Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Parent company guarantee definition

What does Parent company guarantee mean? A parent company guarantee is a contractual promise by a holding or other group company to answer for its subsidiary’s obligations, typically covering payment and/or performance. It is widely used in construction and procurement, and in pensions as a contingent asset to support a defined benefit pension scheme, including meeting any funding shortfall if the sponsoring employer defaults or becomes insolvent. The expression is descriptive rather than statutory; in pensions it is recognised in The Pensions Regulator’s guidance and the Pension Protection Fund’s contingent asset regime (including Type A group company guarantees) for PPF levy purposes. Key features include:...

Guarantees and indemnities: distinctions, construction, drafting, formalities and enforcement in commercial and finance transactions; key issues for individual and corporate providers

Published by a LexisNexis Commercial expert

Practice notes

Practice Note

This Practice Note outlines the principal features of guarantees and indemnities, the situations in which they are applied, and the matters beneficiaries and lenders ought to evaluate regarding the form of any guarantee or indemnity, including where such indemnities or guarantees are provided by either individuals or corporate bodies...

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Web page updated on 21/05/2026

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