Italy: Subcontractor Selection In Construction Projects And The FIDIC Books

Last Updated: 10 August 2016
Article by Giuseppe Broccoli

In international construction projects, the Employer (and certainly the Contractor) may suffer the consequences of a wrong selection of the Subcontractor and this may have an impact on the timing for completion or on the quality of works executed.

Despite the fact that the liabilities for any default of the Subcontractor are generally borne only by the Contractor, the Employer may want to take all the necessary steps to minimize any such risk and this is the reason why in mid-big size projects (especially in EPC projects) the Employer might maintain a certain control in the selection process of Subcontractors.

In this respect, the main contract can provide various alternatives in respect of the subcontractor selection procedure.

Very broadly, FIDIC Red Book and FIDIC Yellow Books do not require the Employer consent for suppliers of materials or for Subcontractors already named in the contract (unless otherwise provided in the Particular Conditions) while the consent is required for other proposed Subcontractors (but the consent cannot be unreasonably withheld or delayed).

However, all the FIDIC Books (including the FIDIC Silver Book) provide the right of the Employer to nominate a Subcontractor under Sub-clause 13 [Variations and Adjustments] which involves the full power of the Employer to instruct the Contractor to appoint a specific Subcontractor balanced however with the right of the Contractor to refuse that specific Subcontractor on the basis of reasonable objections.

It is clear therefore that all such circumstances, the interest of the Employer and of the Contractor may conflict and each of them should find the right way to mitigate their potential risks.

Suggestion for the Employer

The Employer will usually seek to exclude expressly any responsibility in the selection process by inserting a specific wording so that:

"the engagement of any of the listed Subcontractor will not imply any direct relation between the Employer and the Subcontractor and will not diminish in any manner the liability of the Contractor for any failure of the Subcontractor to perform its obligations."

As mentioned above, Sub-clause 4.4 of the FIDIC Silver Book provides that

"The Contractor shall be responsible for the acts or defaults of any Subcontractors, his agents or employees as if they were the acts or defaults of the Contractor."

As said before, this will also apply in the case the Subcontractor has been selected by the Employer so the Contractor should pay specific attention in such a case.

Suggestion for the Contractor

On the other hand, the Contractor needs to consider carefully the skills, expertise and track records of the Subcontractor especially in the case the Subcontractor has been nominated by the Employer. Therefore, the Contractor will need to ensure to have a full 'power' over the Subcontractor and may need to consider to have a provision in the main contract so that:

"the Contractor shall reserve the right to replace at any time the Subcontractor in the case of failure by the latter to properly and timely perform its obligations under the Subcontract."

Sub-clause 4.5 of the FIDIC Silver Book provides that, upon certain conditions, the Contractor has the right to object to Subcontractor nominated by the Employer:

"The Contractor shall not be under any obligation to employ a nominated Subcontractor against whom the Contractor raises reasonable objection [...] with supporting particulars."

Some indications of the reasons why the Contractor may reject to appoint a nominated Subcontractor are listed under Sub-clause 5.2 of the Red Book but it is always preferable to specify in the Particular Conditions or in ad hoc contracts what rights the Contractor have in such respect.

In the case where the main contract does not provide for a list of potential Subcontractor but instead that the Contractor will have the right to subcontract part of the works the risk of disputes increases.

It is obvious that the interest of both parties is to have any such dispute resolved at the earliest convenience and this because either the Employer or the Contractor will at the end suffer the financial consequence of any delay in appointing the Subcontractor. It is, therefore, advisable that the main contract provides for a procedure on how to solve quickly and efficiently any potential dispute in that connection.

Suggestion for the Employer

The Employer will be interested in having details of the proposed Subcontractor so that it will have the concrete opportunity to evaluate the proposed Subcontractor in terms of technical capabilities and financial standing as well as its track record. The Employer will usually also provide a list of requirements that the Subcontractor need to fulfil for its appointment.

The Employer's need is to have the appointment of a Subcontractor in a way that the works will not be delayed/disrupted. In case of dispute, the Employer may consider inserting in the contract a provision such as that

"in case of objections in respect of the appointment of the designated Subcontractor, the Contractor shall propose a new Subcontractor within X days and, if the Employer shall have no objections in respect of the new proposed Subcontractor the latter shall be appointed. Any dispute in respect of the reasonableness of the Employer's objections shall be submitted to the [dispute resolution method] only after the Subcontractor has been appointed."

An additional clause shall deal with which party shall bear the costs arising out of the dispute resolution body decision in respect of the objections raised by the Employer.

Suggestion for the Contractor

The Contractor, on the other hand, will be interested in obtaining an immediate settlement of the objections raised by the Employer on a certain Subcontractor and this mainly because the Contractor will incur additional time and expenses in finding a proposing a new Subcontractor.

The Contractor may, therefore, be interested in providing in the main contract that:

"any objection raised by the Employer in respect of the appointment of the Subcontractor will immediately be referred to the [dispute resolution body] and no Subcontractor will be appointed until the dispute is resolved."

The subcontract is a fundamental part of any major international contract. Specific attention should be given in the case the subcontract is selected or can be selected by the Employer as well as to any local legislation which requires the appointment of local Subcontractor.

The parties should include also a detailed selection procedure for the appointment of Subcontractor bearing in mind that in many jurisdictions there is no direct legal relation between the Employer and the Subcontractor and therefore that any subcontractor underperformance is borne by the Contractor only.

Download our full Guide on Subcontractor Selection in Construction Projects.

Download the Guide

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Giuseppe Broccoli
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.