Subcontracting conditions
Where outsourcing forms a chain, Articles 28(2) and (4) set conditions on engaging a sub-processor. The customer must give prior specific or general written authorisation. With general authorisation, the processor must inform the controller of intended additions or replacements and give it an opportunity to object. The processor must flow down the same obligations to the sub-processor, and the main supplier remains liable to the customer for any breach by the sub-processor.
Under Articles 28(2) and (4), the contract between the customer (or a group entity of the controller) and the main supplier must satisfy four conditions when sub-processors are involved.
- The customer must give prior specific or general written authorisation for engaging a sub-processor
- Where authorisation is general, the processor must inform the controller of any intended addition or replacement of sub-processors and give it the opportunity to object
- The processor must impose the same contractual obligations on any sub-processor that apply to it
- The main supplier remains liable to the customer for any breach by the sub-processor
Flowing obligations down the chain does not shift the risk: the main supplier remains fully liable to the customer for the sub-processor's performance.