The solicitation documents may state that any Contract or Purchase Order will include a provision for Liquidated Damages to ensure proper performance by the vendor. The amount thereof shall be included in the solicitation documents. The amount shall be tailored to the specific type of deliverables and to the operational sensitivity of the requirement's schedule and duration, where applicable.

Purpose of Liquidated Damages
The purpose of Liquidated Damages is to avoid lengthy disputes over the amount of actual damages once the aggrieved party can prove breach of contract. They shall, to the extent possible, be supported by other clauses to secure the economic interests of the UN, such as payment withholding, Performance Security, and disputed invoice.

Generally, if Liquidated Damages are required, the UN shall require a fixed percentage of the contract value per day or week or other time period that the work is not completed or the goods or services are not delivered. However, for certain types of procurements a fixed amount may be more appropriate instead of per diem rates. For example, x% price reduction if a requested report does not meet all the requirements but is still considered acceptable.

Normally, if a contract provides for Liquidated Damages, a party would also be able to claim payment for actual damages, if the alleged amount exceeds the maximum amount of Liquidated Damages.