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Counter Standby Letter Of Credit Template for Singapore

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Key Requirements PROMPT example:

Counter Standby Letter Of Credit

"Need a Counter Standby Letter of Credit to be issued by DBS Bank Singapore in favor of HSBC Hong Kong, backing an existing SBLC worth USD 5 million for a construction project, with validity until March 2025."

Document background
Counter Standby Letters of Credit are essential instruments in international banking and trade finance, particularly when multiple jurisdictions are involved. Under Singapore law, this document type provides a bank-to-bank guarantee that backs an existing Standby Letter of Credit, effectively creating a chain of security. The Counter SBLC contains specific terms regarding the amount, validity period, drawing conditions, and the circumstances under which it can be called upon. It's commonly used in complex international transactions where multiple layers of security are required, especially when dealing with cross-border transactions or when local banking regulations require additional guarantees.
Suggested Sections

1. Issuing Bank Details: Complete identification and contact information of the bank issuing the Counter SBLC

2. Original SBLC Reference: Details and reference numbers of the original SBLC being counter-guaranteed

3. Beneficiary Information: Complete identification and contact information of the beneficiary bank

4. Amount and Currency: Specification of the Counter SBLC amount and currency, including any automatic adjustment mechanisms

5. Validity Period: Clear statement of the effective date and expiry date of the Counter SBLC

6. Drawing Terms and Conditions: Detailed conditions and procedures for making a valid drawing under the Counter SBLC

7. Governing Law and Jurisdiction: Specification of Singapore law as governing law and jurisdiction for dispute resolution

Optional Sections

1. Automatic Extension Clause: Optional provision for automatic extension of the Counter SBLC validity under specified conditions

2. Partial Drawing Provisions: Optional terms allowing and regulating partial drawings under the Counter SBLC

3. Transfer Restrictions: Optional clause specifying any restrictions on transferability of the Counter SBLC

4. Force Majeure: Optional provisions dealing with circumstances beyond reasonable control affecting the Counter SBLC

Suggested Schedules

1. Schedule 1 - Form of Demand: Standard template for making a compliant demand under the Counter SBLC

2. Schedule 2 - Original SBLC: Copy of the original SBLC being counter-guaranteed

3. Schedule 3 - Authentication Requirements: Specified documentation and procedures required for authenticating demands

4. Schedule 4 - Fee Schedule: Details of all applicable fees, charges and commission rates

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions

























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Industries

UCP 600: Uniform Customs and Practice for Documentary Credits - Primary international rules governing letters of credit operations

ISP98: International Standby Practices - Comprehensive framework of rules for standby letters of credit

URR 725: Uniform Rules for Bank-to-Bank Reimbursements under Documentary Credits - Rules governing reimbursement arrangements between banks

Bills of Exchange Act: Singapore Chapter 23 - Legislation governing negotiable instruments including certain aspects of letters of credit

Banking Act: Singapore Chapter 19 - Primary legislation governing banking operations and regulations in Singapore

Monetary Authority of Singapore Act: Legislation establishing MAS and its regulatory powers over financial institutions including letter of credit operations

Contract Law: Singapore Chapter 53B - Fundamental legislation governing contractual relationships and obligations

MAS Notice 643: Regulatory notice governing transactions with related parties in banking operations

MAS Notice 632: Regulatory requirements for banking arrangements with correspondent banks

Banking Credit Card Regulations: Regulations governing banking operations related to credit facilities and payment instruments

Singapore Case Law: Relevant Singapore court decisions establishing precedents for letter of credit operations

English Common Law Principles: Relevant English court decisions that influence Singapore's common law approach to letters of credit

SWIFT Standards: International messaging standards and requirements for bank-to-bank communications in letter of credit transactions

ICC Guidelines: International Chamber of Commerce guidelines for international banking operations and trade finance

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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