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Bid Security vs. Performance Security

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Bid Security vs. Performance Security

Post by The Rock_CPA on Mon Dec 09, 2013 5:09 pm

Good afternoon,

Can anyone elaborate the differences of Bid Security and Performance Security?

Thank you.
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Re: Bid Security vs. Performance Security

Post by Abecedarian on Tue Dec 10, 2013 3:51 pm

The Bid Security is required from the Bidders. Performance Security is required from the awardee of contract.
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Re: Bid Security vs. Performance Security

Post by attywaws on Tue Dec 10, 2013 4:15 pm

In addition, Bid Security and Performance Security also differs in the following aspects:

As to purpose:

       Bid Security guarantees that the successful bidder shall, within 10 calendar days or less, from the receipt of the NOA, enter into contract with the PE & furnish the performance bond.

       On the other hand, Performance Bond guarantees the faithful performance by the winning bidder of its obligations under the contract.

As to when submitted:

        Bid Security is submitted during the eligibility check while a Performance Bond is submitted prior to the signing of the contract.

As to effect of failure to submit:

        Failure to enclose the required Bid Security in the form and amount prescribed shall automatically disqualify the bid.

        On the other hand, failure to post required performance bond shall result to:
1. forfeiture of bid security & sanctions may be imposed on the bidder
2. BAC shall disqualify bidder and shall initiate & complete post qualification process on the bidder with 2nd Lowest Calculated Bid/Highest Calculated Bid.
3. if single Bid, BAC shall disqualify the bidder & shall declare the bidding a failure.
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Re: Bid Security vs. Performance Security

Post by The Rock_CPA on Tue Dec 10, 2013 5:14 pm

Thank you.

I'm examining vouchers and it comes to my attention about this transactions Refunding Bid Securities. now, i understand it very well....

thank you very much abecedarian and waws20 for a will detailed information.

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Re: Bid Security vs. Performance Security

Post by The Rock_CPA on Tue Dec 10, 2013 5:16 pm

in addition, thank you very much waws20 for discussing the "effect of failure to submit"..

that's very important...

thank you....
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Re: Bid Security vs. Performance Security

Post by attywaws on Tue Dec 10, 2013 5:55 pm

welcome sir!  bounce
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Re: Bid Security vs. Performance Security

Post by regina avelino on Fri Dec 13, 2013 11:30 am

as an addition, the bid security is based on the ABC while the performance security is based on the contract price following the percentages given under section 27.2 for bid security and section 39.2 for perfomance security

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Re: Bid Security vs. Performance Security

Post by The Rock_CPA on Tue Dec 17, 2013 3:50 pm

Is performance security a replacement for bid security?
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Re: Bid Security vs. Performance Security

Post by regina avelino on Thu Dec 19, 2013 9:06 am

Performance security is not a replacement for bid security. As correctly pointed out by sir waws20, Bid Security guarantees that the successful bidder shall, within 10 calendar days or less, from the receipt of the NOA, enter into contract with the PE & furnish the performance bond. On the other hand, Performance security guarantees the faithful performance by the winning bidder of its obligations under the contract.

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Re: Bid Security vs. Performance Security

Post by j.a.trev on Thu Jul 16, 2015 4:54 pm

can the lgu carry on with the contract with the awardee eventhough it faileld to post a performance bond? the procurement process was through negotiations after 2 failed biddings because no bidders submitted their intents.

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