Aboriginal Contract Guarantee Instrument (ACGI)

Eligibility Criteria

• Status First Nations, Metis and Inuit individuals;
• in the case of a corporation, at least 51% of the voting shares must be owned by First Nation, Metis and Inuit individuals;
• established contractors (minimum 3 years).

Start-ups will not be considered.

Summary

What is the purpose of the Aboriginal Contract Guarantee Instrument?
The ACGI allows contractors to provide project owners financial guarantees that the contractor will perform the contract. The ACGI acts like a "guarantee" line of credit allowing contractors to give guarantees without tying up working capital or interfering with cash flow.

How does a contractor qualify for the ACGI?
Silu' uses the NACCA network of Aboriginal Financial Institutions (AFI). Contractors need to contact their local AFI to obtain an application.  

Silu' employs similar qualification criteria as the surety industry. The qualification process is known as underwriting. As Silu' is guaranteeing the contractor, Silu' must be certain that the contractor can perform. Therefore Silu' underwrites or assesses the contractor's technical, managerial and financial capabilities.  

Allow up to one month from the submission of the complete application for the ACGI to be in place. Once Silu' has confirmed the contractor has been granted an ACGI facility, the contractor is permitted to bid on projects requiring a guarantee. (ACGI limits vary based on the contractor's capacity and are detailed in the confirmation.)

Are there any costs to the contractor?
Silu' charges an annual underwriting fee of $1 000. The fee is refundable should the contractor not qualify. The fee is payable upon submission of the complete application package and annually upon review. Once the ACGI facility is approved, and the contractor wins a contract bid, the ACGI fees are as follows:

• contract guarantees cost 1% interest per month for the time that the contract guarantee is outstanding, in addition to any fees charged by the bank or other institution should the contract require certain forms of financial guarantee.

Where can a contractor obtain an application?
Contractors can obtain applications from an Aboriginal Financial Institution or by e-mail from Silu'. A listing of these institutions can be obtained from the NACCA or Silu' Web sites.

Nova Scotia Contact(s):
See National Contact.