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General Terms and Conditions for Participation in Inquiries & Projects All companies that do not comply with the terms & conditions stated hereunder, their offers will be

neglected without prior notice.

1. The below-mentioned conditions are considered to be general terms & conditions while

conditions that are mentioned within bid documents are considered to be special conditions. If

there are be any contradictions or differences, bid documents conditions will prevail.

2- Company Profile In order to consider any company in our invitations for tenders, should be attached to the

company profile the following documents:

a- An introduction letter, including company full name in English and Arabic, company logo,

full address (e-mail, phone no, website).

b- An up dated incorporation certificate, including net capital ,field of specialization and

financial statement legalized by Chamber of Commerce and Ministry of Foreign Affairs in

the country of incorporation and Iraqi Consulate or Embassy there. In addition the

incorporation certificate should be legalized by Iraqi ministry of Foreign Affairs / Consular

office or Basrah office.

Agents or Authorized Companies should submit Letters of authorization from

Manufacturing Companies legalized by Chamber of Commerce and Ministry of Foreign

Affairs in the Country of manufacturers and Iraqi Consulate or Embassy there. In

addition the Authorization Letters should be legalized by Iraqi ministry of Foreign Affairs

/ Consular office or Basrah office.

c- A brief history report of previous similar works, implementations and contracts carried out by

the company and manufacturing companies it deals with.

D-Original letter of authorization issued by manufacturers or services and materials suppliers,

whose products and services meet our company requirements, authenticated by Ministry of

Foreign Affairs of supplier/contractor country.

e -If the company has any offices, agents, representatives or subsidiary companies in Iraq, they

should submit a tax clearance certificate issued by Iraqi General Tax Directorate/ companies

department, and full address with phone no. for the representative is required.

f- All companies should submit a quittance certificate issued by Retirement & Social Security

Office in the Ministry of Labour and social affairs certifies that all employees have Social

Security.

g- ISO certificate and/or any other certificate(s) issued by an internationally accredited

classification society.

h- Net capital should be not less than two billion Iraqi dinars or equivalent.

i- Cash flow availability is one of evaluation and qualification criteria of bidders; otherwise this

will conduce to not considering their bids.

j- All foreign companies, manufacturers/and suppliers are bound to dispense with regional

agencies and replace them by national (Iraqi) trading agencies that are registrated in Iraq in

accordance with Iraqi law.

k- The foreign company or the economic corporation which has a constant activity in Iraq or

contracted to conduct certain project shall present a written notification to corporate

registration department once they make the contract or the agreement relevant to their

activity or project. This doesn`t include the companies or the corporations contracted to

supply goods or materials unless they have actual existence in Iraq or the supplying

agreement or contract includes providing whichever kind of services.

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l_ A LIST OF SIMILAR ACTIVITIES SHOULD BE ATTACHED TO BIDDERS` OFFER CERTIFIED BY CONCERNED

PARTIES CONCERNED AND IT WILL BE CONSIDERED AS CRITERION FOR QUALIFICATION.

i- To submit establishment certificate, establishment registration company internal system, authorization

letter, contractors id, coc id, practicing license).

ii- executive manager in more than one company is not allowed to submit more than one bid for the

tender

iii- Bidder address (contractor, supplier, consultant) stated in the bid will be applied in

correspondences and notifications and bidder should notify company of any change to that address

within seven days of such change.

iv- Bidder shall state qualifications of their technical staff and full-time and part-time specialists and

specialized trucks and equipment to be used for the execution of related projects.

v- for Iraqi contractors the classification and contractor degree is required, in addition to company`s

registration certificate, and practicing license, which should be certified by concerned departments

vi- Designs and drawings and modified specification prepared by the contractor will be for the property

of BOC. except some special cases which has a permission of D.G and in such cases no information

is allowed to be announced related to contracting before final permission of high authority.

vii- a letter of non objection to participation in the tender issued by general commission for taxes for

Iraqi companies

m- A copy of your bid bond is to be sent to our e-mail (fpd_basraoilco@boc.oil.gov.iq)on closing date

in order to speed up obtaining the bid bond issuance confirmation from the bank.

n- Field and laboratory chemical testing mechanism is applicable to chemicals provided by suppliers and

contractors or manufacturer to ensure their effectiveness, utility and safety to be used in oil facilities

before giving approval to such chemicals to enter competition with others which have been already in

service.

3- Destination: if means of transportation was by sea, the delivery term (in submitted offer)

should be (CIP BASARH / BOC WEAREHOUSE VIA NORTH UM—QASSER, SOUTH UM-QASSER PORT, KHOR

AL ZUBAIR PORT OR AL MAQAL PORT).

- All suppliers should deliver materials to the delivery warehouses ( Bab al-Zubair / Burjissya / North

Rumaila) and as indicated in the materials clearance form issued by central clearance department.

4- Bid documents will be bought in the fixed prices shown at reception hall or through our web

site at specified closing date.

