Trade Finance

The High Court has considered the implication of failure to provide a statement pursuant to Article 44(c) of UCP 500 (the Uniform Customs and Practices for Documentary Credits) that documents were presented within an extension of time under Article 44(a).

Key announcements of interest to finance lawyers arising from the Chancellor of the Exchequer's 2012 Autumn Statement. (Free access.)

In Fortis Bank S.A./N.V. and another v Indian Overseas Bank [2011] EWCA Civ 58 (31 January 2011), the Court of Appeal upheld a High Court ruling on the construction of article 16 (Discrepant documents, waiver and notice) of UCP 600.

The Court of Appeal has held that advance payment guarantees are performance bonds rather than contracts of surety.

This is a chapter from the Bloomsbury Professional book Debattista: Bills of Lading in Export Trade, 3rd Edition, which covers the sale of goods carried by sea. It considers the nature of bills of lading as documents of title and analyses the connections between the different contracts composing an export transaction. It is an indispensable guide to bills of lading for all legal advisers and it highlights their enduring practical significance to international traders, carriers and banks.

A boilerplate clause dealing with contracting parties' ability to assign, subcontract or otherwise transfer their rights and obligations under the contract.

BAFT-IFSA is considering producing a Sharia law compliant version of its Master Participation Agreement for Trade Transactions.

The British Bankers' Association and Irish Bankers' Federation have issued a Statement of Recommended Accounting Practice on off-balance-sheet instruments and other commitments and contingent liabilities.

On 26 July 2010, the Bank for International Settlements announced that the Group of Central Bank Governors and Heads of Supervision, the oversight body of the Basel Committee on Banking Supervision (BCBS), has reached broad agreement on the reforms to the Basel II framework published for consultation by the BCBS in December 2009.

The Privy Council has held that the Bills of Exchange Act 1882 is concerned with the authority to delivery and not with the precise mode of delivery which was authorised.

The government has launched a new loan guarantee scheme aimed at small to medium enterprises seeking short term export finance facilities. Note: This has been updated to reflect amendments and additions made by BIS on 18 May 2011.

A checklist of the main issues to be considered by a buyer, seller and issuer or guarantor respectively when deciding on the type, and agreeing the form, of a bond, guarantee or standby letter of credit for a particular transaction.

An update on the key announcements of interest to finance lawyers arising from the 2009 Budget.

An update on changes to Companies House's security discharge forms MG04, LL MG04, MG04s, LL MG04s, MG05s, LL MG05s and OS MG03, which Companies House is intending to make on 4 October 2010.

This is a chapter from the Bloomsbury Professional book Debattista: Bills of Lading in Export Trade, 3rd Edition, which covers the sale of goods carried by sea. It considers the nature of bills of lading as documents of title and analyses the connections between the different contracts composing an export transaction. It is an indispensable guide to bills of lading for all legal advisers and it highlights their enduring practical significance to international traders, carriers and banks. Chapter 2 ,  the table of contents and the index are FREE to view, as a sample of the book's contents. To view the other chapters, please subscribe to Books online.

This is a chapter from the Bloomsbury Professional book Debattista: Bills of Lading in Export Trade, 3rd Edition, which covers the sale of goods carried by sea. It considers the nature of bills of lading as documents of title and analyses the connections between the different contracts composing an export transaction. It is an indispensable guide to bills of lading for all legal advisers and it highlights their enduring practical significance to international traders, carriers and banks. Chapter 2 ,  the table of contents and the index are FREE to view, as a sample of the book's contents. To view the other chapters, please subscribe to Books online.

This is a chapter from the Bloomsbury Professional book Debattista: Bills of Lading in Export Trade, 3rd Edition, which covers the sale of goods carried by sea. It considers the nature of bills of lading as documents of title and analyses the connections between the different contracts composing an export transaction. It is an indispensable guide to bills of lading for all legal advisers and it highlights their enduring practical significance to international traders, carriers and banks. Chapter 2 , the table of contents and the index are FREE to view, as a sample of the book's contents. To view the other chapters, please subscribe to Books online.

