Counter Guarantee Subject to URDG 758

With the introduction of Uniform Rules for Documentary Guarantee or URDG 758, the rules for Documentary Guarantee seem to be popular again. It can be imagined from the increasing number of questions that have popped up in recent days. Documentary Guarantee Forum is an effort to develop a platform to discuss these questions.
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CDCS2009
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Counter Guarantee Subject to URDG 758

Post by CDCS2009 »

Hi,

as per URDG758 article 1b,

Where, at the request of a counter-guarantor, a demand guarantee is issued subject to the URDG, the counter-guarantee shall also be subject to the URDG, unless the counter-guarantee excludes the URDG.

Now if the say Bank A issued a counter guarantee in favor of Bank B asking to issue a demand guarantee in favor of beneficiary C. The counter guarantee issued by Bank A is in SWIFT MT 760 and field 40C shows ISPR / None / Othr.

that is anything but URDG. now if bank B issues a demand guarantee subject to URDG, then will the counter guarantee be converted to "subject to ISPR"?
abrar
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URDG758

Post by abrar »

This covers the situation where a counter-guarantor requests issuance of a guarantee subject to URDG758, but is silent as regards its own counter-guarantee.

If the counter-guarantee is subject to say ISP98, (i.e an implied exclusion of URDG758) and the guarantee is requested to be issued subject to URDG758, the guarantor has the choice of complying or seeking an amendment to the counter-guarantee in respect to the rules.
Jackie
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ISP98

Post by Jackie »

Except you would not be issuing a Guarantee subject to ISP98 as this refers to Standby Letters of Credit which are not the same as a Guarantee.
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Guarantee

Post by abrar »

Granted not ideal, but actually, there is no hard and fast rule. It is possible, (and I've seen it happen) to incorporate ISP98 or UCP600 under a demand guarantee, if the parties agree, and it suits their purpose.
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thanks

Post by mustafadogan »

vey valuble information
thank you all

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mentis
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ISP98

Post by mentis »

Can i find an soft copy of ISP98 on the net?
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kimsindberg
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Copy right!

Post by kimsindberg »

Hi Mentis,

ISP98 is protected by copyright :-)

Best regards
Kim
www.remburs.com
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