The Independent Contractor Subcontractor Agreement is essential for businesses operating in Saudi Arabia that engage external service providers or specialists as independent contractors rather than employees. This document is particularly relevant in the context of Saudi Arabia's evolving business landscape, where companies increasingly rely on specialized contractors for project-specific work. The agreement ensures compliance with Saudi Arabian commercial law, labor regulations, and Sharia principles while clearly establishing the independent nature of the relationship. It becomes necessary when a company needs to engage contractors for specific projects, technical expertise, or specialized services while maintaining clear legal separation from employment relationships. The document addresses critical aspects such as scope of work, payment terms, intellectual property rights, confidentiality, and dispute resolution mechanisms, all within the framework of Saudi Arabian legal requirements.
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1. Parties: Identification of the main contractor and subcontractor, including full legal names, commercial registration numbers, and authorized representatives
2. Background: Context of the agreement, relationship between parties, and reference to the main contract (if applicable)
3. Definitions: Key terms used throughout the agreement, including technical terms, project-specific terminology, and legal definitions
4. Scope of Services: Detailed description of services to be provided, deliverables, and performance standards
5. Term and Termination: Duration of the agreement, renewal terms, and conditions for termination
6. Compensation and Payment Terms: Fee structure, payment schedule, invoicing requirements, and currency specifications
7. Independent Contractor Status: Clear statement of independent contractor relationship and disclaimer of employment relationship
8. Obligations and Responsibilities: Specific duties of both parties, including reporting requirements and quality standards
9. Compliance with Laws: Requirement to comply with Saudi laws, regulations, and Sharia principles
10. Confidentiality: Protection of confidential information and trade secrets
11. Intellectual Property Rights: Ownership and usage rights of work product and pre-existing IP
12. Insurance and Liability: Insurance requirements and allocation of risks between parties
13. Dispute Resolution: Process for resolving disputes, including jurisdiction and applicable law
14. General Provisions: Standard contractual terms including notices, amendments, and severability
1. Non-Compete: Restrictions on competitive activities, used when contractor may have access to sensitive business information
2. Equipment and Resources: Provisions regarding tools and resources, used when specific equipment or facilities are provided
3. Training Requirements: Specific training or certification requirements, used in technical or specialized services
4. Performance Metrics: Detailed KPIs and measurement criteria, used in performance-based contracts
5. Security Requirements: IT security and physical security requirements, used when handling sensitive data or accessing secure facilities
6. Force Majeure: Provisions for unforeseen circumstances, particularly relevant in long-term or high-value contracts
7. Warranties: Specific warranties for services or deliverables, used in technical or professional services
8. Succession Planning: Requirements for personnel replacement and knowledge transfer, used in key personnel-dependent services
1. Schedule A - Scope of Work: Detailed technical specifications and requirements for the services
2. Schedule B - Fee Schedule: Detailed breakdown of fees, rates, and payment milestones
3. Schedule C - Service Levels: Performance standards, metrics, and measurement methodologies
4. Schedule D - Key Personnel: List of key personnel and their qualifications
5. Schedule E - Compliance Requirements: Specific regulatory and compliance requirements applicable to the services
6. Appendix 1 - Required Forms: Standard forms for reporting, invoicing, and other administrative requirements
7. Appendix 2 - Insurance Requirements: Detailed insurance coverage requirements and minimum limits
8. Appendix 3 - Health and Safety Standards: Applicable health and safety requirements and procedures
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