Common use of OBLIGATION OF GUARANTEE Clause in Contracts

OBLIGATION OF GUARANTEE. 6.1 Each Bureau shall guarantee the reimbursement by its members of any amount (including late interest) subject to a specific demand for reimbursement55 claimed by the Bureau of the country of accident or by the agent appointed by it. This obligation of guarantee is imposed on the Bureau itself even if the member which issued the card or insurance cover is in a state of insolvency leading to its winding-up proceedings or bankruptcy. The potential intervention of a liquidator comes under the national law of the country where the insurance undertaking is (or was) authorised to carry out compulsory motor civil liability insurance and can at no time prevent the smooth functioning of the Green Card System56. The demand for reimbursement shall be in accordance with the provisions specified in Article 5. In the event of non-conformity with the above mentioned article, the Bureau is free from any obligation of guarantee. According to Article 5.2, the amounts claimed are payable within a period of two months from the date of the demand for reimbursement. On expiry of that period the Bureau of the country of accident or its agent may contact the Bureau of the insurer owing the initial reimbursement and claim payment of the outstanding amount. This guarantee call shall have the effect of making the guaranteeing Bureau responsible for the amounts claimed under the following conditions: The guaranteeing Bureau shall pay the amount claimed within one month of the date of the guarantee call. The amount to be paid is the sum specified in accordance with Article 5.1, increased by the late interest accrued until the date of issue of the guarantee call57. To avoid double payment it would be advisable for the guaranteeing Bureau to inform its member of the payment it has made under the guarantee. Thereafter, the insurer owing the initial reimbursement will have to settle payment of the amount claimed with its own Bureau. If payment is not made by the guaranteeing Bureau within the period of one month, late interest at 12% per annum shall automatically become due by rights from the guaranteeing Bureau without any further reminder. This interest shall run from the date of the guarantee call to the date of receipt of the remittance by the bank of the beneficiary. Late interest is payable no matter how small the amount. Bureaux which address demands for late interest are however invited to find an appropriate approach, bearing in mind that the aim of this provision is not to be used for insignificant amounts. Regarding the guaranteeing Bureaux, they are asked to fully reimburse the amounts claimed and within the given timeframe58. The procedure therefore develops in two stages. 55 2004 – General Assembly, Decision N° 7: Obligation of guarantee - interest 56 1979 – General Assembly, Item 1C, modified in 2007 57 2013 & 2014 – General Assembly Decisions No 5-1 58 2011 – General Assembly, Decision N° 9-1 Explanatory Memorandum to the Internal Regulations Issued 2003 – Latest Update in 2018

OBLIGATION OF GUARANTEE. 6.1 Each Bureau shall guarantee the reimbursement by its members of any amount (including late interest) subject to a specific demand for reimbursement55 reimbursement56 claimed by the Bureau of the country of accident or by the agent appointed by it. This obligation of guarantee is imposed on the Bureau itself even if the member which issued the card or insurance cover is in a state of insolvency leading to its winding-up proceedings or bankruptcy. The potential intervention of a liquidator comes under the national law of the country where the insurance undertaking is (or was) authorised to carry out compulsory motor civil liability insurance and can at no time prevent the smooth functioning of the Green Card System56System57. The demand for reimbursement shall be in accordance with the provisions specified in Article 5. In the event of non-conformity with the above mentioned article, the Bureau is free from any obligation of guarantee. According to Article 5.2, the amounts claimed are payable within a period of two months from the date of the demand for reimbursement. On expiry of that period the Bureau of the country of accident or its agent may contact the Bureau of the insurer owing the initial reimbursement and claim payment of the outstanding amount. This guarantee call shall have the effect of making the guaranteeing Bureau responsible for the amounts claimed under the following conditions: The guaranteeing Bureau shall pay the amount claimed within one month of the date of the guarantee call. The amount to be paid is the sum specified in accordance with Article 5.1, increased by the late interest accrued until the date of issue of the guarantee call57call58. To avoid double payment it would be advisable for the guaranteeing Bureau to inform its member of the payment it has made under the guarantee. Thereafter, the insurer owing the initial reimbursement will have to settle payment of the amount claimed with its own Bureau. If payment is not made by the guaranteeing Bureau within the period of one month, late interest at 12% per annum shall automatically become due by rights from the guaranteeing Bureau without any further reminder. This interest shall run from the date of the guarantee call to the date of receipt of the remittance by the bank of the beneficiary. Late interest is payable no matter how small the amount. Bureaux which address demands for late interest are however invited to find an appropriate approach, bearing in mind that the aim of this provision is not to be used for insignificant amounts. Regarding the guaranteeing Bureaux, they are asked to fully reimburse the amounts claimed and within the given timeframe58timeframe59. The procedure therefore develops in two stages. 55 56 2004 – General Assembly, Decision N° 7: Obligation of guarantee - interest 56 57 1979 – General Assembly, Item 1C, modified in 2007 57 58 2013 & 2014 – General Assembly Decisions No 5-1 58 59 2011 – General Assembly, Decision N° 9-1 Explanatory Memorandum to the Internal Regulations Issued 2003 – Latest Update in 20182020