This is a chapter from the Bloomsbury Professional book Debattista: Bills of Lading in Export Trade, 3rd Edition, which covers the sale of goods carried by sea. It considers the nature of bills of lading as documents of title and analyses the connections between the different contracts composing an export transaction. It is an indispensable guide to bills of lading for all legal advisers and it highlights their enduring practical significance to international traders, carriers and banks. Chapter 2 ,  the table of contents and the index are FREE to view, as a sample of the book's contents.

This is a chapter from the Bloomsbury Professional book Debattista: Bills of Lading in Export Trade, 3rd Edition, which covers the sale of goods carried by sea. It considers the nature of bills of lading as documents of title and analyses the connections between the different contracts composing an export transaction. It is an indispensable guide to bills of lading for all legal advisers and it highlights their enduring practical significance to international traders, carriers and banks. Chapter 2 ,  the table of contents and the index are FREE to view, as a sample of the book's contents.

A recent case in the Court of Appeal has examined the legal relationship between a bank and the supplier of goods or services where payment is made by cheque supported by a cheque guarantee card. Barclays Bank was held liable under a cheque guarantee card issued by it notwithstanding that the card had been stolen and the account holder's signature forged. However, the decision turned on the wording of the terms and conditions endorsed on the reverse of the particular card in question and there appears to be no industry standard for such conditions.

The Cheques Act 1992 which confers statutory recognition on the practice of crossing cheques with the words "account payee" comes into force on 16th June, 1992.

This practice note explains what a governing law clause is and the consequences of not having one. It also sets out the matters that should be considered when selecting the governing law for a finance transaction.

The amendments to Companies House's security discharge forms MG04, LL MG04, MG04s, LL MG04s, MG05s, LL MG05s and OS MG03, which Companies House was intending to make in January 2011, have been delayed until 14 March 2011. Companies House has also announced minor amendments to other security forms to be made on that date. NOTE ADDED 10.01.11: On 6 January 2011, Companies House announced further minor changes to forms MG01s (Particulars of a charge created by a company registered in Scotland) and LL MG01s (Particulars of a charge created by a limited liability partnership registered in Scotland). 

On 1 December 2008, the Counter-Terrorism Act 2008 was published on the Office of Public Sector Information website.

A diagram showing a typical factoring structure. For further information on factoring, see Practice note, Factoring and invoice discounting.

A diagram showing a typical invoice discounting structure. For further information on invoice discounting, see Practice note, Factoring and invoice discounting.

A diagram showing a typical reverse murabaha (tawarruq) structure. For more on reverse murabaha and an overview of Islamic finance, see Practice note, Islamic finance: UK law overview.

A standard form debenture created by a company incorporated in England and Wales in favour of a single corporate lender. This standard document creates a mortgage over properties, fixed charges over a range of other assets and assignments by way of security over the benefit of contracts and insurance policies, together with a floating charge over assets not otherwise mortgaged, charged or assigned. This standard document contains integrated drafting notes and negotiating tips. For detailed information on legal issues that may arise when drafting a debenture, see Drafting note, About this document below.

A recent case vividly illustrates how careful those signing documents on behalf of a company (and especially bills of exchange, promissory notes, endorsement, cheques or orders for money or goods) must be to ensure that the name of the company appears in full, correct in every respect and in legible characters.

The High Court has held that the risk of fraud between payment of a discounted sum and the maturity date lies with the confirming bank.

The Court of Appeal has held that there is no nullity exception, in addition to the fraud exception, to a bank’s obligation to pay on presentation of apparently compliant documents.

An update on Fortis Bank S.A./N.V., Stemcor UK Limited v Indian Overseas Bank [2010] EWHC 84 (Comm), in which the High Court ruled on the construction of Article 16 (Discrepant documents, waiver and notice) of UCP 600. NOTE: this decision was upheld by the Court of Appeal, see Legal update, Act in accordance with your notice: Court of Appeal confirms construction of article 16 of UCP 600.

On 5 December 2007, the Export Credit Guarantee Department published a consultation on whether to discontinue its Fixed Rate Export Finance (FREF) scheme or whether to continue it with modifications aimed at controlling its cost.

An update on a proposal for the Export Credits Guarantee Department to guarantee the reimbursement of UK banks in respect of letters of credit they have confirmed in connection with UK exports.

An update on the extension of the ECGD's Fixed Rate Export Finance scheme to 31 March 2011.

