When a contractor undertakes a construction project, the principal usually requires the contractor to deposit cash as security or furnish a bond to guarantee the due performance and observance of the terms and conditions of the contractor’s obligations.
In most cases, the contractor would choose to furnish a bond instead of putting aside cash as a security deposit.
The value of the bond is usually a certain percentage of the value of the contract.
To comply with the immigration regulations where work permits/visit passes are granted for engaging foreign workers, employers are allowed to furnish an immigration bond to the Controller of Immigration instead of a cash deposit.
The purpose of this security bond is to ensure that employers take responsibility for their foreign workers and repatriate them after their work permits have been cancelled or when their employment have been terminated.