OBLIGATION OF GUARANTEE. 6.1 Each Bureau shall guarantee the reimbursement by its members of any amount (including late interest) subject to a specific demand for reimbursement55 reimbursement58 claimed by the Bureau of the country of accident or by the agent appointed by it. In respect of the liability for a confirmation of cover see the Explanatory Memorandum to Article 3.2.1. for further details. Should the guaranteeing Bureau not be aware of the issued confirmation of cover, it may request a copy of it from the Bureau of the country of accident. The liability for an issued confirmation of cover is neither excluded nor limited by an erroneous issuance of a Green Card (e.g. breaching of Articles 7.2 or 7.3 of the Internal Regulations) or wrongly insuring of a vehicle (e.g. providing insurance cover for a vehicle not normally based in the territory for which the guaranteeing Bureau is competent).59 This obligation of guarantee is imposed on the Bureau itself even if the member which issued the card or insurance cover is in a state of insolvency leading to its winding-up proceedings or bankruptcy. The potential intervention of a liquidator comes under the national law of the country where the insurance undertaking is (or was) authorised to carry out compulsory motor civil liability insurance and can at no time prevent the smooth functioning of the Green Card System56System60. The demand for reimbursement shall be in accordance with the provisions specified in Article 5. In the event of non-conformity with the above mentioned article, the Bureau is free from any obligation of guarantee. According to Article 5.2, the amounts claimed are payable within a period of two months from the date of the demand for reimbursement. On expiry of that period the Bureau of the country of accident or its agent may contact the Bureau of the insurer owing the initial reimbursement and claim payment of the outstanding amount. This guarantee call shall have the effect of making the guaranteeing Bureau responsible for the amounts claimed under the following conditions: The guaranteeing Bureau shall pay the amount claimed within one month of the date of the guarantee call. The amount to be paid is the sum specified in accordance with Article 5.1, increased by the late interest accrued until the date of issue of the guarantee call57call61. To avoid double payment it would be advisable for the guaranteeing Bureau to inform its member of the payment it has made under the guarantee. Thereafter, 58 2004 – General Assembly, Decision N° 7: Obligation of guarantee - interest 59 2020 – General Assembly Decision, No 5-1, Entry into force: 1st October 2020 60 1979 – General Assembly, Item 1C, modified in 2007 61 2013 & 2014 – General Assembly Decisions No 5-1 Explanatory Memorandum to the Internal Regulations Issued 2003 – Latest Update in 2020 the insurer owing the initial reimbursement will have to settle payment of the amount claimed with its own Bureau. If payment is not made by the guaranteeing Bureau within the period of one month, late interest at 12% per annum shall automatically become due by rights from the guaranteeing Bureau without any further reminder. This interest shall run from the date of the guarantee call to the date of receipt of the remittance by the bank of the beneficiary. Late interest is payable no matter how small the amount. Bureaux which address demands for late interest are however invited to find an appropriate approach, bearing in mind that the aim of this provision is not to be used for insignificant amounts. Regarding the guaranteeing Bureaux, they are asked to fully reimburse the amounts claimed and within the given timeframe58timeframe62. The procedure therefore develops in two stages. 1. 55 2004 – General Assembly, Decision N° 7: Obligation of guarantee - interest 56 1979 – General Assembly, Item 1C, modified in 2007 57 2013 & 2014 – General Assembly Decisions No 5-1 58 2011 – General Assembly, Decision N° 9-1 Explanatory Memorandum The first stage relates to the Internal Regulations Issued 2003 – Latest Update demand for reimbursement sent by the Bureau of the country of accident or its agent to the insurance company having issued the Green Card or the insurance contract covering the vehicle involved in 2018the accident (Article 5). At this stage the insurance company shall proceed with the reimbursement claimed from it within a period of two months from the date of the demand. On expiry of this period the insurance company shall be liable to pay late interest calculated at the rate of 12% per annum on the amount claimed as principal and accruing from the date of the demand until the date of receipt of the remittance by the bank of the beneficiary. If the Bureau of the country of accident or its agent has not received the reimbursement within the period of two months it may call on the guarantee of the guaranteeing Bureau. 2. The second stage therefore refers to the guarantee call which the Bureau of the country of accident or its agent is entitled to make to the guaranteeing Bureau, namely the Bureau of which the insurance company responsible for the demand for reimbursement is a member (Article 6.

