Bid bond - Revision history

Designing Buildings at 06:17, 16 August 2024

2024-08-16T06:17:13Z

← Older revision		Revision as of 06:17, 16 August 2024
Line 13:		Line 13:
	[https://constructionprocurement.gov.ie/glossary/ Capital Works Management Framework, Guidance Note, Glossary], Published by the Government of Ireland Department of Finance in 2009 suggests that: ‘A bid bond is effectively a contract of guarantee whereby the guarantor or surety (authorised to do guarantee business) undertakes to pay damages to a second party, in this case the Employer, when the Contractor does not honour his tender. In essence, the guarantor undertakes to be answerable for losses suffered by the Employer if the Contractor withdraws following a bid. The Employer does not need to prove loss before calling in this bond. When a bond is called in, the Employer has a guarantee that funds up to the amount of the bond will be available to defray the Employer’s losses resulting from the Contractor’s default.’		[https://constructionprocurement.gov.ie/glossary/ Capital Works Management Framework, Guidance Note, Glossary], Published by the Government of Ireland Department of Finance in 2009 suggests that: ‘A bid bond is effectively a contract of guarantee whereby the guarantor or surety (authorised to do guarantee business) undertakes to pay damages to a second party, in this case the Employer, when the Contractor does not honour his tender. In essence, the guarantor undertakes to be answerable for losses suffered by the Employer if the Contractor withdraws following a bid. The Employer does not need to prove loss before calling in this bond. When a bond is called in, the Employer has a guarantee that funds up to the amount of the bond will be available to defray the Employer’s losses resulting from the Contractor’s default.’

−	= Related articles on Designing Buildings ~~Wiki~~ =	+	= Related articles on Designing Buildings =

	* Advance payment bond.		* Advance payment bond.
−	* ~~Bonds~~.	+	* Bid security.
	* Bonds and guarantees.		* Bonds and guarantees.
	* Contract award.		* Contract award.

Designing Buildings at 09:04, 29 October 2020

2020-10-29T09:04:48Z

← Older revision		Revision as of 09:04, 29 October 2020
Line 26:		Line 26:
	* Zero-coupon bond.		* Zero-coupon bond.

−	[[Category:Appointments]] [[Category:Contracts_/_payment]] [[Category:Procurement]]	+	[[Category:DCN_Definition]] [[Category:DCN_Guidance]] [[Category:DCN_Product_Knowledge]] [[Category:Appointments]] [[Category:Contracts_/_payment]] [[Category:Procurement]]

Designing Buildings at 08:50, 13 May 2020

2020-05-13T08:50:22Z

← Older revision		Revision as of 08:50, 13 May 2020
Line 10:		Line 10:

	NB the [https://www.ungm.org/Areas/Public/pph/go01.html UN Procurement Practitioner's Handbook], produced by the Interagency Procurement Working Group (IAPWG) in 2006 and updated in 2012, defines a bid bond or bid security as: 'A security from a supplier securing obligations resulting from a contract award with the intention to avoid: the withdrawal or modification of an offer after the deadline for submission of such documents; failure to sign the contract or failure to provide the required security for the performance of the contract after an offer has been accepted; or failure to comply with any other condition precedent to signing the contract specified in the solicitation documents.'		NB the [https://www.ungm.org/Areas/Public/pph/go01.html UN Procurement Practitioner's Handbook], produced by the Interagency Procurement Working Group (IAPWG) in 2006 and updated in 2012, defines a bid bond or bid security as: 'A security from a supplier securing obligations resulting from a contract award with the intention to avoid: the withdrawal or modification of an offer after the deadline for submission of such documents; failure to sign the contract or failure to provide the required security for the performance of the contract after an offer has been accepted; or failure to comply with any other condition precedent to signing the contract specified in the solicitation documents.'
		+
		+	[https://constructionprocurement.gov.ie/glossary/ Capital Works Management Framework, Guidance Note, Glossary], Published by the Government of Ireland Department of Finance in 2009 suggests that: ‘A bid bond is effectively a contract of guarantee whereby the guarantor or surety (authorised to do guarantee business) undertakes to pay damages to a second party, in this case the Employer, when the Contractor does not honour his tender. In essence, the guarantor undertakes to be answerable for losses suffered by the Employer if the Contractor withdraws following a bid. The Employer does not need to prove loss before calling in this bond. When a bond is called in, the Employer has a guarantee that funds up to the amount of the bond will be available to defray the Employer’s losses resulting from the Contractor’s default.’

