Surety Bonds

In the construction sector, many contractors and sub-contractors rely on their bank to provide bonds and guarantees to give third party protection to beneficiaries against loss or damage suffered as a result of breach of contractual obligations.

Contract Bonds

This is a guarantee issued by a third party in support of an underlying contract. The parties to a Contract Bond are the contractor, the employer (such as a main contractor or public body) and the guarantor – the Surety. These can include:

• Bid
• Advance Payment
• Performance
• Retention Bonds

Deferred Consideration Bonds

A landowner may be willing to sell land to a house builder or property developer on deferred payment terms. To give the landowner comfort, a Deferred Consideration Bond can be arranged that will guarantee payment of instalments in the event that the builder or developer defaults. This frees up the finances of the builder or developer and gives peace of mind to the seller of land.

Road and Sewer Bonds

These provide a guarantee on behalf of a house builder or property developer that they will complete the roads and sewers to the required standard and within a defined timeframe. This enables them to be adopted by the appropriate authority under the relevant Acts.

HMRC/Customs and Excise Bonds

The posting of a Duty Deferment Bond or Movement Guarantee with HM Revenue & Customs allows companies to import and distribute goods prior to payment of duty. This enables them to free up their cash flow.

Environment Agency Bonds

This is a common requirement relating to the operation of landfill sites. To fulfil legal obligations under various statutes, a contractor may be required to place a bond in favour of The Environment Agency.