OBLIGATION OF GUARANTEE. 6.1 Each Bureau shall guarantee the reimbursement by its members of any amount (including late interest) interest subject to a specific demand for reimbursement55 reimbursement41 claimed by the Bureau of the country of accident or by the agent appointed by it. This obligation of guarantee is imposed on the Bureau itself even if the member which issued the card or insurance cover is in a state of insolvency leading to its winding-up proceedings or bankruptcy. The potential intervention of a liquidator comes under the national law of the country where the insurance undertaking is (or was) authorised to carry out compulsory motor civil liability insurance and can at no time prevent the smooth functioning of the Green Card System56System42. The demand for reimbursement shall be in accordance with the provisions specified in Article 5. In the event of non-conformity with the above mentioned article, the Bureau is free from any obligation of guarantee. According to Article 5.2, the amounts claimed are payable within a period of two months from the date of the demand for reimbursement. On expiry of that period the Bureau of the country of accident or its agent may contact the Bureau of the insurer owing the initial reimbursement and claim payment of the outstanding amount. This guarantee call shall have the effect of making the guaranteeing Bureau responsible for the amounts claimed under the following conditions: The guaranteeing Bureau shall pay the amount claimed within one month of the date of the guarantee call. The amount to be paid is the sum specified in accordance with Article 5.1, increased by the late interest accrued until the date of issue of the guarantee call57call43. To avoid double payment it would be advisable for the guaranteeing Bureau to inform its member of the payment it has made under the guarantee. Thereafter, the insurer owing the initial reimbursement will have to settle payment of the amount claimed with its own Bureau. If payment is not made by the guaranteeing Bureau within the period of one month, late interest at 12% per annum shall automatically become due by rights from the guaranteeing Bureau without any further reminder. This interest shall run from the date of the guarantee call to the date of receipt of the remittance by the bank of the beneficiary. Late interest is payable no matter how small the amount. Bureaux which address demands for late interest are however invited to find an appropriate approach, bearing in mind that the aim of this provision is not to be used for insignificant amounts. Regarding the guaranteeing Bureaux, they are asked to fully reimburse the amounts claimed and within the given timeframe58timeframe44. The procedure therefore develops in two stages. 55 41 2004 – General Assembly, Decision N° 7: Obligation of guarantee - interest 56 42 1979 – General Assembly, Item 1C, modified in 2007 57 43 2013 & 2014 – General Assembly Decisions No 5-1 58 44 2011 – General Assembly, Decision N° 9-1 Explanatory Memorandum to the Internal Regulations Issued 2003 – Latest Update in 20181

OBLIGATION OF GUARANTEE. 6.1 Each Bureau shall guarantee the reimbursement by its members of any amount (including late interest) subject to a specific demand for reimbursement55 reimbursement56 claimed by the Bureau of the country of accident or by the agent appointed by it. This obligation of guarantee is imposed on the Bureau itself even if the member which issued the card or insurance cover is in a state of insolvency leading to its winding-up proceedings or bankruptcy. The potential intervention of a liquidator comes under the national law of the country where the insurance undertaking is (or was) authorised to carry out compulsory motor civil liability insurance and can at no time prevent the smooth functioning of the Green Card System56System57. The demand for reimbursement shall be in accordance with the provisions specified in Article 5. In the event of non-conformity with the above mentioned article, the Bureau is free from any obligation of guarantee. According to Article 5.2, the amounts claimed are payable within a period of two months from the date of the demand for reimbursement. On expiry of that period the Bureau of the country of accident or its agent may contact the Bureau of the insurer owing the initial reimbursement and claim payment of the outstanding amount. This guarantee call shall have the effect of making the guaranteeing Bureau responsible for the amounts claimed under the following conditions: The guaranteeing Bureau shall pay the amount claimed within one month of the date of the guarantee call. The amount to be paid is the sum specified in accordance with Article 5.1, increased by the late