Art. 103. Final guarantees1. The contractor for the signing of the contract must provide a bond, called a "final guarantee" at his discretion in the form of a security or bond with the procedures laid down in Article 93, paragraphs 2 and 3, equal to 10% of the contractual amount and this obligation is stated in the deeds and documents relating to the assignment of works, services and supplies. In the case of tendering procedures carried out in aggregate by central purchasing bodies, the amount of the guarantee shall be indicated up to a maximum of 10% of the contract amount. In order to safeguard the public interest in concluding the contract in the terms and in the ways programmed in the case of an award with a rebate of more than 10%, the guarantee to be established is increased by as many percentage points as those that exceed the 10%. If the rebate is over 20%, the increase is two percentage points for each rebate point above the 20%. The security is provided as a guarantee for the fulfilment of all contractual obligations and compensation for damages arising from any breach of the obligations, as well as being a guarantee for the reimbursement of the extra sums paid to the performer compared to the final settlement records, without prejudice to any rights to claim compensation for further damage against the contractor. The guarantee ceases to have effect only on the date of issue of the provisional test certificate or the certificate of proper performance. The contracting entity may require the successful tenderer to reinstate the guarantee if it has failed to fulfil in whole or in part. In the case of non-compliance, reinstatement is carried out on the price rates to be paid to the performer. The reductions provided for in Article 93, paragraph 7 for the provisional guarantee apply to the guarantee in this Article.
2. The contracting entities have the right to use the security, within the limits of the maximum guaranteed amount, for any additional expenses incurred in completing the works , services or supplies in the event of the termination of the contract to the detriment of the performer, and are entitled to use the security to pay the amount owed by the performer for non-compliance resulting from the failure to comply with the rules and regulations of collective agreements, laws and regulations on the safeguarding, protection, insurance, physical assistance and safety of the workers who are present on site or in places where the service is provided in the case of service contracts. The contracting entities may forfeit the guarantee to pay the amount due by the successful tenderer for non-compliance resulting from the failure to comply with the rules and regulations of collective agreements, laws and regulations on the safeguarding, protection, insurance, physical assistance and safety of the workers involved in the performance of the contract.
3. Failure to provide the final guarantee as per paragraph 1 shall result in revocation of the award and the seizure of the provisional security filed by the contracting party at the time of bidding, which shall award the tender or the concession contract to the next tenderer in the ranking.
4. The performance bond as per paragraph 1 can be, according to the contractor’s discretion, issued by the entities as per article 93, paragraph 3. Said bond must expressively provide for the waiver of the principal debtor’s right to enforce preliminary payment, the waiver of the exception as per article 1957, para. 2, of the Italian Civil Code, as well as for the guarantee to be applied within fifteen days, further to a simple written request from the contracting party.
5. The guarantee as per paragraph 1 shall be progressively released according to the progress made in performing the obligation, up to a maximum of 80 percent of the initial guaranteed amount. The residual amount of the final security must remain until the date of issue of the provisional test certificate or the certificate of proper performance, or in any case up to 12 months from the date of completion of the work resulting from the relevant certificate. Withdrawal is automatic, without the need of the client’s permission, with the sole condition of the prior delivery to the guarantor, from the contractor or concessionaire, of the state of progress of the works or similar document, in the original or certified copy, attesting to the completion. This automatism also applies to supply and service contracts. Contrary agreements and derogations are void. Failure within fifteen days to deliver progress reports or similar documentation constitutes the default by the guarantor with regards to the undertaking for which the guarantee is provided.
6. Payment of the instalment is subject to the establishment of a security or bank or insurance fiduciary bond equal to the amount of the same instalment plus the legal interest rate applied for the period between the date of issue of the test certificate or verification of compliance in the case of service or supply contracts and the assumption of their finality.
7. The works performer is also obliged to set up and deliver to the contracting entity at least 10 days prior to the delivery of the works an insurance policy that covers the damage suffered by the contracting entities due to the damage or total or partial destruction of installations and works, also pre-existing, occurring during the performance of the works. The amount of the sum to be insured, which normally corresponds to the amount of the contract if there are no special circumstances justifying a higher amount to be secured, is established in the documents and in the tender or assignment deeds. The policy of this paragraph shall insure the contracting entity against third party liability for damages caused during the execution of the works, the ceiling of which is 5% of the sum insured for works with a minimum of 500,000 euros and a maximum of 5,000,000 euros. The insurance cover shall run from the date work is delivered until the provisional test certificate or the regular execution certificate is issued, or in any case twelve months subsequent to the date on which work was completed, as it appears in the pertinent certificate. If a guarantee period is provided, the insurance policy is replaced by a policy that takes care of the contracting entities from all risks associated with the use of guaranteed jobs or any replacement or refurbishment. The omission or late payment of sums due by way of prize or commission by the performer does not imply the ineffectiveness of the guarantee against the contracting entity.
8. For works of more than twice the threshold referred to in Article 35, the holder of the contract for the settlement of the instalment of the balance shall be obliged to stipulate, from the date of issue of the provisional test certificate or the certificate of proper performance or in any case 12 months from the date of completion of the works resulting from the relevant certificate, a 10 year indemnity insurance policy covering the risks of total or partial damage to the work, or risks arising from construction defects. The policy must contain the provision of the payment in the case of contractually due compensation in favor of the client as soon as the latter so requests, even on the basis of accountability and without the need for approvals and authorizations of any kind. The 10 year policy limit must not be less than 20% of the value of the work carried out and not more than 40%, respecting the principle of proportionality regarding the nature of the work. The performer of the works is also obliged to stipulate, for the works referred to in this paragraph, a liability insurance policy for damaged caused to third parties, with effect from the date of issue of the provisional test certificate or the certificate of proper performance for a term of 10 years and with compensation equal to 5% of the value of the work completed with a minimum of 500,000 euros and a maximum of 5,000,000 euros.
9. The fiduciary bonds and insurance policies provided for in this Code are in conformity with the approved type schemes by decree of the Minister for Economic Development in agreement with the Minister for Infrastructure and Transport, and previously agreed with the banks and insurers or their representatives. see Decree of the Ministry of Economic Development no. 31 of January 19, 2018, published in the Italian Official Gazette, no. 83 of April 10, 2018 concerning type schemes of guarantees
10. In the case of temporary groupings, the fiduciary bonds and insurance guarantees shall be submitted, on an irrevocable mandate, by the agent in the name and on behalf of all competitors, without prejudice to the joint and several liabilities of the undertakings".
11. In specific cases, the administration may not require a guarantee for contracts as referred to in Article 36, paragraph 2, letter a), as well as for contracts to be carried out by certified economic operators as well as for supplies of goods that by their nature, or the special purpose they are intended for, must be purchased at the place of production or supplied directly by producers, or art products, machinery, tools and precision jobs, the performance of which must be entrusted to specialist operators. The exemption from the provision of the guarantee must be adequately reasoned and is subject to an improvement in the price of the award.