Analysis of Fundamental Principles Governing Demand Guarantees in International Trade Law with a Look at New Trade Bill

Document Type : Original Article

Authors
Homayoun Mafi 1
Mehdi Fallah Khariki 2
1 Professor, Department of International Trade Law, University of Judicial Sciences and Administrative Services, Tehran, Iran (Corresponding Author)
2 Assistant Professor, Department of Private Law, Ayatollah Amoli Branch, Islamic Azad University, Amol, Iran
10.22034/lc.2025.497916.1577
Abstract
Demand guarantee as one of bank guarantee types, is an independent undertaking that must be paid just by beneficiary demand. The principles of independence and strict compliance are two fundamental principles governing it. The question in this connection is what is the basis and origin of these principles of authentication? Moreover, about demand guarantee, what does the doctrine of strict compliance means? This article by comparative method has tried to study the fundamental principles governing demand guarantee and present proposals to complete trade bill by analysis of the basis and origin of these principles authentication with descriptive and analytical research method. It appears that the basis of these principles in the Iranian legal system is freedom of will and Article 10 of Civil Code. The meaning of documentary characteristic of demand guarantee according to Article 6 of the UNCITRAL Convention, the beneficiary demand, in any manner that is done, whether written or unwritten, must appear to be in accordance with the terms of the guarantee.
Keywords
Basic Principles
International Trade Law
On-demand Guarantees
UNCITRAL Convention

Subjects