interest accrued until the date of issue of the guarantee call57call58. To avoid double payment it would be advisable for the guaranteeing Bureau to inform its member of the payment it has made under the guarantee. Thereafter, the insurer owing the initial reimbursement will have to settle payment of the amount claimed with its own Bureau. If payment is not made by the guaranteeing Bureau within the period of one month, late interest at 12% per annum shall automatically become due by rights from the guaranteeing Bureau without any further reminder. This interest shall run from the date of the guarantee call to the date of receipt of the remittance by the bank of the beneficiary. Late interest is payable no matter how small the amount. Bureaux which address demands for late interest are however invited to find an appropriate approach, bearing in mind that the aim of this provision is not to be used for insignificant amounts. Regarding the guaranteeing Bureaux, they are asked to fully reimburse the amounts claimed and within the given timeframe58timeframe59. The procedure therefore develops in two stages. 55 56 2004 – General Assembly, Decision N° 7: Obligation of guarantee - interest 56 57 1979 – General Assembly, Item 1C, modified in 2007 57 58 2013 & 2014 – General Assembly Decisions No 5-1 58 59 2011 – General Assembly, Decision N° 9-1 Explanatory Memorandum to the Internal Regulations Issued 2003 – Latest Update in 20182019

OBLIGATION OF GUARANTEE. 6.1 Each Bureau shall guarantee the reimbursement by its members of any amount (including late interest) subject to a specific demand for reimbursement55 reimbursement56 claimed by the Bureau of the country of accident or by the agent appointed by it. This obligation of guarantee is imposed on the Bureau itself even if the member which issued the card or insurance cover is in a state of insolvency leading to its winding-up proceedings or bankruptcy. The potential intervention of a liquidator comes under the national law of the country where the insurance undertaking is (or was) authorised to carry out compulsory motor civil liability insurance and can at no time prevent the smooth functioning of the Green Card System56System57. The demand for reimbursement shall be in accordance with the provisions specified in Article 5. In the event of non-conformity with the above mentioned article, the Bureau is free from any obligation of guarantee. According to Article 5.2, the amounts claimed are payable within a period of two months from the date of the demand for reimbursement. On expiry of that period the Bureau of the country of accident or its agent may contact the Bureau of the insurer owing the initial reimbursement and claim payment of the outstanding amount. This guarantee call shall have the effect of making the guaranteeing Bureau responsible for the amounts claimed under the following conditions: The guaranteeing Bureau shall pay the amount claimed within one month of the date of the guarantee call. The amount to be paid is the sum specified in accordance with Article 5.1, increased by the late interest accrued until the date of issue of the guarantee call57call58. To avoid double payment it would be advisable for the guaranteeing Bureau to inform its member of the payment it has made under the guarantee. Thereafter, the insurer owing the initial reimbursement will have to settle payment of the amount claimed with its own Bureau. If payment is not made by the guaranteeing Bureau within the period of one month, late interest at 12% per annum shall automatically become due by rights from the guaranteeing Bureau without any further reminder. This interest shall run from the date of the guarantee call to the date of receipt of the remittance by the bank of the beneficiary. Late interest is payable no matter how small the amount. Bureaux which address demands for late interest are however invited to find an appropriate approach, bearing in mind that the aim of this provision is not to be used for insignificant amounts. Regarding the guaranteeing Bureaux, they are asked to fully reimburse the amounts claimed and within the given timeframe58timeframe59. The procedure therefore develops in two stages. 55 56 2004 – General Assembly, Decision N° 7: Obligation of guarantee - interest 56 57 1979 – General Assembly, Item 1C, modified in 2007 57 58 2013 & 2014 – General Assembly Decisions No 5-1 58 59 2011 – General Assembly, Decision N° 9-1 Explanatory Memorandum to the Internal Regulations Issued 2003 – Latest Update in 20181

