Demand guarantees are crucial instruments in international trade, providing security and assurance to beneficiaries. However, the intricacies of these instruments can sometimes lead to discrepancies and non-compliant demands, causing delays and potential disputes. Fortunately, the International Standard Demand Guarantee Practice (ISDGP) provides clear guidelines on how to rectify such situations. Understanding Non-Compliance A demand is deemed non-compliant when it fails to adhere to the specific terms and conditions outlined in the guarantee. This could range from simple errors in documentation to more substantial deviations from the agreed requirements. When a guarantor identifies a non-compliant demand, they must reject it, triggering a process for potential correction. The Beneficiary's Right to Correct Crucially, the ISDGP acknowledges the beneficiary's right to rectify non-compliance. Even if the guarantee explicitly excludes Article 17(b), the beneficiary is still permit...
Conduct a thorough assessment of the customer's identity, business, industry, and financial requirements. Know Your Customer (KYC) is a critical process for banks to identify, verify, and record the identity of their customers. Internal Sources Account Opening Information: Personal or Corporate Information: Collect detailed information about the customer's identity, address, occupation, and business activities. Supporting Documents: Verify the authenticity of documents such as identification cards, passports, proof of address, and business registration certificates. Source of Funds: Inquire about the source of funds and obtain supporting documentation. Beneficial Ownership: Identify the ultimate beneficial owner(s) of the account and collect necessary information. 2. Credit History: Internal Records: Review the customer's credit history within the ...