Lara Van Dyck

Autonomous guarantee finally enshrined in law

With Book 9 of the Civil Code, the autonomous guarantee - also known as a bank guarantee or guarantee on first demand - now has, for the first time, a clear statutory basis in Belgium. Until now, this legal instrument was primarily shaped by case law, customary practice, and international soft law. With regard to the latter, reference is often made to the so-called URDG 758 (Uniform Rules for Demand Guarantees), a set of practical rules drawn up by the International Chamber of Commerce (ICC). These rules are not binding as such, but they are frequently used in (inter)national trade because they provide uniform and recognizable arrangements and thus legal certainty.