Bid Bond Bank Guarantee Template for Germany

A Bid Bond Bank Guarantee is a crucial document in competitive tendering processes, particularly for large-scale projects or public procurement. This instrument, governed by German law, serves as a risk mitigation tool for tender issuers, ensuring that only serious bidders participate in the tender process. The guarantee typically amounts to 1-5% of the bid value and is designed to protect the tender issuer against bidders who might withdraw their bid before its validity period expires, fail to sign the contract if awarded, or fail to provide required performance security. The document must comply with German banking regulations and the German Civil Code (BGB), particularly sections relating to guarantees and suretyships. It's an unconditional, on-demand guarantee that forms part of the tender submission package and remains active until either the contract is awarded to another bidder, the tender process is completed, or the bid validity period expires.

1. Bank Details and Reference: Full name and address of the issuing bank, guarantee/reference number

2. Beneficiary Details: Full name and address of the party receiving the guarantee (typically the tender issuer)

3. Principal Details: Full name and address of the bidder for whom the guarantee is issued

4. Tender Reference: Specific details of the tender including tender number, project name, and submission deadline

5. Guarantee Amount: The maximum amount of the guarantee expressed in both numbers and words

6. Guarantee Terms: Core terms specifying the bank's unconditional obligation to pay upon first demand

7. Validity Period: Clear specification of when the guarantee becomes effective and when it expires

8. Claim Conditions: Procedure and conditions for making a claim under the guarantee

9. Governing Law and Jurisdiction: Explicit statement that German law governs and specification of jurisdiction