5- The participant should submit four envelopes containing the following:-

First envelope should contain the technical offer (hard and electronic copy).

Second envelope should contain the commercial offer. Third envelope should contain the bid bond; the suppliers/contractors should issue a bid bond equal to

amount that is stated in bid documents in favor of BOC for a validity of three months and to be

extended up to six months if needed ( in case of public invitation only ) , otherwise offers will be

neglected. The bid bond should be in a form of a bank guarantee or a certified check in Iraqi currency

which should be issued by any Iraqi reliable bank or to be paid in cash directly to our account. OR

SAVTAGIH (Note of Hand)

A-Bank guarantees issued by Basra International Investment Bank , Al Warkaa for Investment Bank, Elaf Islamic Bank, Mosul development Bank , Abrea Iraq bank, Islamic cooperation bank, Dijla and

furat investment bank and Babylon bank are not accepted.

B- Bank guarantees must be issued in the name of Supplier Company or in the name of the supplying

the company executive manager exclusively

C- Note of Hand ( savtajih ) issued by local banks for our company account in Al- Rasheed bank are

not accepted D- All participants should advise (TBI), through their corresponding banks, the name of the

authorized person and his (ID) number to receive the bid bond for participation to avoid

confusion.

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- Fourth envelop should contain enquiry document purchasing receipt, up-to date certificate of

establishment, including net capital not less than two billion Iraqi dinars or equivalent.

Authenticated by Iraqi embassy or Iraqi commercial attaché in the country of the company and

financial report including final accounts of the last TWO years authenticated by a legal

accountant. a list of previous similar works or contracts that have been accomplished by the

company. - Any request for extension of closing date should be submitted to BOC no less than two weeks before the

closing date. - conference will be held in commercial committee office before 7 days of closing date to reply the

inquiries of the bidder

6- Bid documents fees are non-refundable.

A-Full address: country, city, district, street, building and floor number (if available).

B- Validity should not be less than (120) days starting from closing date.

C-Delivery period: this period will be enumerated after the receipt and acceptance of the

operative irrevocable L/C by the contractor bank. Delivery or execution of works period

should be stated in days.

D- Full address of advising bank for the company showing: city, district, street, building and

floor number (if available), account no., swift code and Iban no.

E- Port of shipment, route of shipment, entry point to Iraq and country of origin.

F-Offers sent by DHL or registered mail before closing date are accepted only for monopolistic

invitation.

7- Offers to be deposited in specified tender boxes situated at (reception) of our company HQ.

8-Tech.spec.are subjected to modification by BOC without prior notification.

9- After enquiry`s awarding, any requests regarding any of the following are not accepted:-

a- Prices negotiation.

b- Changing origin of materials.

c- Changing company name.

10- Partial awarding on quotation, supplier/contractor are requested to state their acceptance of

(partial) awarding or not.

11-Supplier who has been awarded the enquiry must bear the announcement cost.

General Terms & Conditions for Supply of Goods Contracts

1- Fraud and Corruption 1.1 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, , terminate the supplier's employment under the contract and cancel the

contract after giving a (14-day) notice to the supplier

1.2 The supplier, bidder and subcontractor should adhere to the utmost professional criteria during

the period of supplying the materials and executing the contract.

2- Interpretation 2.1 If required by the context, singular means plural and vice versa.

2.2 Incoterms

(a) Unless inconsistent with any provision of the contract, the meaning of any trade term and the

rights and obligations of parties there under shall be as prescribed by Incoterms.

(b) All terms when used shall be governed by the rules prescribed in the current edition of

Incoterms published by the international chamber of commerce in Paris, France.

2.3 Amendments

No amendment or other variation of the contract shall be valid unless it is in writing, is dated,

expressly refers to the contract, and is signed by a duly authorized representative of each party

thereto.

3- Language

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3.1 The contract shall be written in both Arabic & English. Supporting documents and printed

literature that are part of the contract may be written in another language provided they are

accompanied by an accurate translation of the relevant passages in the language specified. In

which case and for purposes of interpretation of the contract, this translation shall govern.

3.2 The supplier shall bear all costs of translation to the governing language and all risks of the

accuracy of such translation, for documents provided by the supplier.

4- TYPE OF COMPANY

If the supplier is a joint venture, consortium, or association, all of the parties shall be jointly and

severally liable to the purchaser for the fulfillment of the inclusion of the contract and shall

designate one party to act as a leader with authority to bind the joint venture, consortium, or

association.

5- Eligibility All goods and related services to be supplied under the contract shall have their origin in eligible

countries. For the purpose of this clause, origin means the country where the goods have been

grown, mined, cultivated, produced, manufacturing, or processed; or through manufacture or

processing.

