The Domestic Subcontract Agreement is essential for projects in Saudi Arabia where a main contractor needs to delegate specific portions of work to specialized subcontractors. This document is crucial for compliance with Saudi Arabian regulations and Sharia law principles, particularly when executing complex projects that require specialized expertise. The agreement addresses key aspects including scope definition, payment mechanisms, quality standards, and dispute resolution within the Saudi legal framework. It incorporates requirements from various Saudi regulations including labor laws, contractor classification requirements, and local content rules. This type of agreement is particularly important given Saudi Arabia's Vision 2030 initiatives and the increasing focus on major development projects across the kingdom.
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1. Parties: Identification of the main contractor and subcontractor with full legal names, commercial registration numbers, and authorized representatives
2. Background: Context of the main contract, project details, and basis for subcontracting
3. Definitions: Definitions of key terms used throughout the agreement, including technical terms and project-specific terminology
4. Scope of Work: Detailed description of the works to be performed by the subcontractor, including specifications and standards
5. Duration and Timeline: Project schedule, completion dates, and milestones
6. Payment Terms: Pricing, payment schedule, invoicing requirements, and retention amounts
7. Contractor's Obligations: Main contractor's responsibilities, including provision of access, information, and materials
8. Subcontractor's Obligations: Subcontractor's duties, warranties, and performance requirements
9. Materials and Equipment: Requirements for materials, equipment, and quality standards
10. Health, Safety and Environment: HSE requirements and compliance with Saudi regulations
11. Quality Control: Quality assurance procedures and inspection requirements
12. Workforce Requirements: Labor regulations compliance, Saudization requirements, and workforce management
13. Insurance and Liability: Required insurance coverage and allocation of risks
14. Termination: Grounds and procedures for contract termination
15. Dispute Resolution: Procedures for resolving disputes under Saudi law
16. General Provisions: Standard contractual clauses including notices, amendments, and governing law
1. Performance Bond: Required when project value exceeds certain thresholds or when specified by main contract
2. Advance Payment: Include when advance payment is to be made to the subcontractor
3. Intellectual Property: Required when subcontract involves design work or proprietary information
4. Force Majeure: Detailed force majeure provisions beyond standard terms, particularly relevant for long-term projects
5. Confidentiality: Required when sensitive information will be shared
6. Environmental Compliance: Detailed environmental requirements for environmentally sensitive projects
7. Training and Technology Transfer: Required when project involves training of Saudi nationals or technology transfer
8. Warranty Period: Extended warranty provisions beyond standard terms
1. Schedule 1 - Scope of Works: Detailed technical specifications and drawings
2. Schedule 2 - Bill of Quantities: Itemized pricing and quantities
3. Schedule 3 - Project Timeline: Detailed project schedule and milestones
4. Schedule 4 - Payment Schedule: Detailed payment terms and milestone payments
5. Schedule 5 - Key Personnel: List of key personnel and their qualifications
6. Schedule 6 - Required Insurances: Details of insurance requirements and coverage
7. Schedule 7 - HSE Requirements: Detailed health, safety, and environmental requirements
8. Schedule 8 - Quality Assurance Plan: Quality control procedures and requirements
9. Appendix A - Forms and Templates: Standard forms for notices, claims, and variations
10. Appendix B - Main Contract Excerpts: Relevant portions of the main contract that apply to the subcontractor
Authors
Relevant legal definitions
Clauses
Relevant Industries
Construction
Oil & Gas
Infrastructure Development
Real Estate Development
Industrial Projects
Energy
Transportation
Manufacturing
Mining
Telecommunications
Relevant Teams
Legal
Commercial
Procurement
Operations
Project Management
Finance
Risk & Compliance
Technical
Quality Assurance
Health Safety & Environment
Engineering
Construction Management
Relevant Roles
Project Manager
Contract Manager
Legal Counsel
Commercial Manager
Construction Manager
Procurement Manager
Technical Director
Operations Manager
Risk Manager
Compliance Officer
Finance Manager
Quality Assurance Manager
HSE Manager
Site Supervisor
Engineering Manager
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