IACCM Contract Management Forum

« view all forum posts
2017-06-05 10:26:29


Dear All,
I wish to execute a back-to-back subcontract with an entity, with a past record of not always collaborating with Contractor. I intend drafting a stand alone terms and conditions that align with main contract and i need specific wordings and what to watch out for.
I fear to make reference and attach the main contract so that essential terms may not be rendered inefficient as a result of contention, ambiguities, etc.
Also, I do not wish to entertain claims from Subcontractor if the claims are not recognized by the Client. Also I wish to pass on rights of Client to terminate by convenience.

Kindly advise.
 •  World Commerce & Contracting  •   2017-06-05 16:12:42
Much has been written in this subject and our IACCM learning modules cover many of them. At first sight IĀ“d strongly recommend to check previous entries of this forum where in response to Natarajan BalachandarĀ“s post, for instance, we received multiple responses: refer to
Pablo Cilotta
 •  FLSmidth Private Ltd  •   2017-06-26 11:11:44
Most important wording to be included is the subcontract is mutatis mutandis and not "back to back".
The content of subcontract depends on the content of main contract.
Vivek G
 •  Reference Contracting Co.LLC  •   2017-10-01 08:38:08
The back to back subcontract agreement binding the main contractor with the nominated subcontractor reference to the prime contract terms and conditions specifically as follows
1. Payment terms : the subcontractor payment to be release within (i.e 10 days) from the main contract evidence of receiving his payment
2. The variations terms: in the event that the engineer has issued instruction for variation, thereto the subcontractor to submit the variation substations to the main contractor and he will submit to the engineer fro review and approval.
3. Communication : The back to back contract the main contractor is obliged by law to forward all related exchanged correspondences copy to the subcontractor and the subcontractor attendance for meetings is a must.
4. Indemnities : The subcontractor shall indemnify the contractor against any damages so the subcontractor to submit all warranties and guarantees, as well as the insurances..

The back to back sub contracting is very vital related to the important prime contract deliverable packages in terms of cost control requirement and liabilities (time , quality , indemnities ..etc). Subcontracting back to back for all terms and conditions reference to the main contract in case of nominated subcontractor and back to back as a part ( related to payments and variations only ) for the domestic subcontractor.
 •  LogMeIn, Inc.  •   2017-10-08 18:06:17
Regarding the issue of termination for convenience.... you need to determine whether or not you want your company to have a right to terminate for convenience or whether or not you want your customer USING THEIR right to terminate for convenience TO ACT AS A TRIGGER for the contract with the subco to come to an end.

One of the issues I find often gets lost with 'back-to-back', is that people tend to copy exactly what is in the main agreement with their customer into the agreement with subco. When they do this, people often don't take delays in communication into account. I always try to include a buffer regarding obligations of subco to my company.

For example, if there's a service level that obliges me to respond to a customer ticket within 8 hours, and I need to route that to a subco via a non-automated process, or if there's some issue of lag, I need to make sure that the subco is obliged to respond to the ticket in 6 hours. I need to do that to make sure that my company doesn't get 'caught in the middle' by copying obligations and not thinking about how the underlying issue works in practice and understanding if my company can fulfill them when I'm relying on a third party.

Feel free to get in touch.
BR, Nick
Replies: 4
Filter by category
Operations & Capabilities
Organization & People
Strategy & Management Tools