6- Notices 6.1 Any notice given by one party to the other pursuant to the Contract shall be in writing to the

address specified in the documents. The term “in writing” means communicating in written

form with proof of receipt. Notices are deemed to be valid if sent by registered mail to the

address specified by the supplier in the contract or sent by e-mail to the supplier’s address as

mentioned in this document.

6.2 A notice shall be effective when delivered or on the notice’s effective date, whichever is later.

7- Scope of Supply

The Scope of Supply shall be as specified in the P.O/ contract

8-Delivery and completion 8.1 The delivery of the goods and completion of the related services (if any) shall be as specified in

the P.O/ contract.

8.2 Shipping Documents

8.2.1 The details of shipping and other documents to be furnished by the supplier as specified in the

P.O/ contract

An authenticated original copy together with (6) authenticated copies of the shipping documents

referred in (P.O/ contract) should be sent to the bank (TBI). A copy of these shipping to be sent to

the purchaser at least (10) days prior to materials arrival to entry point for customs clearance

purpose. Otherwise, the supplier will bear all charges which will occur as a consequence of the

delay in offering the required documents at the required period.

8.2.2 Certificates of origin should be endorsed before shipment by the (Iraqi Commercial Attaché

or by the Iraqi Embassy in case there is no commercial attaché) in the country of origin

8.2.3 Commercial invoices should be endorsed before arrival of materials to the entry point by the

(Iraqi Commercial Attaché) in the exporter country or by the Iraqi Embassy in case there is no

commercial attaché.

8.2.4 The original commercial invoice endorsed by the (Iraqi Commercial Attaché in the supplier`s

country /exporting country where it is registered as a trading co. OR by the Iraqi Embassy in

case there is no commercial attaché . The invoice should include the contract number, letter of

(L/C) number, the total price ( number and written ), currency type, shipment specifications

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and the product protection code (HS). Also it should include the delivery term (CIP) or (CIF)

with the name of the entry point. With Arabic translated version of the Invoice.

8.2.5. Commercial invoices issued by Iraqi company should be endorsed by Chamber of Commerce

in which that company is registered.

8.2.6 The origin of the materials should be identical with the contract; otherwise the supplier will

be liable to the difference in origin.

8.2.7 The second party shall be liable to the legal and financial consequences arising from delay in

clearance of goods at the Iraqi entry points if:

a-The supplier does not notify purchaser of the date of materials arrival to Iraq.

b-The corresponding bank has delayed dispatching the shipping documents to BOC due to

discrepancies in these documents.

c-The carrier has delayed the issuance of goods delivery orders to BOC. The second party has

to urge the carrier to accelerate materials delivery without delay as they arrive at entry

points

8.2.8 in case of containers being of beneficiaries ` property, their numbers should be included with the

materials that are listed in the invoices.

9- Supplier’s Responsibility The supplier shall supply all the goods and related services included in the scope of supply and the

specifications of goods in the contract/P.O.

10- Payment terms Payment terms will be effected through irrevocable non-transferable (letter of credit) as follows:-

A- Direct sales contracts

1- (70% for suppliers)

2- (80% for manufacturers)

of contract value or shipment value in case of partial shipment payable upon shipping and

submitting (1) original and(6) copies of the required shipping documents as stated in the P.O/

contract

3- (30% for suppliers)

4- (20% for manufacturers)

of contract value or shipment value in case of partial shipment payable after arrival of

shipment to the final destination and upon submission of a certificate of checking and

conformity issued by the purchaser (BOC) confirming receipt and acceptance of the shipment .

The amount shall be released against payment notification from the purchaser to the bank.

Note/ BASRA Oil Company has the right to decrease the above mentioned

payment percentage if the contract has complementary works such as (commissioning and

installation).

B- Service Contract

Terms of payment for (service contracts) will be peculiar to the nature and the work to be

carried out and both parties agreement.

11- Performance Bond

Before signing the contract, the supplier should submit an unconditional performance bond

equals to 5% of the contract price. The proceeds of the performance bond shall be payable to

the purchaser as a compensation for any loss resulting from the supplier’s failure to complete

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his obligations under the contract.

This guarantee shall be exclusively issued through TBI or any Iraqi reliable bank. The

performance bond shall remain valid and not to be released until the supplier completes

delivery of all materials to the site in Iraq and fulfills all his obligations under the contract and

settling all final accounts. On the other hand, if a warranty period is included in the tender's

documents and the required materials require installation, maintenance or operating, then the

performance bond will be released just after the end of the warranty period.

12- Copy Right

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, or, if they

are furnished to the purchaser directly or through the supplier by any third party, including

suppliers of materials, the copyright in such materials shall remain vested in such third party.

13- Confidential Information 13.1 The purchaser and the supplier shall keep confidential and shall not, without the written

consent of the other party hereto, divulge to any third party any documents, data, or other

information furnished directly or indirectly by the other party hereto in connection with the

contract, whether such information has been furnished prior to, during or following completion

or termination of the contract. Notwithstanding the above, the supplier may furnish to its

subcontractor such documents, data, and other information it receives from the purchaser to the

extent required for the subcontractor to perform its work under the contract, in which event the

supplier shall obtain from such subcontractor an undertaking of confidentiality similar to that

imposed on the supplier.

