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Standby Letter Of Credit And Bank Guarantee
"I need a Standby Letter of Credit and Bank Guarantee document for a construction project in Manila, with a value of 50 million Philippine Pesos, expiring in March 2025, where our company is the applicant and the local government is the beneficiary."
1. Parties: Identification of the issuing bank, the applicant (account party), and the beneficiary
2. Background: Context of the transaction and the underlying relationship between the applicant and beneficiary
3. Definitions: Key terms used throughout the document including banking terms, financial definitions, and technical terminology
4. Amount and Currency: Specification of the maximum amount of the credit/guarantee and the currency of payment
5. Effective Date and Expiry: Clear statement of when the instrument becomes effective and its expiration date
6. Conditions for Drawing: Specific conditions and documentation required for the beneficiary to make a claim
7. Form of Demand: The precise format and requirements for making a valid demand under the instrument
8. Payment Terms: Timeline and method of payment upon receipt of a complying demand
9. Bank's Obligations: Scope and nature of the bank's commitment and obligations
10. Applicant's Counter-Indemnity: Applicant's obligation to reimburse the bank for payments made under the instrument
11. Governing Law and Jurisdiction: Specification of Philippine law as governing law and jurisdiction for disputes
12. Notices: Communication procedures and contact details for all parties
13. Assignment and Transfer: Rules regarding the transferability of rights under the instrument
1. Multiple Currency Provisions: Include when the instrument allows for payment in multiple currencies
2. Automatic Extension Clause: Include when the instrument has provisions for automatic renewal
3. Reduction Schedule: Include when the amount of the credit/guarantee reduces over time according to a predetermined schedule
4. Counter-Guarantee Provisions: Include when there is a counter-guarantee from another bank
5. Syndication Provisions: Include when multiple banks are involved in providing the facility
6. Electronic Presentation: Include when electronic presentation of documents is permitted
7. Force Majeure: Include specific force majeure provisions beyond standard UCP 600 provisions
8. Anti-Money Laundering Compliance: Include specific AML provisions when required by the transaction structure
1. Schedule 1 - Form of Demand: Template for the beneficiary to make a complying demand
2. Schedule 2 - Required Documents: List and format of supporting documents required for a valid drawing
3. Schedule 3 - Fee Schedule: Details of all applicable fees, charges, and commission
4. Schedule 4 - Authorized Signatories: List of persons authorized to act on behalf of each party
5. Appendix A - Underlying Contract Reference: Key details of the underlying contract or obligation being guaranteed
6. Appendix B - Special Conditions: Any special conditions or requirements specific to the transaction
7. Appendix C - Communication Procedures: Detailed procedures for communications between parties
8. Appendix D - Reduction Schedule: If applicable, detailed schedule of amount reductions over time
Authors
Banking and Financial Services
International Trade
Construction and Infrastructure
Manufacturing
Energy and Utilities
Telecommunications
Real Estate Development
Mining and Natural Resources
Transportation and Logistics
Government and Public Sector
Import/Export
Retail and Consumer Goods
Legal
Finance
Treasury
Risk Management
Compliance
International Trade
Corporate Banking
Credit Administration
Documentation
Trade Operations
Project Finance
Chief Financial Officer
Treasury Manager
Trade Finance Manager
Credit Risk Officer
Legal Counsel
Compliance Officer
Banking Relationship Manager
Finance Director
Corporate Banking Officer
Trade Finance Specialist
Risk Management Officer
International Business Manager
Financial Controller
Documentary Credits Manager
Senior Banking Executive
Project Finance Manager
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