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Revolving SBLC for United Arab Emirates

Revolving SBLC Template for United Arab Emirates

A Revolving Standby Letter of Credit (SBLC) agreement governed by UAE law, incorporating both federal banking regulations and UAE Central Bank requirements. This document establishes a renewable credit facility where the available amount automatically reinstates after each drawing, subject to specified conditions. The agreement complies with UAE Federal Law No. 18 of 1993 (Commercial Code) and Federal Law No. 14 of 2018 (UAE Central Bank Law), while also adhering to international banking practices including ISP98 and UCP 600. It details the mechanisms for drawings, reinstatement conditions, fees, and obligations of all parties involved.

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What is a Revolving SBLC?

This document template is designed for establishing a Revolving Standby Letter of Credit (SBLC) under UAE law, providing a framework for recurring financial security in commercial transactions. It is particularly useful when continuous or multiple drawings are anticipated, with the credit amount automatically reinstating after each drawing up to the specified maximum amount. The document incorporates UAE banking regulations, including UAE Central Bank requirements and relevant federal laws, while also considering international banking practices. It is structured to accommodate both conventional and Islamic banking principles, making it versatile for various commercial applications in the UAE market. The template includes comprehensive provisions for the revolving mechanism, drawing procedures, compliance requirements, and party obligations, ensuring clarity and enforceability under UAE jurisdiction.

What sections should be included in a Revolving SBLC?

1. Parties: Identifies the issuing bank, applicant, and beneficiary with their full legal names and addresses

2. Background: States the purpose of the SBLC and the underlying commercial relationship

3. Definitions: Defines key terms used throughout the document including 'Revolving Basis', 'Reinstatement', 'Drawing', etc.

4. Facility Details: Specifies the SBLC amount, currency, availability period, and revolving mechanics

5. Conditions Precedent: Lists the documents and conditions required before the SBLC becomes effective

6. Drawing Requirements: Specifies the conditions and documentation required for making a drawing under the SBLC

7. Revolving Mechanism: Details how and when the SBLC amount reinstates after each drawing

8. Fees and Charges: Outlines all applicable fees, commissions, and charges

9. Representations and Warranties: States the legal declarations made by the applicant

10. Events of Default: Lists circumstances that would constitute default and their consequences

11. Governing Law and Jurisdiction: Specifies UAE law as governing law and relevant jurisdiction for disputes

What sections are optional to include in a Revolving SBLC?

1. Islamic Banking Compliance: Required when the SBLC needs to be Sharia-compliant, detailing specific Islamic banking requirements

2. Counter-Indemnity: Include when additional security or indemnity is required from the applicant

3. Transfer and Assignment: Include when the SBLC needs to be transferable to other beneficiaries

4. Multiple Currency Provisions: Required when the SBLC can be drawn in multiple currencies

5. Automatic Extension Clause: Include when the SBLC has an automatic extension feature

6. Sanctions Compliance: Include when transactions involve international trade or parties from multiple jurisdictions

What schedules should be included in a Revolving SBLC?

1. Schedule 1 - Form of SBLC: The actual format and text of the SBLC to be issued

2. Schedule 2 - Drawing Certificate Template: Standard format for beneficiary's drawing request

3. Schedule 3 - Fee Schedule: Detailed breakdown of all fees, charges, and commission rates

4. Schedule 4 - Conditions Precedent Documents: List of required documents and their formats

5. Appendix A - Specimen Signatures: Authorized signatures for all relevant parties

6. Appendix B - Communication Arrangements: Details of authorized communication methods and contact points

7. Appendix C - Revolving Schedule: Detailed timeline and mechanics of the revolving feature

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Publisher

Ƶ

Document Type

Letter of Credit

Cost

Free to use
Relevant legal definitions












































Clauses































Relevant Industries

Banking and Financial Services

International Trade

Construction and Engineering

Manufacturing

Oil and Gas

Real Estate Development

Shipping and Logistics

Wholesale and Distribution

Infrastructure Development

Energy and Utilities

Relevant Teams

Legal

Finance

Treasury

Trade Finance

Compliance

Risk Management

Corporate Banking

Islamic Banking

Credit Administration

Operations

Relevant Roles

Chief Financial Officer

Treasury Manager

Trade Finance Manager

Financial Controller

Legal Counsel

Compliance Officer

Credit Risk Manager

Banking Relationship Manager

Finance Director

Commercial Director

Contract Manager

Corporate Banking Officer

Documentary Credits Specialist

Risk Management Officer

Islamic Banking Specialist

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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