Escrow in Public Tenders: Continuity and Assurance as a Decisive Factor

In an increasing number of public tenders – from municipalities and provinces to healthcare institutions and financial organizations – digital continuity is a hard requirement. Public bodies and corporates want to be sure that critical software and data remain accessible, even if the supplier ceases operations. Escrow services play a key role here: they provide assurance for both the contracting authority and the supplier.

Why Escrow is Essential in Public Tenders

1. Continuity Assurance
Governmental institutions and corporates often depend on mission-critical applications. Service disruption can cause social disruption or significant financial damage. Escrow allows the contracting authority to demonstrate that continuity is safeguarded.

2. Compliance and Regulation
Regulations such as NIS2 and, in some sectors, specific industry requirements emphasize risk management and business continuity. Escrow fits seamlessly with these obligations.

3. Trust and Competitive Advantage
Suppliers offering escrow demonstrate responsibility and transparency in managing risks. This builds trust – and can be a decisive factor in the awarding process.

Key Considerations for Suppliers

Clear Description: Provide a clear explanation of what escrow entails, how the process works, and which components (software, source code, documentation, data) are included in the escrow agreement. Avoid technical jargon; keep it understandable for evaluators.

Concrete Arrangements: Specify which type of escrow you offer: source code escrow, data escrow, or SaaS escrow. Indicate how often verifications take place and how quickly the contracting authority will gain access in the event of a trigger.

Risk Connection: Demonstrate which risks are covered by escrow (bankruptcy, acquisition, breach of contract, discontinuity). This shows that you actively contribute to risk management.

Alignment with Tender Requirements: Tenders often include specific continuity requirements. Ensure your escrow offer matches these exactly and refer explicitly to the criteria provided.

Professional Partner: Collaborate with a specialized escrow provider experienced in public tenders. This enhances your credibility and gives the contracting authority additional assurance.

Escrow as a Differentiator

In a market where price often weighs heavily, escrow can make the difference in terms of quality and assurance. It shows that, as a supplier, you look beyond short-term delivery and genuinely safeguard the client’s interests. Escrow thereby becomes not only a compliance tool but also a commercial advantage in the tendering process.

Tip: Always include escrow in your tender proposals. It increases your chances of success and strengthens your position as a reliable partner.