Cross-guarantees

1. Guarantees given by the participants in a notional pooling scheme to the bank providing the notional pooling service that they will honour any outstanding dues in the event of the failure of one of the members to fulfil its duties.
2. Similar guarantees given by companies within a group in relation to the financial obligations of other group companies. For example in relation to servicing and repaying loans.

Cross-guarantees may have tax implications and may be difficult to enforce on a cross-border basis.

See also

• Notional pooling
• Upstream
• Legal implications of cash pooling structures