Letter of Guarantee is a written promise for the beneficiary made at the request by the applicant to our bank. It will provide guarantee for the applicant’s activities such as bidding, performing the contract and making prepayment and will compensate for the applicant’s failure to perform contracts.

During service period, the letter of guarantee shall not be assigned, determined or altered arbitrarily.

During the guarantee period, if the guaranteed party and the beneficiary wish to modify or terminate the guarantee due to the change of the master contract they shall submit together a written notice to the guarantee issuing bank, i.e. CMBC.

(1) During the guarantee period, CMBC is entitled to carriy out inspections on the production, operation and financial situation of the guaranteed party and the counter guarantor in accordance to the provisions of the guaranteed agreement and counter guarantee contract.

(2) During the guarantee period, the beneficiary may request a claim from CMBC based on the terms for claiming set out in the Letter of Guarantee and CMBC shall perform its duty if no ground of defense is available. At the same time, CMBC may pursue the right of recourse or counter guarantee debt from the counter guarantor according to the guarantee agreement and the counter guarantee contract.

(3) The advancement which is made for the purpose of performing the guarantee duties will be collected an interest at a rate for overdue loans.

(4) When the term of guarantee is due or the guarantee duties are performed the letter of guarantee will go expired automatically. CMBC shall request the guaranteed party or the beneficiary to return the letter of guarantee.

(5) The term of guarantee is subject to determination based on the contract provisions related to the letter of guarantee.

(6) Processing fee will be charged at 0.5‰-2‰, which shall be determined based on the amount for guarantee, mode and risks.

Fill out the Letter of Guarantee Application Form with the company's stamp and the signature of the legal representative. For entering into the Guarantee Agreement, the company shall provide:

1) The Business License of company which have passed annual check, and its photocopies;

2) Tax Registration Certificate and the photocopies;

3) Certificate of Legal Representative;

4) Company contract and the Articles of Association;

5) Resolution of Board of Directors or Letter or Authorization;

(6) Financial statement of last year or of the latest;

(7) Guarantee related documents such as the bid invitation, tender, engineering contracting agreement, subcontracting agreement and sales agreement.

(8) For the guarantee provided by the counter guarantee companies, the relevant credit and financial information shall be provided;

Provide the format for letter of guarantee bearing the company stamp or financial stamp, and the trade agreement, contracting agreement or bid invitation;

1) if it is for agency business, please provide agency import agreement;

2) Sign the agreement and confirm the guarantee fund or the counter guarantee company;

3) If open the letter of guarantee under the trading business, and if the imported goods are controlled, the relevant governmental approvals shall be provided as the following:

a. Import license

b. Registration Certificate for Mechanical Products Import or Automatic Import License

c. License for Important Industrial Products Import License

The letter of guarantee will be established.

The letter of guarantee shall be signed by the authorized bank director with the official stamp of the bank.

When delivering the letter of guarantee, CMBC shall request the signing from the guaranteed party (applicant) or the beneficiary (except for the letter of guarantee opened with telegraph).

1. Enterprises with the right for importing and exporting approved and granted by the foreign trade authorities may apply for the letter of guarantee. Currently we are still unable to provide financing grantee for enterprises without the trading background.

2. Ensure that the signed and approved guarantee agreement shall be made effective;

3. The counter guarantee contract under the guarantee agreement shall be signed and made effective;

4. The relevant applicant should have been granted credit limit (or single credit limit);

5. It has set up a settlement account with our bank;

6. The enterprise should have the proven ability to perform the contract;

7. The guaranteed project does not conflict with the state regulations;

8. Provide the required counter guarantee; the counter guarantee is a guarantee made by the applicant and it can either be the deposit or a counter-guarantee organization.

9. Based on the applicant’s operation, financial and settlement situation, we may require the following mode for guarantee to be made:

(1) Full amount deposit: the deposit equal to the guarantee bond shall be requested;

(2) Partial deposit: deposit for guarantee collected based on a fixed percentage;

(3) Counter guarantor: the applicant shall provide a counter guarantor that has been approved by our bank.

10. The applicant has performed its duties.

11. The external guarantee reported should have been reported to the relevant foreign exchange authorities.