General Conditions of Contract

• Fraud and Corruption

• If the Purchaser determines that the Supplier
has engaged in corrupt, fraudulent, collusive,
coercive or obstructive practices, in competing
for or in executing the Contract, then the
Purchaser may, after giving 14 days notice to
the Supplier, terminate the Supplier's
employment under the Contract and the
provisions of Clause 34.1 shall apply.
• Inco terms
The meaning of any trade term and the rights
and obligations of parties there under shall be
as prescribed by Inco terms, published by the
International Chamber of Commerce at the date
of the Invitation for Bids or as specified in the
SCC.
• Severability
• If any provision or condition of the Contract is
prohibited or rendered invalid or
unenforceable, such prohibition, invalidity or
unenforceability shall not affect the validity or
enforceability of any other provisions and
conditions of the Contract.
• Governing Law
• The Contract shall be governed by and
interpreted in accordance with the laws of
Nepal.
• Settlement of Disputes
• The Purchaser and the Supplier shall make every effort
to resolve amicably by direct informal negotiation any
disagreement or dispute arising between them under
or in connection with the Contract.
• If the parties fail to resolve such a dispute or difference
by mutual consultation within thirty (30) days from the
commencement of such consultation, either party may
require that the dispute be referred for resolution to
the formal mechanisms specified in the SCC.
• Supplier’s Responsibilities
• The Supplier shall supply all the Goods and
Related Services included in the Scope of
Supply in accordance with the Delivery and
Completion Schedule
• Purchaser’s Responsibilities
• Whenever the supply of Goods and Related
Services requires that the Supplier obtain
permits, approvals, and import and other
licenses from public authorities in Nepal, the
Purchaser shall, if so required by the Supplier,
make its best effort to assist the Supplier in
complying with such requirements in a timely
and expeditious manner.
• Terms of Payment
• The Contract Price shall be paid in Nepalese
Currency.
• Payments shall be made promptly by the
Purchaser, no later than thirty (30) days after
submission of an invoice or request for
payment by the Supplier, and the Purchaser
has accepted it.
• Taxes and Duties
• For goods supplied, the Supplier shall be
entirely responsible for all taxes, duties,
license fees, etc., incurred until delivery of the
contracted Goods to the Purchaser.
• The successful bidder shall submit a
performance bank guarantee equivalent to
ten percent (10%) of the total contract
amount (including inland transportation cost,
if applicable) as Performance Security at the
time of signing the Contract
• Copyright
• The copyright in all drawings, documents, and
other materials containing data and
information furnished to the Purchaser by the
Supplier herein shall remain vested in the
Supplier
• Subcontracting
• The Supplier shall notify the Purchaser in
writing of all subcontracts awarded under the
Contract if not already specified in the Bid.
Subcontracting shall in no event relieve the
Supplier from any of its obligations, duties,
responsibilities, or liability under the Contract.
• The goods supplied under the Contract shall
be fully insured in a currency of Contract or in
Ne
• The Supplier shall arrange for Insurance,
naming the Purchaser as beneficiarypalese
Currency against any loss or damage
• The Supplier shall at its own expense and at
no cost to the Purchaser carry out all such
tests and/or inspections of the Goods and
Related Services as are specified in Sections V,
Schedule of Requirements.
• The Purchaser or its designated representative
shall be entitled to attend the tests and/or
inspections
 Liquidated Damages

