Guide to ICC Uniform Rules for Demand Guarantees (URDG 758)

The first edition of this Guide was widely acclaimed. This substantially revised and expanded volume is equally indispensable for bankers, businesses, lawyers and bank supervisors.

This edition addresses many more issues and updated references to a substantial volume of ICC materials including:

• the ground-breaking International Standard Demand Guarantee Practice (ISDGP),
• Opinions of the ICC Banking Commission,
• DOCDEX decisions,
• reflections of the Task Force on Guarantees,
• Technical Advisory Briefings issued by the Technical Advisors to the ICC Banking Commission, and
• ICC Guidance Papers.

Chapters have been added to reflect new preoccupations in the international guarantee business and new policy decisions issued by the ICC Banking Commission on rules and practices that are common to the UCP and the URDG.

The stage-by-stage analysis of the life cycle of a typical demand guarantee followed by an article-by-article commentary on the URDG and the ISDGP are included in this volume.

The enriched alphabetical index will enable readers to pinpoint the paragraph where a particular issue is discussed.

This is the only Guide which has been drafted by the authors of the rules themselves. A must-have!

Details: 

Table of contents: 

PART I

CHAPTER 1

DEMAND GUARANTEES AND COUNTER-GUARANTEES IN A NUTSHELL

[1.1]       What is a demand guarantee?
[1.2]       Types of guarantee
[1.3]       Why are demand guarantees used?
[1.4]       Legal nature of demand guarantees
[1.5]       Fraud and other defences
[1.6]       Documents
[1.7]       Non-documentary conditions
[1.8]       Independence of guarantees
[1.9]       Demand guarantees as distinguished from suretyships
[1.10]     Demand guarantees as distinguished from indemnities
[1.11]     Demand guarantees as distinguished from documentary credits
[1.12]     Demand guarantees as distinguished from standby letters of credit
[1.13]     Multi-party guarantees; syndicated guarantees
[1.14]     Two-party guarantees
[1.15]     Guarantees not issued in connection with an underlying contract
[1.16]     What is a counter-guarantee?
[1.17]     Structure of a counter-guarantee
[1.18]     Independence of a counter-guarantee
[1.19]     Can the beneficiary make a claim against the counter-guarantor?
[1.20]     Can the applicant make a claim against the guarantor, and vice-versa, under an indirect guarantee?

CHAPTER 2

THE ROAD TO URDG 758

[2.1]       Why the URDG?
[2.2]       In the beginning … a void
[2.3]       The URCG
[2.4]       URDG 458
[2.5]       Beneficiary to state, but not prove, the breach
[2.6]       Applicant to renounce defences derived from underlying relationship
[2.7]       Guarantor’s independent and documentary role
[2.8]       URDG 458’s success
[2.9]       A brief history of the revision
[2.10]     The revision process
[2.11]     URDG 758 and URDG 458 compared

CHAPTER 3

THE URDG AND THE ISDGP IN A NUTSHELL

[3.1]       What are the URDG?
[3.2]       What is the ISDGP?
[3.3]       Are there conditions for the URDG to apply to a guarantee?
[3.4]       How do the URDG apply?
[3.5]       The URDG and the law
[3.6]       Using URDG 758: advantages to all parties
[3.7]       The scope of URDG 758: what’s in – what’s out
[3.8]       Other questions on the scope of the URDG
[3.9]       In summary
[3.10]     Interpretation of the URDG

CHAPTER 4

URDG 758 IN OPERATION

[4.1]       The main characters in the URDG play
[4.2]       Drafting a URDG guarantee
[4.3]       Issuing a URDG guarantee
[4.4]       Changing the terms of a URDG guarantee
[4.5]       Making a presentation
[4.6]       Examining a presentation
[4.7]       Making payment
[4.8]       Termination of the guarantee
[4.9]       The relationship with the instructing party

CHAPTER 5

FRAUD AND OTHER DEFENCES TO A CLAIM ON A
GUARANTEE OR COUNTER-GUARANTEE

[5.1]       Summary of defences to a claim
[5.2]       Fraud
[5.3]       What constitutes fraud?
[5.4]       Invoking fraud: procedural aspects
[5.5]       Forged or otherwise invalid documents
[5.6]       Cancellation of guarantee for misrepresentation
[5.7]       Breach of mandate
[5.8]       Unconscionable or unfair conduct
[5.9]       Breach of agreement between instructing party and beneficiary
[5.10]     Illegality of intended payment
[5.11]     Set-off
[5.12]     Position of issuer

CHAPTER 6

THE URDG IN THE WORLD

[6.1]       The URDG in various languages
[6.2]       The URDG and other ICC Rules
[6.3]       The URDG and the UN Convention on Independent Guarantees and Stand-by Letters of Credit
[6.4]       The URDG as a model for national laws
[6.5]       The URDG as a model for other organizations’ standard guarantee forms

PART II

A COMMENTARY ON URDG 758

Article 1 – Application of URDG
Article 2 – Definitions
Article 3 – Interpretation
Article 4 – Issue and effectiveness
Article 5 – Independence of guarantee and counter-guarantee
Article 6 – Documents v. goods, services or performance
Article 7 – Non-documentary conditions
Article 8 – Content of instructions and guarantees
Article 9 – Application not taken up
Article 10 – Advising of guarantee or amendment
Article 11 – Amendments
Article 12 – Extent of guarantor’s liability under guarantee
Article 13 – Variation of amount of guarantee
Article 14 – Presentation
Article 15 – Requirements for demand
Article 16 – Information about demand
Article 17 – Partial demand and multiple demands; amount of demands
Article 18 – Separateness of each demand
Article 19 – Examination
Article 20 – Time for examination of demand; payment
Article 21 – Currency of payment
Article 22 – Transmission of copies of complying demand
Article 23 – Extend or pay
Article 24 – Non-complying demand, waiver and notice
Article 25 – Reduction and termination
Article 26 – Force majeure
Article 27 – Disclaimer on effectiveness of documents
Article 28 – Disclaimer on transmission and translation
Article 29 – Disclaimer for acts of another party
Article 30 – Limits on exemption from liability
Article 31 – Indemnity for foreign laws and usages
Article 32 – Liability for charges
Article 33 – Transfer of guarantee and assignment of proceeds
Article 34 – Governing law
Article 35 – Jurisdiction