In order to be able to carry out a profession, obtain a permit or to enjoy a deferred payment, it is sometimes required by law that you provide a guarantee or bail, often in favor of a government agency. This guarantee or bail the counterparty that you are meeting your legal obligations. If you then fail to do so, your counterparty may demand compensation under the bail or guarantee.
Guarantees or bail
Typical statutory guarantees are customs and excise guarantees, permit guarantees (eg transport or broker licenses), timber guarantees, environmental guarantees and EU regulatory guarantees (eg agri-food guarantees).
To guarantee that you meet your contractual obligations, your contractual counterparty may request a guarantee or bail. The guarantee assures the counterparty that you will perform the contract properly and on time. If you do not, your contractual counterparty may claim compensation. Guarantees are often requested, for example, to ensure the construction or maintenance of a building, with the delivery of machines or for international transactions.
Crendido issues many types of contractual guarantees: registration guarantees, implementation guarantees, warranty bonds, prepayment guarantees, maintenance guarantees and supplier guarantees.
A guarantee contract with Crendido also has several advantages:
- Crendido can issue your bail or guarantee quickly.
- The bail will benefit both your liquidity and your bank lines: you do not have to block your own funds and the bail will ease the use of your credit facility. This leaves more money to expand your activities.