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UN Draft Convention on Independent Guarantees and Stand-by Letters of Credit

INTRODUCTION

CHAPTER I. - SCOPE OF APPLICATION

Article 1. - Scope of application

Article 2. - Undertaking

Article 3. - Independence of undertaking

Article 4. Internationality of undertaking

CHAPTER II. - INTERPRETATION

Article 5. - Principles of interpretation

Article 6. - Definitions

CHAPTER III. - EFFECTIVENESS OF UNDERTAKING

Article 7. - [Issuance] [Establishment] of undertaking

Article 8. - Amendment

Article 9. - Transfer of beneficiary's right to demand payment

Article 9 bis. - Assignment of proceeds

Article 10. - Cessation of effectiveness of undertaking

Article 11. - Expiry

CHAPTER IV. - RIGHTS, OBLIGATIONS AND DEFENCES

Article 12. - Determination of rights and obligations

Article 13. - [Standard of conduct and] liability of guarantor/issuer

Article 14. Demand

Article 16. Examination of demand and accompanying documents

Article 17. - Payment or rejection of demand

Variant B

Variant C

Variant D

Article 18. - [get]

Article 19. - Improper demand

Article 20. - Set-off

CHAPTER V. - [PROVISIONAL COURT MEASURES]

Article 21. Provisional court measures

CHAPTER VI. - JURISDICTION

Article 24. - Choice of court or arbitration

Article 24 bis. - Jurisdiction of other courts

Article 25. - Determination of court jurisdiction

Article 25 bis. - Relationship to other treaty arrangements

CHAPTER VII. - CONFLICT OF LAWS

Article 26. - Choice of applicable law

Article 27. - Determination of applicable law

Metadata

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Manifest

SiSU Manifest, alternative outputs etc.

UN Draft Convention on Independent Guarantees and Stand-by Letters of Credit

United Nations (UN)

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UN Draft Convention on Independent Guarantees and Stand-by Letters of Credit

CHAPTER IV. - RIGHTS, OBLIGATIONS AND DEFENCES

Article 17. - Payment or rejection of demand

(1) Subject to paragraph (2) of this article, the guarantor/issuer shall pay against a demand made in accordance with the provisions of article 14. Following a determination that a demand for payment so conforms, payment shall be made promptly, unless the undertaking stipulates payment on a deferred basis, in which case payment shall be made at the stipulated time.

(1 bis) Any payment against a demand that is not in accordance with the provisions of article 14 does not prejudice the rights of the principal/applicant.

(2) Where the guarantor/issuer is shown facts that make the demand manifestly and clearly improper according to article 19, it [ shall not make payment] [may nevertheless decide to make payment, provided it acts in conformity with paragraph (1) of article 13].

[ Note to the Working Group: The remainder of article 17, which was not considered at the twenty-first session, is reproduced as it appeared in A/CN.9/WG.II/WP.80.]

(3) If the guarantor or issuer rejects the demand [on any ground referred to in paragraphs (1) and (2) of this article], it shall promptly give notice thereof to the beneficiary by teletransmission or, if that is not possible, by other expeditious means. Unless otherwise stipulated in the guaranty letter, the notice shall indicate the reason for the rejection. [(4) Variant A If the guarantor or issuer fails to comply with the provisions of article 16(2) or of paragraph (3) of this article, it is precluded from invoking any discrepancy in the documents not discovered or not notified to the beneficiary as required by those provisions.


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