Unconditional standby L/C

General questions regarding UCP 600
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Shahed
Posts: 168
Joined: Fri Apr 05, 2019 5:26 pm

Unconditional standby L/C

Post by Shahed » Fri Oct 16, 2015 1:00 am

Sometime banks are requested to issue a Standby L/C (subject to the UCP600) like - We hereby issue our irrevocable unconditional standby letter of credit...

Is there any problem to use the word "unconditional" in the manner stated above?

ISP98 defines what unconditional means, but nothing in the UCP600.

Your thoughts, please.

Shahed
Toronto
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asamaha
Posts: 197
Joined: Fri Apr 05, 2019 5:16 pm

Unconditional standby L/C

Post by asamaha » Thu Oct 29, 2015 12:00 am

An unconditional standby should logically be interpreted as an undertaking of payment at a certain future date without any conditions. But if documents are to be presented for payment of standby amount, then the term ‘unconditional’ would have no meaning and be ignored, as the condition of presentation of documents should prevail just as for standbys issued subject to ISP.

Regards
Antoine Samaha
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