What are the functions of a bid bond? The difference between a bid bond and a bid bond

What is a Bid Guarantee?

The bid guarantee is a letter of guarantee issued by the bidder to the guarantee agency, guaranteeing that the bidder shall not revoke the bid before the winning bidder is determined, and shall sign a contract with the tenderer in accordance with the bidding documents and bidding documents after winning the bid. If the bidder violates the regulations, the guarantee agency that issued the guarantee letter will pay the funds specified in the bid guarantee to the tenderer according to the notice of the tenderer. At present, the mainstream of the market is the electronic bid guarantee certificate with legal effect issued to the beneficiary (i.e., the tenderer) through the computer network through electronic documents, which is what we usually call the electronic bid guarantee.

The role of the bid guarantee:

Use the credit of the guarantor to solve the problem of mutual distrust between the bidding and bidding parties, and promote the smooth progress of the bidding;

As an alternative to cash deposit, it can effectively reduce the bidder's capital occupation and reduce the bidder's bidding cost;

It can also solve the problem that the tenderer has a large workload and cumbersome process for collecting and returning the bid deposit due to the large number of bidding projects.

The bid guarantee guarantee is a commitment made by the guarantor to ensure that the bidder properly engages in bidding activities, and its validity period is usually as long as 28 days than the validity period of the tender. The amount of the bid guarantee guarantee should be 1%-2% of the total bid price, and it can be calculated at 3% for small contracts, and the bid guarantee amount can be as high as 5% in the case that the lowest bidder is likely to withdraw the bid. The bidder shall, within the specified time, send the tender together with the bid guarantee to the tenderer.

After the opening of the bids, the owner shall promptly return the bid guarantee of the bidder who has not won the bid. After the project is signed, the bid guarantee of the winning bidder shall also be returned.

There are two approaches to the Bid Guarantee Guarantee:

One approach is to provide a bid guarantee by a professional guarantee guarantee agency, and once the following situations occur, the professional guarantee guarantee agency will compensate the owner in accordance with the bid guarantee amount specified in the contract: the bidder withdraws the bid before the expiration of the bid validity period; The successful bidder fails or refuses to provide the required performance bond within the specified time; The winning bidder refused to sign the contract with the owner within the stipulated time.

In addition, there is a practice that before bidding, the bidder pays the bid deposit directly to the owner as required, so as to ensure that once the bid is won, the contracted project will be performed. If the bidder's behavior constitutes a breach of contract, the owner will cancel the bid qualification and confiscate the bid deposit. Since this practice only involves both the owner and the contractor, and does not involve the provision of guarantee by a third-party guarantor, it cannot be regarded as a bid guarantee in the strict sense.

The significance of the bid guarantee is that the contractor must obtain the bid guarantee in advance if it wants to participate in the bidding. On the one hand, since the withdrawal of the bid must bear the loss, the bidder can be prompted to take the bid seriously through the bid guarantee guarantee, which effectively prevents the rash bidding; On the other hand, the guarantor must strictly review the credit status of the bidder before providing the bidder with a bid guarantee guarantee, otherwise it will not provide a bid guarantee for the bidder, which restricts or excludes unqualified contractors from participating in the bidding activities.

The function of the bid guarantee is to replace the bid bond, save cash flow, and make the bidder's funds better used for the project, rather than being temporarily occupied by the bank as a deposit.

1.For bidders, the bid bond can reduce the capital occupation caused by the payment of cash deposit and obtain capital benefits; Compared with the payment of cash margin, the allocation of limited funds can be optimized; It is more conducive to safeguarding legitimate rights and interests.

2.For the tenderer, the bid guarantee can not only protect their own interests; It also avoids the cumbersome procedures of collecting and returning deposits, and improves work efficiency.

ToCheck optimizes the algorithm for bidding documents and provides text error correction functions, which does not let go of clues, and finds suspected plagiarism, plagiarism, collusion and bid-rigging for users, helping enterprises avoid risks.

Bid Bonds and Bid Bonds.

It has the same effect, can directly replace the bid deposit, and can effectively reduce the capital occupation and reduce the bidding cost for the bidder; For the tenderer, it will avoid the problem of cumbersome procedures when collecting and returning the deposit. Handling the bid guarantee on the Jinhan network can also reduce the process of submitting information offline, so now many companies have begun to handle the bid guarantee on the first place.

