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.

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  1. What's the difference between a bank guarantee and a letter of credit?

    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 >>
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    Transfer pricing refers to prices that a multinational company or group charges a second party operating in a different tax ... Read Full Answer >>
  3. Marginal propensity to Consume (MPC) Vs. Save (MPS)

    Historically, because people in the United States have shown a higher propensity to consume, this is likely the more important ... Read Full Answer >>
  4. When do I need a letter of credit?

    A letter of credit, sometimes referred to as a documentary credit, acts as a promissory note from a financial institution, ... Read Full Answer >>
  5. 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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