ICC Uniform Rules for Demand Guarantees
The guidelines set down by the International Chamber of Commerce, (ICC), are adhered to by all major banks. Based in Paris, the International Chamber of Commerce sets the rules and standards for global business and international trade, (including Bank Guarantees and Standby Letters of Credit).
An excellent example of these rules is URDG 758, which has been specifically written for Demand Bank Guarantees, and the verbiage is so precise, there can be no misinterpretation that the Demand Bank Guarantee has been issued for monetisation purposes only. The verbiage also deters any future lawsuits that interested parties might issue to try and change the Terms and Conditions of the Demand Bank Guarantee.
If the Beneficiary defaults on their financial obligations to the lender, the lender can claim against the Demand Bank Guarantee, which is payable on FIRST DEMAND.
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