A back-to-back guarantee is a working term in trade finance for a pair of linked bank guarantees: the applicant's own bank issues a guarantee in favour of a bank in the beneficiary's country, and that local bank, relying on it, issues its own guarantee to the beneficiary. The first instrument is the counter guarantee, explained in full in its own entry, and the arrangement as a whole is more formally called an indirect guarantee.
The structure is common where a buyer or public authority insists on a guarantee from a bank in its own country, for example in construction contracts or tenders that call for a performance bond or a bid bond. Under the ICC's Uniform Rules for Demand Guarantees (URDG 758), each instrument is independent: the local bank must pay a compliant demand from the beneficiary and then claims under the counter-guarantee.
The phrase should not be confused with a back-to-back letter of credit, where a trader uses an incoming credit as support for a second credit to its own supplier. A standby letter of credit can also serve as the counter-undertaking.