Performance Guarantee Bonds are essential financial security instruments in the UAE business landscape, particularly in construction and large-scale projects. These bonds are required when a contractor enters into a significant contract and the client needs security for the contractor's performance. The Performance Guarantee Bond, governed by UAE law, typically amounts to 10% of the contract value and remains valid throughout the contract period plus any warranty period. It serves as a risk mitigation tool for project owners and clients, providing them with immediate access to financial compensation if the contractor fails to fulfill their contractual obligations. The document must comply with UAE Federal Laws, including Civil Code (Federal Law No. 5 of 1985) and Commercial Code (Federal Law No. 18 of 1993), as well as UAE Central Bank regulations. Banks or insurance companies issuing these bonds typically require counter-security from the contractor.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Your data doesn't train Genie's AI
You keep IP ownership聽of your docs
1. Identification of Parties: Details of the Guarantor (bank/insurance company), Principal (contractor), and Beneficiary (client)
2. Reference to Underlying Contract: Details of the main contract or agreement that this guarantee is securing
3. Guarantee Amount: The maximum amount of the guarantee expressed in both numbers and words
4. Scope of Guarantee: Clear description of what performance/obligations are being guaranteed
5. Duration and Validity: Effective date, expiry date, and any auto-extension conditions
6. Claim Conditions: Specific conditions under which the guarantee can be called, including notice requirements
7. Payment Terms: Timeline and method of payment upon valid claim
8. Governing Law and Jurisdiction: Explicit reference to UAE law and courts
9. Language Provision: Specification of prevailing language if document is bilingual
1. Reduction Clause: Include when the guarantee amount needs to reduce progressively based on project milestones
2. Assignment Provisions: Include when assignment of the guarantee rights needs to be addressed
3. Counter Guarantee Reference: Include when there is a counter-guarantee from another bank
4. Force Majeure Clause: Include for long-term guarantees where force majeure events need to be addressed
5. Electronic Presentation: Include when claims can be submitted electronically
6. Multiple Beneficiaries Clause: Include when there are multiple beneficiaries to the guarantee
1. Form of Demand: Template for making a claim under the guarantee
2. Project Details: Detailed description of the project or performance being guaranteed
3. Authentication Method: Specified format for authenticating claims, especially for electronic submissions
4. Contact Details: List of authorized contacts and addresses for notices for all parties
Find the exact document you need
Performance Guarantee Agreement
A UAE-law governed guarantee agreement where a guarantor ensures a principal's performance obligations to a beneficiary through financial security.
Download
Contract Performance Guarantee
A UAE law-governed bank guarantee securing the performance of contractual obligations, providing financial security to the beneficiary in case of the principal's default.
Download
Performance Guarantee Bond
A UAE-law governed financial guarantee issued by a bank/insurer to secure a contractor's performance obligations to their client.
Download
骋别苍颈别鈥檚 Security Promise
Genie is the safest place to draft. Here鈥檚 how we prioritise your privacy and security.
Your documents are private:
We do not train on your data; 骋别苍颈别鈥檚 AI improves independently
All data stored on Genie is private to your organisation
Your documents are protected:
Your documents are protected by ultra-secure 256-bit encryption
We are ISO27001 certified, so your data is secure
Organizational security:
You retain IP ownership of your documents and their information
You have full control over your data and who gets to see it
.png)