SUB-CONTRACT AGREEMENT
EXECUTION OF DESIGN AND CONSTRUCTION OF ME WORK FOR ………………………………
No:
This Subcontract Agreement (“Sub-contract”) is made and entered into this……… of 201…, by and between:
PARTY A:
Address :
Tel :
Represented by: Position:
(Hereinafter referred to as the “Main Contractor")
PARTY B:
Address : ..............................................................................................
Tel : ..................................... Fax : .....................................
Represented by: ............................................. Position:...............................
(Hereinafter referred to as the “Sub-contractor")
Article 1: OBJECTS OF SUB-CONTRACT
1.1 The Main Contractor assigns and the Sub-contractor undertakes to carry out the design and construction of ME works for the following project:
(i) Name of works /project:
(ii) Location of works:
(iii) Scopes of works:
(iv) Construction period:
This transaction has been approved by the Owner.
Article 2: SUB-CONTRACT DOCUMENTS
Sub-contractor will perform its Work in accordance with this Sub-contract Agreement and Contract Documents, which are identified as follows:
Quotation with break down detail and quotation conditions;
Contract drawings based on architect drawings issued by Main contractor;
ME work schedule follow general schedule of Main contractor;
Any documents, if any, mutually agreed by both parties.
Article 3: SUB-CONTRACT PRICE AND MODE OF PAYMENT
Sub-contract Price:
Sub-contract price is of BDT………………………………………. (in words:…………………………………………….), this price is excluded VAT.
3.2 Mode of payment:
a) Payment schedule:
First payment: 30% of Sub-contract value to be made to Sub-contractor upon signing this Subcontract.
• Final payment: 70% of Sub-contract value to be made to Sub-contractor within 10 (ten) days after completion of the Works.
Payment paid to Sub-contractor shall be made in BDT and be remitted to bank account designated by Subcontractor as follows :
Name of Bank :
Address :
A/C No. (BDT):
A/C Name :
c) Bank charge inside Bangladesh are for Applicant’s A/C. Bank charge outside Bangladesh are for Beneficiary’s A/C.
Bank charge will be at Applicant’s A/C only. However, correspondent bank charges will be borne by Beneficiary
3.3 Adjustment of Sub-contract Price
Either party may, by expressly stating the reason therefor, make a claim for a necessary adjustment to the Sub-contract Price due to any of the following cases:
If, during the term of the Sub-contract, the Sub-contract Price has become apparently inappropriate and improper due to an enactment, revision or abrogation of laws, ordinances or regulations, drastic changes in the economic conditions or other unforeseeable causes;
If, in a long term contract, the amount of the Sub-contract Price corresponding to any portion of the Work which shall have been executed hereunder after the first anniversary of conclusion of the Contract, is inappropriate and improper due to an enactment, revision or abrogation of laws, ordinances or regulations, or due to changes in the commodity prices, wages and other such matters.
In case of arising the above-mentioned reasons and one of two parties desires to negotiate the Sub-contract Price adjustment, such party has to give sufficient and accurate evidences in order to mutually discuss in advance by both parties and reach conclusion in writing before carrying out the adjustment of the Sub-contract Price.
Article 4: RESPONSIBILITY FOR ENSURING QUALITY OF THE WORKS
4.1 Sub-contractor shall be responsible with the State and the Main Contractor for issues regarding the Works such as technical, quality, and other commitments described herein and compensate for damages caused by itself.
4.2 In order to ensure quality of construction works, the Sub-contractor has to comply with regulations and standards on assuring quality, and quality management requirements as regulated in responsibility and obligations of the parties.
Article 5: GUARANTEES OF THE EXECUTION OF SUBCONTRACT
5.1 Responsibility of Main Contractor:
a) To sufficiently provide to Sub-contractor with all documents related to the project, equipment, if any, for design and the construction of the Works.
b) To consider timely and sign approval for documents submitted by Sub-contractor as well as combine with Sub-contractor to solve difficulties with mutually both parties during construction period to ensure on schedule and construction quality as well.
c) To hand over the Site to Sub-contractor, including landmark, borderlines levels, actual state of height, engineering geological.
d) To make payment timely, as agreed herein.
5.2 Responsibility of Sub-contractor:
a) To ensure that Sub-contractor has sufficiently conditions, capabilities to perform work design and construction in accordance with provisions of law.
b) To carry out the design strictly according to the Owners’ and local authorities’ requests. Scope of design as well as design responsibility including following main parts if there is no any agreement:
Basic design drawings;
Technical design drawings (included design agreed drawings with related local authorities);
Design drawings;
Construction design drawings; and
As-built drawings.
The stages of design are shown by quantity of drawings, size and drawing number according to Main contractor’s requests.
c) To hand over and submit documents relating to ordering equipments, machinery, materials, catalogues, samples to get approval before ordering and installing at site.
