Terms and Methods of Payment
2.34 Payment terms shall be in accordance with the international commercial practices applicable to the specific goods, works, and non-consulting services.
(a) Contracts for supply of goods shall provide for full payment on the delivery and inspection, if so required, of the contracted goods except for contracts involving installation and commissioning, in which case a portion of the payment may be made after the Supplier has complied with all its obligations under the contract. The Bank normally requires the use of letters of credit so as to assure prompt payment to the Supplier. In major contracts for equipment and plant, provisions shall be made for suitable advances and, in contracts of long duration, for progress payments during the period of manufacture or assembly.
(b) Contracts for works shall provide, in appropriate cases for mobilization advances, advances on Contractor’s equipment and materials, regular progress payments, and reasonable retention amounts to be released upon compliance with the Contractor’s obligations under contract.
2.35 Any advance payment for mobilization and similar expenses, made upon signature of a contract for goods, works, and non-consulting services, shall be related to the estimated amount of these expenses and be specified in the bidding documents. Amounts and timing of other advances to be made, such as for materials delivered to the site for incorporation in the works, shall also be specified. The bidding documents shall specify the arrangements for any security required for advance payments.
2.36 Bidding documents shall specify the payment method and terms offered, whether alternative payment methods and terms will be allowed, and, if so, how the terms will affect bid evaluation.