What is a guarantee of compliance?

Let's see, the famous compliance guarantee - or compliance bail, if you like to complicate it - it is basically insurance for when a contractor watering and does not comply with what he promised in a contract. Super common in all that of public tenders. It is the shield used by government agencies so as not to be hung if the winning company decides to disappear or simply does not do things right.

And how does this work? Well, if the company awarded is thrown back or makes a disaster, the government can go directly to collect the guarantee and use that money to finish the project, normally hiring someone else. Thus the project continues and nobody stays crying in the corner. It is like having a well -armed “plan B”.

Legally, this issue is a maze because it depends on each country and each sector. For example, in the United States they have the famous Miller Act, which forces you yes or yes to put the guarantee if you want to work on federal projects. In most places, not anyone can issue this guarantee; You need a bank or insurance with all of the law.

For companies that want to launch into the ring of public tenders, understanding this roll is key. Eye, which is not free: the compliance guarantee costs and you have to put it in the budget from the beginning. But it is also a strong letter because public organizations give much more peace of mind to choose if you see that you have everything covered.

So, if you are thinking of getting into the world of tenders, or doubt it: get that guarantee and do it with an insurer or bank that suits you, because in the end that can change the price and conditions. But neither do you think it is the only lifeguard that exists for the risks of public contract; There are more tools in the box.

In summary, the compliance guarantee is the bulletproof vest for the government if the contractor does not comply. Yes, it is an extra expense, but it can also be the difference between choosing you or not. This is how the game works.