Since the end of World War II, the standby letters of credit have been used as a surety device, serving as a performance bond and guarantee in the world. UCP has been used a governing rule for standby letters of credit transactions in international commercial transactions. But the UCP may be sufficient for certain simple standbys, it is not fully applicable nor appropriate for standbys - as is recognized in UCP 500 Article 1. On the other hand, the International Standby Practices(ISP98) provide rules of practice drafted specifically for standby letters of credit intended as an alternative to UCP 500. It became effective on January 1, 1999. In addition to restating general rules applicable to all independent undertakings with greater precision than does UCP 500, thereby reducing the possibility of litigation, it addresses issues that commonly arise in standby practice not addressed in UCP 500. UCP 500 is valid and still applies to standby letter of credit "to the extent to which they may be applicable." Since ISP98 and UCP 500 coexist and may be applicable to standby letters of credit by incorporation, applicants, beneficiaries and issuers have a choice. This study will assist all interested parties in establishing the right rules for the right product, for the right standby letters of credit.