Issuance of a Standby LC without UCP or ISP

[Shahed]

Is there any problem if we issue a standby L/C without inserting ICC rules (i.e. UCP or ISP) ?

Regards,

[JimBarnes]

This is not a problem if the SLC is issued with an effective choice of law clause choosing the law of a state in the US, because we have codified uniform state letter of credit law. Otherwise, there would be numerous problems starting with whether the undertaking qualifies as "independent".

Regards, Jim Barnes

[Shahed]

This SBLC will be issued out of Canada, and shall be governed by and construed in accordance with the laws, customs and regulations which may be in force in any place of payment thereof.

[NigelHolt]

The considerations are, I would anticipate, essentially the same as where issuing a 'demand guarantee' not subject to any ICC rules (a common occurence in Canada I would imagine).

[JimBarnes]

A choice of law clause in the undertaking that refers to the place of payment is itself a problem. Unless the undertaking specifies the place of payment, that place might include any place where the beneficiary demands that funds be wire transferred.

Regards, Jim Barnes