A US judge has ordered the Royal Bank of Scotland (RBS) to stop using trade finance software supplied by Complex Systems.

The web-enabled platform created by the US-based software house is used to process letters of credit (L/Cs) and guarantees amongst other transactions.

Legal wrangle

New York district judge Katherine Forrest ordered RBS to stop using the Complex Systems' BankTrade software for new trade finance transactions within 60 days and completely within a year.

The ruling ends a six year legal battle that began in 2007 after RBS acquired Dutch banking giant, ABN Amro.

No license transfer

ABN Amro's one-time US subsidiary, LaSalle, licensed BankTrade from Complex Systems but the Dutch institution sold LaSalle to Bank of America in a bid to scupper the RBS takeover.

Subsequently, RBS failed to transfer the BankTrade license but continued to use the software.

Damages expected

Forrest said the UK-headquartered bank could "not continue benefitting from its blatant and ongoing infringement simply because stopping that infringement will be disruptive to its business." A hearing on damages is scheduled for 5 June.

As well as providing web-enabled processing for documentary credits, including standby L/Cs and bank guarantees, the software also supports collections, remittances, shipping guarantees, trade loans, reimbursements, bonds and Islamic banking

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