13.2 The purchaser shall not use such documents, data, and other information received from the

supplier for any purposes unrelated to the contract. Similarly, the supplier shall not use such

documents, data, and other information received from the purchaser for any purpose other than

the performance of the contract.

13.3 The obligation of a party under sub-clauses13.1 and13.2 above, however, shall not apply to

information that:

(a)The purchaser or supplier need to share with the bank or other institutions participating in the

financing of the contract;

(b Now or hereafter enters the public domain through no fault of that party;

(c)Can be proven to have been possessed by that party at the time of disclosure and which was not

previously obtained, directly or indirectly, from the other party; or Otherwise lawfully becomes

available to that party from a third party that has no obligation of confidentiality.

13.4 The above provisions of clause 13 shall not in any way modify any undertaking of confidentiality

given by either of the parties hereto prior to the date of the contract in respect of the supply or any

part thereof.

13.5 The provision of clause 13 shall survive for (3) years even after the completion or termination,

for whatever reason, of the contract.

14- Subcontracting The supplier shall notify the purchaser in writing of all subcontracts awarded under the contract if

not already specified in the bid. Such notification, in the original bid or later shall not relieve the

supplier from any of its obligations, duties, responsibilities, or liability under the contract.

15- Specifications and Standards

(a) The goods and related services supplied under contract shall conform to the technical

specifications and standards mentioned in schedule of requirements and, when no applicable

standard is mentioned, the standard shall be equivalent or superior to the official standards

whose application is appropriate to the goods’ country of origin.

(b) The supplier shall be entitled to disclaim responsibility for any design, data, drawing,

specification or other document, or any modification thereof provided or designed by or on behalf

of the purchaser, by giving a notice of such disclaimer to the purchaser.

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(c) Wherever references are made in the contract to codes and standards in accordance with which

it shall be executed, the edition or the revised version of such codes and standards shall be those

specified in the schedule of requirements. During contract execution, any changes in any such

codes and standards shall be applied only after approval by the purchaser.

16-Acceptance

By acceptance of the purchase order/contract, supplier/contractor has agreed that the prices

contained herein are firm.

17- Liquidated Damages

17.1 If the Supplier fails to deliver any or all of the Goods by the date(s) of delivery or perform the

Related Services(if any) within the period specified in the Contract, the Purchaser may

without prejudice to all its other remedies under the Contract, deduct from the contract price,

as liquidated damages . 17-2 Delay due to causes beyond control (force majeure) will not be liable to liquidated damages

provided that such causes had been immediately notified by fax, e- mail or registered mail &

approved by client.

17-3 liquidated damages to be paid by the supplier as a penalty of his failure to deliver the

materials in due time but shall not relieve supplier from its other obligations under the

contract.

17-4 Supplier/contractor has to pay a delay penalty for each day delay according to the following

equation which should not exceed (10%) of the total amount of P.O/ contract:-

(a) In case the materials in one shipment:-

Total Amount of contract / P.O ×((10 -25%) AS STATED IN THE BID DOCUMENTS))

(b) In case of partial shipment:- The delay penalties shall be reduced according to the rate of completion of

the contractual obligation specified in the executed plan of the contract in which an initial delivery

certificate was issued for the work performed or the supplied goods or the identical required services

conforming prepared for use according to the terms of the contract.

18-ASSIGNMENT

1-Supplier cannot assign to another party any part of the contract without written permission

from the other party.

2-The supplier cannot assign the contract to a subcontractor.

19-Bank Charges :

a- All banking churches outside Iraq are on the beneficiary's account, and all banking charges

inside Iraq on applicant account, except confirmation, extension, and L/C amendment are

on beneficiary’s account.

b- commissions of amending and extending the letter of credits concerning capex contracts

should be paid in advance by suppliers at BOC financial division upon notification from BOC

after getting approvals and before instructing the bank about extension or amendment.

= penalty per day

Delivery period in days

Amount of non - executed obligation

x (10-25%) = penalty per day

Contract period

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20 - Payment Mechanism

20.1 The contract price shall be paid as specified in the P.O/ contract.

20.2 Payment of contract price shall be made by L/C as specified in the P.O/ contract

The L/C should be covered by U.C.P. version 600 of 2007 issued by (I.C.C) Paris, opened

by (TBI) for the benefit of the second party payable according to the terms of payment

required under L/C amount upon submission of the customary commercial documentation

indicated in the P.O/ contract and certified upon fulfillment of all other obligations

stipulated in the contract.

20.3 Payments shall be made promptly by the purchaser, but in no case later than ninety (90)

days from the date of receiving the materials, accepted and settled by the purchaser.

