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Plain-language definitions of every Financial Terms term that shows up in government tender work.
An upfront payment made to a contractor or supplier at contract start, typically ranging from 10 to 30 percent of the contract value, to cover mobilisation costs before work begins.
Read definitionA binding, private dispute resolution process used in international procurement contracts where an independent tribunal hears evidence from both parties and issues an enforceable award in place of court litigation.
Read definitionA private, binding dispute resolution process in which parties submit their disagreement to an independent arbitral tribunal, whose award is enforceable across more than 170 countries under the New York Convention.
Read definitionThe formal process under a contract by which a party asserts entitlement to additional time or money, and the escalation path if the claim is rejected and becomes a dispute requiring third-party resolution.
Read definitionAn unallocated financial reserve built into a project budget to cover unforeseen costs or risks that cannot be attributed to specific items at the time the contract is prepared.
Read definitionThe currency or currencies in which a bidder is required to express its price in a tender submission, as specified in the instructions to bidders in the solicitation documents.
Read definitionThe currency or currencies in which the employer will actually pay the contractor under the contract, which may differ from the currency used to express the bid price.
Read definitionA method of valuing varied or unforeseen work by paying the contractor the actual cost of labour, plant, and materials plus an agreed percentage for overheads and profit, used when measurement is impractical.
Read definitionA standing panel of independent experts appointed at contract start that issues binding decisions on disputes during construction, allowing works to continue while the decision is challenged if either party is dissatisfied.
Read definitionA standing panel of independent experts appointed at contract start to visit the project regularly and issue binding decisions on disputes within 84 days, with those decisions enforceable even if a party gives notice of dissatisfaction.
Read definitionA standing panel of independent experts that issues non-binding recommendations on disputes referred by contracting parties, used on projects where the parties prefer a facilitative rather than adjudicative first-tier mechanism.
Read definitionAn independent panel of experts appointed at contract start that issues non-binding recommendations on disputes, giving parties a rapid, informed assessment before they decide whether to proceed to arbitration.
Read definitionA contract provision that allows the contract price to be adjusted upward or downward to reflect changes in costs such as labour, fuel, or materials over the contract period.
Read definitionThe fixed currency conversion rate specified in tender documents that procurement officers use to translate bids submitted in different currencies into a single evaluation currency, ensuring all offers are compared on a consistent financial basis.
Read definitionThe official rate used by a procuring entity to convert bids expressed in different currencies into a single evaluation currency, fixed at a specific date stated in the solicitation documents.
Read definitionThe last payment made under a contract after all works are complete, defects remedied, and accounts agreed, settling the outstanding balance including retained funds and any accepted claims.
Read definitionA contract provision that excuses a party from performance obligations when an extraordinary event beyond its reasonable control makes performance impossible or illegal, typically entitling the affected party to a time extension.
Read definitionArbitration administered by the International Chamber of Commerce under its ICC Rules, the world's most widely used institutional framework for resolving international commercial and procurement disputes.
Read definitionA pre-agreed daily or weekly sum the contractor pays the employer for each day of delay beyond the contract completion date, quantifying delay compensation without requiring proof of actual loss.
Read definitionA voluntary, confidential dispute resolution process in which a neutral mediator helps contracting parties negotiate a mutually acceptable settlement, without imposing a binding decision.
Read definitionA payment tied to the verified completion of a defined project milestone or deliverable, linking cash release to tangible outputs rather than to elapsed time or measured quantities.
Read definitionA contractual formula that adjusts payments to a contractor over time to reflect changes in labour, material, and equipment costs, protecting both parties from inflation risk on long contracts.
Read definitionA periodic payment made to a contractor based on certified work completed to date, keeping cash flowing through a long contract without waiting until completion for full settlement.
Read definitionA defined allowance included in a contract for works or items whose scope or cost cannot be determined precisely at the time of bidding, to be spent only on the engineer's instruction.
Read definitionA percentage withheld from each progress payment as a performance security, released in two tranches at substantial completion and at the end of the defects liability period.
Read definitionThe employer's right to end a contract when the contractor has committed a material breach such as prolonged suspension, insolvency, or persistent failure to perform, with the employer entitled to recover additional completion costs.
Read definitionA universally accepted set of procedural rules for ad hoc international arbitration published by the UN Commission on International Trade Law, widely used in investment and procurement disputes.
Read definitionA formal instruction issued under a contract that directs the contractor to add, omit, or alter scope, with the associated cost and time adjustment determined through the contract's valuation mechanism and agreed before or after execution of the changed work.
Read definitionA formal written instruction from the engineer or employer that directs the contractor to add, omit, or alter scope under an existing contract, with agreed adjustments to price and time.
Read definitionSee how Bidovate turns these government tender terms into pipeline. Explore the platform or book a 15-minute demo.
