Short answer. It is an extra fee a commission agent receives on top of his ordinary commission, and in exchange he bears the risk of collection. If the buyer never pays, the agent must still pay the principal the proceeds of the sale, on the same terms that were agreed with that buyer.
What the law says
Should the commission agent receive on a sale, in addition to the ordinary commission, another called a guarantee commission, he shall bear the risk of collection and shall pay the principal the proceeds of the sale on the same terms agreed upon with the purchaser.
Civil Code, Article 1907 — Guarantee Commission (Del Credere). Read the full provision →
The extra fee, and what it buys
A commission agent sells goods for someone else and takes a commission for doing so. Article 1907 describes what happens when he takes a second fee on top: Should the commission agent receive on a sale, in addition to the ordinary commission, another called a guarantee commission, he shall bear the risk of collection and shall pay the principal the proceeds of the sale on the same terms agreed upon with the purchaser. The extra fee is the one often called del credere. In everyday terms, the agent is being paid to stand behind the buyer's payment.
What the agent is taking on
He bears the risk of collection. If the buyer defaults, disappears or turns out to be insolvent, that is the agent's problem and not the principal's — the principal is still to be paid. This is precisely what the extra commission pays for: it prices the shift of a credit risk from the owner of the goods to the person who found and chose the buyer. It also explains a knock-on effect worth having. An agent carrying that risk has every reason to screen buyers carefully, and a principal who agrees to it is buying the agent's judgment as much as his effort.
The timing does not change
Note the closing words: he pays on the same terms agreed upon with the purchaser. A guarantee commission does not convert a credit sale into a cash sale, and it does not entitle the principal to the money sooner than the buyer was due to pay. What it secures is that payment will come, not that it will come early. Nor does it make the agent answerable for everything that could go wrong. It addresses collection of the price; disputes about the goods themselves, or about the principal's own obligations to the buyer, fall outside it.
Put it in writing
Because the arrangement costs the principal money and exposes the agent to real loss, it should be explicit. Record that a guarantee commission is being paid, at what rate, and which sales it covers. Say what happens on partial payment, or where the buyer's schedule is later renegotiated. Both sides should keep the sale documents, since the agent's liability is measured by the terms actually agreed with the purchaser. Where an agent refuses to pay after a buyer defaults, the claim is an ordinary civil one and is subject to time limits, so raise it promptly rather than waiting to see whether the buyer recovers.