Securing a transaction guarantee is the obligation of the Guarantor company (which it provides at the request of its client - the Principal) to pay the Beneficiary a sum of money upon presentation of the documents specified in the text of the guarantee (documentary guarantees) or a written demand (guarantee on demand), confirming the Principal's failure to fulfill his obligations to the Beneficiary.
The guarantee is an additional payment security or the performance of other contractual obligations. It means that if the parties to the trade transaction fulfill properly their contractual obligations, the guarantee remains unused, and payment is made only upon the occurrence of a warranty case.
In order to ensure the fulfillment of customer obligations under trade contracts, NSTAR Logistics is ready to issue various types of guarantees:
Tender guarantee - a guarantee to ensure that the tender participant fulfills tender obligations to the customer/contractor. Such a guarantee is required when open tenders are conducted. The guarantee ensures the payment of a guaranteed amount of money in case the tenderer withdraws his/her tender before the deadline for consideration of tenders, in case of refusal of the winner of the tender, sign a contract with the customer/contractor for the supply of goods/services or provide him/her with a guarantee of performance of the contract . As a rule, the guarantee amount is 1-10% of the tender amount;
Advance payment guarantee - issued on behalf of the exporter of goods/services to the importer in the amount of the advance paid to the exporter under the contract and provides a refund of the amount of the advance payment if the exporter does not fulfill his/her obligations to deliver the goods. The amount of the guarantee automatically decreases as supplies are made under the contract;
Guarantee of the contractual obligations’ performance - issued on behalf of the exporter of goods/services to the importer as ensuring the proper performance by the exporter of contractual obligations. The amount of the guarantee is usually 5-10% of the contract amount and is used until the Principal fully fulfills the obligations covered by the guarantee;
Loan repayment guarantee - issued on behalf of the borrower to the creditor and ensures that the borrower fulfills his/her obligations to the creditor to repay the principal amount and/or interest on the loan within the time period specified by the contract;
Payment guarantee - issued on behalf of the importer in favor of the exporter (supplier of goods/services) and ensures that the importer fulfills payment obligations in accordance with the contract.