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The Letter of Credit Limit agreement is essential for businesses engaged in international trade in Indonesia, providing a predetermined ceiling for Letter of Credit issuance. This document is typically used when a company has regular import or export activities requiring multiple Letters of Credit over time. It streamlines the LC issuance process by pre-establishing terms, conditions, and documentation requirements under Indonesian law, particularly complying with Bank Indonesia regulations and the Indonesian Civil Code. The agreement includes comprehensive details about facility limits, validity periods, security arrangements, and compliance requirements, serving as a master agreement for all subsequent LC transactions within the approved limit.

1. Parties: Identification of the issuing bank and the applicant (customer)

2. Background: Context of the agreement and relationship between parties

3. Definitions: Key terms used throughout the agreement including facility-specific terminology

4. Facility Amount and Purpose: Specification of the LC limit amount and permitted uses of the facility

5. Term and Availability: Duration of the facility and conditions for availability

6. Conditions Precedent: Prerequisites that must be satisfied before the facility becomes available

7. LC Issuance Process: Procedures and requirements for requesting and issuing LCs under the facility

8. Fees and Charges: All applicable fees, commissions, and charges related to the LC facility

9. Security and Collateral: Required security arrangements and collateral to support the facility

10. Representations and Warranties: Standard declarations by the applicant about their legal and financial status

11. Covenants: Ongoing obligations of the applicant during the facility period

12. Events of Default: Circumstances that constitute default and their consequences

13. Bank's Rights and Remedies: Actions the bank can take in case of default or breach

14. Governing Law and Jurisdiction: Specification of Indonesian law as governing law and jurisdiction for disputes