Subcontracting in tenders

When subcontracting is allowed

Subcontracting is allowed unless banned by tender docs; the share that may be delegated is set by contract. Some procurements have limits.

Liability

The contractor is liable to the customer for the whole scope — including subcontractor work. The subcontractor has no direct relationship with the customer.

Subcontractor documents

The customer may require the same qualification documents from the subcontractor; when using subcontractor resources to qualify — the subcontract agreement goes in the bid.

Payment

Subcontractor is paid by the contractor, not directly by the customer; subcontractor invoices are no basis for customer payment.

Typical limits

Common limits: subcontracting up to 30–50% of scope, ban on delegating key work (design, main contract), requirement to notify involvement.

Risks

Involving a subcontractor without required notice — grounds for termination. A paper-only subcontract for qualification — bid rejection.