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What is a Subcontracting Agreement?

A Subcontracting Agreement is a contract that sets out the terms and conditions between a contractor and subcontractor for the provision of services to a third party.

A Subcontracting Agreement is required when a business does not supply all the goods or services for a project directly but engages a subcontractor to provide some of the goods or services.

A Subcontracting Agreement specifies the terms of the relationship between the main contractor and the subcontractor.

Key points included

  • Whether the main contractor has already entered into a main contract;
  • Who the contractor will be providing goods or services to;
  • Details about the subcontractor;
  • Whether the subcontractor will be responsible for everything agreed in the main contract or only certain aspects;
  • Whether the subcontractor will indemnify the main contractor in respect of any work performed by the subcontractor; and
  • If there is any agreed limit of liability for both the contractor and the subcontractor.

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