tiktok���˰�

The Performance Letter of Guarantee is a crucial document in Malaysian business transactions, particularly in construction and infrastructure projects. It is typically required when a company (principal) enters into a significant contract to provide services or complete a project, and the client (beneficiary) needs security against non-performance. The guarantee, issued by a Malaysian bank or financial institution, provides financial protection up to a specified amount, usually a percentage of the contract value. The document includes essential details such as the guarantee amount, validity period, conditions for invocation, and payment terms. Under Malaysian law, these guarantees are regulated by the Financial Services Act 2013 and must comply with Bank Negara Malaysia's guidelines, making them legally enforceable financial instruments that provide security and confidence in business transactions.

1. Bank's Letterhead and Reference: Official letterhead of the issuing bank with reference number and date

2. Addressee Details: Beneficiary's complete name and address

3. Guarantee Reference: Clear statement that this is a Performance Guarantee with reference to the underlying contract

4. Principal Identification: Details of the party on whose behalf the guarantee is issued

5. Underlying Contract Details: Reference to the main contract including date and brief description of works/services

6. Guarantee Amount: The maximum amount guaranteed, stated in both figures and words

7. Validity Period: Clear start and end dates of the guarantee

8. Terms of Invocation: Conditions under which the guarantee can be called upon

9. Payment Terms: Timeline and method of payment upon valid invocation

10. Governing Law: Statement that the guarantee is governed by Malaysian law