• If the Supplier fails to deliver any or all of the Goods or

perform the Related Services within the period
specified in the Contract, the Purchaser may under the
Contract, deduct from the Contract Price, as liquidated
damages, a sum equivalent to the percentage specified
in the SCC of the Contract Price for each week or part
thereof of delay until actual delivery or performance,
up to a maximum deduction of the percentage
specified in the SCC.
• Once the maximum is reached, the Purchaser may
terminate the Contract.
• Unless otherwise specified in the SCC, the
warranty shall remain valid for twelve (12)
months after the Goods, or any portion
thereof as the case may be, have been
delivered to and accepted at the final
destination
• The Supplier shall, indemnify and hold
harmless the Purchaser from and against any
and all suits, actions or administrative
proceedings, claims, which the Purchaser may
suffer as a result of any infringement or
alleged infringement of any patent, utility
model, registered design, trademark,
copyright, or other intellectual property right
registered or otherwise existing at the date of
the Contract
 Force Majeure
• The Supplier shall not be liable for forfeiture
of its Performance Security, liquidated
damages, or termination for default if and to
the extent that its delay in performance or
other failure to perform its obligations under
the Contract is the result of an event of Force
Majeure.
• Such events may include, but not be limited
to, acts of the Purchaser in its sovereign
capacity, wars or revolutions, fires, epidemics,
quarantine restrictions, and freight embargoes
Termination for Default
(a) The Purchaser, may terminate the Contract in
whole or in part:
• (i) if the Supplier fails to deliver any or all of
the Goods within the period specified in the
Contract, or within any extension thereof
granted by the Purchaser or
• (ii) if the Supplier fails to perform any other
obligation under the Contract.
• Termination for Insolvency
• The Purchaser may at any time terminate the
Contract by giving Notice to the Supplier if the
Supplier becomes bankrupt or otherwise
insolvent. In such event, termination will be
without compensation to the Supplier, provided
that such termination will not prejudice or affect
any right of action or remedy that has accrued or
will accrue thereafter to the Purchaser.
• Termination for Insolvency
• The Purchaser may at any time terminate the
Contract by giving Notice to the Supplier if the
Supplier becomes bankrupt or otherwise
insolvent. In such event, termination will be
without compensation to the Supplier.
 Termination for Convenience

• The Purchaser, by written Notice sent to the Supplier,

may terminate the Contract, in whole or in part, at any
time for its convenience. The Notice of termination
shall specify that termination is for the Purchaser’s
convenience, the extent to which performance of the
Supplier under the Contract is terminated, and the date
upon which such termination becomes effective.
• The Goods that are complete and ready for shipment
within seven (7) days after the Supplier’s receipt of the
Notice of termination shall be accepted by the
Purchaser at the Contract terms and prices.
 Specific conditions of contract
• In the case of unresolved dispute between the
Purchaser and the Supplier, the dispute shall
be referred to arbitration in accordance with
the laws prevailing in Nepal
• Upon delivery of the Goods to the Purchaser,
the Supplier shall submit the following
documents to the Purchaser:
• Certificate of origin; and
• Supplier’s/Manufacturer Factory Test Report
• 100% Payment of the Goods and Services shall
be made through Irrevocable Letter of Credit
(L/C) opened in favour of Supplier.
• Extended Warranty Service
• A separate L/C shall be opened for the amount
of Extended warranty Service before the
expiry of warranty period. The supplier shall
submit pro-forma invoice and Performance
Security amounting 10% of the cost of
Extended Warranty Service.
 Payments shall be made in following
manner:
• Advance Payment:
• Twenty Percent (20%) of the total Price of the Goods (Hardware and
System Software) will be paid through Letter of Credit against submission
of Advance Payment Guarantee for the equivalent amount by the Supplier
• On Delivery Completion Certificate (DCC)Forty Percent (40%) of the price
of the Goods shall be made through irrevocable L/C within thirty (30) days
upon issuance of Delivery completion Certificate (DCC)
• On Provisional Acceptance Certificate (PAC): Twenty percent (20%)
payments of the goods shall be made through irrevocable letter of credit
(L/C) within thirty (30) days from the date of issuance of Provisional
Acceptance Certificate.
• On Final Acceptance Certificate (FAC): Twenty percent (20%)
payments of the goods shall be made through irrevocable letter of credit
(L/C) within thirty (30) days from the date of issuance of Final Acceptance
Certificate
• Payment for 3 Years Extended Warranty
Service
• Payment for three years warranty service will
be paid in twelve consecutive quarterly
installments starting from the satisfactory
completion of the warranty period of one year
• The applicable rate of liquidated damages
shall be 0.5 percent of the Contract Price per
week.