Advising of amendment of Guarantee

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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Advising of amendment of Guarantee

Post by CDCS2009 »

hi,

while UCP600 insists that any amendment of the letter of credit must be advised though the same channel as that of the LC, why URDG offer a leverage in article 10?
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shahriar
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party vs bank

Post by shahriar »

In UCP600, the LC is issued and advise only by the bank. but URDG allows any party (any person or company) to advise a credit. practically any person or business has higher probability to be out of business compared to a bank especially considering the fact that a guarantee often lasts over a long period. hence URDG allows this leverage.

more comments welcome
leekaiyin55
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Advising of amendment of Guarantee

Post by leekaiyin55 »

Dear Shahriar

Your view makes sense although I am not sure if it is the original intention of the drafters.

One more idea is that BG tends to be secondary payment instructment and negotiation is not covered under URDG758. The role of advising party is more of verifying the genuineness of the BG only.

Any further comments?
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