Kalily E. P.

Search on site
Go to content

Main menu



Collateral - SBLC


Clarification for the assignment of an SBLC, provided by an Investor,
for the provision of an "Extended Value Chain" for
refined petroleum products between Seller/Supplier and Buyer.

For the provision of an Extended Value Chain of Refined Petroleum Products between the Supplier and Buyer/Reseller the Supplier requires an SBLC in size of at least one delivery of products on his bank account as collateral for the trading operation. This STAND BY LETTER OF CREDIT is subject to the rules and practices for documentary credits, under the ICC, Paris, France publication UCP 600, or latest revisions.

The required SBLC is a fundamental financial basis for Supplier’s Bank to support the complete delivery chain. Therefore, the receiving bank will neither allow anyone to touch it nor monetize it without explicit allowance of the issuing bank of the Investor, who of course will not grant this allowance. This is secured by banking regulations. Any access to the SBLC would stop the delivery chain.

Supplier’s bank is fully responsible for the complete delivery process and is always in possession of the valid production documents and supervises the documentation flow and financial processing during the execution of every trade operation until completed.

After this SBLC has been confirmed as legal & valid by Supplier’s Bank, deliveries of Refined Petroleum Products will be organized between Supplier and his contractual Buyer/Reseller according to a signed Sales & Purchase Agreement (SPA).

Back to content | Back to main menu