| Commentary

21 General

| Commentary

5: PERFORMANCE BONDS

21 General

Parties to international contracts are frequently required to provide a performance bond or guarantee as security for their performance of the contract. The bank issuing a performance bond will usually take a counter-indemnity in respect of the bond from the customer at whose instructions the bond is issued authorising the bank to debit the customer’s account for sums paid in accordance with the terms of the bond.

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