Accordingly, a subcontractor who has performed the entire contract without having been paid in full must take care of the main contractor, unless there has been an assignment of rights. Another difference between domestic subcontractors and designated subcontractors is payment. In accordance with the terms of the main contract, the main contractor has a general obligation to prove that the payment was made to the designated subcontractors and, if it does not, the employer has the right to make direct payments to the designated subcontractor. However, the distinction between national subcontractors and designated subcontractors is generally drawn from the contract. For example, in its section 5, the FiDIC Red Book addresses the issue of subcontractors designated in 1999 and provides that a prime contractor is not required to recruit a designated subcontractor where there is reason to believe that the designated subcontractor does not have sufficient skills, resources or financial capacity to carry out the work, or (2) that the subcontractor itself has no specific compensation for the main business. if the main contractor immediately informs the employer of its objection, the subcontractors should request the right to suspend the work for non-payment by the contractor. Regardless of a pay-when-paid clause, the suspension of work is a powerful weapon that can lead a contractor to carefully follow the subcontractor`s claims and put pressure on the employer to pay for the non-contentious work. Therefore, in the eyes of the employer, any delay or omission of the subcontractor is considered a delay or omission of the main contractor. This goes without saying, unless otherwise provided in the main contract. Fidic 1999 Red Book offers major contractors the possibility to derogate from this position and provides, in subsection 4.4, that the contractor is liable for the acts or omissions of a subcontractor, its representatives and staff, as if they were acts or omissions of the contractor, unless otherwise specified in the special conditions. Where a subcontractor has this type of agreement, it is necessary to ensure that the terms agreed with the employer do not leave the subcontractor with other legal obstacles (e.g. B disputes before local courts and not by arbitration).
Designated subcontractors are the subcontractors designated as such in the main contract or that the engineer instructs the main contractor to employ. Uae law does not distinguish between domestic and designated subcontractors and, therefore, from a legal point of view, and unless there are contractual conditions to the contrary, the liability of the prime contractors towards designated and domestic subcontractors is the same. The Civil Transactions Code of the United Arab Emirates authorizes the main contractor to award all or part of the work to a third party, without the need to obtain the employer`s authorization, unless otherwise provided in the contract or if the execution of the works depends on the personal jurisdiction of the contractor. . . .