SUBCONTRACT AGREEMENT FOR SPECIALIZED WORKS
Conforming to Pakistan Engineering Council (PEC) Guidelines & Contract Act, 1872
THIS SUBCONTRACT AGREEMENT (hereinafter referred to as the "Subcontract") is entered into on this [AgreementDate] at [ExecutionCity], Pakistan, by and between:
1. [MainContractor], having its principal registered office at [MainContractorAddress], represented by its authorized representative [MainContractorRep] (hereinafter referred to as the "Main Contractor", which expression shall include its successors, legal representatives, and permitted assigns) of the FIRST PART;
AND
2. [Subcontractor], a specialized contracting entity holding Pakistan Engineering Council Registration No. [SubcontractorPEC], having its principal office at [SubcontractorAddress], represented by [SubcontractorRep] (hereinafter referred to as the "Subcontractor", which expression shall include its successors, legal representatives, and permitted assigns) of the SECOND PART.
(The Main Contractor and Subcontractor are hereinafter collectively referred to as the "Parties" and individually as a "Party".)
PREAMBLE & RECITALS
A. The Main Contractor has entered into a principal contract with [EmployerName] (the "Employer") for the execution of [ProjectTitle] (the "Main Project").
B. The Subcontractor has represented and warranted that it possesses the requisite technical competence, PEC licensing, certified manpower, specialized equipment, and financial solvency to execute the specialized works described herein.
C. Relying upon the Subcontractor's representations, the Main Contractor has agreed to engage the Subcontractor to execute the Subcontract Works on the terms and conditions set forth below.
Clause 1 — Scope of Subcontract Works
The Subcontractor shall execute, complete, and remedy all defects in the following works: [ScopeOfWork] (the "Subcontract Works"). All works shall strictly conform to approved architectural/MEP drawings, Bill of Quantities (BOQ), and Pakistan Engineering Council (PEC) technical standards.
Clause 2 — Subcontract Price & Payment Milestones
The total agreed subcontract consideration is PKR [ContractPrice]/- (the "Subcontract Price"). Payments shall be administered as follows:
- Mobilization Advance: An advance of [MobilizationAdvance]% of the Subcontract Price shall be released upon submission of an acceptable advance payment guarantee and site mobilization.
- Interim Running Bills: The Subcontractor shall submit monthly Interim Payment Certificates (IPCs) based on verified work measured on site. Verified bills shall be processed within 14 working days of certification by the Resident Engineer.
- Retention Security: A retention deduction of [RetentionPercent]% shall be withheld from each progressive IPC as performance security.
Clause 3 — Time for Completion & Delay Damages
The Subcontractor shall achieve substantial completion of the Subcontract Works within [CompletionTime]. If the Subcontractor fails to complete the works within this agreed timeline without an approved force majeure extension, the Subcontractor shall pay Liquidated Damages at 0.1% of the Subcontract Value per day of delay, subject to a maximum ceiling of 10% of the total Subcontract Price.
Clause 4 — Quality Assurance & Defects Liability Period (DLP)
The Subcontractor warrants that all materials and workmanship shall be first-class and free from defects. The Subcontractor guarantees the works against all latent and patent defects for a Defects Liability Period of [DefectLiabilityPeriod] commencing from the issuance of the Substantial Completion Certificate. Any defective work identified during this period shall be promptly rectified by the Subcontractor at its sole expense within 7 days of written notice.
Clause 5 — Release of Retention Money
Fifty percent (50%) of the total retained amount shall be released to the Subcontractor upon issuance of the Substantial Completion Certificate, and the remaining fifty percent (50%) upon successful expiration of the Defects Liability Period and issuance of the Final Clearance Certificate.
Clause 6 — Labor Compliance, HSE & Indemnification
The Subcontractor shall be exclusively responsible for all labor and technicians deployed on site, including full compliance with the Workmen's Compensation Act, EOBI, and Provincial Social Security contributions (PESSI/SESSI). The Subcontractor shall strictly enforce site Health, Safety & Environment (HSE) standards and hereby indemnifies and holds harmless the Main Contractor and Employer against any liability, fines, property damages, or bodily injury claims.
Clause 7 — Governing Law & Dispute Resolution
This Subcontract is governed by the laws of Pakistan. In the event of any unresolved dispute between the Parties, the matter shall be referred to sole arbitration in accordance with the Arbitration Act, 1940. The venue of arbitration shall be [ExecutionCity], Pakistan, and the decision of the Arbitrator shall be final and binding.
IN WITNESS WHEREOF, the Parties hereto have caused this Subcontract Agreement to be executed by their duly authorized representatives on the date first written above.
FOR & ON BEHALF OF MAIN CONTRACTOR
Authorized Signatory & Official Seal
FOR & ON BEHALF OF SUBCONTRACTOR
Authorized Signatory & PEC Stamp
WITNESS 1:
Signature: __________________________
Name: _____________________________
CNIC No: __________________________
WITNESS 2:
Signature: __________________________
Name: _____________________________
CNIC No: __________________________