	= Related articles on Designing Buildings Wiki =		= Related articles on Designing Buildings Wiki =

Designing Buildings at 11:06, 1 May 2020

2020-05-01T11:06:50Z

← Older revision		Revision as of 11:06, 1 May 2020
Line 9:		Line 9:
	However, there is the disadvantage that bid bonds can be open to abuse by the client and they may prevent smaller companies from tendering. Internationally, there have been cases of bonds 'disappearing' along with the client.		However, there is the disadvantage that bid bonds can be open to abuse by the client and they may prevent smaller companies from tendering. Internationally, there have been cases of bonds 'disappearing' along with the client.

−	~~= Find out more =~~	+	NB the [https://www.ungm.org/Areas/Public/pph/go01.html UN Procurement Practitioner's Handbook], produced by the Interagency Procurement Working Group (IAPWG) in 2006 and updated in 2012, defines a bid bond or bid security as: 'A security from a supplier securing obligations resulting from a contract award with the intention to avoid: the withdrawal or modification of an offer after the deadline for submission of such documents; failure to sign the contract or failure to provide the required security for the performance of the contract after an offer has been accepted; or failure to comply with any other condition precedent to signing the contract specified in the solicitation documents.'

−	=== Related articles on Designing Buildings Wiki ===	+	= Related articles on Designing Buildings Wiki =

	* Advance payment bond.		* Advance payment bond.

Editor at 10:29, 15 May 2018

2018-05-15T10:29:39Z

← Older revision		Revision as of 10:29, 15 May 2018
Line 22:		Line 22:
	* Retention.		* Retention.
	* Surety.		* Surety.
		+	* Zero-coupon bond.

	[[Category:Appointments]] [[Category:Contracts_/_payment]] [[Category:Procurement]]		[[Category:Appointments]] [[Category:Contracts_/_payment]] [[Category:Procurement]]

Designing Buildings at 16:46, 15 January 2018

2018-01-15T16:46:31Z

← Older revision		Revision as of 16:46, 15 January 2018
Line 1:		Line 1:
−	Bonds are a means of protection against the non-performance of ~~the contractor~~. They are an undertaking by a bondsman or surety to make a payment to the client in the event of non-performance of the ~~contractor~~. The cost of the bond is usually borne by the ~~contractor~~, albeit, this is likely to be reflected in ~~the contractor's~~ tender price.	+	Bonds are a means of protection against the non-performance of supplier. They are an undertaking by a bondsman or surety to make a payment to the client in the event of non-performance of the supplier. The cost of the bond is usually borne by the supplier, albeit, this is likely to be reflected in their tender price.

−	Bid bonds, also known as tender bonds, are rare in the UK, but can be a requirement of an international tender process. They are usually on-demand bonds submitted with a tender to secure the tender's commitment to commence the contract. The bond is partially or fully forfeited if the winning ~~tender~~ fails to execute the contract or meet other specified conditions.	+	Bid bonds, also known as tender bonds, are rare in the UK, but can be a requirement of an international tender process. They are usually on-demand bonds submitted with a tender to secure the tender's commitment to commence the contract. The bond is partially or fully forfeited if the winning tenderer fails to execute the contract or meet other specified conditions.

−	The presence of a bid bond is intended to provide the client with the assurance that the tenderer has the financial capabilities of accepting the contract for the price quoted in their bid~~. This is a benefit for the client, who is not normally aware of whether or not bidders are financial stable or have the resources necessary to complete the project~~.	+	The presence of a bid bond is intended to provide the client with the assurance that the tenderer has the financial capabilities of accepting the contract for the price quoted in their bid.

