Extend or Pay- URDG Art 23(b)

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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Sabrina
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Extend or Pay- URDG Art 23(b)

Post by Sabrina »

Dear Experts,

Request you to throw some light on article 23(b) of URDG 758 which reads as:

"Where, following such suspension the guarantor makes a complying demand under the counter-guarantee that includes, as an alternative, a request to extend the expiry , the counter guarantor may suspend payment for a period not exceeding four calendar days less than the period during which payment of the demand under the guarantee was suspended."

Regards,
Nitin
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picant
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together with 23 a

Post by picant »

Hi Pal,

I have a note that in case of counter-guarantee, being this one a separate undertaking a demand is necessary but the suspension is 4 days less the 30 calendar days, so 26 days to pay or extend .This time is necessary for a guarantor, i.e. a bank, to start a process to extend the credit facility.
Other comments appreciated
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hatrung317
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URDG 758, Sub-article 23(b)

Post by hatrung317 »

Hi,
I'm confused with the phrase "a period not exceeding four calendar days less than the period during which payment of the demand under the guarantee was suspended". Does it mean (a period not exceeding four calendar days less than) the perod during ...; or a period not exceeding (four calendar days less than the period during ...). For example: if the payment for a complying demand under the guarantee is suspended for 30 calendar days. By the first meaning the period of suspending a payment for a complying demand under the counter-guarantee must be atleast 26 days, while by the second meaning this period must be atmost 26 days.
Thanks in advance for any clarification!
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WanDan
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URDG Art 23 (a) + (b)

Post by WanDan »

Hi,

IMHO picant's interpretation is correct (utmost 26 calender days).

Cheers,
Dan
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