Law in Motion
Legal & Regulatory Updates
Cameroon: A New Law Strictly Regulates Subcontracting and Strengthens National Preference
Promulgated on 15 July 2025, Law No. 2025/010 on the subcontracting regime in Cameroon introduces an ambitious framework designed to promote local SMEs, particularly in strategic sectors such as oil and gas. It builds on existing local content policies and marks a turning point in the regulation of industrial value chains.
Mandatory National Preference
The law requires main contractors to give priority to Cameroonian SMEs, defined as companies with their registered office in Cameroon and at least 51% national ownership. For reference, Law No. 2015 10 classifies as SMEs entities employing no more than 100 people and generating annual turnover not exceeding XAF 3 billion (≈ €4.6 million).
Where a proven technical or material incapacity exists, subcontracting may be temporarily entrusted to a large company with at least 33% Cameroonian shareholding, or to a foreign company for a maximum period of six months. After this period, a Cameroonian law entity must be established.
Strengthened Quotas and Contractual Obligations
Any large Cameroonian company or foreign company must allocate at least 40% of the contract value to subcontracting when the amount exceeds a regulatory threshold.
The law also regulates contractual and financial arrangements, including :
- Competitive tendering above a regulatory threshold
- Mandatory 30% advance payment before commencement
- Strict payment deadlines
- Mandatory registration of subcontractors with the Subcontracting Authority
- Payments through licensed financial institutions
- Implementation of technical training programmes
- Annual publication by each company of its list of subcontractors and amounts paid
Deterrent Sanctions and Enhanced Social Responsibility
Non compliance exposes offenders to fines ranging from 25% to 75% of the contract value, depending on the seriousness of the breach (failure to apply national preference, fraud, concealed subcontracting, etc.). Penalties and late payment interest also apply where subcontractors are not paid on time.
The main contractor’s social responsibility is reinforced: in the event of subcontractor default, it must assume payment of wages, leave entitlements and social security contributions for the affected workers. These workers, as well as social security bodies, have a direct right of action against the main contractor.
Extended scope to cascade subcontracting
The law also applies to subcontractors who themselves subcontract part of their activities, thereby establishing a cascading regulatory framework.
Implementing regulations still pending
The implementing regulations required for the effective application of the new law have not yet been published.