Claim for counter guarantee subject to URDG

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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moneo
Posts: 17
Joined: Sat May 25, 2013 9:52 pm
First Name: MOUSA
Last Name: ALMOUSA
Organization: ALAWWAL BANK
Filter: Two Plus Two =: 4
Location: SAUDI ARABIA

Claim for counter guarantee subject to URDG

Post by moneo »

Dears,
we have received claim to liquidate/pay our counter guarantee which is subject to URDG758. the case is we are unable to remit the value of this guarantee as our NOSTRO account with the beneficiary bank has been freeze by our compliance
due to political issues.
whats is our liability or responsibility as per the URDG758. kindly advise

Thanks all in advance
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picant
Posts: 1942
Joined: Wed Aug 20, 2008 1:49 pm

Re: Claim for counter guarantee subject to URDG

Post by picant »

Hi Pal,

if a bank is issuing a bank guarantee under your counter guarantee it is granting you a credit line.
Many credit line remain not rembursed due to various grounds, one is a so called political risk.
I know that when the Debtor Country is newly accepted to act, many creditors require the settlemenr of old positions. So in your case due to political reasons the account has been freezed but your debt too.
Ciao
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