There are many advantages to handling a bid guarantee, and the specific reasons are as follows:

Benefits for bidders:Reduce the capital occupation caused by the payment of cash margin and obtain capital income;

Compared with the payment of cash margin, the limited funds can be optimally allocated;

It is conducive to safeguarding legitimate rights and interests.

Benefits for tenderers:can well protect their own interests;

Avoid the cumbersome procedures for collecting and returning security deposits, and improve work efficiency.

Scope of application of bid guaranteeIt is applicable to all public bidding and bid negotiations, and the owner requires the bidder to pay the bid deposit.

In order to avoid losses caused to the bidder by changing the bid or withdrawing the bid during the bid evaluation process, or refusing to sign the contract after winning the bid, the tenderer usually requires the bidder to pay the bid deposit to restrain the behavior of the other party.

A bid bond is a good alternative to a cash bond.

e-Greentown: Replace the deposit with a letter of guarantee to reduce the financial pressure of the enterprise

As the payment method of bid bond actively promoted by the first and highest levels at all levels, the bid bond is also the preferred bid bond payment method for many bidding enterprises, but in our country, there are many enterprises that cannot handle the bid bond, which enterprises are these enterprises and why?

1. Enterprises with bad credit. At present, China's credit system for enterprises has been very perfect, for enterprises with bad credit records, banks can directly check through the system, in order to reduce the risk of guarantees, for enterprises with poor credit, banks will not provide bid guarantees.

2. Enterprises that are unable to provide capital pledge or physical pledge. If there is no pledge of funds or kinds, the bank cannot recover from the guarantor in the event of a default by the guarantor, and the interests of the bank cannot be guaranteed, so the bank does not issue a bid guarantee in such a situation.

If the bidder handles it through the guarantee company that handles the bid guarantee, it can not pay the pledge or pledge in kind. Because the guarantee company that applies for the bid guarantee pledges a large amount of funds in the bank, and then makes a profit by helping the bidder to apply for the bid guarantee.

1. The applicant fills in the "Letter of Guarantee Application" and submits relevant information;

2. The bank will review the applicant's qualifications, application procedures and project feasibility;

3. Sign an agreement and implement a deposit or counter-guarantee;

4. The bank issues a bid guarantee for the applicant.

The amount of the bid guarantee is generally 1%-5% of the bid.

The duration of the bid bond.

The validity period of the bid guarantee is generally within six months and takes effect from the date of issuance.

Bid Bond. Refers to the bidding in the tender.

In order to ensure that the bidder shall not revoke the bidding beam.

After winning the bid, the bidder shall not enter into a contract with the tenderer without justifiable reasons, and the bidder shall be required to submit the written guarantee generally issued by the bank when submitting the bidding documents.

Pros: To bidders:

Reduce the amount of cash deposit.

the occupation of funds caused by the acquisition of capital gains;

Compared with the payment of cash deposit, it can optimize the allocation of limited funds;

It is conducive to safeguarding legitimate rights and interests.

For the tenderer: to protect their own interests;

Avoid the cumbersome procedures of collecting and returning high return margins, and improve work efficiency.

Legal Analysis: The Submission Subjects Are Different: The Bid Bond is submitted by all bidders, and the Bid Bond is submitted only by the winning bidder.

The bid guarantee is a letter of guarantee issued by the bidder applying for a bank, guaranteeing that the bidder shall not revoke the bid before the winning bidder is determined, and shall sign a contract with the tenderer in accordance with the bidding documents and bidding documents after winning the bid. If the bidder violates the regulations, the bank that issued the letter of guarantee will pay the amount of funds specified in the bank guarantee to the tenderer according to the notice of the tenderee. A bid bond is a form of bid bond.

Legal basis: Article 26, paragraph 2 of the Regulations for the Implementation of the Tendering and Bidding Law of the People's Republic of China The domestic bidders of the projects that must be tendered in accordance with the law shall transfer the bid deposit in the form of cash or checks from their basic accounts.

Bid guarantee: refers to the tenderer in the bidding and bidding in order to ensure that the bidder shall not revoke the bidding documents, and shall not enter into a contract with the tenderer without legitimate reasons after winning the bid, etc., requiring the bidder to submit the bidding documents together with the written guarantee generally issued by the bank.

