The concepts ‘Guarantee’ and ‘Surety’ have very different legal implications under common law and often,
indeed, as between different common law jurisdictions.
Taking English law as a basis, a true ‘guarantee’ in consumer-rights parlance probably looks a bit more like a standard Gewährleistung under German law,
although a ‘surety’ is also sometimes referred to as a ‘guarantor’ i.e. one who guarantees the performance of another under a contract, especially as regards liability for a debt. However, a ‘surety’ would more correctly be referred to in German law (BGB) as a Bürgschaft, not a Garantie.
The bank acts as guarantor for an obligation of the debtor for Guarantee/Surety. Both this transactions have in common is the bank's promise to guarantee the payment of a debt or the performance of a service if the debtor fails to meet its contractual debtor fails to meet his contractual obligations.
With this promise, the bank undertakes to pay a maximum defined amount if the conditions of the Guarantee/Surety are met.
Bürgschaft vs Guarantee
The main difference between them is that the 'Guarantees' are subject to the international guidelines URDG rules(Uniform Rules for Demand Guarantees) where the obligation of the bank issuing the guarantee is
independent of the underlying contract or reason for default.
'Bürgschaft' on the other hand does not subject to any URDG rules and is governed by the local laws of Germany. This Guarantee constitutes, and is intended by the Guarantor to constitute, an unlimited non-accessory undertaking. This instrument is usually issued when both Applicant and the Beneficiary resides in the same country and where the German Civil Code (BGB) only is applicable.