Export Credits Guarantee Department launches an export working capital scheme to assist UK exporters gain access to working capital finance. NOTE ADDED ON 7 OCTOBER 2011: The ECGD has updated its quick guides to the scheme to clarify that, while the export contract must generally have a value in excess of £1 million to be eligible, contracts with a value of £25,000 or more will be considered.

An update on the publication by the Export Credits Guarantee Department of Guidance to Applicants: Process and Factors in ECGD consideration of Applications.

The Treasury has issued a consultative document containing proposals to introduce "truncation" which would enable the payment of cheques to be made by the transmission of electronic information.

A report about the extension to the Enterprise Finance Guarantee facility, as announced in the Pre-Budget Report on 9 December 2009.

The Export Credits Guarantee Department (ECGD) is the UK's official Export Credit Agency. ECGD works closely with exporters, project sponsors, banks and buyers to help UK exporters of capital equipment and project-related goods and services to win business and UK firms to invest overseas.

The Finance Act 2006 was given Royal Assent on 19 July 2006.

Do you have a trainee or newly qualified lawyer joining your finance team? Are you a trainee or newly qualified lawyer wondering what finance transactions are all about? Have you moved in house and find yourself having to get to grips with finance law? If so, have a look at the following materials to get an overview of the law and practice of finance transactions. Remember to arrange for any new recruits to get access to PLC Finance and ensure they are signed up to receive our weekly and/or monthly e-mails. To do this, please e-mail info@practicallaw.com or contact your account manager on 020 7202 1220. If you do not subscribe to PLC Finance, see Request a free trial or call 020 7202 1220 to register your interest in a free trial.

An explanation of raising finance by forfaiting bills of exchange or promissory notes.

An update on a letter to customers published by the Export Credit Guarantee Department confirming the extension of the Fixed Rate Export Finance scheme.

This practice note discusses forfaiting transactions and their implications.

A licensed gaming club could sue on an underlying loan when third party cheques which had been exchanged for gaming tokens in accordance with section 16 of the Gaming Act 1968 were dishonoured.

HM Treasury has unveiled a funding programme to accelerate infrastructure investment and provide support to UK exporters.

An update about the government extending its trade credit insurance top-up scheme in June 2009.

A specific liabilities guarantee and indemnity given by a corporate guarantor of a company. Both companies are incorporated in England and Wales and security has been given by the borrower.

An update on guidance from a joint working party of The Law Society Company Law Committee and The City of London Law Society Company Law and Financial Law Committees on the execution of documents at a virtual signing or closing following the High Court decision in Mercury. In February 2010, the joint working party (JWP) of The Law Society Company Law Committee and The City of London Law Society Company Law and Financial Law Committees updated its original guidance note, published in May 2009, on execution of documents at a virtual signing or closing, (with only minor changes). This legal update reflects those changes.

A recent Supreme Court decision found that banks are under an obligation to check carefully the identity and authorisation of a person presenting an order cheque before it is honoured or cashed. An order cheque is made out as payable to a specified person or to his order, and can only be transferred by endorsement.

On 16 May 2006, the International Chamber of Commerce (ICC) has announced that it will have revised rules for documentary credits later this year. ICC provides a standardised set of rules through the Uniform Customs and Practice for Documentary Credits (UCP). Subject to final approval, the new rules, called UCP 600, intend to cover the following provisions: (1) a new section of definitions, (2) a definite period of time for determining compliance of documents which replaces the term "reasonable time" and (3) re-drafted articles for identification of carriers and agents. For more information on letters of credit, see Practice note, Letters of credit: overview.

On 27 April 2007, the International Chamber of Commerce (ICC) announced it had approved an updated version of its International Standard Banking Practice for the Examination of Documents under Documentary Credits (ISBP). The ISBP is a supplement to the Uniform Customs and Practices (UCP), which are the ICC's rules on documentary credits. The 2002 version of the ISBP has been updated to reflect changes made to the UCP that are due to come into effect on 1 July 2007. For more on these changes, see Legal update, ICC publishes revised documentary credits rules, UCP 600. The amendments to the ISBP are generally quite minor and much of it remains unchanged.

