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Counter-Guarantee for exporters

Additional safeguard for exporters

We support you in the additional provision of bonds

If you as exporter are required to put up contract bonds for an export transaction, the guarantor who is asked to issue the bond on your behalf will then charge your credit line with the relevant bond amount. Often the guarantor requests you to provide adequate security – for instance in the form of a charge over cash collateral. Depositing such security may in turn lead to a reduction of your liquidity.

The Federal Government will reimburse the guarantor if the bond is called 

In issuing a Counter-Guarantee the Federal Government undertakes to reimburse most of the sum to the guarantor which he has to pay out in the event of the contract bond in favour of the foreign buyer (bond holder) being called. This means that the Federal Government takes over the risk for the guarantor that the latter is unable to successfully take recourse for compensation to the exporter, a right which accrues to him for the sum paid out when the bond is called. The Counter-Guarantee therefore goes a long way towards relieving the recourse risks of the guarantor. This relief enables the guarantor not only to refrain from demanding further collateral from the exporter, thus constraining his liquidity, but in addition makes it unnecessary for him to charge the bond amount against the exporter’s credit lines. At the end of the day, this is intended to make it easier for the exporter to put up the bond required by his foreign buyer.


Worth knowing: The Counter-Guarantee supplements the Contract Bond Guarantee.

Counter-Guarantee at a glance

Target group

  • As applicant: German export firms
  • As beneficiaries of the Counter-Guarantee:
    • German banks / surety companies
    • branch offices of foreign banks / surety companies with a seat in Germany
    • foreign banks / surety companies (under certain conditions)

Special features

Although the Counter-Guarantee protects the guarantor, it is the exporter who has to apply for it.

As a rule, a Counter-Guarantee will only be issued if parallel a Contract Bond Guarantee for the contract bond to be covered is granted by the Federal Republic. In principle, a Supplier Credit Guarantee is also required. This may, however, be dispensed with if the exporter is not exposed to any foreign payment risks because of the payment terms (e.g. confirmed letter of credit, progress payment). On a case-by-case bases, the Federal Government may grant a Counter-guarantee in combination with a Contract Bond Guarantee also without cover of the other risks of an export transaction if such cover is not available or insurance is not acceptable or not wished by the exporter.

Whether a Counter-Guarantee will be granted is conditional upon the exporter having the necessary technical and organisational resources to ensure the due performance of the export transaction. The exporter’s ability to ensure performance is assessed by means of a questionnaire to be completed by him.

From the moment a Counter-Guarantee is granted until a reimbursement is made the administration will be handled exclusively between the Federal Government and the guarantor. For this purpose, the guarantor has to sign a  so-called “Ergänzungserklärung des Garantiestellers zur Avalgarantie” prior to the final commitment and also perform certain information duties in time.



  • The exporter does not have to pay a separate premium for a Counter-Guarantee. Instead, the Federal Government receives a share in the bond premium, which the exporter has to pay to the guarantor for issuing a contract bond, directly from the guarantor. For this purpose the guarantor will receive one invoice each for the first and the subsequent premium from the Federal Government; to begin with, an advance premium will be charged which will be finally settled at the end of each calendar year and the end of liability.
  • The usual premium has to be paid for the compulsory Contract Bond Guarantee and any Supplier Credit Guarantee which may be required.


Counter-Guarantee for exporters: Your advantages at a glance


You can apply for a Counter-Guarantee quite easily in our customer portal myAGA.

Supplentary Cover

The Counter-Guarantee is a supplementary form of cover and can only be applied for in combination with a Contract Bond Guarantee.

No additional premium

No extra premium is payable for a Counter-Guarantee. The risk-priced compensation due to the Federal Government for assuming the Counter-Guarantee is discharged by means of its share in the bond premium which the exporter has to pay to his guarantor in any case for issuing the contract bond.

How does a Counter-Guarantee work? 

The core of the Counter-Guarantee is the undertaking by the Federal Government (itself equivalent to a guarantee) towards the guarantor to reimburse to him the amount paid out on a bond call within 10 bank days and on first written demand. The percentage reimbursed can be up to 80%. The undertaking to pay is agreed in a guarantee contract made between the Federal Government and the exporter. If the contract bond for the benefit of the foreign buyer is not issued directly by the exporter’s principal bank, which provides the financing, but by a different credit institution, it is not the direct bond that will be covered by the Counter-Guarantee but the corresponding back-to-back guarantee issued by the exporter’s principal bank. In both cases the undertaking applies – unlike the insured events in con­tract bond cover – for any and every reason for calling the bond, and therefore also to fair calling. After reimbursement has been made, the Federal Government has recourse on the exporter. The right of recourse is normally asserted only six months after reimbursement of the guarantor and only when no claim has been recognized in favour of the exporter as valid up to that date in respect of the corresponding Contract Bond Guarantee. If such a valid claim has been accepted, the claim for recourse will be set off against the amount due for indemnification.

