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Bid Bond Bank Guarantee Template for Singapore

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Key Requirements PROMPT example:

Bid Bond Bank Guarantee

"I need a Bid Bond Bank Guarantee for a Singapore government construction tender worth SGD 5 million, with the guarantee amount being 2% of the tender value and validity until March 15, 2025."

Document background
A Bid Bond Bank Guarantee is commonly required in Singapore tender processes to ensure serious participation from bidders. The document serves as a financial security instrument where the bank undertakes to pay a specified sum to the beneficiary if the bidder fails to honor their tender commitments. Used extensively in construction, infrastructure, and government procurement, the guarantee typically remains valid from tender submission until contract award or specified expiry. Under Singapore law, these guarantees are governed by strict banking regulations and must conform to Monetary Authority of Singapore guidelines.
Suggested Sections

1. Bank Details: Full legal name and details of the issuing bank, including registration number and registered address

2. Beneficiary Details: Complete details of the party receiving the guarantee (typically the project owner)

3. Principal Details: Complete details of the bidder/contractor for whom the guarantee is issued

4. Guarantee Amount: Specific amount of the guarantee and currency, stated both in numbers and words

5. Tender/Project Reference: Details of the tender or project the bid bond relates to, including tender reference number

6. Validity Period: Start and end dates of the guarantee, including any automatic extension provisions

7. Demand Conditions: Terms and conditions under which the guarantee can be called, including demand procedure

Optional Sections

1. Counter-Guarantee Provisions: Terms and conditions related to counter-guarantees from other banks, used for international projects or when required by beneficiary

2. Assignment Clause: Provisions regarding transfer of guarantee rights and any restrictions on assignment

3. Electronic Presentation: Terms and procedures for electronic submission of demands and related communications

Suggested Schedules

1. Form of Demand: Standard template for making a claim under the guarantee, including required declarations and supporting documents

2. Tender Documents Reference: Reference to key details from the tender documents that the bid bond relates to

3. Authentication Procedures: Detailed procedures for verifying authenticity of demands and communications under the guarantee

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions

























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Industries

Banking Act (Chapter 19): Primary legislation governing banking institutions and their operations in Singapore, including the issuance of bank guarantees

Securities and Futures Act (Chapter 289): Regulates financial products and services, including certain aspects of bank guarantees when they might be considered financial instruments

Contract Law: Fundamental laws governing contract formation, validity, and enforcement in Singapore, essential for bank guarantee agreements

Monetary Authority of Singapore Act (Chapter 186): Establishes MAS's regulatory authority over financial institutions and their products, including bank guarantees

MAS Notice 610: Regulations regarding submission of statistics and returns by banks, affecting reporting requirements for bank guarantees

MAS Notice 637: Guidelines on risk-based capital adequacy requirements, affecting how banks structure and reserve for guarantees

MAS Guidelines on Corporate Governance: Corporate governance requirements affecting bank operations and issuance of guarantees

Unfair Contract Terms Act: Legislation protecting against unfair terms in contracts, applicable to bank guarantee agreements

Electronic Transactions Act: Governs electronic transactions and digital signatures, relevant for electronically issued bank guarantees

URDG 758: Uniform Rules for Demand Guarantees, international standard rules for demand guarantees and counter-guarantees

ISP98: International Standby Practices, providing guidelines for standby letters of credit and bank guarantees

ABS Guidelines: Association of Banks in Singapore guidelines providing industry standards for banking practices

Singapore Banking Practice: Local banking industry guidelines and best practices for banking operations including guarantees

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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