An update on the publication by the International Chamber of Commerce of a guidance paper on the use of sanction clauses in trade finance documents such as letters of credit and guarantees.

An update on the publication by the International Chamber of Commerce of a revised version of the Uniform Rules for Demand Guarantees (formally called URDG 758), which will come into force on 1 July 2010. 

An update on an International Chamber of Commerce (ICC) statement on the volcanic eruption delaying delivery of documents under transactions subject to ICC rules.

On 18 July 2008, the ICC announced in a press release that an updated version of its uniform rules for bank-to-bank reimbursements under documentary credits (URR) will take effect on 1 October 2008. The ICC approved the updated rules on 16 April 2008. Bank-to-bank reimbursement arrangements arise if, in order to claim reimbursement from the issuer of a letter of credit, the nominated or confirming bank needs to claim those monies from another bank (because, for example, the issuer has an account with that bank). For information on letters of credit, see Practice note, Letters of credit: overview. Like the UCP 600, the URR are incorporated by express agreement of the parties into a letter of credit. For information on the UCP 600, see Practice note, UCP 600. The updated version of the URR, the URR 725, conform the URR with the UCP 600. The new version will replace the previous edition, the URR 525 published in 1995. According to the press release, the URR 725 contain several important technical changes, such as "express indication", and "operative reimbursement authorisation". The new rules can be purchased from the ICC website.

An update on the Industry and Exports (Financial Support) Act 2009 receiving Royal Assent.

A checklist for English lawyers instructing foreign lawyers in connection with a secured loan where the security is located outside England and Wales and/or where the party providing the security is established outside of England and Wales

Commercial letters of credit, the most frequent method of payment for goods in international trade transactions, have frequently been described as the lifeblood of international commerce. However, it can be argued that another, related method of payment is of equal importance, namely the independent or "on-demand" payment undertaking. This form of payment encompasses standby letters of credit, independent or on-demand bank guarantees and performance bonds. This chapter considers the basic features of letters of credit (also known as documentary credits), how commercial letters of credit work and how they are used in international trade, how standby letters of credit work and considers international standby practice, the basic principles of performance bonds and bank/on-demand guarantees, and outlines their use in international trade, their effectiveness and the establishment of uniform rules in this area. From an English law perspective, other negotiable instruments that are used in trade finance to effect payment, in particular, bills of exchange, promissory notes, forfaiting and advance payment bonds and guarantees. It also considers the use of these instruments in international trade. This article is part of the PLC multi-jurisdictional guide to finance. For a full list of contents visit www.practicallaw.com/finance-mjg.

Application to a bank for the issue of an irrevocable documentary credit (also called an irrevocable letter of credit).

This Bloomsbury Professional book is a detailed and authoritative account of the law and practice of documentary credits, including standby credits and demand guarantees. It also explains the rights and liabilities of each of the parties in the chain of complex relationships involved. Written from the perspective of banking practices as well as the law, it considers the Uniform Customs and Practice for Documentary Credits 600, as well as a full review of the body of case law on the UCPDC 500. Chapter 2 and the index are FREE to view, as a sample of the book's contents. To view the other chapters, please subscribe to Books online.

On 19 September 2009, the Joint Money Laundering Steering Group published for consultation a revised draft of part II of its money laundering guidance.

An update on the key announcements of interest to finance lawyers arising from the June 2010 Budget.

This note gives an overview of the matters to be considered when requesting or responding to a request for an English legal opinion, the form and content of an English legal opinion and the practical steps to be taken when providing an English legal opinion. The note also links to detailed notes on the purpose and structure of legal opinions in finance transactions in the United States, including the purpose and structure of legal opinions delivered in securities offerings in the United States.

A letter of credit (also called a documentary credit) to be issued by a bank, incorporating the Uniform Customs and Practice for Documentary Credits (UCP).

Mr Justice Waller has concluded that Citibank acted reasonably in exercising its discretion under the proper construction of the terms of a letter of agreement between Ludgate Insurance and Citibank. The letter set out the basis on which Ludgate's deposits, under letter of credit arrangements with Citibank, were to be held.

The Divisional Court has held that the general rule of English law that a debtor is required to seek out the creditor at his place of business and pay him there has limited application in the context of international credit transactions.

