Definition of the letter of guarantee: -

Is a written undertaking issued by the Guarantor Bank on the instructions his client (the bidder - supplier - seller Applicant), undertakes whereby the bank to pay a specified cash amount for the benefit of a third party (the beneficiary Beneficiary) when the first request from the beneficiary, regardless of any opposition from the client side, or any another party during a specified period of time.





Letter of Guarantee characteristics: -





1. a written pledge from the bank site.


2 - arranges an obligation on the bank to pay the amount of cash and no commitment to the implementation of other commitments.


3 - only a personal beneficiary of it.


4 - it may not be an endorsement nor traded or waived.


5 - issued for a specific term or determinable.


Parties to the letter of guarantee: -

1 - Client Applicant

A student, a letter of guarantee bidder or party ascribed to it compact, which requires issuance of the letter of guarantee for its own account, who pay the price of the letter of guarantee in case of non-implementation of its obligations arising from the tender or contractual obligations.


2 - Bank source FAQ Foreign Guarantor

It is the bank that issues the letter of guarantee to the expense of the client applicant and shall send it to correspondent country of the beneficiary, and ask the correspondent either Report the letter of guarantee to the beneficiary without responsibility or obligation of the reporter or required to issue or subscribe to the issuance of the letter of guarantee under the full responsibility of the Bank source FAQ .

3 - Local Bank Local Bank

It informs the letter of guarantee to the beneficiary without any liability or obligation by building on the outer bank instructions source instructions or the ratification of or issue a letter of guarantee under the full responsibility of the external bank source instructions.

4 - Beneficiary Beneficiary

It is the party that issued the letter of guarantee for him, which declared the tender or Musnad of the contract, which has the right to get on the end value of the collateral in whole or in part, in the following cases:

A - in the case of withdrawal of the tender before the end of the appointment took effect.


B - In case the bidder bidding on a mooring and has not signed the final contract or did not provide the final desired warranty.


C - in the case of non-implementation of its obligations contracted contractual.


D - in the case of non-implementation of the contracted terms of the contract that restores the amounts paid in advance or after it returned to the bank of the beneficiary of the abolition of expiration of the expiration of purpose issued for him before.


E - the Bank's commitment not to reduce the letter of guarantee only after obtaining the consent of the beneficiary of the letter of guarantee did not provide for the automatic reduction.


And - the Bank's commitment not to edit the letter of guarantee to the detriment of the beneficiary only after obtaining approval.


Basic data to be mentioned by the letter of guarantee: -





1 - the date of issuance of the speech.


2 - Type the letter of guarantee (primary - Final - downpayment).


3 - the beneficiary's full name and address.


4 - Customer Name of applicant (the unsecured).


5 - The purpose of the issuance of the letter of guarantee (No. tender / contract number).


6 - the value of the letter of guarantee.


7 - expiry date of the letter of guarantee.


Issue a letter of guarantee procedures: -

Issued letters of guarantee for foreign correspondents bank account abroad and that the bank associated with banking arrangements, and the bank's management report of the limits of his credit to correspondents issued in the scope of the required letters of guarantee, and issuance procedures are as follows: -


1 - Receives the department concerned external bank instructions, either in the form of speech in this case are validated signatures of the bank instruction source indicates it is responsible for keeping signatures models or in the form of a telex or telegram in this case is to verify that the PIN shown on the message it's true, and it indicates the section code.

2. A - if the reporter instructions is to send the letter of guarantee to the beneficiary without the commitment of the Bank shall be registered letter of guarantee in a special register prepared for this purpose and a given number indicative and sent to the recipient with a letter Facility and showing that he sends a letter of guarantee after the promotion of the signature only without any obligation or responsibility for the bank and be notified of what has been a reporter and require reimbursement of the value of commission and expenses.


(B) If the reporter is to issue instructions or to participate in the issuance of the letter of guarantee follow the procedures as follows: -


3 - Ensure allow the credit limit granted to the reporter.