Bid bond: refers to a certain form and a certain amount of bidding liability guarantee submitted to the tenderer by the bidder along with the bidding documents in the bidding and bidding activities. It mainly guarantees that the bidder shall not revoke the bidding documents after submitting the bidding documents, and shall not enter into a contract with the tenderer without justifiable reasons after winning the bid, and shall not put forward additional conditions to the tenderer when signing the contract, or shall not submit a performance bond in accordance with the requirements of the bidding documents, otherwise, the tenderer shall have the right not to return the bid bond submitted by it.

Bid guarantee refers to the tenderer in the bidding in order to ensure that the bidder shall not revoke the bidding documents, after winning the bid shall not enter into a contract with the tenderer without a legitimate reason, etc., the bidder is required to submit the bidding documents together with the written guarantee generally issued by the bank.

Within the time limit specified in the bid, the bidder shall not modify the original ** and shall not withdraw the bid halfway after bidding; After the bidder wins the bid, it must sign a contract with the tenderer and provide a performance guarantee from the bank within the specified time. If the bidder fails to perform the above obligations, the guarantee bank shall perform the compensation obligation in accordance with the provisions of the letter of guarantee when the beneficiary makes a claim.

Bid guarantee refers to when the bidder submits the tender to the tenderer, the bid guarantee of the attached bank after the bid is opened, the winning bidder previously attached to the bank bid guarantee takes effect immediately, the bid guarantee refers to a kind of financial guarantee in the bidding to prevent the winning bidder from not signing the contract and causing it to suffer losses, the beneficiary is the construction unit of the project, the bidder needs to go to the bank for processing, and attached to the bidding documents.

The bid guarantee is a credit certificate issued by the bidder to the bank, and the guarantee is generally deposited with the bank of 30-50 of the guarantee amount when the letter of guarantee is issued. If the bidder defaults, the tenderer can unconditionally transfer this deposit. Another margin payment method is:

The bid bond is remitted directly to the tenderer.

A letter of guarantee for a bid bond? It is a kind of letter guaranteed by the bank

Do you know what a bid guarantee is for?

E Greentown tells you: the bid guarantee is a bid guarantee is a credit certificate issued by the bidder to the bank, which used to require a deposit, and now all are replaced by a bank guarantee, and the cost is based on the total amount of the project about 2, and the minimum can be done on the e-Greentown platform, and the letter can be issued within 2 days, which can support online checking.

The bid guarantee has the following advantages: for bidders: reduce the capital occupation caused by the payment of cash deposit and obtain capital benefits; Compared with the payment of cash margin, the limited funds can be optimally allocated; It is conducive to safeguarding legitimate rights and interests.

For the tenderer: to protect their own interests; Eliminate the cumbersome procedures for collecting and returning deposits, and improve work efficiency. Shubi bid guarantee refers to the tenderer in the bidding for the potato to ensure that the bidder shall not revoke the bidding documents, after winning the bid shall not enter into a contract with the tenderer without a legitimate reason, etc., requiring the bidder to submit the bidding documents together, generally issued by the bank of the written guarantee.

Difference Between Bid Bond and Performance Bond:

1. Submitting subject: The bid bond shall be submitted by all bidders; The performance bond is submitted only by the winning bidder.

2. The term chain limit of the deposit: the bid bond shall be submitted within the bid bond period specified in the bidding documents, and it is generally submitted at the same time as the bidding; The performance bond should be submitted before the formal construction contract is signed; The return time of the bid bond is the 28th day when the construction contract is signed or the performance guarantee is provided; The time for the return of the performance bond is the date on which the project experience is qualified or the time agreed in the contract.

3. Consequences: If the bid deposit is not submitted in accordance with the bidding documents or the bid deposit provided is defective, it shall be disposed of as a scrapped bid; If the bid bond is submitted but violates one of the two cases of the bid bond of the following party, the bid bond shall be confiscated; If the performance bond is not submitted as required in the bidding documents, it will lose the qualification to conclude the contract and the bid bond will be confiscated. If the party submitting the performance bond fails to perform the contract, the recipient may confiscate the bond as agreed in the contract, and this is not limited to this; If the receiving party fails to perform the contract, it must return the performance bond to the submitting party double, and this is not limited.

4. Purpose: The purpose of the bid bond: the bidder cannot withdraw its bid documents within the validity period; Once the bid is awarded, a performance bond must be submitted or a contract must be signed within the specified period.

The purpose of the performance bond is to ensure the full performance of the contract, mainly to ensure that the contract is performed in accordance with the quality and construction terms agreed in the contract.