Promissory Note To Follow Documents Template for the Philippines

When engaging in international trade transactions in the Philippines, you may encounter situations where payment must be made before all required documents are available. A Promissory Note To Follow Documents (PNTD) addresses this timing challenge by creating a legally binding promise to pay while acknowledging that certain documents will be provided later. This instrument is essential in Philippine trade finance, particularly for import/export businesses that need to maintain cash flow while ensuring document security.

When do you need this document?

You'll typically use a PNTD when importing goods and your bank requires payment before original shipping documents arrive from overseas. This commonly occurs in letter of credit transactions where documents are in transit, during trust receipt arrangements where you need goods before completing documentation, or when establishing trade financing facilities that require interim payment commitments. The document is also valuable when your business needs to release goods from customs while awaiting complete documentation, or when banks require additional security for documentary collection transactions.

Key legal considerations

Your PNTD must contain an unconditional promise to pay a specific amount, clearly identify all parties including maker and payee, and specify the exact documents to follow with delivery timelines. Under Philippine law, the document must comply with negotiable instrument requirements, including proper dating, signing, and witnessing where required. You should clearly define what constitutes acceptable document delivery, establish consequences for non-delivery of documents within specified timeframes, and include provisions for document examination and acceptance criteria. The note should also address currency denomination, interest calculations if applicable, and jurisdiction for dispute resolution.

Legal requirements in Philippines

The Negotiable Instruments Law (Act No. 2031) governs your PNTD's validity and enforceability, requiring specific formalities for negotiable instruments. Your document must be in writing, signed by the maker, and contain an unconditional promise to pay a definite sum. The New Central Bank Act (Republic Act No. 7653) provides additional banking transaction guidelines, while the Civil Code governs contract formation and performance obligations. If your PNTD involves electronic execution, you must comply with the E-Commerce Act (Republic Act No. 8792) for digital signatures and electronic documents. For corporate makers, proper authorization through board resolutions or corporate secretary certification is required, and the document may need notarization depending on the transaction value and banking requirements.