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Perspectives — Brief Insights

Confirmation vs Silent Confirmation

Mohamad M. Burjak

Confirmation — A definite undertaking of the confirming bank, in addition to that of the issuing bank, to honour or negotiate a complying presentation. It is added at the issuing bank's request or authorisation, and it operates within a credit subject to UCP 600 (UCP 600, articles 2 and 8).

Silent confirmation — A separate arrangement — typically between the beneficiary and a bank — made outside the UCP confirmation mechanism and usually without the issuing bank's request or authorisation. It is not a confirmation as defined by UCP 600; it is governed by its own contractual terms, and its structures vary from case to case.

Both can give the beneficiary added comfort; only one is a confirmation under the credit. The other is a separate contract beside it.

© Mohamad M. Burjak. Published by Burjak Institute®. All rights reserved.

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