certificate of compliance and URR 725

[jim]

dear sir,

i am confused with this URR clause

An issuing bank shall not require a certificate of compliance with the terms and conditions of the credit in the reimbursement authorization.

does this clause mean that issuing bank is looking for certificate of compliance from reimbursing bank

or

does this mean that reimbursing bank will require a certificate of compliance from the claiming bank before making a reimbursement?

[Judith]

This refers to the issuing bank asking the reimbursing bank to pay only if the claiming bank certifies that all terms and conditions comply with the credit. The reimbursing bank is not a party to the credit. Its primary responsibility is to pay on receipt of a claim that complies with the reimbursement authorisation.

In my opinion, the inclusion of the sub-article is to try and break the link which the issuing bank tries to impose on the reimbursing bank.