Document background
The Guarantee Promissory Note is commonly used in Dutch commercial transactions where additional security is required for payment obligations. This document type combines the straightforward nature of a promissory note with the added security of a third-party guarantee, making it particularly valuable in business transactions where credit risk is a concern. Governed by Dutch law, specifically the Civil Code (Burgerlijk Wetboek) and Bills of Exchange Act (Wisselwet), it must contain certain mandatory elements including an unconditional promise to pay, specific payment terms, and clear guarantee provisions. The document is particularly useful in situations where the beneficiary requires additional assurance beyond the primary debtor's promise to pay, such as in trade finance, real estate transactions, or commercial lending.
