Common use of Penalty for Failure to Respect the Local Content Clause in Contracts

Penalty for Failure to Respect the Local Content. Failure to respect the Local Content shall subject the Contractor to a penalty, which shall be calculated on the monetary amount not observed, in the following percentage, as the case may be: If the percentage of the Unused Local Content is below sixty-five percent (65%) of the Minimum Local Content, the penalty shall be forty percent (40%) of the amount of the Unused Local Content. if the percentage of the unused Local Content is equal to or higher than sixty-five percent (65%), the penalty shall begin at forty percent (40%), reaching seventy-five percent (75%) of the amount of the minimum Local Content in case of 100% unused Local Content (NR), according to the formula: Where, M (%): percentage of the penalty to be calculated on the defaulted monetary amount; and NR (%): percentage of unused Local Content. In case of simultaneous failure to honor more than one commitment for the Macro-Groups referred to in item “b” of paragraph 25.1, the amount of the penalty shall correspond to the sum of the penalties for each Macro-Group. The amount of the penalty shall be adjusted by the IGP-DI up to the date of the effective payment.

Penalty for Failure to Respect the Local Content. Failure to respect the Local Content shall subject the Contractor Contracted Party to a penalty, which shall be calculated on upon the monetary amount not observed, in observed and the following percentage, as the case may be: If if the percentage of the Unused unused Local Content is below sixty-five percent (65%) of the Minimum minimum Local Content, the penalty shall be forty percent (40%) of the amount of the Unused unused Local Content. if the percentage of the unused Local Content is equal to or higher than sixty-five percent (65%), the penalty shall begin at forty percent (40%), reaching seventy-five percent (75%) of the amount of the minimum Local Content in case of 100% unused Local Content (NR), according to the formula: Where, M (%): percentage of the penalty to be calculated on upon the defaulted monetary amount; and NR (%): percentage of unused Local Content. In case of simultaneous failure to honor more than one commitment for the Macro-Groups referred to in item “b” of paragraph 25.124.1, the amount of the penalty shall correspond to the sum of the penalties for each Macro-Group. The amount of the penalty shall be adjusted by the IGP-DI up to the date of the effective payment.

Penalty for Failure to Respect the Local Content. Failure to respect the Local Content shall subject the Contractor Contracted Party to a penalty, which shall be calculated on upon the monetary amount not observed, in observed and the following percentage, as the case may be: If if the percentage of the Unused unused Local Content is below sixty-five percent (65%) of the Minimum minimum Local Content, the penalty shall be forty percent (40%) of the amount of the Unused unused Local Content. if the percentage of the unused Local Content is equal to or higher than sixty-five percent (65%), the penalty shall begin at forty percent (40%), reaching seventy-five percent (75%) of the amount of the minimum Local Content in case of 100% unused Local Content (NR), according to the formula: Where, M (%): percentage of the penalty to be calculated on upon the defaulted monetary amount; and NR (%): percentage of unused Local Content. In case of simultaneous failure to honor more than one commitment for the Macro-Groups referred to in item “b” of paragraph 25.122.1, the amount of the penalty shall correspond to the sum of the penalties for each Macro-Group. The amount of the penalty shall be adjusted by the IGP-DI M up to the date of the effective payment.

Penalty for Failure to Respect the Local Content. Failure to respect the Local Content shall subject the Contractor Concessionaire to a penalty, which penalty that shall be calculated on the defaulted monetary amount not observedamount, in the following percentage, as the case may be: If if the percentage of the Unused unused Local Content is below sixty-five percent (65%) of the Minimum minimum Local Content, the penalty shall be forty percent (40%) of the amount of the Unused unused Local Content. if the percentage of the unused Local Content is equal to or higher than sixty-five percent (65%), the penalty shall begin at forty percent (40%), reaching seventy-five percent (75%) of the amount of the minimum Minimum Local Content Content, in case of 100% unused Local Content (NR)Content, according to the formula: M (%) = NR (%) - 25%. Where, M (%): ) is the percentage of the penalty to be calculated on the defaulted monetary amount; and NR (%): ) is the percentage of unused Local Content. In case of simultaneous failure to honor more than one commitment for the Macro-Groups referred to in item “b” of paragraph 25.120.1.2, the amount of the penalty shall correspond to the sum of the penalties for each Macro-Group. The amount of the penalty shall be adjusted by the IGP-DI up to the date of the effective payment.

Penalty for Failure to Respect the Local Content. Failure to respect the Local Content shall subject the Contractor Concessionaire to a penalty, which shall be calculated on the monetary amount not observed, in the following percentage, as the case may be: If the percentage of the Unused Local Content (NR) is below sixty-five percent (65%) of the Minimum Local Content, the penalty shall be forty percent (40%) of the amount of the Unused Local Content. if If the percentage of the unused Unused Local Content (NR) is equal to or higher than sixty-five percent (65%), the penalty shall begin at forty percent (40%), reaching seventy-five percent (75%) of the amount of the minimum Minimum Local Content in case of 100% unused Unused Local Content (NR), according to the formula: Where, M (%): percentage of the penalty to be calculated on the defaulted monetary amount; and ) = NR (%): ) - 25%. Where NR (%) is the percentage of unused Unused Local Content. In case of simultaneous failure to honor more than one commitment for the Macro-Groups referred to in item “b” of paragraph 25.120.1.4, the amount of the penalty shall correspond to the sum of the penalties for each Macro-Group. The amount of the penalty shall be adjusted by the General Market Price Index (IGP-DI M) up to the date of the effective payment.