4 - Make sure that the correspondent operations include contrast escrow for the benefit of the bank, which must take into account the following

A - make it clear that the bank issuing the letter of guarantee under the full responsibility of the correspondent bank and contrast Escrow allows Order when the first request and without any opposition from any party.

B - The duration of warranty expiration contrast Tved be for the period of validity of the letter of guarantee for a period of days to meet the mailing deadline to give the bank an opportunity to inform the claims-sending.


Lübeck reporter to issue a letter of guarantee in Egyptian Pounds it had to ......... reporter that in the event claim the value of the letter of guarantee, the plug will be in foreign currency equivalent of Egyptian pounds, calculated in accordance with the exchange rates of Almlnh commission banking market on payment.

D - For banks, the American continent Due to not allow US law for US banks to issue letters of guarantee that what is going on him a job in this country is to issue letters of credit is irrevocable and that's where the Egyptian side in accordance with the laws and rules applicable to be them submit a letter of guarantee.

So it on the US bank should issue the letter of credit is irrevocable for the bank allows dragging it (payment) under CEGEP telex enhanced identification number.

In the case of the US request for sending the bank a certain document from the beneficiary of the letter of guarantee that the set is obtained for the US bank in advance before the release of collateral required for agreeing to accept the sender document mailed mechanism even if the Charge it after the expiration of the letter of credit.

Also take into account that the validity of relying be valid after the expiration of the letter of guarantee for a period of not less than 10 days for possible withdrawal attic beneficiary claims which may be contained to the bank until the last day of the validity of the letter of guarantee.

5 - to make sure that the instructions include the basic data for the letter of guarantee.


6 - Make sure there are no terms of the letter of guarantee and it allows the Order at the first request of the beneficiary without any opposition from any party and in the case of a condition that can prove a document-characterized full description and passed by the beneficiary, it can issue a letter of guarantee to the attention of the beneficiary that any claim must It is accompanied by the document set out the text of the letter of guarantee.

7 - under the letter of guarantee data register prepared for this purpose and given a serial number and includes data on the record (correspondent bank - name of the beneficiary - the value of the letter of guarantee).

8 - edit the letter of guarantee from the reality of the data contained in the instructions reporter and is editing the forms prepared and signed the letter of guarantee from Ptoukiein authorized to sign them right officials.

And taken into account when editing the letter of guarantee to determine its type (Primary - Final - a down payment) and stating clearly that photo or carbon to the letter of guarantee negligible and that little well it should be returned to the bank to cancel when it expires in the case of the Bank's ratification of the letter of guarantee incoming correspondence is signed letter of guarantee of those who have the right to sign, after the addition of the following paragraph of the text:

And strengthen what you came to this guarantee within the limits stated by no later than ............)

9 - are met qualitative stamp on the letter of guarantee.

10 - Edit speech accompanied by the letter of guarantee and sent by registered mail to the beneficiary reporter what instructions did not provide for the delivery to delegate its customers.

It is preferable to clarify the speech facility any data bank sees clarified to the beneficiary if the shows do that any claim under the guarantee must be accompanied by the document set out the text of the letter of guarantee and the dangers of the recipient to open the required accreditation or transfer payment or modify the letter of credit to be fit for the exchange of it.


11 - edit a letter to the correspondent bank issued to display the letter of guarantee shows by the Bank to the implementation of his instructions to issue a letter of guarantee and the attached image letter of guarantee issued in favor of the beneficiary and calls for the bank commission and accrued expenses on the implementation of this process in cases where the bank shows the reporter that the expenses the responsibility of the beneficiary except for letters of guarantee elementary obtained the approval of the beneficiaries first for bearing commission and expenses owed to the bank with access to enhance the beneficiaries that the contract signed in this regard spend Pthmlhm such commissions and expenses are also required to beneficiaries to address a letter to the held bank has their account by accepting discount freelance twinkling It is obtained as well as the consent of the beneficiary's bank to accept the blink of an opponent at their expense.

