Uniform Rules for Bank-to-Bank Reimbursements for Documentary Credits (URR 725)
In most cases under LC, reimbursement by the issuing bank is made using the service of a now as Reimbursing Bank’. And the process of making reimbursement using the service of the Reimbursing Bank is known as Bank-to-Bank Reimbursement Arrangement. It has been referred to in article 13 of UCP 600; however, the process is guided by a separate ICC set of rules titled, The Uniform Rules for Bank-to-Bank Reimbursements under Documentary Credits, (ICC publication No 725) which came into
effect from October 1, 2008 containing 17 articles. To get coverage of the rules, it must be stated on the face of reimbursement authorization issued by the Issuing Bank. As in the case of UCP 600, the URR 725 permits modification and exclusion of any provision of the rules. URR suggests two way of making reimbursement one simply by authorizing Reimbursing Bank to make reimbursement to the Claiming Bank; and two, by authorizing Reimbursing Bank to issue a reimbursement undertaking to the Nominated Bank one is revocable whereas the second one is irrevocable. Reimbursement undertaking offers greater security to reimbursement to the Nominated Bank and thus to the exporter. The rules of URR assign liabilities and responsibilities of different parties involved in the process of reimbursement.
Article 3- Reimbursement Authorizations Versus Credits
Article 4- Honour of a Reimbursement Claim
Article 5-Responsibility of the Issuing Bank
Article 6- Issuance and Receipt of a Reimbursement Authorization or Reimbursement Amendment
Article 7- Expiry of a Reimbursement Authorization
Article 8- Amendment or Cancellation of a Reimbursement Authorization
Article 9-Reimbursement Undertaking
Article 10 –Standards for a Reimbursement Claim
Article 11- Processing a Reimbursement Claim
Article 12-Duplication of a Reimbursement Authorization
Article 13-Foreign Laws and Usages
Article 14-Disclaimer on the Transmission of Messages
Article 17-Interest Claims/Loss of Value
Download URR 725 ICC Uniform Rules For Bank-to-Bank Reimbursement pdf file……..
