(1) Subject to subsections (2) and (3),
where a bid security is required, a public body shall indicate in the bidding document
the type and form of the security in order to be acceptable.
(2) The type and form of the security
indicated in the bidding document shall be in accordance with the instructions
provided for in the standard bidding document.
(2A) (a) A
bid security shall be required in procurement where the estimated value of the
procurement exceeds 200 million rupees;
(b) A public body may request a bid security
for procurement of an estimated value which is less than 200 million rupees in
accordance with instructions issued by the Policy Office.
(3) Prior
to submitting a bid, a bidder may request the public body to confirm the
acceptability of a proposed issuer or confirmer of a bid security and where
required, the public body shall respond promptly to such a request.
(4) Any
confirmation of the acceptability of a proposed issuer or of any proposed
confirmer shall not preclude the public body from rejecting the bid security on
the ground that the issuer or the confirmer, as the case may be, has subsequently
become insolvent or otherwise lacks creditworthiness, in such a case, a bidder
shall be permitted to replace the unacceptable security by an acceptable one.
(5)
A bid security shall be subject to
a demand for payment in the following circumstances –
(a) if the bidder
withdraws, cancels or substantially modifies the bid after the bid opening,
during its period of validity;
(b) if the bidder
does not accept a correction of an arithmetical error; or
(c) if the bidder, having been notified of
the acceptance of its bid during the validity of the bid, fails to sign the
contract if so required or fails to furnish a performance security if so
required.
(6)
A public body shall make no claim to
the amount of the bid security, and shall promptly return the bid security
after –
(a) the expiry of
validity period of the bid security;
(b) the entry into
force of a procurement contract and the provision of a security for the
performance of the contract, if such a security is required by the bidding
document;
(c) the termination
of the bidding proceedings without the entry into force of a procurement
contract; or
(d) the withdrawal
of the bid prior to the deadline for the submission of bids, whichever is
earlier.
(7)
A public body may not request a bid
security for single source procurement or from overseas suppliers in respect of
goods obtainable only from a limited number of suppliers.