An Advance Bank Guarantee is commonly required in commercial transactions where substantial advance payments are made before the delivery of goods or services. This document becomes particularly important in the UAE market where advance payments are common practice in various sectors, especially construction and international trade. The Advance Bank Guarantee provides security to the party making the advance payment (beneficiary) by ensuring that a bank will repay the advance if the receiving party (principal) fails to fulfill their contractual obligations. Operating under UAE law, particularly Federal Law No. 18 of 1993 (Commercial Code) and Federal Law No. 14 of 2018 (Central Bank Law), these guarantees must meet specific regulatory requirements and typically include detailed terms regarding validity, claim procedures, and expiry conditions. The document is often required in government contracts and major commercial projects where significant advance payments are involved.

1. Bank Details and Reference: Issuing bank's details, guarantee reference number, and date of issuance

2. Beneficiary Details: Full name and address of the party receiving the guarantee (typically the party making the advance payment)

3. Principal Details: Full name and address of the party on whose behalf the guarantee is issued (typically the contractor/supplier)

4. Guarantee Amount: The specific amount of the guarantee in both figures and words, including currency

5. Underlying Transaction: Reference to the main contract or agreement requiring the advance payment guarantee

6. Guarantee Terms: Core terms including validity period, conditions for payment, and bank's undertaking

7. Expiry Conditions: Specific conditions under which the guarantee expires or can be released

8. Claim Procedure: Process and requirements for making a claim under the guarantee

9. Governing Law and Jurisdiction: Specification of UAE law as governing law and relevant jurisdiction