Retention Release Letter: A Sample You Can Adapt
The Defects Notification Period expired weeks ago. The snag list is closed, the Engineer has raised no complaint since, and the retention money still sits in the Employer's account. Nobody is being dishonest — the certificate simply never got written, because under FIDIC nobody is forced to write it. This guide gives you the letter that forces the issue, plus the Sub-Clause 14.9 timing most Contractors never check until the money is overdue.
Retention Money Doesn't Release Itself
Retention is the percentage the Employer withholds from every Interim Payment Certificate as security that the Contractor will finish the job and fix whatever breaks during the Defects Notification Period. It is the Contractor's own money, held back rather than paid, and it comes back in two instalments once the conditions for release are met.
The trap is in that word "supposed to." Sub-Clause 14.9 describes when the Engineer is to certify release — but unlike the Taking-Over Certificate under Sub-Clause 10.1, there is no formal Contractor "application" step written into the clause. In theory the Engineer acts unprompted once the Taking-Over Certificate is issued, or once the Defects Notification Period expires. In practice, a certificate nobody has asked for is easy for a busy Engineer's office to leave for the next billing cycle.
That is why a written request earns its place even though the Contract does not demand one. It is not a notice with a time bar attached — it simply fixes the date the Engineer's obligation to act was triggered, which matters if the release has to be chased further.
Key Takeaway: Retention Money is the Contractor's own money, held back as security and released in two stages under Sub-Clause 14.9. Nothing in the clause forces the Engineer to act without being asked, so a written request is what actually moves it, even though it is not a formal application.
When Each Half of the Retention Money Falls Due
Under the FIDIC 1999 Red Book, the standard mechanism splits the release in two. The first half is certified once the Taking-Over Certificate is issued for the Works — or a proportional share once a Taking-Over Certificate is issued for a Section, if the Contract states that Section's percentage value. The second half is certified once the Defects Notification Period has expired, or, where Sections carry different periods, once the latest of them has expired.
Notice what is missing from both triggers: a day count. There is no "28 days from X" or "56 days from Y" written into Sub-Clause 14.9 itself. The release is tied to events — a certificate being issued, a period running out — not to a clock that starts ticking from a single date, the way the Clause 20.1 notice period does. That is the single most common misunderstanding Contractors bring to this letter: looking for a deadline the sub-clause simply does not contain.
Once the Engineer certifies the release, the amount joins the next Interim Payment Certificate, and the ordinary payment cycle applies from there. Under FIDIC 1999 Sub-Clause 14.7, the Employer then has 56 days from when the Engineer received the relevant Statement to pay it. The event-based trigger gets the retention certified; the standard IPC clock gets it paid.
Key Takeaway: The first half of Retention Money is tied to the Taking-Over Certificate; the second half is tied to the Defects Notification Period expiring. Neither trigger carries a fixed day count — once certified, the amount simply joins the normal 56-day Sub-Clause 14.7 payment cycle.
Retention Release Letter Template — Copy and Adapt
Here is a skeleton for the final, second-half request — the one Contractors chase most often, because it is the one most likely to sit unasked. Replace everything in square brackets with your own facts, then delete the brackets.
The same skeleton works for the first-half request — swap the Defects Notification Period paragraph for a single line confirming the date the Taking-Over Certificate was issued. Either version should name the exact triggering date and confirm what has actually been done, not a vague assurance that "everything is in order."
Key Takeaway: One skeleton covers both halves of the retention release. Name the exact triggering date — Taking-Over Certificate issuance or Defects Notification Period expiry — and confirm what has actually been done, not that things are generally fine.
Worked Example: A Filled-In Retention Release Letter
Here is the same template filled in for a logistics hub at the end of its Defects Notification Period.
Notice how fast the Engineer can check this: two named defects, each with its own completion date, against an expiry date stated outright rather than implied. There is nothing left for the Engineer to chase before acting.
Key Takeaway: A request the Engineer can act on immediately states the exact expiry date and names each remedied item individually — it leaves nothing for the Engineer's office to go back and ask about.
Retention Under Sectional Completion
On a project split into Sections, the mechanism stays the same but runs separately for each one. A Section gets its own Taking-Over Certificate and its own Defects Notification Period, so it releases its own proportional share of each half on its own timeline — a bridge Section can clear its retention long before the access roads Section does.
