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Red flags with ‘pay if/when paid’ clauses in subcontracting agreements

12 November 2023

In subcontracting agreements, parties sometimes opt for a ‘pay if paid’ or ’pay when paid’ clause. As a consequence of such clauses, payment of the subcontractor by the main contractor is made conditional ("back-to-back”) upon payment of the main contractor by his own client. In other words, the key to the subcontractor getting paid (by the main contractor) is payment by the client.

This article is available in Dutch and French.

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