Governing Laws on Letters of Credit under Uniform Commercial Code

Abstract

Unlike most countries, the USA has express rules for letters of credit in its national law, Uniform Commercial Code Article 5. Due to its unique nature, this article has provided academic attractions to lawyers and practitioners alike, so that various issues thereof have been thoroughly studied. However, its sub-article,§ 5-116, which determines the choice of law matters thereof, has not been dealt with by scholars, albeit its importance. Considering the fact that this specific issue is generally recognised as to provide rather complicated legal and practical issues, such a curious dearth of academic analysis, needs to be rectified. This article aims, therefore, to provide the in-depth analysis with respect to how the choice of law matters for disputes arising out of letters of credit would be determined under the UCC, for the purpose of providing a solid foundation for a stable letter of credit transaction with the USA.