Study On The Legal Issue Of Risk Prevention Of Standby Letter Of Credit In International Trade And Economy

The purpose of the standby letter of credit is to guarantee the benefit of the creditor(the beneficiary under the standby letter of credit)in basic contract,so its value orientation is to prevent the beneficiary from facing the risk and protect the beneficiary's benefit.However,in practice,more and more malicious beneficiaries claim the money under the standby letter of credit,which breaks the balance under the standby letter of credit and brings risk to the issuer(always the bank under the standby letter of credit).In order to protect the interests of the bank,the International Chamber of Commerce takes series of measures to curb the beneficiary to abuse his right of claim.In addition,the academic research on the risk of standby letter of credit also tends to the risk of the issuer,which leads to the deviation of the value orientation of standby letter of credit,which is,considering the issuer's risks too much and tending to protect the issuer's interests.This value orientation is misleading,if it is not be corrected,the standby letter of credit will lose its application value.It is of great theoretical and practical significance to re-examine the value orientation of standby letter of credit and return to the original intention of protecting the beneficiaries' interests as well as guard against beneficiaries' risks.However,it is reasonable to protect the interests of the issuer in the past theory and practice.Thus,while returning to the protection of the interests of the beneficiary,the interests and risks of the issuer should also take into account.The beneficiary's risks include legal application risk,failure to demand payment risk and risk of validity of standby letter of credit;the issuer's risks include operational risk,risk of fraudulent claims of the beneficiary and risk of extension of the standby letter of credit.It is necessary to conduct a comprehensive analysis and provide specific prevention measures for the above risks.The development of standby letter of credit in China has been relatively slow;the deficiencies in the risk prevention of standby letter of credit mainly reflected in legislation,judicial practice and supervision.Analyzing the deficiency of standby letter of credit in China,and giving some suggestions on legislation,judicial practice and supervision,which is helpful to promote the internationalization of standby letter of credit in China.