An issuing bank is free to set-off a beneficiary's debts against payment under letter of credit, even where the beneficiary owes those amounts under a completely unrelated transaction. Lehman Brothers Commodity Services Inc. v Credit Agricole Corporate and Investment Bank [2011] EWHC 1390 (Comm).

A checklist of the main issues to be considered by a buyer, seller and bank respectively when deciding upon the type, and agreeing the form, of a letter of credit for a particular transaction.

Practical advice on the use of letters of credit.

Issuing banks have a very short time (usually a few working days) in which to inspect and reject presented documents during which time they may consult the buyer on whose application the letter of credit was issued but not allow him to inspect the documents.

An update on publication by the LMA of a paper on grantor credit risk in the context of funded participations.

An update on the recent expansion of investments eligible for political risk insurance from the Multilateral Investment Guarantee Agency (MIGA).

The International Chamber of Commerce (ICC) has unveiled new uniform rules on forfaiting, which will enter into effect on 1 January 2013.

Where a third party's cheque is accepted in payment of services to a customer there may be no consideration to support an action on the cheque if it is subsequently dishonoured.

This note explains the role of notaries and what notarisation means. It outlines the types of documents that are notarised and explains what legalisation and apostille mean. It includes a checklist of what to consider when instructing a notary.

The OECD has published a revised version of its sector understanding on export credits for renewable energy, climate change mitigation and water projects. It has also adopted a revised version of its recommendation on common approaches for officially supported export credits and environmental and social due diligence.

An update on modifications to the Arrangement on Officially Supported Export Credits.

The OECD has published the March 2011 version of its Arrangement on Officially Supported Export Credits.

On 28 January 2008, the OECD announced its members (including the United Kingdom) have adopted a set of principles entitled Principles and guidelines to promote sustainable lending practices in the provision of official export credits to low-income countries (the Principles). The Principles are designed to ensure that loans to low-income (buyer) countries supported by OECD member export credit agencies (ECAs): 1) reflect sustainable lending practices (lending that supports that country's economic and social progress without endangering its financial future and long term development prospects); and 2) do not result in those countries building up debt following recent debt relief initiatives. The Principles apply to ECAs who provide commercial credits to support loans with a repayment term of one year or more to public borrowers in those countries. They include requirements to: 1) ensure such credits do not beach any borrowing limits binding on those countries agreed with the International Monetary Fund (IMF) and the World Bank; 2) take into account the latest debt sustainability analyses produced by the IMF and the World Bank; and 3) seek assurances from government authorities in that country that the transaction is in line with the country's agreed borrowing and development plans. (This only applies to larger transactions with a repayment term of two years or more.) For more information see the press release which links to the Principles.

An update on the 2009 revision of the Arrangement on Officially Supported Export Credits published by the OECD.

An update on the OECD's publication of the January 2010 version of its Arrangement on Officially Supported Export Credits.

On 11 October 2007, the Organisation for Economic Co-operation and Development (OECD) published a new version of the Sector Understanding on Export Credits for Ships (the Understanding). The Understanding came into force on 8 October 2007 and replaces the previous version in force since 2002. The Understanding constitutes Annex 1 to the Arrangement on Officially Supported Export Credits (the Arrangement). The Arrangement is a "gentlemen's agreement" among the participants to it, which include the European Community. The purpose of the Arrangement is to create a level playing field for the provision of export credit support by or on behalf of governments for the export of goods and services. Official subsidies are limited to encourage competition among exporters based on quality and price of goods and services exported rather than on the most favourable official support exporters can obtain. The only changes to the Understanding are new provisions on the payment of interest and confirmation the project finance provisions of the Arrangement do not apply. Whether such provisions should apply is under review.

The Organisation for Economic Co-operation and Development (OECD) has published an action statement against bribery and officially supported export credits. In the statement, the members of the OECD give various steps each member country should take, including requiring exporters/applicants: (1) to give an undertaking that they have not engaged in bribery, (2) to disclose if they have been charged with violation of laws against bribery in any country within five years preceeding the application and (3) to carry out enhanced due diligence. The member countries may refuse credit, cover or support if there is evidence that bribery was involved in the transaction and ask for indemnification or refund of funds provided. The action statement and the press release are available on the OECD website.

