Autonomous Bank Guarantee Wording
Usually, an autonomous bank guarantee is a document issued by the bank with a limited number of data such as date, amount, name of the beneficiary and expiration date. Unlike a regular check where a date for realization appears.
In addition, a short number of preconditions are required for the realization of the guarantee.
The word realization refers to the physical delivery of the bank guarantee to the bank issuing the guarantee and receiving the said payment in the guarantee.
From this, we understand that this is not a bill but a direct contract between the bank and the beneficiary.
The bank’s obligation to the landlord is independent and differs from the relationship between the landlord and the tenant.
The basic principle on which an autonomous bank guarantee is based in the principle of independence, which gives the guarantee transaction an independent status and separates it from the basic transaction that the guarantee came to support and strengthen.
This principle gives the beneficiary confidence that, if the conditions specified in the letter of the guarantee are met, he will be able to exercise the guarantee without being dependent on a decision in disputes arising from the underlying transaction.