How to Avoid Risk in
The ICC Uniform Rules for Bank-to-Bank Reimbursements under Documentary Credits (URR 525) was effective on July 1, 1996. As these Rules originate from the USA banking practice, bankers in your country may not be familiar with the underlying concepts of certain articles. Mr. T. O. Lee of Canada, with active involvement in the USA, brings to your country the USA practice and highlight the risks associated with bank-to-bank reimbursements under L/C and the ways to avoid them. Cases studies will be used to illustrate those areas usually neglected or abused by the banks, particularly on reimbursement instructions, reimbursement authorization, reimbursement undertaking and the related amendments, of which a crystal clear concept must be acquired to avoid reimbursement disputes.
- The USA banking practice and its influence to the URR 525 Rules.
- Disagreement amongst the bankers on the contents of certain articles during the drafting stage of the URR 525 Rules.
- The roles and obligations of the issuing bank, the reimbursing bank and the claiming bank.
- Precise ICC interpretation of articles in the URR 525.
- Common negligence and abuse of certain articles of the URR 525 Rules.
- Risk free "best practice" to deal with reimbursement instructions, pre-notification, pre- debit notification, sight and timed drafts, claiming amount, interest, charges, additional payment instructions and various amendments.
- Checklists for the parties.
- Problems of expiry dates in the L/C, the reimbursing authorization and the reimbursement undertaking.
- Reimbursement authorizations separate from the L/C itself.
- Reimbursing bank has no obligation to honour reimbursement claims.
- Certificate of compliance presented to the right party.
- Amendment and cancellation of reimbursement authorization.
- Reimbursement undertaking v. confirmation of L/C.
- How to make an effective reimbursement claim.
- How to resolve disputes arising from the URR 525 Rules.
Mr. T. O. Lee, FAE, MCIArb, MITD
|(905) 237-6465||Please send email instead|