The catch sits earlier than most Contractors expect. The proportional release depends on a percentage value being stated against that Section in the Contract Data. If the Contract never assigned one, Sub-Clause 14.9 releases nothing for that Section, however long its Defects Notification Period has run — a gap worth finding before a Section is taken over, not after the request has gone unanswered.
Key Takeaway: Each Section releases retention on its own schedule, tied to its own Taking-Over Certificate and Defects Notification Period — but only if the Contract stated a percentage value for that Section. Check the Contract Data before, not after, a Section is taken over.
Common Mistakes That Delay Retention Release
- Waiting for the Engineer to act first. Sub-Clause 14.9 gives no Contractor application step, so in practice nothing happens until someone asks.
- Searching for a day-count deadline that isn't there. The release is event-triggered, not date-triggered — chasing the wrong clock wastes a letter's leverage.
- Requesting before every notified defect is closed out. The second half is not due while a defect remains outstanding, even if the period has technically expired.
- A vague confirmation instead of a named list. "All defects have been remedied" invites a follow-up question; naming each item with its date does not.
- Missing a Section's percentage gap. Assuming every Section carries a proportional release, when an unstated percentage value means it carries none.
Key Takeaway: Most delayed retention traces back to waiting for the Engineer to move first, chasing a deadline the clause does not set, or a request too vague or too early for the Engineer to act on without asking more questions.
Frequently Asked Questions
Is there a fixed FIDIC deadline for releasing retention money?
No. Unlike the 28-day notice period under Sub-Clause 20.1, Sub-Clause 14.9 does not set a fixed number of days from a single date. The first half of the Retention Money is released once the Taking-Over Certificate is issued; the second half is released once the Defects Notification Period expires (or, for Sectional Completion, the latest of the relevant periods). Once the Engineer certifies the released amount in the next Interim Payment Certificate, the Employer's payment deadline reverts to the normal Sub-Clause 14.7 cycle — 56 days from when the Engineer receives the Statement under FIDIC 1999.
How much of the Retention Money is released at each stage?
The standard mechanism under FIDIC 1999 releases the Retention Money in two equal halves. Fifty per cent is certified once the Taking-Over Certificate is issued for the Works, or a pro-rata share for a Section. The remaining fifty per cent is certified once the Defects Notification Period has expired. The retention percentage itself — how much is withheld from each payment in the first place — is set in the Contract Data, not the standard Conditions, so check the Appendix to Tender for the actual figure.
Does the Performance Certificate have to be issued before the second half of Retention Money is paid?
Not necessarily on the same date, but the two are closely linked in practice. Sub-Clause 14.9's own trigger for the second half is the expiry of the Defects Notification Period. The Performance Certificate, under Sub-Clause 11.9, also waits for that same expiry, plus confirmation that every notified defect has been remedied and the Contractor's Documents supplied. Many Engineers process both at the same time, but the two are governed by separate sub-clauses and can, in principle, land on different dates.
What happens to retention release on a project with Sections?
Sectional Completion changes the maths, not the mechanism. Each Section releases its own proportional share of each half, tied to that Section's own Taking-Over Certificate and its own Defects Notification Period. The catch: if the Contract does not state a percentage value for a Section, no retention is released for that Section under Sub-Clause 14.9 at all — so the percentage breakdown in the Contract Data needs checking before a Section is taken over, not after.
Can the Employer withhold retention for outstanding snagging items?
Only within limits, and only under the standard wording. Sub-Clause 14.9 conditions the second half on the Defects Notification Period expiring with notified defects remedied, so an outstanding notified defect can genuinely hold up that half. A general right to withhold retention for minor snagging beyond that is not in the standard 1999 text — where it exists, it has usually been added by the Particular Conditions, so check for an amendment before assuming it applies.
Authoritative Sources
This guide reflects the FIDIC Conditions of Contract and established commentary. For the primary materials, see:
- FIDIC Conditions of Contract — the official contract suite published by the International Federation of Consulting Engineers, which sets out the Sub-Clause 14.9 retention mechanism referenced throughout this guide.
- 1999 Suite: Commentary on Clause 14 — Contract Price and Payment, Howard Kennedy — a clause-by-clause commentary covering the Sub-Clause 14.9 two-stage release and its treatment under Sectional Completion.
About the Author
Muhammad M. Jiwani is a Project Director with 15 years' experience on major infrastructure and energy projects administered under FIDIC contracts. He writes from first-hand experience serving notices and managing contractual claims on live projects.