The Karnataka Ceiling on Government Guarantees Act, 1999

The Karnataka Ceiling on Government Guarantees Act, 1999

The Karnataka Ceiling on Government Guarantees Act, 1999 establishes fiscal discipline by imposing a legal cap on financial guarantees issued by the Karnataka State Government. It applies to guarantees backed on behalf of public sector undertakings, local authorities, statutory bodies, and co-operative institutions. Under the law, total outstanding state guarantees cannot exceed eighty percent of the state's revenue receipts from two years prior. It strictly prohibits guarantees for private entities and requires a minimum non-refundable commission of one percent on guarantees provided. By controlling state contingent liabilities, the Act protects public funds, promotes transparency, and mandates legislative reporting for major infrastructure commitments.

PDF: pending for this language.