12. Preparation card to the letter of guarantee to ensure no letter of guarantee, type and name of the correspondent and the name of the beneficiary and the date of expiration and the value of the letter of guarantee and commission earned.

13 - Conduct regular restrictions on the face follows: -

Of h / statutory accounts receivable


Correspondents commitments for letters of guarantee

To h / regular accounts payable


Bank commitments for letters of guarantee

14 - work PC form to record the issuance of automated computer security

15 - Number of file retains all the security documents.

16 - Registration of maturity letters of guarantee in a special book.

17 - Registration of maturity commission in a special book and so for letters of guarantee came bearing Amoltha each period individually.

18 - save a file letters of credit arranged Bdoulab conservation.


Amendments letters of guarantee: -

After the issuance of the letter of guarantee may need to make some adjustments in the terms of the letter of guarantee and the bank letter of guarantee to make the source of the amendment based on the bank's instructions given it The following are the most important amendments which can be a letter of guarantee: -

1 - to extend shelf life:

Originally to extend shelf life to help them to the bank source of the letter of guarantee given (local bank) from the bank given the matter based on the claim directed directly beneficial to a client in the case where the face of the beneficiary claim extended warranty expiration of the bank source can be for the bank to inform claim to correspondence provided to respond during the validity of the guarantee for instructions on them.

    D validity procedures: -

    To ensure that the letter of guarantee is valid and did not revoked the bank's commitment to a given matter.

    Make sure that the instructions received from the bank a given matter.

    Make sure that the sender instructed extended shelf life the full amount of the letter of guarantee.

    Make sure that the sender extended shelf life the same terms as the letter of guarantee instructions.

    Make sure that the instructions contained under the letter bears the signatures match and if the telegram or telex must be reinforced by a secret number.

    Make sure to extend the validity of the guarantee return, too.

    Edit a speech to the customer extended the validity of the letter of guarantee to the forms prepared for this purpose.

    Risks reporter that he was the beneficiary dangers extended the validity of the letter of guarantee and required to pay the commission owed.

    Notation in the book version of the new validity to the letter of guarantee.

    Mark entitlement agenda and the agenda of the powers guarantees the new dates for each of the maturity of the commission, the validity of the guarantee dates.

    Validity security card recording.

    Action computer form to modify the computer security Automated expires.


2 - increase the value of the letter of guarantee: -

Based on the instructions of the source of instruction, the Bank source of the letter of guarantee issued a letter addressed to the recipient that includes increasing the value of the letter of guarantee and follow the same steps version when you make increase the value of the letter of guarantee in the case of whether a request to increase the value of the security ward of the beneficiary of the guarantee Viaan informed the reporter to get the instructions on it.

3 - reducing the value of the letter of guarantee: -

Before the bank a reduction of the value of the letter of guarantee based on the bank's instructions given it must first obtaining the approval of written beneficiaries except in cases in which contains the text of the letter of guarantee that the value automatically cut a certain percentage of the value of each shipment made on the strength of Documentary on its reliance security is so often letters of guarantee payments provided in the case where a request for reduction of the question of the beneficiary of the guarantee to the bank can be implemented immediately without the need to contact the reporter on it.

Steps:

    Edit a speech to the beneficiary by reducing the value of the letter of guarantee.

    The dangers of a given bank it with a reduced commitment by the Bank to come into force the new terms.

    Conducting regular restrictions:

Of h / regulatory restrictions

Bank commitments for the letter of guarantee


To h / accounts regular city

Correspondents commitments for letters of guarantee

    Modifying the letter of guarantee card.

    Action computer form to modify the total value of the computer automated.

4. modifying the text of the letter of guarantee: -

It includes modifying some of the data contained the text of the letter of guarantee as the number of nodes - history - tender number and date, the Bank issued a letter to the beneficiaries include the required amendment, based on a given orders to issue a letter of guarantee instructions.

