Handling Sicherheitseinbehalt and Bürgschaft (security retention and surety bond) under VOB/B correctly

What the security is for

Under § 17 para. 1 VOB/B, the security serves to ensure performance in accordance with the contract and defect claims. In practice, a distinction is made between:

• Performance security (Vertragserfüllungssicherheit): applies until acceptance.
• Warranty security (Mängelsicherheit) (formerly “Gewährleistungsbürgschaft”): applies after acceptance.

Both exist only if the contract provides for them. § 17 VOB/B then regulates how they are provided and returned.

Which types are there?

Unless the contract says otherwise, security can be provided by (§ 17 para. 2 VOB/B):

• retention of money,
• deposit of money,
• a Bürgschaft (surety bond) from a credit institution or credit insurer licensed in the EU, in the EEA or in a state party to the WTO Government Procurement Agreement.

You have the choice among these types and may replace one security with another (§ 17 para. 3). This is your most important lever: you can exchange a retention for a surety bond and so have the money paid out to you.

The surety bond: requirements

For a surety bond, the following requirements apply under § 17 para. 4 VOB/B:

• The client must have recognised the surety as suitable.
• The declaration must be made in writing, waiving the defence of prior recourse (§ 771 BGB).
• It must not be limited to a specific time and must be issued in the form prescribed by the client.
• The client cannot demand a surety bond payable on first demand.

If the contract deviates from these rules (for example a surety bond on first demand or the amount of the security), this can be an unreasonable disadvantage. In case of doubt, have such clauses checked before you sign.

The retention: 10 per cent, blocked account, 18 working days

If the client is to retain the security in instalments from its payments, § 17 para. 6 no. 1 VOB/B provides:

• It may reduce each payment by at most 10 per cent until the agreed security amount is reached.
• It must notify you of the amount retained and pay it within 18 working days into a blocked account (Sperrkonto). The bank must notify you of the payment. You are entitled to the interest (§ 17 para. 5).
• Invoices without VAT under § 13b UStG: the VAT is disregarded when calculating the retention.
• For smaller or short-term orders, the client may pay the amount in only with the final payment (no. 2).
• If it does not pay in the amount retained on time, you can set a grace period. When it expires, you can demand immediate payment out and then no longer have to provide any security (no. 3).
• Public clients may place the amount in their own custody account; it then bears no interest (no. 4).

After every payment, check whether the 18 working days are running. Note the date. Anyone who does not watch the deadline finances the client.

When the security is returned

§ 17 para. 8 VOB/B regulates the return of securities that have not been realised:

The two-year rule applies only if no other return is agreed. Many contracts provide for return only when the limitation period expires. Check this point before concluding the contract.

If you, as contractor, provide the security

The contractor must provide the security within 18 working days of the conclusion of the contract, unless otherwise agreed. If it does not, the client may retain from the balance an amount equal to the agreed security (§ 17 para. 7). Anyone who delivers the surety bond in time thereby has payments released.

Relationship to BGB rules

Even without VOB/B, some limits are set by law: under § 650m BGB, the total amount of interim payments must not exceed 90 per cent of the agreed total remuneration. For consumers, additional rules apply on security for timely completion (5 per cent). You check the combination of the cap on interim payments and the retention in every contract.

Typical mistakes

• No deadline noted for the blocked account and the return.
• Surety bond certificate not filed; on return, the proof is missing.
• Retention and surety bond provided at the same time. This doubles the security.
• Performance security not demanded back after acceptance.
• For § 13b invoices, retention calculated on the gross amount.

Frequently asked questions

Sources and status

• § 17 paras. 1 to 8 VOB/B – provision of security (2016 version, checked against the statutory text in the BauWalker corpus)
• § 650m BGB – interim payments; securing the claim to remuneration
• Stand: 19.10.2026. No case law was evaluated here on the effectiveness of individual security clauses in general terms and conditions.
• Quotations of statutory text are given in translation; the German wording is authoritative.