爱华网具备银行保函功能的备用信用证，其实最近在翻译《国际商会工厂交钥匙合同范本》这本书过程中，也遇到 standbyL/C作为预付款和履约保函替代方案，一位伊朗做工程的朋友称他们在用信用证作为预付款保函，我才觉得对这个问题值得大家好好学习。但既然国外对备用信用证作为保函的功能已经有详述，那我就不多说了，直接引文分享给大家。大家也可以看看百度百科中备用信用证的阐述。
What is a standby letter ofcredit?
A Standby Letter of Credit(called“SLC or “LC” ) are written obligationsofan issuing bank to pay a sum of money to a beneficiary on behalfoftheir customer in the event that the customerdoes not pay thebeneficiary. Itis important to note that standby letters of creditapplyonly whenever the issuing bank's commitmentto pay is not contingenton the existence,validity and enforceability of it’s customer’sobligation;this is called an “abstract”guarantee; that is, the bank’s obligation istopay regardless of any disputes between itscustomer and thebeneficiary.The issuance of letters of credit is a privatetransactionand does not result in the issuance ofany public trading securities.
Why do we have standby letters ofcredit?
The standby letter of credit comesfrom the banking legislation of theUnited States,which forbids US credit institutions fromassumingguarantee obligations of third parties.(Most other countries outsideofthe USA continue to allow bank guaruntees.)To circumvent this USbankingrule, the US banks created the standby letter of credit, whichisbased on the uniform customs and practice fordocumentary credits. In1998 theInternational Chamber of Commerce (ICC)addedISP98(International Standby Practices98)(详见链接)as the rules to guidestandbyletters of credit. Theserules are slowly being adopted; however,many ofthe standby letters of credit continue to rely on the ICC’solderguide, Uniform Customs and Practices forDocumentary Credits, 1993revision, ICCPublication 500.
Who are the parties to the standbyletter of credit?
(1) The Applicant.This is the customer of the bank who applies tothebank for the standby letter of credit.He must provide collateral tothebank or have sufficient credit to induce thebank to issue theinstrument. Healso must pay the bank a fee for issuing the instrument.
(2) The Issuing Bank.This is the applicant’s bank that issuesthestandby letter of credit.
(3) The Beneficiary.This is the party in whose favor the instrumentisissued.
(4) ConfirmingBank. This is a bank (usually located nearthebeneficiary) that agrees (confirms) to pay thebeneficiary rather thanhave the issuing bank paythe beneficiary. The beneficiary paystheConfirming Bank a fee for this convenience.The Confirming Bankthencollects from the Issuing Bank the amountpaid to the beneficiary.
(5) Advising Bank.This is the bank that represents the beneficiary.Itmay accept the letter ofcredit on behalf of the beneficiary and collectonit on behalf of the beneficiary. In order for thetransaction to be abank-to-bank transaction, theadvising bank works for the beneficiaryto keepthe instrument in the banking system. Sometimesthe AdvisingBank also is the Confirming Bank, butnot always.
What is the purpose of the standbyletter of credit?
The standby basically fulfills thesame purpose as a bank guarantee: itis payableupon first demand and without objections or defensesonthe basis of the underlying transaction betweenthe applicant and thebeneficiary. It is up to thebeneficiary to decide whether he may acceptastandby.
What are the types of standbyletters of credit?
(1) Performance Standby.This instrument supports an obligationtoperform other than to pay money including thepurpose of coveringlosses arising from a defaultof the applicant in completion of theunderlyingtransaction.
(2) Advance Payment Standby.This instrument supports anobligationto account for an advance payment madeby the beneficiary to theapplicant.
(3) Bid Bond/Tender Standby.This standby supports an obligationofthe applicant to execute a contract if theapplicant is awarded a bid.
(4) Counter Standby.This instrument supports the issuance ofaseparate standby or other undertaking by thebeneficiary of thecounter standby.
(5) Direct Pay Standby.This instrument serves to supportpaymentwhen due of an underlying paymentobligation typically in connectionwith afinancial standby without regard to default. Thisstandby is alsoused to directly pay an obligationwhere the only conditions of paymentare thepassage of the term and presentment of payment.
(6) Insurance Standby.This instrument is an insurance orreinsuranceobligation of the applicant.
(7) Commercial Standby.This is the most used standby anditsupports the obligations of an applicant to payfor goods or services inthe event of non-paymentby a business debtor.
Arestandby letter of credits transferable?
Assignment of Standby letter ofcredit proceeds -The beneficiary canassign theproceeds of a standby letter of credit. But thisassignmentdoes not assign the rights of thebeneficiary as “drawer” on thestandby letter ofcredit, and only the beneficiary may exercisethe“drawer” rights and present the demand forpayment under the termsof the standby letter ofcredit unless the terms of the instrumentprovideotherwise. This means that the assignee mayreceive theproceeds of the standby, but in orderto obtain those proceeds thebeneficiary mustfirst make the demand for payment. This alsomeansthat the beneficiary can sell by assignment,at discount, the benefits ofthe standby.An assignment of proceeds requires notice to theissuingbank of this action; otherwise the issuingbank would pay thebeneficiary rather than theassignee.
Transfer of Standby letter ofcredits. Standby letter of credits canbetransferred to a third party ONLY with thewritten consent of theissuing bank AND thebeneficiary.
Arestandby letter of credits the subject of trading?
There is no public market for thetrading of standby letters of credits.
Standbyletters of credits can only be transferred or theproceedsassigned in private transactions (aspreviously noted above).
Standby letters of credit do not haveCUSIP or ISIN numbering.
Standbyletters of credits are not trading securities, tradingdebtinstruments, or trading investment funds, andtherefore are notsubject to the rules andregulations of the Security andExchangeCommission.
