On demand bid bond

An on demand bid bond (also called a tender bond or tender guarantee) involving an independent payment obligation, to be issued in letter form, typically by a bank. The bond is primarily intended for use on a construction and engineering project, although bid bonds are rare in the UK construction market.

Practical Law Construction (based on a PLC Finance document contributed by Karen Spencer and Sarah Sabin of Gateley (Manchester) LLP)


 

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