PPR - 2007, Rule 110 and 112

110. Performance Security to be Furnished for conclusion of Contract:

(1) A bidder whose bid is accepted shall, while submitting performance security pursuant to Sub-section (4) of Section 27 of the Act, submit the performance security issued by a commercial bank in the format as specified in the bidding documents within the time specified under Sub-section (3) of Section 27 of the Act

(2) The amount of the performance security under Sub-section (1) shall be five percent of the procurement contract amount.

(3) In the case of a procurement contract which does not disclose the amount pursuant to Sub-section (2), the performance security shall be submitted as stipulated in the bidding documents by the Public Entity

(4) Except otherwise provided in the procurement contract, the validity period of the performance security under Sub-rule (1) shall exceed at least by the period of one month beyond the last period for supply or delivery of the goods or the period of warranty or the period of defects liability of construction works as referred to in such contract.

(5) The performance security issued by a foreign bank shall be valid only if it is counter-guaranteed by a commercial bank established in Nepal.

112. Insurance to be Made:

(1) Except otherwise provided in the procurement contract, a construction entrepreneur carrying out a construction work of the price above one million Rupees shall have to insure the following matters:-

(a) Full replacement cost of construction works including construction materials, machine, equipment or plants to be used,
Explanation: For the purpose of this clause "cost" shall include the profit as well.
(b) Fifteen percent amount of the replacement cost under clause (a) or the additional amount as referred to in the procurement contract to rectify the cost to be incurred for loss or damage occurred or incidental cost relating thereto including the cost required for professional fees, demolishing, removing any part of the construction work and for removing debris or wasted materials,
(c) Adequate amount required for replacement of the equipment or other things brought to the construction site by construction entrepreneur,
(d) All losses and damages to any part or portion of the construction work from whatsoever causes other than the ones referred to in Sub-rule (2), arising from the date of the handing over of construction site to the construction entrepreneur until the date of issue of Taking Over Certificate,
(e) The following liabilities of the construction entrepreneur:

(1) Loss and damage caused in the course of discharging construction entrepreneur's obligation during the defects liability period, and
(2) Loss and damage caused during the defects liability period by a cause arisen prior to commencement of the defects liability period.

 

(2) Notwithstanding anything contained elsewhere in these Regulations, a construction entrepreneur shall not be required to bear obligation for the insurance under clause (d) of Sub-rule (1) for the loss and damage caused due to the following reasons:-

(a) War, enmity or invasion,

(b) Rebellion, revolution, insurrection, or Military Rule or civil war,

(c) Ionizing radiations, radiation of nuclear fuel or nuclear waste originated from the combustion of nuclear fuel or explosion of radioactive toxic or explosion of other hazardous elements or nuclear assembly or pollution of nuclear portion thereof, and

(d) Pressure wave caused by aircraft or aerial devices that flies at sonic or supersonic speeds.

(3) Except otherwise provided in the procurement contract, the construction entrepreneur shall have to bear the cost against the claim for the following loss and damage occurred while carrying out a construction work or while correcting any defect underlying therein or resulted from such work and the cost and charges expended for conducting the proceedings relating to such claim:-

(a) If a person gets bodily injuries or dies,
(b) The loss and damage caused to any property in the course of work operation and completion except in construction work.

 

(4) In procuring goods, insurance shall be so made, from go-down to go-down as to cover all risks including war, strike and arson, of an amount equal to at least 110 percent of the CIP (Carriages and Insurance Paid to) price.

(5) The conditions of insurance cannot be changed without a written approval of the chief of the concerned Public Entity.

SBD (for medium contract for construction of bridge) Section IV GCC: clause 13 Insurance and clause 51 Securities

13. Insurance

13.1 The Contractor shall provide, in the joint names of the Employer and the Contractor, insurance cover from the Start Date to the end of the Defects Liability Period, in the amounts and deductibles stated in the SCC for the following events which are due to the Contractor’s risks:

a. loss of or damage to the Works, Plant and Materials;
b. loss of or damage to Equipment;
c. loss of or damage to property (except the Works, Plant, Materials and Equipment) in connection with the Contract; and
d. personal injury or death.

 

13.2 Policies and certificates for insurance shall be delivered by the Contractor to the Project Manager for the Project Manager’s approval before the Start Date. All such insurance shall provide for compensation to be payable in the types and proportions of currencies required to rectify the loss or damage incurred.

