The Contractor shall, within fifteen (15) days from signing the contract, provide a Performance Security for the due performance of the Contract in the amount specified in the SCC.
Notwithstanding the provision of Sub-clause above a conditional insurance bond shall be accepted as Performance Security.
The proceeds of the Performance Security shall be payable to the Public Body as compensation for any loss resulting from the Contractor’s failure to complete its obligations under the Contract.
The Performance Security shall be denominated in currency specified in the SCC, and shall be in the form of cash, cheque certified by a reputable bank, letter of credit, or Bank Guarantee in the format specified in the SCC.
No payments shall be made in favor of the Contractor prior to the provision of the Performance Security. The Performance Security shall continue to remain valid until the contract has been fully and properly implemented.
During the performance of the contract, if the natural or legal person providing the Performance Security is not able to abide by his commitments, the Performance Security shall cease to be valid. The Public Body shall give formal notice to the Contractor to provide a new Performance Security on the same terms as the previous one. Should the Contractor fail to provide a new Performance Security the Public Body may terminate the Contract.
The Public Body shall demand payment from the Performance Security of all sums for which the guarantor is liable under the Performance Security due to the Contractor's default under the Contract, in accordance with the terms of the Performance Security and up to the value thereof. The guarantor shall, without delay, pay those sums upon demand from the Public Body and may not raise any objection for any reason whatsoever. Prior to making any claim under the Performance Security, the Public Body shall notify the Contractor stating the nature of the default in respect of which the claim is to be made.
The Performance Security shall be discharged by the Public Body and returned to the Contractor not later than twenty-eight (28) days following the date of issuing of the signed Final Statement of Account referred to in GCC Clause 65, for its total amount except for amounts which are the subject of amicable settlement of disputes, unless specified otherwise in the SCC.
Notwithstanding the provision of GCC Sub-Clause 58.2 above, the Performance Security may be returned to the Contractor where the Procurement Endorsing Committee ascertains that the noncompliance of the Contractor does not affect the interest of, or entail additional cost on the Public Body and is not due to the fault of the Contractor.
The Public Body shall be required to submit any document in its possession in relation to a procurement in which it authorizes the return of the Performance Security to the Contractor and account for its action under the preceding GCC Sub-Clause 58.9 of this GCC to the Public Procurement and Property Administration Agency or other competent body if and when required to do so.
