Safcec Subcontract Agreement

For this reason, CIDB and the government disapprove of major contractors who enter into subcontracting agreements that are not favourable to the subcontracting relationship. CIDB recommended best practices for subcontracts. Another peculiarity of the joint agreement is that if 2 or more partners registered with the CIDB create a joint venture, they can offer it for a contract of superior CIDB quality, while a subcontracting agreement has no influence on your CIDB level. In addition, a subcontractor must not be registered or be reputable, while a joint venture created to ensure a higher CIDB classification must be registered with the CIDB. For this reason, the CIDB recommends and defines standards and best practices for subcontracts that can be used by the main party for the development of subcontractors. The main difference between a joint venture and a subcontract is the distribution of the management, financing, skills and liabilities of the contract. In a subcontract, the subcontractor is not directly proportionate to the liabilities, losses and management behaviour of the main contractor. For example, a subcontractor can only be issued for the supply of air conditioning systems. Once the subcontractor has fulfilled its contractual conditions, I hope that it will be paid and that it will leave it. Subcontracts with other service providers must be fair and equitable in the commercial sense of the term. They must be of mutual benefit between the parties and be generated by legal terms that are not contrary to the law. Subcontracts drawn up without the above-mentioned points could pose problems for the main contractor.

Subcontracting is normally considered to be a means by which the main contractor can use the financial, labour and time resources of the subcontractors without interest, resulting in abuses on the part of the system. In this case, South African courts tend to determine whether the subcontracting agreement entered into had a realistic mutual benefit for both parties. Since the subcontract is usually drawn up by the main contractor, South African courts will attempt to investigate terms that might have been unfavourable to the contractor and will attempt to rule in favour of the subcontractor. . . .

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