13.3 If the Contractor does not provide any of the policies and certificates required, the Employer may effect the insurance which the Contractor should have provided and recover the premiums the Employer has paid from payments otherwise due to the Contractor or, if no payment is due, the payment of the premiums shall be a debt due.

13.4 Alterations to the terms of an insurance shall not be made without the approval of the Project Manager.

13.5 Both parties shall comply with any conditions of the insurance policies.

51. Securities

51.1 The Performance Security shall be provided to the Employer no later than the date specified in the Letter of Acceptance and shall be issued in an amount, specified in the SCC, and form and by a bank acceptable to the Employer, and denominated in the types and proportions of the currencies in which the Contract Price is payable. The Performance Security shall be valid until a date 30 days from the date of issue of the Defects Liability Certificate in the case of a bank guarantee.

 

PWD Part III, Medium Contract, Clause 13 and 52, Condition of Contract

13. Insurance

13.1 The Contractor shall provide, in the joint names of the Employer and the Contractor, insurance cover from the Start Date to the end of the Defects Liability Period, in the amounts and deductibles stated in the Contract Data for the following events which are due to the Contractor’s risks:

a. loss of or damage to the Works, Plant and Materials;
b. loss of or damage to Equipment;
c. loss of or damage to property (except the Works, Plant, Materials and Equipment) in connection with the Contract; and
d. personal injury or death.

13.2 Policies and certificates for insurance shall be delivered by the Contractor to the Project Manager for the Project Manager’s approval before the Start Date. All such insurance shall provide for compensation to be payable in the types and proportions of currencies required to rectify the loss or damage incurred.

13.3 If the Contractor does not provide any of the policies and certificates required, the Employer may effect the insurance which the Contractor should have provided and recover the premiums the Employer has paid from payments otherwise due to the Contractor or, if no payment is due, the payment of the premiums shall be a debt due.

13.4 Alterations to the terms of an insurance shall not be made without the approval of the Project Manager.

13.5 Both parties shall comply with any conditions of the insurance policies.

44. Compensation Events

44.1 The following shall be Compensation Events:

a. The Employer does not give access to a part of the Site by the Site Possession Date stated in the Contract Data.

b. The Employer modifies the Schedule of Other Contractors in a way that affects the work of the Contractor under the Contract.

c. The Project Manager orders a delay or does not issue Drawings, Specifications, or instructions required for execution of the Works on time.

d. The Project Manager instructs the Contractor to uncover or to carry out additional tests upon work, which is then found to have no Defects.

e. The Project Manager unreasonably does not approve a subcontract to be let.

f. Ground conditions are substantially more adverse than could reasonably have been assumed before issuance of the Letter of Acceptance from the information issued to Bidders (including the Site Investigation Reports), from information available publicly and from a visual inspection of the Site.

g. The Project Manager gives an instruction for dealing with an unforeseen condition, caused by the Employer, or additional work required for safety or other reasons.

h. Other contractors, public authorities, utilities, or the Employer do not work within the dates and other constraints stated in the Contract, and they cause delay or extra cost to the Contractor.

i. The advance payment is delayed.

j. The effects on the Contractor of any of the Employer’s Risks.

k. The Project Manager unreasonably delays issuing a Certificate of Completion.

l. Other Compensation Events described in the Contract or determined by the Project Manager shall apply.

44.2 If a Compensation Event would cause additional cost or would prevent the work being completed before the Intended Completion Date, the Contract Price shall be

increased and/or the Intended Completion Date shall be extended. The Project Manager shall decide whether and by how much the Contract Price shall be increased

and whether and by how much the Intended Completion Date shall be extended.

 

44.3 As soon as information demonstrating the effect of each Compensation Event upon the Contractor’s forecast cost has been provided by the Contractor, it shall be assessed by the Project Manager, and the Contract Price shall be adjusted accordingly. If the Contractor’s forecast is deemed unreasonable, the Project Manager shall adjust the Contract Price based on the Project Manager’s own forecast. The Project Manager will assume that the Contractor will react competently and promptly to the event.

44.4 The Contractor shall not be entitled to compensation to the extent that the Employer’s interests are adversely affected by the Contractor’s not having given early warning or not having cooperated with the Project Manager.