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Contractor’s Obligations and Liability

The Act on the Contractor’s Obligations and Liability when Work is Contracted Out (22.12.2006/1233) obligates a client to check that their contracting partners fulfill their legal obligations as contracting party and employer. The Act aims at preventing “grey”, or undeclared, economy, and its purpose is to promote equal competition between companies as well as compliance with terms of employment. The Regional State Administrative Agency for Southern Finland is the body that monitors compliance with the Act in Finland.

The Act stipulates that the client requests and the contracting partner supplies information and certificates that are no older than three (3) months:

  • An account of whether the enterprise is entered in the Prepayment Register as stipulated in the Prepayment Act (1118/1996), the Employer Register and the Value Added Tax Register as stipulated in the Value-added tax Act (1501/1993)
  • An extract from the Trade Register
  • A certificate that demonstrates that the enterprise does not have tax debt as defined in paragraph 2 of subsection 1 in section 20 b of the Act on the Public Disclosure and Confidentiality of Tax Information (1346/1999), or an account given by an official regarding the tax debt
  • Certificates of pension insurances arranged for employees and of pension insurance premiums paid, or an account that a payment agreement on outstanding pension insurance premiums has been made
  • An account of the collective agreement or the principal terms of employment applicable to the work
  • An account of provided occupational healthcare
  • A certificate of mandatory accident insurance required in the building sector