An on demand performance bond (also called a performance guarantee) involving an independent payment obligation, to be issued in letter form, typically by a bank.

Payment of purchase price against presentation of shipping documents is not deemed to be a payment against Bills of Exchange of which that the payer has no knowledge.

An update reminding practitioners that the Perpetuities and Accumulations Act 2009 is in force with effect from 6 April 2010. 

PLC Finance highlights the key cases and legal developments that were of most interest to finance lawyers during 2011 and looks ahead to what 2012 has in store.

PLC Finance highlights the key cases and legal developments that were of most interest to finance lawyers in the first half of 2012 and looks ahead to anticipated developments for the remainder of the year. (Free access.)

The High Court has held that an English clearing bank which collects a stolen English cheque marked a/c payee only as agent for a foreign collecting bank whose customer is not the payee of the cheque, will be liable for the proceeds of that cheque unless it can be shown that it acted in good faith and without negligence.

A standard form promissory note under which one or more companies promises to pay an amount to the order of a specified company or to the holder of the note in due course.  This standard document contains integrated drafting notes and negotiating tips. For detailed information on legal issues that may arise when drafting a promissory note, see Drafting note, Drafting assumptions and legal issues.

An update on the International Chamber of Commerce's plan to draft new trade finance forfaiting rules.

In Petrologic Capital SA v Banque Cantonale De Geneve and another [2012] EWHC 453 (Comm), the Commercial Court considered the buyer's arguments that it had jurisdiction to grant an injunction to prevent a bank paying monies out under a letter of credit.

The Wolfsberg Group has published the 2011 version of its Trade Finance Principles, revising the version published in January 2009. The 2011 version includes new appendices containing guidance for standby letters of credit and guarantees.

CRESTCo Ltd has made available on its website a new version (version 2) of its White Book "Securities Lending and Collateral Transfers in CREST". The White Book briefly outlines how the CREST functionality works and describes the ways in which CREST members can use this service to accomodate their securities lending/borrowing and general collateral delivery commitments. Three methods are available: (1) the stock loan transaction type (SLO) in which title to all securities and collateral passes from one party to the other outright, and the party acquiring title is obliged at a later date to redeliver equivalent rather than identical securities; (2) the delivery by value type (DBV) in which CREST members can give and receive packages of securities of a nominated value as collateral, usually against the creation of a CREST payment in GBP, EUR or USD, or free of payment; and (3) the repo type, in which CREST members can give and receive packages of securities as collateral within CREST, usually against the creation of a CREST payment.

This practice note explains the difference between set-off and netting. It also reviews their use in finance transactions.

Every month, PLC Finance features a selection of its resources on a particular topic. This month's topic is: How do you distinguish between a guarantee and a performance bond?

On 23 January 2008, the Bankers' Association for Finance and Trade published a standard agreement for use by European banks to buy and sell country and bank trade-related risk (such as letters of credit, performance bonds, bills of exchange and promissory notes). The agreement, known as the Master Participation Agreement, is designed to simplify the exchange of documentation and reduce legal costs associated with the buying and selling of trade-related risk across Europe. For more on letters of credit and performance bonds and their use in trade finance, see Practice note, Bonds, guarantees and standby credits: overview. For more information on bills of exchange and promissory notes and their use in trade finance, see Practice note, Forfaiting. Source: Bankers' Association for Finance and Trade, 23 January 2008. NOTE ADDED AUGUST 2010: In 2010, the Bankers' Association for Finance and Trade merged with the International Financial Services Association to create BAFT-IFSA, which now promotes the Master Participation Agreement.

This is a list of the standard documents and clauses, with drafting notes, available on PLC Finance.

This Law Firm Publication by Morrison & Foerster LLP focuses on the statutory obligation Hong Kong listed companies will face on 1 January 2013 which imposes a statutory disclosure requirement for them to make price-sensitive information public in the event they receive “inside information” which is likely to have a material effect on the price of a listed security.

Subscribers to PLC Finance have been given access to the PLC Corporate, Practice note, Supply contracts: overview. The overview summarises the key considerations when drafting and using standard terms and conditions of sale or purchase in supply contracts. It also considers provisions commonly found in supply contracts dealing with such matters as specification, delivery, acceptance, price, payment and retention of title. The overview is of use to finance lawyers and others who encounter supply contracts in trade finance transactions.

