## II.14.2. Precedence of liquidated damages foreseen in a Service Level Agreement 

Unless otherwise stipulated in a Service Level Agreement and for the key performance indicators defined therein, the liquidated damages foreseen in a Service Level Agreement prevail over the liquidated damages foreseen above. 

## II.14.3. Procedure 

The contracting authority must formally notify the contractor of its intention to apply liquidated damages and the corresponding calculated amount. 

The contractor has 30 days following the date of receipt to submit observations. Failing that, the decision becomes enforceable the day after the time limit for submitting observations has elapsed. 

If the contractor submits observations, the contracting authority, taking into account the relevant observations, must notify the contractor: 

(a) of the withdrawal of its intention to apply liquidated damages or 

(b) of its final decision to apply liquidated damages and the corresponding amount. 

## II.14.4. Nature of liquidated damages 

The parties expressly acknowledge and agree that any amount payable under this Article is not a penalty and represents a reasonable estimate of fair compensation for the damage incurred due to failure to provide the supplies/services within the applicable time limits or with regard to the required quality and security levels set out in the FWC (including the ones set out in a Service Level Agreement and in the tender specifications). 

## II.14.5. Claims and liability 

Any claim for liquidated damages does not affect the contractor’s actual or potential liability or the contracting authority’s rights under Article II.17. 

## II.15. REDUCTION IN PRICE 

## II.15.1. Quality standards 

If the contractor fails to deliver the supply and/or provide the services in accordance with the FWC or a specific contract (‘unperformed obligations’) or if it fails to deliver the supply and/or provide the services in accordance with the expected quality and security levels specified in the tender specifications (‘low quality delivery’), the contracting authority may reduce or recover payments proportionally to the seriousness of the unperformed obligations or low quality delivery. This includes in particular cases where the contracting authority cannot approve a document or deliver a certificate of conformity for supplies as defined in Article I.6 after the contractor has submitted the required additional information, correction or new supply. 

A reduction in price may be imposed together with liquidated damages under the conditions of Article II.14. 

## II.15.2. Procedure 

The contracting authority must formally notify the contractor of its intention to reduce payment and the corresponding calculated amount. 

The contractor has 30 days following the date of receipt to submit observations. Failing that, the decision becomes enforceable the day after the time limit for submitting observations has elapsed. 

If the contractor submits observations, the contracting authority, taking into account the relevant observations, must notify the contractor: 