Practical example of a Counter-Guarantee 

Rehabilitation of the wastewater network in Ecuador

Since the beginning of 2017, Ludwig Pfeiffer Hoch- und Tiefbau GmbH & Co. KG has been modernising the wastewater network of the La Chala basin in Guayaquil, Ecuador. In the course of the project 450 kilometres of sewage pipes were cleaned. In addition, the German family-owned company is overhauling approx. 100 kilometres of the sewage network using various trenchless technologies together with 400 manholes.


The Federal Republic of Germany is backing the project with isolated contract bond cover and a Counter-Guarantee.

Bild: Sanierung Abwassernetz in Ecuador

Applying for a Counter-Guarantee 

You can apply quite easily for this product online in the myAGA customer portal. Please submit your online application there in order to apply for cover for your export transaction under a Counter-Guarantee. For this purpose please register once and comfortably with just a few steps in our myAGA customer portal. If you already use myAGA you can log on directly with your access data.


If you need assistance with the submission of the application or if you have any questions regarding the suitable product for you, please contact our business consultants.

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FAQs Counter-Guarantee

What is guaranteed with a Counter-Guarantee?

A Counter-Guarantee provides security for the exporter in favour of the guarantor for the loss up to 80% of the bond sum paid out by the latter. Payment guarantees assumed by the guarantor in excess of the actual bond amount, such as interest, compensation for damages, legal or other costs are in principle not insurable. An exception here is a Counter-Guarantee given in respect of an advance payment bond. This also covers the interest normally included in the bond.

What conditions does the exporter have to fulfil in order to get a Counter-Guarantee? 

As a rule, the granting of a Contract Bond Guarantee for the contract bond in question is a precondition for getting a Counter-Guarantee. A principal guarantee can be dispensed with if cover of the other risks involved is not possible, not reasonable or not wanted by the exporter. However, it is always necessary to have a corresponding Contract Bond Guarantee. A Counter-Guarantee can also be granted for covered business which is already being transacted if a principal guarantee and a Contract Bond Guarantee have already been granted, so far only a principal guarantee exists but the granting of a Contract Bond Guarantee is still possible because the contract bond has not yet been issued or the main transaction has not been covered and cannot be covered for lack of risks that are eligible for cover (e.g. payment under an irrevocable letter of credit) but the granting of a Con­tract Bond Guarantee is still possible because the underlying contract bond has not yet been issued. In addition, it is necessary for the exporter to prove that he has the organisational and technological resources to ensure due performance of the export transaction. The assessment of the exporter’s ability to ensure performance is done mainly by means of a questionnaire to be filled out by him. The maximum liability of the Federal Government in respect of all Counter-Guarantees assumed is EUR 80 million per exporter. Subject to certain conditions this limit on the maximum exposure may be exceeded in individual cases if that turns out to be necessary due to the special nature of the transaction.

What period is the Counter-Guarantee valid for?

The commitment undertaken by the Federal Government begins in respect of guarantees already issued immediately with the receipt of the letter of confirmation from the Federal Government. In respect of a guarantee which has not been issued the commitment under­taken by the Federal Government begins when the guarantee is actually issued. If, in praxis, the coming into effect of the guarantee is taken as basis, the commitment undertaken by the Federal Government also begins with the coming into effect of the guarantee and not with its issuance.

When will the Counter-Guarantee become effective?

A Counter-Guarantee given by the Federal Government takes effect upon receipt of the letter of confirmation from the Federal Govern­ment. The Counter-Guarantee would become ineffective only if the guarantor failed to pay the premium within the term of payment set by the Federal Government even after receiving a letter of reminder; in such a case it is up to the guarantor to maintain the effectiveness by making payment within the time limit.

Do you have any additional questions regarding a Counter-Guarantee? 

Our experts will be pleased to answer any questions regarding a Counter-Guarantee and will guide you step by step through the application process if desired. Please do not hesitate to contact them.

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Your Contacts

Please do not hesitate to contact us.
Customer Support
Do you have any questions about export finance? We will support you.
Andreas Gehring
Manufacturing Risk and Credit Confirmation Risk Cover; Counter; Securitisation Guarantee for the KfW Refinancing and Shopping Line Cover
Matthias Jost
Counter-Guarantee; Export Credit Cover for Service Providers, Revolving Buyer Credit Cover