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Tender Guarantee/Bid Bond

Name

Tender Guarantee/Bid Bond

Introduction

It is a written document issued by Bank of China Brussels Branch to tenderee at the request of the tenderer for bids of construction projects and procurement projects, promising that the tenderer will not withdraw or amend its bid within the validity period, and will sign the contract or submit the performance guarantee by the preset deadline once winning the bid.

Functions

With Bank of China's credit as guarantee, the product solves the problem of mutual mistrust between the tenderee and tenderer, ensuring the smooth tender offer; the replacement of cash margin with tender guarantee/bid bond can reduce the financial pressure of the tenderers.

Features

1. It solves the problem of mutual mistrust between tenderee and tenderer to a construction project or procurement project. With good reputation, Bank of China Brussels Branch acts as the guarantor of the tenderer to promote smooth bidding.

2. It reduces the financial pressure of tenderer. As an alternative to cash margin, it can reduce the tied-up fund for the tenderer;

3. When the tenderer breaches the contract, the tenderee can receive economic indemnity and the tenderer can be economically punished by implementing the guarantee, therefore effectively reducing the possibility of breach, and avoiding the cost incurred by arbitration or proceeding to solve disputes related to the bidding contract.

Charges

The charges are subject to the charging principle and rate applied in the relevant rules of Bank of China Brussels Branch.

Target Customers

1. Tenderer (contractor) in the engineering bid invitation;

2. Tenderer (supplier) in the material procurement bid invitation.

Applicant Qualifications

1. The applicant shall have a corporate account in Bank of China Brussels Branch;

2. The applicant shall hold a business license of a legal person that has passed the annual inspection or other valid official certificates which fully prove its operation and scope of business;

3. The applicant shall be qualified to engage in relevant business (such as qualification of contracting foreign projects, and qualification for construction projects);

4. The applicant shall have a credit line in Bank of China, or pay full counter guarantee acceptable to Bank of China or full margin.

Procedure

1. Application for letter of guarantee

(1) The applicant fills outan application form;

(2) The applicant pays margin or submits other counter guarantee;

(3) The applicant submits primary documents related to the business background (such as preliminary contracts);

(4) The applicant submits other documents necessary for issuance of a letter of guarantee as required by Bank of China.

2. Verification and issuance of letter of guarantee

(1) Bank of China Brussels Branch examines the customers' credit standing, qualification, underlying transaction background and relevant documents;

(2) Bank of China Brussels Branch examines the application and form of letter of guarantee for irregularities;

(3) Bank of China Brussels Branch checks and confirms the customer's credit line, margin or other forms of counter guarantee;

(4) Bank of China Brussels Branch issues the letter of guarantee.

Tips

1. Amendment to letter of guarantee: At the request of the guaranteed party and the beneficiary, the clauses under the letter of guarantee can be amended, for example, the validity period can be extended.

2. Payment/compensation of letter of guarantee: If the beneficiary claims compensation within the validity period of the guarantee, the applicant shall be notified in time. The payment shall be made after Bank of China Brussels Branch verifies the claim documents and confirms that they are in compliance with the claim clauses under the guarantee.

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