������Ƶ

The Irrevocable Letter of Guarantee is a crucial financial instrument in Philippine business transactions, commonly used to provide security in commercial contracts, tender submissions, and performance obligations. This document, strictly regulated under Philippine banking laws and BSP circulars, represents a bank's unconditional commitment to pay a specified sum to a beneficiary if the principal fails to meet their obligations. It's particularly important in large-scale projects, international trade, and government contracts where financial security is paramount. The document must be carefully structured to ensure enforceability under Philippine law while meeting international banking standards. Common uses include bid bonds, performance bonds, advance payment guarantees, and payment security in commercial contracts. The irrevocable nature means it cannot be modified or cancelled without the beneficiary's consent, providing robust protection for the guaranteed party.

1. Letter Header: Bank's letterhead, date, reference number, and addressing details of the beneficiary

2. Subject Line: Clear identification as an 'Irrevocable Letter of Guarantee' with reference to the underlying transaction

3. Opening Statement: Formal introduction identifying the bank as guarantor, the principal (applicant), and the beneficiary

4. Guarantee Amount: Explicit statement of the guaranteed sum in both figures and words, including currency

5. Underlying Transaction: Description of the primary contract or obligation being guaranteed

6. Scope of Guarantee: Detailed description of what is being guaranteed and under what circumstances

7. Duration and Validity: Explicit statement of the guarantee period, including effective date and expiry date

8. Demand Requirements: Specific conditions and procedure for making a claim under the guarantee

9. Payment Terms: Timeline and method of payment upon receipt of a valid demand

10. Irrevocability Statement: Clear statement that the guarantee is irrevocable and independent from the underlying transaction

11. Governing Law and Jurisdiction: Specification of Philippine law as governing law and jurisdiction for disputes

12. Authorized Signatures: Space for bank officials' signatures with their names and designations