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Bank Guarantee Return Letter Template for Hong Kong

A Bank Guarantee Return Letter is a formal document used in Hong Kong's banking and financial services sector to formally return and cancel a previously issued bank guarantee. This document serves as legal evidence of the beneficiary's intention to release the bank from its obligations under the original guarantee. Governed by Hong Kong law, particularly the Banking Ordinance (Cap. 155) and Contract and Rights of Third Parties Ordinance (Cap. 623), this letter ensures proper documentation of the guarantee's termination and protects all parties' interests in the transaction.

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What is a Bank Guarantee Return Letter?

A Bank Guarantee Return Letter is utilized when a beneficiary wishes to formally return and cancel a bank guarantee that is no longer required or has served its purpose. This document is particularly important in Hong Kong's commercial landscape, where bank guarantees are frequently used in various business transactions. The letter typically includes specific details about the original guarantee (such as reference numbers, dates, and amounts), a clear statement of return and cancellation, and appropriate release language. It serves as conclusive evidence that the beneficiary no longer requires the guarantee and releases the bank from all obligations thereunder. The document must comply with Hong Kong banking regulations and practices, including specific requirements under the Banking Ordinance and related legislation. This formal return process helps manage the bank's contingent liabilities and provides clarity on the status of outstanding guarantees.

What sections should be included in a Bank Guarantee Return Letter?

1. Date and Letterhead: Bank's letterhead, date of issuance, and reference numbers

2. Addressee Details: Full name and address of the beneficiary returning the guarantee

3. Reference to Original Guarantee: Details of the original bank guarantee including reference number, date, amount, and purpose

4. Confirmation of Return: Clear statement confirming the return of the original bank guarantee

5. Release Declaration: Statement releasing the bank from all obligations under the guarantee

6. Acknowledgment of Cancellation: Confirmation that the guarantee is cancelled and no longer valid

7. Authorized Signature Block: Space for authorized signatory's name, title, and signature

What sections are optional to include in a Bank Guarantee Return Letter?

1. Original Document Status: Include when the original guarantee is lost or destroyed, requiring a declaration of the same

2. Indemnity Clause: Include when there's a need to indemnify the bank against future claims, especially in cases of lost guarantees

3. Witness Section: Include when local practice or bank policy requires witness verification of signatures

4. Company Seal Section: Include when the returner is a company and company seal is required by their articles or local practice

What schedules should be included in a Bank Guarantee Return Letter?

1. Copy of Original Guarantee: Attached copy of the original bank guarantee being returned

2. Authorization Evidence: Documents proving the signatory's authority to act on behalf of the company

3. Lost Guarantee Affidavit: If applicable, sworn affidavit regarding lost or destroyed guarantee

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Hong Kong

Publisher

Genie AI

Document Type

Bank Guarantee

Sector

Banking

Cost

Free to use

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