    Zbel the value of the letter of guarantee (confiscation):

The bank is obliged to pay the value of the letter of guarantee to the beneficiary when first asked him, provided that the claim be pounding the following conditions: -

1 - make the claim during the validity of the letter of guarantee.

2. The claim progress within the limits of the value of the letter of guarantee.

3. to provide claim of the beneficiary of the letter of guarantee (letter of guarantee is not considered commercial paper and may not be traded or endorsement.

4. that the claim be updated with the terms of the letter of guarantee accompanied by any document contained the text of the letter of guarantee if the text of the warranty on it.

5. to clarify the request confiscated it in return for scrapping or letter of guarantee in exchange for reduced value according to each case.

    Procedures for the implementation of confiscation:

1 - dangers reporter (Bank instruction source) request the beneficiary and requests him adding value to our account and explain to the reporter that the beneficiary presented document provided a letter of guarantee and the sender of him (if the letter of guarantee provided for the submission of a particular document) In the case of US banks shall be clouds on the reporter, according the terms of accreditation.

    Once sure to add reporter for the value of the account bank payment to the beneficiary either by notice in addition to the account or issuing bank check for valid and be made to the beneficiary for Madl- of the value of the letter of guarantee in Egyptian Pounds calculated on the basis of the declared banking market rates on repayment except in the cases of monetary rules allow the payment currency Free.

3 - notify the beneficiary to repay the value of the letter of guarantee and explains to him that the payment has been received at his request and fulfillment of the value of the letter of guarantee in exchange for the bank canceled and the evacuation of its obligations by the beneficiary and requests him re letter of guarantee to the bank.

4 - notify reporter to cancel the letter of guarantee and cleared its obligations arising from the issuance of the letter of guarantee if payment for the full value of the collateral or part thereof against the repeal.

5 - If required the beneficiary to pay only a portion of the value of collateral in exchange for a stable residual value are paid the required value with the issue a letter to the beneficiary to reduce the bank's commitment to kiss the value paid to him and describes the new value of the guarantee in force provided that the validity of the guarantee is still valid.

6. conduct their own regulatory restrictions to cancel the letter of guarantee or reduce its value:

Of h / regular accounts payable


Bank commitments for the letter of guarantee

To h / accounts regular city

Correspondents commitments for letters of guarantee

7 - working computer form to prove void the warranty your part or by reducing the amount paid.

The expiration of the letter of guarantee:

1 - expire letter of guarantee on the date specified by stating if the bank did not reach any claim during the duration of effect.

2 - Re-beneficiary letter of guarantee to the bank to end its purpose before the expiration of the letter of guarantee.

Cancel the letter of guarantee:

1 - the expiration of the letter of guarantee and did not reach the bank any claim during the validity period of sending a letter to the beneficiary after the expiry of the letter of guarantee shows that the letter of guarantee has ended without making any demands through the duration of effect and that the bank had been annulled so required to re-guarantee letter to Bank met for the records.


    After 15 days from the date of this speech sends a letter to the beneficiary rush first speech to rebuild the letter of guarantee at the same time sends a letter to the reporter the end of the validity of the letter of guarantee shall be notified to vacate the commitment by the bank and requests him to pay any fees or commissions owed has not been paid up to the date of cancellation.

Conducting statutory restrictions to cancel the letter of guarantee: -

Of h / regular accounts payable



Bank commitments for the letter of guarantee

To h / accounts regular city



Correspondents commitments for letters of guarantee

- Mark agenda of Merit and the commission, the book version to cancel the warranty.


- Cancel Security card and work PC form to prove void the warranty


2 - Re-beneficiary letter of guarantee:

    The dangers of the beneficiary receiving the letter of guarantee and that it has been canceled.

    The dangers of re-reporter letter of guarantee and it has been canceled from our records and Akhlenah of its obligations thereunder.

    Conduct regular restrictions to cancel the letter of guarantee, according to the above statement.

    Cancel the letter of guarantee card.

    Mark agenda of Merit and the commission, the book version to cancel the warranty.


  FORM work computer to prove the automated computer security.



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