20.4 The currencies in which payments shall be made to the supplier under this contract shall be

those in which the bid price is expressed.

21-Shipment Instructions

a- Bills of lading, CMR, Multimodal, Airway bill should be endorsed by the L/C issuing bank

and include the contract number , L/C number and the commercial invoice number.

b- The bill of lading should indicate country of registration of the vessel as well as the port of call

of the vessel up to the delivery.

c- Purchaser prefers shipment to be effected through Iraqi government (land, sea and air) lines

and through (United Arab Shipping Company).

d- In case of sea shipment, vessels should be no more than (15) years of age.

e- The name of the purchaser (end user) (BOC) should be clearly stated on all shipping

documents.

f-The responsibility of the carrier starts from the moment the consignment being under his

custody and ends at the consignment delivery to consignee or put it under his control at final

destination according to the contract or handing it over to an authorized party based on a

joint report.

g- The third party inspection activities are the obligation of BOC according to the contract

between Boc and (Intertek) which has the right to inspect all items during the manufacturing

process.

h-The containers used in transporting the materials will be the property of the importer (BOC).

22- Packing 22.1 The supplier shall provide such packing of the goods as is required to prevent their

damage or deterioration during transit to their final destination, as indicated in the

contract. During transit, the packing shall be sufficient to withstand, without limitation, rough

handling and exposure to extreme temperatures, salt and precipitation, and open

storage. Packing case size and weights shall take into consideration, where appropriate, the

remoteness of the goods’ final destination and the absence of heavy handling facilities at all

points in transit.

22.2 The packing, marking, and documentation within and outside the packages shall comply

strictly with such special requirements as shall be expressly provided for in the contract,

including additional requirements, and any other instructions ordered by the purchaser.

22.3 Wooden packing of supplied materials and equipments should be cleared from bark and

treated by heat ,vapor and saturated by chemical pressure as well as to be marked with a

fixed readable and clear mark to indicate that this wood is treated by one of these foresaid

ways.

22.4 Packing List : it should include of the contract number, commercial invoice number, parcels

and pieces numbers and gross and net weight.

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23-Settlement of Disputes

23.1 Amicable Settlement

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 p.o

through the appointment of a committee from both parties to study the matter carefully and come

to an agreement according to relevant effective laws and instructions. If the two parties fail, they

may appeal to the following methods stated in the p.o. 23.2 National Arbitration

Disputes may be arised from this contract shall be settled according to the procedures stated in the

Civil Proceedings law Code no.(83) of 1969 and Code no.(56) of 1977.

23.3 Basra Courts

Basra Courts shall be indicated to settle Disputes.

24-Insurance

24.1The goods supplied under the contract shall be fully insured—in a freely convertible currency

from an eligible country—against loss or damage incidental to manufacture or acquisition,

transportation, storage, and delivery.

24.2 Insurance required for service contracts must cover the A/M item besides his own personnel

and any employer's personnel working in the worksite against death and injury according to the

relevant Iraqi laws.

24.3 The Goods supplied under the P.O shall be fully insured by 110% of goods value in a freely

convertible currency from an eligible country against all risks in accordance with the

applicable Incoterms of 2010.

25-Transportation

- Unless otherwise specified in the P.O/ contract, responsibility for arranging transportation of the

goods shall be in accordance with specified Incoterms.

26- Inspections and Tests

26.1 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 specified in the P.O/ contract.

26.2 , and/or at the goods’ final destination, or in another place in Iraq as specified in the P.O/ the

inspections and tests may be conducted at the premises of the supplier or its subcontractor, at

point of delivery contract. if conducted on the supplier's offices or its subcontractor, all

reasonable facilities and assistance, including access to drawings and production data, shall be

furnished to the inspectors at no extra charge to the purchaser.

26.3 The purchaser may ask the supplier to carry out any test and/or inspection not required by the

contract but deemed necessary to verify that the characteristics and performance of the goods

comply with the technical specifications codes and standards under the contract, provided that

the supplier’s reasonable costs and expenses incurred in carrying out such test and/or inspection

shall be added to the contract price. Further, if such test and/or inspection impedes the progress

of manufacturing and/or the supplier’s performance of its other obligations under the contract,

due allowance will be made in respect to the delivery dates and completion dates and the other

obligations so affected.

26.4 The supplier shall provide the purchaser with a report of the results of any such test and/or

inspection.

26.5 The purchaser may reject any goods or any part thereof that fail to pass any test and/or

inspection or do not conform to the specifications. The supplier shall either rectify or replace

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such rejected goods or parts thereof or make alterations necessary to meet the specifications at

no cost to the purchaser, and shall repeat the test and/or inspection, at no cost to the purchaser,

upon giving a notice pursuant to P.O/ contract.

26.6 The supplier agrees that neither the execution of a test and/or inspection of the goods or any

part thereof, nor the attendance by the purchaser or its representative, nor the issue of any report

pursuant to P.O/ contract, shall release him from any warranties or other obligations under the

contract.

