fera l'objet d'une retenue

English translation: (5% of the contract amount) will be withheld

08:48 Jun 18, 2008

French to English translations [PRO]
Bus/Financial - Finance (general) / guarantee deposit/contract

French term or phrase: fera l'objet d'une retenue

PLEASE NOTE: I understand the meaning of the question term, it is the overall sentence meaning that escapes me.

Document: A contract for the supply of a power plant.

A first article lists the payment schedule - there are various milestones (eg submission of plans, delivery, installation, testing) each of which requires payment of a % of the overall price. After this schedule, it says:

"Il est pratiqué une retenue de garantie ou cautionnement correspondant à 5% du montant du Contrat (soit 90600,00 €) selon les modalités définies à l’article 15.1."

Which I took to mean in addition to the contract price, a further 5% will be taken as a guarantee deposit. Turning then to article 15.1:

"CAUTIONNEMENT
Le terme de paiement correspondant à la Réception des installations du Lot fera l'objet d'une retenue égale à 5 % du Prix Contractuel, afin de garantir l'exécution des travaux et de satisfaire, le cas échéant, aux réserves faites par le Maître d’Ouvrage dans le Procès-verbal de Réception. Cette retenue de garantie ne sera pas pratiquée à la condition que l'Entrepreneur remette au Maître d’Ouvrage, pour un montant égal à cette retenue, une caution personnelle et solidaire, émanant d'un organisme financier habilité."

i. None of the milestones specifically refers to "reception des installations", although there are 3 of them which are for 5% of the price, one of which refers to "reception des essais de performance".
ii. So does this mean that an additional 5% will be taken as a deposit, or that one of the 5% payment installments will be used as a deposit. But in this latter case, given that the guarantee deposit is to be refunded if no faults are found (confirmed later on in the para), then that would lead to a shortfall in the price paid...

Can anyone clarify?

Thanks

Wendy Cummings KudoZ activity Questions: 905 (5 open) (2 without valid answers) (91 closed without grading) Answers: 199 United Kingdom
Local time: 16:08

English translation:(5% of the contract amount) will be withheld

Explanation:
UNLESS the contractor posts a performance bond of the same amount.

If the contractor does NOT post bond, he will not receive the amount withheld from the acceptance instalment until all work has been performed to the MO's satisfaction, specifically including any reservations noted on the acceptance statement.

Selected response from:

rkillings
United States
Local time: 08:08

Grading comment

Sums it up neatly. Thanks to Miguel also
4 KudoZ points were awarded for this answer

Summary of answers provided

will be subject to reserve (requirements)

Radu DANAILA

3 +1

as below

Julie Barber

will suffer a deduction of...

MikeGarcia

a deduction will be applied

Euqinimod (X)

3 +1

(5% of the contract amount) will be withheld

rkillings

will be subject to withhold / will be held or retained as collateral

Gustavo Silva

Discussion entries: 8

Gustavo Silva

Portugal

10:13 Jun 20, 2008

sera retenu = will be withheld
fera l'objet d'une retenue = will be subject to withhold
"5% of the contract amount will be subject to withhold". Did you see my suggestion?

MikeGarcia

Spain

10:47 Jun 18, 2008

Basically, yes. The contractor has the choice to deliver the performance bond or to let the 5 % be deducted from the down payment he is due. Either way, when the works are delivered satisfactorily, everything will be settled accordingly.

Wendy Cummings

United Kingdom

ASKER

10:25 Jun 18, 2008

Ok, so assuming that the time at which this bond is due is the same time as the 5% payment instalment is due, if the contractor chooses the deduction option, the two will cancel each other out (so to speak) and he will not receive that 5% payment (at least, not until the end of the guarantee period and the bond must be refunded). Is that right?

MikeGarcia

Spain

10:14 Jun 18, 2008

guarantee satisfactory execution of the job. I am offering a translation of the terms you mention in the kudoz phrase...

MikeGarcia

Spain

10:13 Jun 18, 2008

Hi, Wendy: The performance bond issued by a financial entity will replace the 5 % cash deduction, therefore there are no money matters involved at that stage, according to 15.1.- The builder can opt for the deduction or the performance bond, the aim is to

Wendy Cummings

United Kingdom

ASKER

09:18 Jun 18, 2008

After the first mention of this bond, it seems clear that there will be a 5% performance bond owing (i understand the concept of performance bonds).

I think my confusion is due to the fact that later on there is the phrase "Le terme de paiement correspondant à la Réception des installations du Lot fera l'objet d'une retenue..."

Wendy Cummings

United Kingdom

ASKER

09:16 Jun 18, 2008

Hi Julie. So you think it means that at the time that the 5% instalment for "reception des installations" is due, the client shall require the contractor to provide a performance bond for 5% of the overall price. i.e. the client pays the contractor a 5% instalment, and the contractor pays the client a 5% bond?

Julie Barber

United Kingdom

09:04 Jun 18, 2008

For your first sentence - it doesn't mean an 'additional' 5%. It means that a performance bond (or guarantee/deposit) equal to 5% of the total contract value is required. It is separate from payments for the works.

Answers

23 mins confidence:

will be subject to reserve (requirements)

Explanation:
Constituer une réserve est une pratique normale pour garantir un tel contrat.

Radu DANAILA
Romania
Local time: 18:08
Works in field
Native speaker of:

Romanian
PRO pts in category: 24

28 mins confidence:

peer agreement (net): +1

as below

Explanation:
if I've understood your questions correctly....

For your first sentence - it doesn't mean an 'additional' 5% as such. It means that a performance bond (or guarantee/deposit) *equal* to 5% of the total contract value is required. It is separate from payments for the works.

The bond retained against the contract is separate to the money to be paid. Ie: if your contract is worth £5m you may be required to put down 1% of that £5m, as a guarantee against messing up.

At the end the full £5m is due and the 1% is returned if there are no issues.

If there is a problem the full £5m is due and the 1% might be retained.

But the bond and payments are separate so to speak, the value of the contract is just used to calculate the level of the bond. So there can't be a shortfall.

If I'm explaining myself correctly here.....

Julie Barber
United Kingdom
Local time: 16:08
Works in field
Native speaker of: English
PRO pts in category: 132

1 hr confidence:

will suffer a deduction of...

Language variant: UK/USA.

Explanation:
As per my comments in the dialogue section "to/from asker".

MikeGarcia
Spain
Local time: 17:08
Specializes in field
Native speaker of:

Spanish
PRO pts in category: 28

1 hr confidence:

will be subject to withhold / will be held or retained as collateral

Explanation:
withholding = the act of retaining something (retenue)
"Collateral is a form of security to the lender in case the borrower fails to pay back the loan."

Reference: http://www.thefreedictionary.com/withholding
Reference: http://financial-dictionary.thefreedictionary.com/collateral

Gustavo Silva
Portugal
Local time: 16:08
Specializes in field
Native speaker of: Portuguese
PRO pts in category: 8

1 hr confidence:

a deduction will be applied

Explanation:
a deduction of 5% of the contractual payment on delivery as surety bond.

Euqinimod (X)
Local time: 17:08
Works in field
Native speaker of:

French
PRO pts in category: 18

17 hrs confidence:

peer agreement (net): +1

(5% of the contract amount) will be withheld

rkillings
United States
Local time: 08:08
Specializes in field
Native speaker of:

English
PRO pts in category: 1140

Grading comment

Sums it up neatly. Thanks to Miguel also

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fera l'objet d'une retenue

English translation: (5% of the contract amount) will be withheld

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fera l'objet d'une retenue

English translation: (5% of the contract amount) will be withheld

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