Bid Bond Bank Guarantee Template for Indonesia

The Bid Bond Bank Guarantee is a crucial document in Indonesian tender processes, particularly in sectors involving significant contracts or government procurement. It serves as a risk mitigation tool for tender organizers, ensuring that only serious bidders participate in the tender process. The guarantee amount typically ranges from 1-3% of the bid value, as per common practice in Indonesia. When drafting a Bid Bond Bank Guarantee, careful attention must be paid to Indonesian banking regulations, including Bank Indonesia Regulation No. 7/3/PBI/2005 and OJK Regulation No. 40/POJK.03/2019. The document must clearly state the conditions for calling the guarantee, validity period, and claim procedures, while ensuring compliance with local banking practices and tender requirements.

1. Bank Details and Reference: Bank's letterhead, reference number, and date of issuance

2. Parties: Identification of the Bank (Guarantor), Principal (Bidder), and Beneficiary (Tender Organizer)

3. Background: Details of the tender being bid for and the requirement for a bid bond

4. Definitions: Key terms used in the guarantee including 'Tender', 'Bid', 'Guarantee Amount'

5. Guarantee Amount: Clear statement of the guaranteed sum in numbers and words

6. Guarantee Scope: Specific conditions under which the guarantee can be called

7. Validity Period: Start and end dates of the guarantee validity

8. Claim Procedure: Process and requirements for making a claim under the guarantee

9. Payment Terms: Timeline and method of payment upon valid claim

10. Governing Law and Jurisdiction: Confirmation of Indonesian law application and jurisdiction

11. Execution Block: Signature blocks for authorized bank officials