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Subcontractor Agreement for Malaysia

Subcontractor Agreement Template for Malaysia

A comprehensive legal agreement governed by Malaysian law that establishes and regulates the relationship between a main contractor and a subcontractor. The document outlines the scope of work, payment terms, performance standards, and compliance requirements while incorporating relevant Malaysian regulatory requirements, including those under the Contracts Act 1950 and industry-specific regulations. It includes provisions for quality control, safety standards, dispute resolution, and termination rights, all structured to ensure compliance with Malaysian legal framework and business practices.

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What is a Subcontractor Agreement?

The Subcontractor Agreement is essential for businesses operating in Malaysia that need to delegate specific portions of their contractual obligations to third parties. This document is commonly used across various industries where specialized work or additional capacity is required. It must comply with Malaysian legal requirements, including the Contracts Act 1950, Employment Act 1955, and industry-specific regulations. The agreement typically includes detailed provisions on scope, payment terms, quality standards, safety requirements, and dispute resolution mechanisms, while addressing local business practices and regulatory compliance. It's particularly important for risk management and establishing clear hierarchies of responsibility in complex projects.

What sections should be included in a Subcontractor Agreement?

1. Parties: Identification of the main contractor and subcontractor, including registration numbers and addresses

2. Background: Context of the agreement, including reference to the main contract and project

3. Definitions: Definitions of key terms used throughout the agreement

4. Scope of Work: Detailed description of the works or services to be performed by the subcontractor

5. Duration and Timeline: Contract period, key milestones, and completion dates

6. Payment Terms: Payment amount, schedule, method, and conditions for payment

7. Performance Standards: Quality standards, specifications, and performance requirements

8. Subcontractor Obligations: Key responsibilities and duties of the subcontractor

9. Main Contractor Obligations: Key responsibilities and duties of the main contractor

10. Compliance with Laws: Obligation to comply with relevant Malaysian laws and regulations

11. Insurance and Indemnity: Insurance requirements and indemnification provisions

12. Health and Safety: Health and safety requirements and responsibilities

13. Confidentiality: Protection of confidential information and trade secrets

14. Termination: Grounds and procedures for contract termination

15. Dispute Resolution: Process for resolving disputes between parties

16. General Provisions: Standard contractual provisions including notices, amendments, and governing law

What sections are optional to include in a Subcontractor Agreement?

1. Intellectual Property Rights: Required when the subcontracted work involves creation or use of intellectual property

2. Performance Bond: Include when a performance bond or security deposit is required

3. Equipment and Materials: Needed when specific provisions about equipment or materials supply are necessary

4. Environmental Compliance: Include for projects with significant environmental impacts or requirements

5. Force Majeure: Optional but recommended for long-term or high-value contracts

6. Assignment and Subcontracting: Include when there's a need to restrict or regulate further subcontracting

7. Warranties: Required when specific warranties for work or materials are needed

8. Local Content Requirements: Include when there are specific Malaysian local content requirements

9. Quality Control and Inspection: Required for projects with specific quality control requirements

10. Training and Knowledge Transfer: Include when the subcontractor must provide training or transfer knowledge

What schedules should be included in a Subcontractor Agreement?

1. Schedule 1 - Scope of Works: Detailed technical specifications and scope of works

2. Schedule 2 - Payment Schedule: Detailed breakdown of payments, milestones, and payment terms

3. Schedule 3 - Project Timeline: Detailed project schedule, milestones, and deadlines

4. Schedule 4 - Key Personnel: List of key personnel and their roles from both parties

5. Schedule 5 - Equipment and Materials: List of equipment and materials to be provided by each party

6. Schedule 6 - Insurance Requirements: Detailed insurance requirements and coverage limits

7. Schedule 7 - Health and Safety Requirements: Specific health and safety procedures and requirements

8. Appendix A - Forms and Templates: Standard forms for progress reports, payment claims, and variations

9. Appendix B - Technical Standards: Applicable technical standards and specifications

10. Appendix C - Site Rules and Procedures: Site-specific rules and procedures to be followed

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Malaysia

Publisher

Ƶ

Cost

Free to use
Relevant legal definitions






























Clauses






























Relevant Industries

Construction

Engineering

Manufacturing

Information Technology

Oil and Gas

Infrastructure

Telecommunications

Mining

Real Estate Development

Facilities Management

Energy

Industrial Services

Relevant Teams

Legal

Procurement

Operations

Commercial

Risk Management

Project Management

Compliance

Health and Safety

Quality Assurance

Business Development

Technical Operations

Contract Administration

Relevant Roles

Project Manager

Contract Manager

Legal Counsel

Procurement Manager

Operations Director

Commercial Manager

Risk Manager

Construction Manager

Site Supervisor

Technical Director

Compliance Officer

Chief Operating Officer

Business Development Manager

Quality Assurance Manager

Health and Safety Officer

Industries










Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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