Uniform Rules For Demand Guarantees - URDG


DEFINITION of 'Uniform Rules For Demand Guarantees - URDG'

A set of rules developed by the International Chamber of Commerce (ICC) and adopted in 1992. URDG provides a framework for harmonizing international trading practices and establishes agreed-upon rules for independent guarantees and counter-guarantees among trading partners. The guarantees specify uniform practices for securing payment and performance in worldwide commercial contracts.

BREAKING DOWN 'Uniform Rules For Demand Guarantees - URDG'

The World Bank and the United Nations Commission on International Trade Law (UNCITRAL) have adopted the URDG into their standards for financing international trade. The ICC's publication, Uniform Rules for Demand Guarantees, is considered an authoritative guide and reflects international practice in the use of demand guarantees, while preserving the goal of the original rules – to balance the interests of the trading parties and curb abuse in the development of international trade guarantees.

  1. The World Bank

    An international organization dedicated to providing financing, ...
  2. Demand Guarantee

    A type of protection that one party in a transaction can impose ...
  3. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a ...
  4. Guarantor

    A person who guarantees to pay for someone else's debt if he ...
  5. Payment

    The transfer of one form of good, service or financial asset ...
  6. Deficit

    The amount by which a resource falls short of a mark, most often ...
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    A bank guarantee and a letter of credit are similar in many ways but they're two different things. Letters of credit ensure ... Read Full Answer >>
  2. When do I need a letter of credit?

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  3. When has the United States run its largest trade deficits?

    In macroeconomics, balance of trade is one of the leading economic metrics that determines the trading relationship of a ... Read Full Answer >>
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    There is no question the composition of a country's balance of payments is more important than its balance of trade. This ... Read Full Answer >>
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  6. What is the difference between Cost and Freight (CFR) and Free on Board (FOB)?

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