SWIFT and the Banking Commission of the International Chamber of Commerce will collaborate to create rules to promote the use of the Bank Payment Obligation, which is similar to a letter of credit.

A checklist of key legal issues for taking security over assets by way of pledge.

A note on taking security over choses in action.  A chose in action is an asset that can only be claimed or enforced by action at law or equity, rather than by taking physical possession of the asset. The note looks at how to take security over various types of choses in action such as rights under contracts, debts, financial instruments and cash deposits in bank accounts.

A sample term sheet for the grant of a term loan by a syndicate of lenders for financing the production of commodities by the borrower.

An introduction to term sheets in the context of loan finance transactions, including details of what they are used for. This note also considers what provisons are typically included in term sheets and the lender's and borrower's perspectives in drafting and negotiating term sheets.  This note includes links to related resources such as standard documents, term sheets and commitment letters. It also includes a link to an introduction to bank loan term sheets in the US.

The Court of Appeal has refused to compromise the autonomy of an advance payment guarantee in order to correct an injustice arising out of the lax behaviour of the parties to the underlying transaction.

An update on the announcement by the government of a trade credit insurance top-up scheme and the publication by the Association of British Insurers of a statement of principles for trade credit insurance.

A note outlining different types of lending (categorised by the number of lenders) and loan facilities. This note also links to a multi-jurisdictional guide to finance (that covers issues relating to secured lending) and to a note on corporate loan facilities and bank loans in the United States.

This note explains changes of interest to finance lawyers made by the Uniform Customs and Practice for Documentary Credits, 2007 Revision, ICC Publication No. 600 (UCP 600) from the previous edition of the UCP, UCP 500. The UCP is a set of contractual rules which are frequently incorporated by express agreement into a documentary credit (also called a letter of credit) transaction. Where relevant this note also refers to: The International Standard Banking Practice for the Examination of Documents under Documentary Credits, 2007 Revision for UCP 600, ICC Publication No. 681 (ISBP); and The International Standby Practices ISP 98, ICC Publication No. 590 (ISP 98).

On 1 July 2007, the International Chamber of Commerce (ICC) revised rules on documentary credits, the Uniform Customs and Practice for Documentary Credits (UCP) 600, came into effect. The revised rules, published in December 2006, will be written into most letters of credit (see Legal update, ICC publishes revised documentary credits rules, UCP 600). For more information on the revised rules, see Legal update, ICC approves revised documentary credit rules UCP 600. For information on letters of credit, see Practice Note, Letters of credit: overview.

On 13 June 2007, the Export Credits Guarantee Department (ECGD), UK's official export credit agency, announced changes to its foreign content rules that simplify and update the rules for UK exporters looking for support for contracts involving non-UK firms. The main changes are: 1) For all contracts (credit or cash) the maximum level of support for foreign content will be 80% of the contract value, where ECGD risk capacity is available. 2) The distinction between credit contracts valued at £10m and below will be removed. 3) The distinction between goods originating from the EU, Japan and other countries will be removed. 4) Software and related services originating in the UK and exported electronically will be treated as UK content. The rules are set out in a Government response to a public consultation on changes to ECGD policy on support of foreign content. The rules will apply to limited recourse projects and structured finance transactions but not to local costs incurred in the project country (which are subject to Organisation for Economic Co-operation and Development rules).

UK Export Finance has announced its bond insurance is a free standing product.

Letter from UK Export Finance Chief Executive, Patrick Crawford on UK Export Finance Short term schemes (22 June 2012).

This note provides a brief overview of the primary and secondary markets in syndicated debt. It includes sections on investment grade and leveraged debt, credit derivatives and the role of international organisations such as the LMA, LSTA and rating agencies.

A look at the advantages of factoring and invoice discounting as a simple means of short term finance.

A note about the law relating to variation of guaranteed obligations. It examines the extent to which an underlying contract, which is the subject of a guarantee, can be amended or varied without that variation of contract discharging the guarantee and releasing the guarantor from its liability.

A brief overview of some legal developments affecting finance lawyers that can be expected in 2007.