27-Taxes and Duties

27.1 for goods manufactured outside the purchaser’s country, the supplier shall be entirely

responsible for all taxes, stamp duties, license fees, and other such levies imposed outside the

purchaser’s country.

27.2 for goods manufactured within the purchaser’s country, the supplier shall be entirely

responsible for all taxes, duties, license fees, etc., incurred until delivery of the contracted goods

to the purchaser.

27.3 The purchaser shall deduct an amount equal to (2.7%) from each invoice value up to maximum (2.7%)

of P.O total value and 3% of service contract value and transfer it to the State Commission for Taxes. - Juridical fee which equal (0.001 up to 10000) Iraqi dinar should be borne by the supplier .

27.4 The final payment shall not be released unless:-

A- The purchaser receives written approval from the State Commission for Taxes, or alternatively, the

purchaser shall deduct (10%) of the final payment value and transfer it to the State Commission for Taxes.

B- A quittance issued from retirement and social security directorate.

27.5 Stamp Fee Which is equal to (0.003) of the total amount of contract/ should be borne and paid by the

supplier before signing the contract, according to the resolution of the Council of Ministers no (40) Of

2017. 27.6 Engineering stamp fee: Which is equal to (0.001) of the total amount of the contract should be borne and

paid by the contractor before signing the contract according to the Iraqi law no.(7) of 1971 and the

amendment no.91 of 1977.

27-7 Debts : Debts of the supplier resulted from any contract signed with the governmental

companies or with the purchaser will be deducted according to the Law of Governmental Debts

Obtainment no. 56 of 1977 or by any other alternative law.

28-Warranty 28.1 The supplier/ contractor warrants that all the goods are new, unused, and of the most

recent or current models, and that they incorporate all recent improvements in design and

materials, unless provided otherwise in the P.O / contract.

28.2 The supplier /contractor further warrants that the goods shall be free from defects arising

from any act or omission of the supplier /contractor or arising from design, materials, and

workmanship, under normal use in the conditions prevailing in the country of final destination

28.3 The supplier warrants the materials which include insulation, operation , and maintenance

under the P.O/ contract for defect arising from faulty design, material or workmanship for

a period to be stated in P.O/ contract from the date of receipt of the materials on end user’s

site and Boc will retain a certain percentage from the L/C to cover the period of warranty .

28.4 Unless otherwise specified in P.O/ contract of the P.O/ contract, the warranty shall remain

valid after the goods, or any portion thereof as the case may be, have been delivered to and

accepted at the final destination indicated in P.O/ contract of the P.O/ contract, or the

purchaser shall give notice to the supplier stating the nature of any such defects together with

all available evidence thereof, promptly following the discovery thereof. The purchaser shall

afford all reasonable opportunity for the supplier to inspect such defects.

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28.5 upon receipt of such notice, the supplier shall, within the period specified in P.O/ contract of

the P.O/ contract, expeditiously repair or replace the defective goods or parts thereof, at no

cost to the purchaser.

28.6 If having been notified, the supplier fails to remedy the defect within the period specified in

P.O/ contract of the P.O/ contract, the purchaser may proceed to take within a reasonable

period such remedial action as may be necessary, at the supplier’s risk and expense and

without prejudice to any other rights which the purchaser may have against the supplier

under the contract.

29-Patent Indemnity

29.1 The supplier/contractor shall indemnify and hold harmless the purchaser and its employees

and officers from and against any and all suits, actions or administrative proceedings, claims,

demands, losses, damages, costs, and expenses of any nature, including attorney’s fees and

expenses, 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 by reason

of:

(a) The installation of the goods by the supplier or the use of the goods in the country where the

site is located; and

(b) The sale in any country of the products produced by the goods.

Such indemnity shall not cover any use of the goods or any part thereof other than for the

purpose indicated by or to be reasonably inferred from the contract, neither any infringement

resulting from the use of the goods or any part thereof, or any products produced thereby in

association or combination with any other equipment, plant, or materials not supplied by the

supplier, pursuant to the contract.

29-2 If any proceedings are brought or any claim is made against the purchaser arising out of the

matters, the purchaser shall promptly give the supplier a notice thereof, and the supplier/

contractor may at its own expense and in the purchaser’s name conduct such proceedings or

claim and any negotiations for the settlement of any such proceedings or claim.

If the supplier fails to notify the purchaser within twenty-eight (28) days after receipt of such

notice that it intends to conduct any such proceedings or claim, then the purchaser shall be free

to conduct the same on its own behalf.

29.3 The purchaser shall, at the supplier’s /contractor's request, afford all available assistance to

the supplier / contractor in conducting such proceedings or claim, and shall be reimbursed by

the supplier for all reasonable expenses incurred in so doing.

