Gapensi protests Caltex over rejection of guarantee letters

The provincial chapter of the association of Indonesian contractors (Gapensi) in Riau has protested PT Caltex Pasific Indonesia over its policy to reject promissory notes issued by insurance companies as a guarantee in joining the oil giant's tenders, Riau Pos reported on Wednesday

Bismar Rambah, a senior executive of the provincial chapter of the association, said in Pekanbaru on Tuesday that Caltex's policy not to accept the insurance companies' promissory notes as a guarantee in joining the tender was against the government's regulation.

According to the presidential decree no 18, 2000, the guarantee letters that should be given by a contractor to works providers could be in the form of guarantee letters or written guarantees issued by financial institutions such commercial banks or insurance companies, Bismar said.

"Caltex's policy has posed difficulties to companies which are interested in joining the company's tender because most of the contractors used the insurance companies' promissory notes as a guarantee when bidding a project," he said.

He acknowledged that some insurance companies often breached their guarantee contracts but he said the oil giant's policy to reject all the guarantee letters issued by the insurance companies was wrong. (*)