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KAI TVAR JEA
ANNEX
Rules applicable to the automatic inclusion of sub-contracts with parties in other member.countries of the European Communities or in non-member countries in the cover which may be granted to the principal contractor.
SECTION I – DEFINITION OF "SUB-CONTRACT"
"Sub-contract" means a contract concluded by an undertaking (hereinafter called the "principal contractor") with another undertaking (hereinafter called the "sub-contractor") under which it is agreed that, in performance of another contract made between the "incipal contractor and a third undertaking (hereinafter called the "buyer"), the sub-contractor will deliver
for goods or perform services which the principal contractor must incorporate or use in performing the subject-matter of the contract or contracts which the buyer has made with him, it being understood that:
(a)
(b)
Position in law
The sub-contractor is not a co-signatory to the contract concluded between the principal contractor and the buyer
and
the principal contractor has sole responsibility to the buyer for performance of the contract and bears all the risks which may be guaranteed in relation to the latter.
Technical and economic position
Supplies from the sub-contractor cover goods (other than raw materials or semi-finished goods) and/or services which, from the technical and economic point of view, constitute for the Buyer essential ancillaries to. performance of the contract by the principal contractor.
SECTION II
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AUTOMATIC INCLUSION OF SUB-CONTRACTING
Sub-contracts exclusively with parties in one or more Member States shall be automatically included in the cover which may be granted to the principal contractor where the amount ? such sub-contracts is equal to or less than:
40 per cent for con "acts of a value less than 7 500 000 units of account,
3 million units of
ccount for contracts of a value between 7 500 000 and 10 million units of account,
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•.30 per cent for contracts of a value over 10 million units of account.
However, where the principal contractor's credit insurer is unable, because the risk inherent in the tra saction is particularly heavy, to support cover for the whole of the transac ion, consultation between the interested credit, insurance organisations shal take place with a view to resolving the problem by means of joint insurance if possible, re-insurance.
D.D. 992/72 (E 997)
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