−	If the bond is partially or fully forfeited, the principal (typically the contractor) and the surety are jointly and severally liable for the bond, which includes any additional costs the client incurs in selecting and awarding another ~~contractor~~. Often this is the difference between the lowest bid and the second-lowest bid.	+	If the bond is partially or fully forfeited, the principal (typically the contractor) and the surety are jointly and severally liable for the bond, which includes any additional costs the client incurs in selecting and awarding another supplier. Often this is the difference between the lowest bid and the second-lowest bid.

−	However, there is the disadvantage that bid bonds can be open to abuse by the client and may prevent smaller companies from tendering.	+	However, there is the disadvantage that bid bonds can be open to abuse by the client and they may prevent smaller companies from tendering. Internationally, there have been cases of bonds 'disappearing' along with the client.

	= Find out more =		= Find out more =

Editor at 15:34, 10 January 2018

2018-01-10T15:34:48Z

← Older revision		Revision as of 15:34, 10 January 2018
Line 1:		Line 1:
	Bonds are a means of protection against the non-performance of the contractor. They are an undertaking by a bondsman or surety to make a payment to the client in the event of non-performance of the contractor. The cost of the bond is usually borne by the contractor, albeit, this is likely to be reflected in the contractor's tender price.		Bonds are a means of protection against the non-performance of the contractor. They are an undertaking by a bondsman or surety to make a payment to the client in the event of non-performance of the contractor. The cost of the bond is usually borne by the contractor, albeit, this is likely to be reflected in the contractor's tender price.

−	Bid bonds are rare in the UK, but can be a requirement of an international tender process. They are usually on-demand bonds submitted with a tender to secure the tender's commitment to commence the contract. The bond is partially or fully forfeited if the winning tender fails to execute the contract or meet other specified conditions.	+	Bid bonds, also known as tender bonds, are rare in the UK, but can be a requirement of an international tender process. They are usually on-demand bonds submitted with a tender to secure the tender's commitment to commence the contract. The bond is partially or fully forfeited if the winning tender fails to execute the contract or meet other specified conditions.

	The presence of a bid bond is intended to provide the client with the assurance that the tenderer has the financial capabilities of accepting the contract for the price quoted in their bid. This is a benefit for the client, who is not normally aware of whether or not bidders are financial stable or have the resources necessary to complete the project.		The presence of a bid bond is intended to provide the client with the assurance that the tenderer has the financial capabilities of accepting the contract for the price quoted in their bid. This is a benefit for the client, who is not normally aware of whether or not bidders are financial stable or have the resources necessary to complete the project.

Editor: Created page with "Bonds are a means of protection against the non-performance of the contractor. They are an undertaking by a bondsman or surety to make a payment to the client in the event of non..."

2018-01-10T15:33:31Z

Created page with "Bonds are a means of protection against the non-performance of the contractor. They are an undertaking by a bondsman or surety to make a payment to the client in the event of non..."

New page

Bonds are a means of protection against the non-performance of the contractor. They are an undertaking by a bondsman or surety to make a payment to the client in the event of non-performance of the contractor. The cost of the bond is usually borne by the contractor, albeit, this is likely to be reflected in the contractor's tender price.

Bid bonds are rare in the UK, but can be a requirement of an international tender process. They are usually on-demand bonds submitted with a tender to secure the tender's commitment to commence the contract. The bond is partially or fully forfeited if the winning tender fails to execute the contract or meet other specified conditions.

The presence of a bid bond is intended to provide the client with the assurance that the tenderer has the financial capabilities of accepting the contract for the price quoted in their bid. This is a benefit for the client, who is not normally aware of whether or not bidders are financial stable or have the resources necessary to complete the project.

If the bond is partially or fully forfeited, the principal (typically the contractor) and the surety are jointly and severally liable for the bond, which includes any additional costs the client incurs in selecting and awarding another contractor. Often this is the difference between the lowest bid and the second-lowest bid.

However, there is the disadvantage that bid bonds can be open to abuse by the client and may prevent smaller companies from tendering.

= Find out more =

=== Related articles on Designing Buildings Wiki ===

* Advance payment bond.
* Bonds.
* Bonds and guarantees.
* Contract award.
* On-demand bonds.
* Parent company guarantee.
* Performance bond.
* Retention.
* Surety.

[[Category:Appointments]] [[Category:Contracts_/_payment]] [[Category:Procurement]]