The International Chamber of Com-merce Nigeria, (ICCN) is collaborating with the Central Bank of Nigeria (CBN) to hold a one day seminar on the revised version of the Uniform Rules for Demand Guarantees (URDG) in Lagos this week
The URDG has gained increasing worldwide acceptance over the years and it applies to hundreds of billions of dollars of demand guarantees securing monetary and performance obligations in a wide array of international and domestic contracts.
Internationally, the revised edition of the URDG, including Model Forms, will enter into force on July1, 2010.
The Seminar on the new 758 URDG, to be facilitated by renowned and highly experienced international and local experts, will provide sensitization opportunity for key stakeholders like the authorized dealers, international operations and trade exchange executives, bankers, lawyers, audit and risk management officials.
While Mr. Vincent Oâ€™Brien is the facilitator, Mrs. Omolara Akanji would moderate as the seminar.
The URDG rules have also been endorsed by the United Nations Commission on International Trade Law and national lawmakers have used them as a model for independent guarantee statutes.
â€œSince its founding in 1919, ICC has been writing rules to facilitate cross-border trade and investment. ICC rules are globally accepted in the fields of banking, customs, marketing, advertising and trade finance.â€
The revised URDG rules are the latest example of ICCâ€™s leadership in writing the rules that govern some $14trn of international tradeâ€.
â€œThis new URDG is clearer, more precise, comprehensive, offering the fairest balance in an innovative way to the parties and competing interests.â€
Comprising 35 articles, the URDG rules set out the liabilities and responsibilities of the parties at each key stage of the lifecycle of the guarantee.
The changes include innovative treatments of payment contingencies and more precise language for determining whether a presentation made under a guarantee or counter-guarantee, whether paper-based or electronic, is a complying presentation.
These changes are expected to curb the rate of rejection of demands and increase the certainty of the instrument.
In international sales, whereas a documentary credit assures the exporter of being paid upon the presentation of complying documentation showing that shipment is made, a demand guarantee provides protection to the importer against non-performance, or late or defective performance, by the exporter.
The revision of the URDG spanned two and a half years and was a cooperative effort by ICCâ€™s Banking Commission and its Commission on Commercial Law and Practice (CLP), which are made up of representatives from banks, companies and law firms worldwide.
The revision was conducted under the stewardship of the ICC Task Force on Guarantees, a standing body of experts from 26 countries.