29.4 The purchaser shall indemnify and hold harmless the supplier / contractor and its employees,

officers, and subcontractors from and against any and all suits, actions or administrative

proceedings, claims, demands, losses, damages, costs, and expenses of any nature, including

attorney’s fees and expenses, which the supplier /contractor 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 arising out of or in connection with any design, data, drawing, specification, or other

documents or materials provided or designed by or on behalf of the purchaser.

30- Limitation of Liability

Except in cases of willful negligence and misconduct,

(a) The supplier/ contractor shall not be liable to the purchaser, whether in P.O/ contract, tort, or

otherwise, for any indirect or consequential loss or damage, loss of use, loss of production, or

loss of profits or interest costs, provided that this exclusion shall not apply to any obligation of

the supplier to pay liquidated damages to the purchaser and

(b) The aggregate liability of the supplier contractor to the purchaser, whether under the P.O /

contract, in tort or otherwise, shall not exceed the total contract price, provided that this

limitation shall not apply to the cost of repairing or replacing defective equipment, or to any

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obligation of the supplier contractor to indemnify the purchaser with respect to patent

infringement.

31- Force Majeure

31.1 The supplier/contractor 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.

31.2 For purposes of this clause, “force majeure” means an event or situation beyond the control

of any of the two parties, and that is not foreseeable, or is unavoidable, and its origin is not

due to negligence or lack of care on the part of any of the two parties. Such events may

include wars or revolutions, fires, floods, epidemics, quarantine restrictions, and freight

embargoes.

31.3 If a force majeure situation arises, the supplier / contract, shall promptly notify the

purchaser in writing of such condition and the cause thereof. Unless otherwise directed by

the purchaser in writing, the supplier shall continue to perform its obligations under the

contract as far as is reasonably practical, and shall seek all reasonable alternative means for

performance not prevented by the force majeure event.

31.4 Prevailing Circumstances

It is confirmed and agreed by the supplier/ contractor that the prevailing circumstances in

Iraq do not in any way constitute an impediment for the implementation by the contractor

obligation under the P.O./contract.

32. Change in Orders and Contract Amendment 32.1 The purchaser may at any time order the supplier /contractor through notice to make changes

within the general scope of the contract in any one or more of the following:

(a) Drawings, designs, or specifications, if goods to be furnished under the contract are to be

specifically manufactured for the purchaser;

(b) The method of shipment or packing;

(c) The place of delivery; and

(d) The related services to be provided by the supplier /contractor.

32.2 If any such change causes an increase or decrease in the cost of, or the time required for, the

supplier’s/contractor's performance of any provisions under the contract, an equitable

adjustment shall be made in the P.O/ contract price or in the delivery/completion schedule, or

both, and the P.O / contract shall accordingly be amended. Any claims by the supplier for

adjustment under this clause must be asserted within twenty-eight (28) days from the date of

the supplier’s receipt of the purchaser’s change order.

32.3 Prices to be charged by the supplier/contractor for any related services that might be needed

but which were not included in the contract shall be agreed upon in advance by the parties and

shall not exceed the prevailing rates charged to other parties by the supplier/contractor for

similar services.

32.4 subject to the above, no variation in or modification of the terms of the P.O /contract shall be

made except by written amendment signed by the parties.

33- Extensions of time

33.1 If at any time during performance of the Contract, the Supplier or its subcontractors should

encounter conditions impeding timely delivery of the Goods or completion of Related Services ,

the Supplier shall promptly notify the Purchaser in writing of the delay within 15 days from the

date when the cause has arisen , it’s likely duration, and its cause. As soon as practicable

after receipt of the Supplier’s notice, the Purchaser shall evaluate the situation and may at its

discretion extend the Supplier’s time for performance, in which case the extension shall be

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ratified by the parties by amending of the Contract in case of the arise of a reasonable causes

affecting the supply of the materials .

33.2 Except in case of Force Majeure, as provided under Clause 31, a delay by the Supplier in the

performance of its Delivery and Completion obligations shall render the Supplier liable to the

imposition of liquidated damages, unless an extension of time is agreed upon.

34- Termination 34.1 Termination for Default

The Purchaser, without prejudice to any other remedy for breaching the Contract and without

official adjudication or warring, by written notice of default sent to the Supplier, may

terminate the Contract or with draw the work in whole or in part in the following cases:

(i) In case the second party fails supplying for 25% of contract period agreed by two parties

(including extensions periods).the first party has the right to seize the contract and

confiscate the performance bond within (15) days after notifying the second party.

(ii) if the Supplier fails to perform any other obligation under the Contract;

(iii)if the Supplier, in the judgment of the Purchaser has engaged in fraud and corruption, in

competing for or in executing the Contract.

34.2 Termination for Insolvency

The purchaser may at any time terminate the contract by giving notice to the

supplier/contractor, if the supplier/contractor becomes bankrupt or insolvent. In such event,

termination will be without compensation to the supplier/contractor, 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.

