flow-down clauses | положения, подлежащие включению в договоры субподряда (положения договора генерального подряда • Federal government contractors and subcontractors often struggle with flow-down clauses. Fundamentally, prime and subcontractors squabble over flow-down clauses because they involve assumption of risk. A prime contractor has committed to comply with all of the clauses in its prime contract. To the extent a prime contractor does not flow down a clause to its subcontractor, the prime contractor assumes the risk of any subcontractor non-compliance. This is because, if a contracting officer identifies regulatory non-compliance, the government only looks to the party with which it has privity to enforce compliance: the prime contractor. If the prime contractor has not flowed down the applicable clause to its subcontractor, the prime contractor is responsible for its subcontractor’s non-compliance. If the clause has been flowed down, the prime contractor can enforce compliance upon its subcontractor. From a subcontractor perspective, the more flow-down clauses it accepts from its prime contractor, the more compliance risk it assumes. lexology.com 'More) |