Q & A - Commercial Law

A bank guarantee is an unconditional promise by a bank, on behalf of the bank’s customer, to pay the recipient of the guarantee the amount of the guarantee on written demand. It is an alternative to providing a security deposit or bond to a supplier, vendor or landlord. Bank guarantees require security in the form of cash held on deposit held with the bank, or real estate.

In the past, the general approach had been that the tenant was liable for the entire lease costs. However, the recent trend is that each party bears its own costs for the lease. When the premise are difficult to lease, the tenant may negotiate with the landlord and seek concessions such as the landlord should bear its own legal costs of preparation of the lease.