Sec. 5.112. TRANSFER OF LETTER OF CREDIT. (a) Except as otherwise provided in Section 5.113, unless a letter of credit provides that it is transferable, the right of a beneficiary to draw or otherwise demand performance under a letter of credit may not be transferred.
(b) Even if a letter of credit provides that it is transferable, the issuer may refuse to recognize or carry out a transfer if:
(1) the transfer would violate applicable law; or
(2) the transferor or transferee has failed to comply with any requirement stated in the letter of credit or any other requirement relating to transfer imposed by the issuer which is within the standard practice referred to in Section 5.108(e) or is otherwise reasonable under the circumstances.
Amended by Acts 1999, 76th Leg., ch. 4, Sec. 1, eff. Sept. 1, 1999.
Structure Texas Statutes
Title 1 - Uniform Commercial Code
Section 5.104. Formal Requirements
Section 5.106. Issuance, Amendment, Cancellation, and Duration
Section 5.107. Confirmer, Nominated Person, and Adviser
Section 5.108. Issuer's Rights and Obligations
Section 5.109. Fraud and Forgery
Section 5.112. Transfer of Letter of Credit
Section 5.113. Transfer by Operation of Law
Section 5.114. Assignment of Proceeds
Section 5.115. Statute of Limitations
Section 5.116. Choice of Law and Forum
Section 5.117. Subrogation of Issuer, Applicant, and Nominated Person
Section 5.118. Security Interest of Issuer or Nominated Person