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A Commercial Standby Letter of Credit is primarily used in Saudi Arabian commercial transactions as a contingent payment security instrument. It is typically issued when parties need a reliable payment guarantee mechanism, particularly in high-value commercial contracts or international trade transactions. The document serves as a bank's irrevocable commitment to pay the beneficiary upon the applicant's default or non-performance of specified obligations. The instrument must comply with Saudi Arabian banking regulations, particularly SAMA guidelines, while also adhering to international standards like ISP98 and UCP 600. This type of document is especially relevant in the Saudi Arabian context given the kingdom's significant international trade activities and its role as a major commercial hub in the Middle East. The Commercial Standby Letter of Credit provides essential details including the maximum drawable amount, validity period, trigger events for payment, and documentary requirements for making a compliant presentation.

1. Bank Details: Name, address, and contact information of the issuing bank

2. Beneficiary Details: Name, address, and contact information of the beneficiary

3. Applicant Details: Name, address, and contact information of the applicant requesting the SBLC

4. Letter of Credit Number: Unique identification number for the Standby Letter of Credit

5. Issue Date: Date of issuance of the Standby Letter of Credit

6. Amount and Currency: Maximum amount and currency of the Standby Letter of Credit

7. Expiry Date: Date and place of expiry of the Standby Letter of Credit

8. Governing Rules: Reference to applicable rules (e.g., ISP98, UCP 600) and Saudi Arabian law

9. Trigger Events: Specific conditions or events that would trigger a demand under the SBLC

10. Required Documents: List of documents required to make a complying presentation

11. Payment Terms: Conditions and timing of payment upon presentation of complying documents

12. Transfer Provisions: Whether and how the SBLC may be transferred to another beneficiary