OBLIGATION OF GUARANTEE. 6.1 Each Bureau shall guarantee the reimbursement by its members of any amount (including late interest) subject to a specific demand for reimbursement55 reimbursement63 claimed by the Bureau of the country of accident or by the agent appointed by it. In respect of the liability for a confirmation of cover see the Explanatory Memorandum to Article 3.2.1. for further details. Should the guaranteeing Bureau not be aware of the issued confirmation of cover, it may request a copy of it from the Bureau of the country of accident. The liability for an issued confirmation of cover is neither excluded nor limited by an erroneous issuance of a Green Card (e.g. breaching of Articles 7.2 or 7.3 of the Internal Regulations) or wrongly insuring of a vehicle (e.g. providing insurance cover for a vehicle not normally based in the territory for which the guaranteeing Bureau is competent).64 This obligation of guarantee is imposed on the Bureau itself even if the member which issued the card or insurance cover is in a state of insolvency leading to its winding-up proceedings or bankruptcy. The potential intervention of a liquidator comes under the national law of the country where the insurance undertaking is (or was) authorised to carry out compulsory motor civil liability insurance and can at no time prevent the smooth functioning of the Green Card System56System65. The demand for reimbursement shall be in accordance with the provisions specified in Article 5. In the event of non-conformity with the above mentioned article, the Bureau is free from any obligation of guarantee. According to Article 5.2, the amounts claimed are payable within a period of two months from the date of the demand for reimbursement. On expiry of that period the Bureau of the country of accident or its agent may contact the Bureau of the insurer owing the initial reimbursement and claim payment of the outstanding amount. This guarantee call shall have the effect of making the guaranteeing Bureau responsible for the amounts claimed under the following conditions: 63 2004 – General Assembly, Decision N° 7: Obligation of guarantee - interest 64 2020 – General Assembly Decision, No 5-1 The guaranteeing Bureau shall pay the amount claimed within one month of the date of the guarantee call. The amount to be paid is the sum specified in accordance with Article 5.1, increased by the late interest accrued until the date of issue of the guarantee call57call66. To avoid double payment it would be advisable for the guaranteeing Bureau to inform its member of the payment it has made under the guarantee. Thereafter, the insurer owing the initial reimbursement will have to settle payment of the amount claimed with its own Bureau. If payment is not made by the guaranteeing Bureau within the period of one month, late interest at 12% per annum shall automatically become due by rights from the guaranteeing Bureau without any further reminder. This interest shall run from the date of the guarantee call to the date of receipt of the remittance by the bank of the beneficiary. Late interest is payable no matter how small the amount. Bureaux which address demands for late interest are however invited to find an appropriate approach, bearing in mind that the aim of this provision is not to be used for insignificant amounts. Regarding the guaranteeing Bureaux, they are asked to fully reimburse the amounts claimed and within the given timeframe58timeframe67. The procedure therefore develops in two stages. 1. 55 2004 – General Assembly, Decision N° 7: Obligation of guarantee - interest 56 1979 – General Assembly, Item 1C, modified in 2007 57 2013 & 2014 – General Assembly Decisions No 5-1 58 2011 – General Assembly, Decision N° 9-1 Explanatory Memorandum The first stage relates to the Internal Regulations Issued 2003 – Latest Update demand for reimbursement sent by the Bureau of the country of accident or its agent to the insurance company having issued the Green Card or the insurance contract covering the vehicle involved in 2018the accident (Article 5). At this stage the insurance company shall proceed with the reimbursement claimed from it within a period of two months from the date of the demand. On expiry of this period the insurance company shall be liable to pay late interest calculated at the rate of 12% per annum on the amount claimed as principal and accruing from the date of the demand until the date of receipt of the remittance by the bank of the beneficiary. If the Bureau of the country of accident or its agent has not received the reimbursement within the period of two months it may call on the guarantee of the guaranteeing Bureau. 2. The second stage therefore refers to the guarantee call which the Bureau of the country of accident or its agent is entitled to make to the guaranteeing Bureau, namely the Bureau of which the insurance company responsible for the demand for reimbursement is a member (Article 6.