and Workforce: Labor law compliance, Saudization requirements, and workforce management
12. Insurance and Liability: Required insurance coverage and liability allocation
13. Warranties and Defects: Warranty period, defect remediation, and quality guarantees
14. Variations and Changes: Process for handling changes to scope or specifications
15. Suspension and Termination: Rights and procedures for suspension or termination
16. Force Majeure: Definition and consequences of force majeure events
17. Dispute Resolution: Dispute resolution procedures compliant with Saudi law
18. Governing Law: Confirmation of Saudi law as governing law
19. General Provisions: Standard boilerplate clauses including notices, assignment, and severability
1. Performance Security: Requirements for performance bonds or guarantees, if required for high-value works
2. Intellectual Property Rights: IP provisions when design or technical innovations are involved
3. Confidentiality: Confidentiality obligations when sensitive information is shared
4. Environmental Protection: Additional environmental requirements for environmentally sensitive projects
5. Equipment Supply: Specific provisions when substantial equipment supply is involved
6. Storage and Materials Management: Detailed provisions for projects requiring significant materials storage
7. Site Security: Additional security requirements for high-security or sensitive locations
8. Technology and Systems: IT and systems requirements for technology-intensive projects
9. Training and Knowledge Transfer: Training requirements when specific skills transfer is needed
1. Schedule 1 - Scope of Works: Detailed technical specifications and drawings
2. Schedule 2 - Bill of Quantities: Detailed breakdown of quantities and prices
3. Schedule 3 - Project Timeline: Detailed project schedule and milestones
4. Schedule 4 - Payment Schedule: Detailed payment terms, milestones, and procedures
5. Schedule 5 - Key Personnel: List of key personnel and their qualifications
6. Schedule 6 - Required Insurance: Detailed insurance requirements and coverage levels
7. Schedule 7 - HSE Requirements: Detailed health, safety, and environmental requirements
8. Schedule 8 - Quality Assurance Plan: Quality control procedures and requirements
9. Schedule 9 - Forms and Procedures: Standard forms for variations, payments, and approvals
10. Schedule 10 - Site Rules and Procedures: Site-specific rules and operational procedures
Authors
Relevant legal definitions
Clauses
Relevant Industries
Construction
Infrastructure
Real Estate Development
Oil & Gas Construction
Industrial Construction
Commercial Construction
Residential Construction
Healthcare Construction
Education Construction
Transportation Infrastructure
Energy Infrastructure
Mining
Relevant Teams
Legal
Operations
Commercial
Procurement
Project Management
Construction
Risk & Compliance
Finance
Engineering
Quality Assurance
Health & Safety
Relevant Roles
Construction Manager
Project Director
Commercial Manager
Contracts Manager
Legal Counsel
Procurement Manager
Project Manager
Site Manager
Operations Director
Chief Operating Officer
Risk Manager
Compliance Officer
Technical Director
Engineering Manager
Quality Assurance Manager
HSE Manager
Finance Director
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