34.3 Termination for Convenience

(a) The purchaser, by notice sent to the supplier/contractor, 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 P.O/contract is terminated, and the date upon which such termination

becomes effective.

(b) The goods that are complete and ready for shipment within twenty-eight (28) days after

the supplier’s/contractor's receipt of notice of termination shall be accepted by the

purchaser at the contract terms and prices. For the remaining goods, the purchaser may

elect: (i) To have any portion completed and delivered at the P.O/ contract terms and prices; and/or

(ii) To cancel the remainder and pay to the supplier/ contractor an agreed amount for partially

completed goods and related services and for materials and parts previously procured by the supplier/ contractor.

35-Administrative Charges

For service contract only, the administrative charges shall be determined when BOC, the

employer, carries out part of the suppliers /contractor's obligations via another party, at a rate not

exceeding (20%) of the actual cost of executing such obligation.

36-The Legal Liabilities Resulting From Contractors\Suppliers BreachingTheir Contractual

Obligation

36.1 The legal Liabilities Caused by Breaching Before Signing the P.O/ Contract

In case the contractor\supplier has failed to sign the contract's documents after an official

notification within (15) days from the date of the notification, the following procedures shall

be applied:-

(a-) Bid bond of the breached enquiry shall be confiscated.

(b)The enquiry shall be awarded to the next competitor. The breaching tenderer shall bear the

difference between 2 prices resulting from the contract execution as well as confiscation

of its bid bond.

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(c) In case of the first and the second competitors abstain from signing the P.O/ contract and

/or submitting the performance bond, BOC shall have the right to award the enquiry to the

next competitor. The first & the second breaching renderers’ shall be jointly liable to

bear the difference in prices according to the value of their commercial bids .In addition

,bid bonds shall be confiscated .

(d) The breaching parties shall be subjected to the aforesaid procedures (a, b & c) if their

offers are valid during the time of breaching.

36.2 The Legal Liabilities caused by the Suppliers/contractor's breach after signing the P.O

/contract

(a) Confiscating the performance bond.

(b) Execute the contract in away appropriate to the purchaser .the supplier shall bear the

difference between the two prices as well as the delay penalties and administrative charges

amounting 20% shall be calculated from the total amount of the breached obligation as well as

other financial commitments and if contractor is found (debtor), compensations shall be

claimed by purchaser for such amount.

(c) The purchaser has the right to transfer the P.O/contract to another

supplier/contractor if required, and the breaching supplier/ contractor shall bear the

difference between the two prices resulting from the P.O /contract execution. In addition, the

performance bond amount represent (5%) shall be confiscated.

37- Assignment Supplier/ contractor cannot assign to another party any part of the P.O/contract without written

permission from the other party.

38-Export Restriction

Notwithstanding any obligation under the Contract to complete all export formalities, any export

restrictions attributable to the Purchaser, to the country of the Purchaser, or to the use of the

products/goods, systems or services to be supplied, which arise from trade regulations from a

country supplying those products/goods, systems or services, and which substantially impede the

Supplier from meeting its obligations under the Contract, shall release the Supplier from the

obligation to provide deliveries or services . However, that the Supplier can demonstrate to the

satisfaction of the Purchaser and of the Bank that it has completed all formalities in a timely

manner, including applying for permits, authorizations and licenses necessary for the export of

the products/goods, systems or services under the terms of the Contract. Termination of the

Contract on this basis shall be for the purchaser convenience.

39-Effective Date of the P.O / Contract The effective date of the P.O/contract shall be the date of the receipt and acceptance of the

operative irrevocable L/C by the supplier / contractor bank. Supplier/contractor should notify

BOC of his acceptance or comments if any.

40-- Governing Law The Contract shall be governed by and interpreted in accordance with the laws of republic of

Iraq and construed according to Iraqi laws and the regulations of the general contracts issued by

the Iraqi ministry of planning.. The Iraqi laws shall have exclusive jurisdiction to hear and

determine all actions and proceedings arising out of the contract to the Iraqi courts.

41- Pollution

Supplier / contractor shall comply and adhere to the good environment protection practices

where working site will be cleaned properly ; otherwise BOC has the right to suspend or

temporarily close the work or impose a penalty amounting to (10000000)ID to be monthly

reiterated till removing the contravention from the polluted place.

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42- INSTRUCTION AND CONDITION S FOR HEALTH , SAFTY AND ENVIRONMENT FOR SUPPLING CONTRACTS

The following instructions and conditions should be applied by the supplier:-

1. Packaging of delivered materials to protect them from atmosphere conditions.

2. Provide personal protective equipment

3. Taking into account safety conditions when transporting hazardous materials and protect the

containers from any damage

4. . Providing all needs for employees such as equipments during loading commissioning,

transportation and setup.

5. Providing the minimal limit of first aid equipments and qualified persons must be available.

6. Separation between materials and consider regularity dangerous classification signs cracks.