Commentary

18 Standby letters of credit

BANKING vol 4(1)
| Commentary

18 Standby letters of credit

| Commentary

18 Standby letters of credit

For a documentary credit constituting a ‘standby letter of credit’, there is an alternative procedure available1. The International Chamber of Commerce has established the ‘International Standby Practices, ISP 98’, which apply if specifically adopted in the standby letter of credit. The ISP simplifies, standardises and streamlines the drafting of standbys, and provides clear and widely accepted answers to common problems. However most bankers continue to use the UCP relevant form (presently UCP 600) with which they were familiar, rather than incorporating the specific rules relating to standby letters of credit. It is expected

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