9Definitions

9 Definitions

9 Definitions

In this part—

assurer—

(a) under a letter of comfort—see definition of letter of comfort, or

(b) under a letter of financial support—see definition of letter of financial support.

bank guarantee means an arrangement under which an entity that provides finance undertakes to do either of the following in relation to another entity (the guarantee recipient)—

(a) guarantee to a third party the performance of an obligation by the guarantee recipient,

(b) pay a third party on demand by the guarantee recipient.

finance recipient—see definition of supplier finance arrangement.

general guarantee means an arrangement under which an entity (a guarantor) promises to another entity to be responsible for performing the obligations of a third entity if the third entity fails to perform the obligations.

guarantee recipient—see definition of bank guarantee.

guarantor—see definition of general guarantee.

lessee—see definition of operating or finance lease arrangement.

letter of comfort means an arrangement—

(a) under which an entity (the assurer) gives a document to a second entity that is intended to generally reassure the second entity about a state of affairs and the assurer’s intention to perform obligations to facilitate a proposed arrangement, and

(b) that gives rise to a contingent liability for the assurer.

letter of financial support means an arrangement—

(a) under which an entity (the assurer) gives a document to a second entity that verifies funding will be available for a third entity for the purposes of a proposed arrangement, and

(b) that gives rise to a contingent liability for the assurer.

operating or finance lease arrangement means an arrangement under which an entity (the lessor) grants another entity (the lessee) for value—

(a) a right for the lessee to use an asset, other than land, of the lessor for a specified period, and

(b) any entitlements to the risks and rewards resulting from the use of the asset.

social benefit bond means an arrangement created by an instrument under which any financial return is made contingent on the achievement of specified social outcomes.