ICC Digital Library Forum

Can you give some information about silent confirmation,since one of customers requests such a transaction and It is not commonly used,thus not well known.
Thank you

Opinion R207, issue 2, has something to say on the matter.

Dear Esra,silent confirmation means confirmation added by advising/negotiating bank at the special request of the bnf and without knowledge of the issuing bank, under a l/c that doesn't ask for l/c to be confirmed.
It is not a confirmation in a technical sense of the word. When adding a silent confirmation,the bank that acted so is not udner protection of UCP500 and cannot invoke,no matter what,the art.9b and 9d provisions.
You may say is more a guarantee to pay than a confirmation.
The risk covered relates only to the relationship between bnf and the bank that confirm so.
Bogdan

Bogdan,

I would expect a nominated bank -per sub-Art. 10(b)(i)- that had given a ‘silent confirmation’ -the most common ‘silent confirmation’ occurrence in my experience- would be able to claim the rights of a nominated bank against an issuing and any confirming bank under sub-Art9(a)/(b) / sub-Art14(a). Such a 'confirmation' I would describe as a ‘documentary, bank & sovereign risk undertaking’. Obviously, the position is quite different when one is not a nominated bank and one is giving a ‘bank & sovereign risk (only) undertaking’.

Jeremy

[edited 9/11/2006 2:19:04 PM]