A Guild War is a state of overt conflict between two or more guilds. Participating guilds usually fight with the desire to annihilate the enemy guild(s).
The Magic Council has forbidden Legal Guilds from having guild wars with each other. Though, Legal Guilds are allowed to declare war on Dark Guilds without fear of retribution from the Council, however they must still notify them of it. This is most likely done in order to lower the high number of Dark Guilds.
Prior to these events, in X679, Guild Wars were common as Legal Guilds fought over commercial rights, land and establishments.
Eventually, in X692 at the end of the Second Trade War with the humongous toll of death from warring feudal lords and guilds fighting over trading rights in the aftermath, the Magic Council has passed the Interguild Dispute Interdiction Treaty that forbids all and every guild from waging war against one or another for whatever reason, marking a beginning of a short era of peace.