NPM 025-2012

Requesting Entity: Department of National Defense

Issues Concern: Grant of Contract Delivery Extension



Clarification relative to the rules on the grant of extension of delivery period and the corresponding imposition of Liquidated Damages on the procurement of goods

Please note that as a general rule, the supplier/manufacturer/distributor must deliver the goods or perform the services within the period specified by the Procuring Entity, as specified in the Contract. If delays are likely to be incurred, the supplier/manufacturer/distributor must notify the Procuring Entity in writing. It must state therein the cause/s and duration of the expected delay. The Procuring Entity may grant several time extensions, at its discretion, as long as it is based on meritorious grounds, with or without liquidated damages.

If the supplier fails to satisfactorily deliver any or all of the Goods and/or to perform the Services within the period(s) specified in the Contract inclusive of duly authorized time extensions, if any, the Procuring Entity shall, without prejudice to its other remedies under this Contract and under applicable laws, deduct from the Contract Price, as liquidated damages, the applicable rate of one tenth (1/10) of one (1) percent of the cost of the unperformed portion of every day of delay until actual delivery or performance.