To ensure construction quality, Sub-contractor has to submit documents relating to project quality management as well as standards, measures of construction at suitable time for inspection and evaluation conducted by the Main contractor.
d) To carry out the construction strictly according to the designs, construction standards, ensuring quality, progress, safety and environmental sanitation;
e) To compile work construction diaries;
f) To provide and test construction materials and products; as well as using certificates for equipments and machines supplied and installed by sub-contractor after installation (or before hand over) as requested by competent authorities.
g) To manage construction workers in the construction sites, ensure security and order, without affecting the surrounding population quarters;
h) To make construction completion drawings and take part in the pre-acceptance test of works, works’ hand-over as agreed herein;
i) To provide work warranty as agreed herein;
j) To make compensation for damages caused by breaches of Sub-contract, use of construction materials of wrong categories or construction activities which are not up to the standards or cause environmental pollution, and other acts of violation causing damage due to their faults;
k) To bear responsibility for the quality of construction works they are in charge of;
l) Other obligations provided for by law.
Article 6: RIGHTS OF SUB-CONTRACTOR
a) To reject unlawful requests by the Owner or Main Contractor;
b) To propose design modifications to make designs more suitable to realities, thus ensuring quality and efficiency of works;
c) To stop the work construction if the Main Contractor fails to strictly perform his commitments herein, thus causing obstacles and damage to Sub-contractor;
d) To request compensations for damage caused due to faults of the Main Contractor.
Article 7: INSPECTION, ACCEPTANCE TEST, HAND-OVER OF WORKS
7.1 During construction period, Sub-contractor has to implement strictly inspecting the scope of works in scale of Sub-contractor’s tasks, specifically:
To inspect manufacturing equipments ordered for project before delivering. Sub-contractors should carry out test by themselves or having Main contractor’s participation, mutually two parties will discuss specifically and be consistent for each situation.
To inspect construction periods, comply with Main contractor’s inspection schedules;
To hand over inspection results sufficiently and on schedule to make reports and transfers according to Main contractor’s request as well as relating local authorities.
7.2 The pre-acceptance test and hand-over of Works shall be strictly executed with the progress of the Works.
a) After completion of each job, each part, each stage and each work item, pre-acceptance test must be made for putting works as required;
b) Particularly for hidden parts of works, the pre-acceptance test and construction completion drawings must be made before the subsequent jobs are carried out;
c) Pre-acceptance test shall be made only when the to be-tested objects are completed and the dossiers thereon are completed;
d) Works shall be put into pre-acceptance test for use only when they satisfy the design requirements, ensure the quality and are up to the prescribed standards.
7.3 Sub-contractor shall have to finish to construction, clear the construction sites, make construction completion drawings and prepare documents in service of the pre-acceptance test and hand-over of the Works.
7.4 Main Contractor shall have to organize the pre-acceptance test and reception of Works, together with the Owner.
Article 8: WARRANTY FOR WORKS
8.1 Sub-contractor shall have to provide warranty for Works from the date of pre-acceptance test and hand-over of Works with duration of 24 months.
8.2 Contents of warranty of Works include: repair and replacement of damaged or faulty equipment, correction of abnormal operation of Works caused due to Subcontractor’s faults.
Article 9: OBLIGATIONS FOR ASSURANCE OF SAFETY AND ENVIRONMENTAL SANITATION
9.1 Sub-contractor shall have to carry out and be responsible for ensuring safety for people, machines, equipment, assets and works under construction, underground works and adjacent works. If causing damage, Sub-contractor would pay compensation.
9.2 Sub-contractor shall apply measures to ensure the environmental sanitation in the course of work construction, including requirements on air environment, water environment, solid waste, noise and other requirements on environmental sanitation.
Repair, make compensations for damage caused by environmental sanitation – related violations they commit in the course of construction and transport of construction materials.
Article 10: INSURANCE
Sub-contractor shall enter into insurance policies for materials, equipment, factories serving construction works, accident insurance for employees, civil liabilities to a third party and other insurance, if any, provided for by law.
Article 11: SUBLETTING
Sub-contractor shall only be entitled to assign a part of the Works under the contract to the third parties with prior written approval from the Main Contractor.
Article 12: COMPENSATION FOR DAMAGE
12.1 In cases where Subcontractor would not follow the schedule time and progress of the execution of construction works, Main Contractor will be entitled to apply a fine of 0.2% of Subcontract value for each day of delay, but not exceed 5% of Subcontract value.
12.2 Where Subcontractor causes damages to Main Contractor, Owner, or any third party, Subcontractor would pay compensation for such damages.
Article 13: TAX AND OTHER FINANCIAL OBLIGATIONS
13.1 Any reference to the Subcontract Sum or any part thereof shall be deemed to be inclusive of all taxes (excluding VAT) levied within and outside Bangladesh hereinafter called taxes. All taxes shall be deducted by responsible party according to respective rules and regulations existed in Bangladesh at the time being in force.
13.2 The rates and prices herein are based on the understanding that the Subcontractor is required to comply with all taxation requirements in Bangladesh, including corporate income tax, turnover tax, profit tax, personnel income tax and duties levies or charges of any kind assessed by any Bangladeshi governmental authority.
