The Performance Letter of Credit is a crucial financial instrument in South African business transactions, particularly where parties seek secure guarantees for contractual performance. This document type is commonly used in large-scale projects, international trade, and significant commercial contracts where the beneficiary requires protection against non-performance by the other party. The Performance Letter of Credit, governed by South African law and banking regulations, provides an independent, bank-backed guarantee that can be called upon if specified performance criteria are not met. It includes detailed conditions for drawing, specific performance metrics, and documentary requirements that align with both local legal requirements and international banking standards. This instrument is particularly valuable in cross-border transactions where parties seek the security of a bank-backed performance guarantee.

1. Bank Details and Reference: Issuing bank's details, letter reference number, and date of issuance

2. Beneficiary Information: Complete details of the party in whose favor the Letter of Credit is issued

3. Applicant Information: Complete details of the party requesting the Letter of Credit

4. Credit Amount and Currency: Specific amount and currency of the Performance Letter of Credit

5. Underlying Contract Reference: Details of the contract or agreement for which the performance guarantee is being issued

6. Performance Obligations: Clear description of the performance obligations being guaranteed

7. Expiry Details: Expiry date and place of the Letter of Credit

8. Drawing Terms: Specific conditions and documentation required for drawing under the Letter of Credit

9. Governing Law and Jurisdiction: Specification of South African law and relevant jurisdiction

10. UCP 600 Reference: Statement of applicability of ICC Uniform Customs and Practice for Documentary Credits