Guam § 5212 - Bid Security and Performance Bond Requirement for Contractors.

§ 5212. Bid Security and Performance Bond Requirement for Contractors.

(a) Requirement for Bid Security. Bid security shall be required for all competitive sealed bidding for

the procurement of supplies or services when the total price is estimated by the Chief Procurement Officer

to exceed Twenty-Five Thousand Dollars ($25,000.00). Bid security shall be a bond provided by a surety

company authorized to do business in Guam, or the equivalent in cash, or otherwise supplied in a form

satisfactory to the government of Guam. Nothing herein prevents the requirement of such bonds on the

procurement of supplies or services totaling fewer than Twenty-Five Thousand Dollars ($25,000.00) when

a written determination and justification for such requirement is included as an integral part of the Invitation

for Bid solicitation package.

(b) Amount of Bid Security. Bid security shall be in an amount equal to fifteen percent (15%) of the

total amount bid.

(c) The bid security required above under any applicable Invitation for Bid shall not be released upon

award of the bid, but instead shall continue in full force and effect until delivery of the supplies or services

required by any contract awarded to contractor under the associated Invitation for Bid is completed, except

that the bid security for a lease of real property shall be released upon the government’s execution of the

lease and taking possession of the property. The Director of Administration shall review all bid security for

existing leases and shall release said bid security if a lessor is in compliance with the lease.

(d) Action against Bid Security. In the event that a successful bidder fails to complete delivery of

supplies or services as required in the contract between such contractor and the government of Guam, the

government of Guam may proceed to procure such supplies or services from the next lowest bidder who is

able to deliver such supplies or services. The government of Guam may retain so much of the bid security

as may be required to compensate the government for damages arising from contractor=s failure to complete

delivery of such supplies or services, and the government of Guam may also bring an action in the Superior

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Court of Guam against the contractor for direct damages, if any, beyond the amount of the bid security

posted except that no action against bid security maybe taken in such circumstances where supplies or

services are terminated due to the government of Guam’s failure to pay for such services or supplies on a

timely basis.

(e) Rejection of Bids for Noncompliance with Bid Security Requirements. When the Invitation for

Bids requires bid security, noncompliance requires that the bid be rejected unless, pursuant to Policy Office

regulations, it is determined that the bid fails to comply in a non-substantial manner with the security

requirements.

(f) Withdrawal of Bids. After the bids are opened, they shall be irrevocable for the period specified in

the Invitation for Bids, except as provided in §§ 5211(f) of this Chapter. If a bidder is permitted to withdraw

its bid before award, no action shall be had against the bidder or the bid security.

(g) No Requirement for Performance Bond. The bid security that shall be held until complete delivery

of the supplies or services by the successful bidder is deemed to be satisfactory to adequately protect the

best interest of the government of Guam, from default, and thus, no separate performance bond shall be

required of the successful bidder on a contract for supplies or services.

(h) Bond Forms. The Policy Office shall promulgate by regulation the form of the bond or other bid

security required by this Section together with any additional regulations necessary for the administration

of this Section. Any person may request and obtain from the Government of Guam a certified copy of a

bond upon payment of the cost of reproduction of the bond and postage, if any. A certified copy of a bond

shall be prima facie evidence of the contents, execution and delivery of the original.