Article 14: PARTIES’ COMMON COMMITMENTS ON ANTI-BRIBERY AND CORRUPTION
14.1. Each Party acknowledges that the laws of country / countries in the Territory forbid the making of gifts or payments to the government employees or political parties to induce such employees or parties to misuse positions of influence in order to obtain or retain business.
14.2. Each Party warrants that it has and maintains and undertakes to keep up to date its own compliance policy on ethical behavior (“Compliance Code”)., and which compliance policy shall take into account in particular the Applicable Laws, rules and industry codes on anti-bribery and corruption activities in each case in those countries in the Territory in which the relevant Party is engaged in activities pursuant to this Agreement.
14.3. In engaging in their various activities under or pursuant to this Agreement, each Party undertakes to comply with their own Compliance Code as well as with all Applicable Laws, rules and industry codes on anti-bribery and corruption.
For purpose of this clause, the Territory shall mean the territory of Vietnam.
14.4. Subcontractor/Consultant Contractor’ Further Commitments on Anti-bribery and Corruption
Subcontractor/Consultant Contractor shall take all actions reasonably necessary to ensure that from and after the execution date of this Agreement, Subcontractor/Consultant Contractor and its Affiliates, and their respective directors, officers, employees and agents, shall be in compliance with all Applicable Anti-Corruption Laws (defined below), including, without limitation, Vietnamese laws and regulations.
Subcontractor/Consultant Contractor represents and warrants to Main Contractor that the following statements contained in this Article are true and correct as of the execution date of this Agreement.
14.5 Anti-Corruption Practices
Subcontractor/Consultant Contractor is aware of and familiar with the anti-corruption laws applicable in each jurisdiction in which Subcontractor/Consultant Contractor or its Affiliates conduct business (hereinafter “Applicable Anti-Corruption Laws”) and neither Subcontractor/Consultant Contractor nor any of its Affiliates has violated any Applicable Anti-Corruption Law. Neither Subcontractor/Consultant Contractor nor any of its Affiliates, nor, to the knowledge of Subcontractor/Consultant Contractor or any of its Affiliates, any director, officer, employee, agent, affiliate or other person acting on behalf of Subcontractor/Consultant Contractor or its Affiliates, is, or has been, under administrative, civil, or criminal investigation, indictment, information, suspension, debarment, or audit (other than a routine contract audit), by any party, in connection with alleged violations of the Applicable Anti-Corruption Laws. Further, Subcontractor/Consultant Contractor has taken, and has caused its Affiliates to take, reasonable efforts to ensure that their directors, officers, employees, and agents act in compliance with the Applicable Anti-Corruption Laws in connection with the operation of the business of Subcontractor/Consultant Contractor and its Affiliates.
Breach of any of the provisions in this clause or of any Applicable Anti-Corruption Law is a material breach of this Agreement and, without prejudice to any other right, relief or remedy, entitles the Main Contractor to terminate this Agreement immediately upon Subcontractor/Consultant Contractor’s receipt of the notice of termination.
Article 15: GOVERNING LAW AND DISPUTE RESOLUTION
15.1 This Sub-contract shall be governed by and construed in accordance with the laws of Bangladesh; however, in the event that there is no published and publicly available law in Bangladesh governing a particular matter relating to this Sub-contract, reference shall be made to general international commercial practice.
15.2 Any question or dispute arises between the Parties concerning the rights, duties or obligations of the parties hereunder; the parties will first endeavor to settle through discussions and negotiations. If, however, after sixty (60) days from the commencement of a dispute and such dispute has not been resolved to the satisfaction of the Parties, then either Party may bring an action in a competent court in Singapore.
Article 16: NOTICES
16.1 Any notices to be given under this Contract shall be sent by personal delivery, airmail post, special courier, cable, telegraph or facsimile to the address of the relevant herein.
By prior written notice, either party may at any time designate a different address for communication under this Contract:
The Main Contractor:
Address:
Tel:
The Sub-contractor: ..................................................................
Address: .....................................................................,
Tel: .......................... Fax: ....................
Article 17: LANGUAGE
Languages used in this Sub-contract and its related documents, notices, and correspondents shall be English.
Article 18: SUPPLEMENTATION, AMENDMENT, AND EFFECTIVE
18.1 No amendment or modification to this MOU shall be effective unless made in writing and signed by the Parties.
18.2 This Sub-contract comes into full force upon signing and shall be terminated by the parties’ agreement upon receipt of notice of subcontract termination from other party.
Article 19: FORCE MAJEURE
Nonperformance of either party (except for payment obligations) shall be excused to the extent that performance is rendered impossible by strike, fire, flood, act of God, governmental acts, failure of suppliers or any other reason beyond the reasonable control of the non-performing party.
This Agreement shall be made on two (2) identical copies and each such copy shall be deemed to be an original.
FOR MAIN CONTRACTOR
Signature:_________________________
Name :
Title :
Date :
FOR SUB-CONTRACTOR
Signature:____________________________
Name :
Title :
Date :