Clients deliver money, securities, documents, contracts, or other assets to CTBC, and CTBC holds these assets in an independent position for parties in the transaction (two or more parties). When the conditions of the transaction are met, the promise in the agreement has been fulfilled, or the legal event occurs, CTBC will transfer the assets under custody to the third party. When the condition, promise, or event does not occur, the assets under custody are returned to the client.
Normal transactions have the risk of security or obstructions, such as:
| 1. |
Before the ESCROW deposits are delivered to the seller, the ESCROW deposits are subjected to compulsory enforcement by the court, rendering delivery impossible. |
| 2. |
The provider of ESCROW deposits go out of business within the warranty period, making it impossible to file a warranty claim. |
| 3. |
Between the time of signing the contract and the contract is performed, the parties to the contract may have regrets about the terms of the contract or want to seek better deals than what the contract provides, and therefore they delay or cooperate unwillingly while performing the contract. |
The risks mentioned above can be reduced by ESCROW to ensure the security, the smooth progress of transaction, and that the parties to the transaction fulfill the contracts
‧Ensuring the security of transaction – payment and ESCROW deposits are both secure.
‧Funds are under custody and used for their designated purposes.
‧The funds to be distributed are collected in advance and then distributed to multiple parties with rights to the fund.
‧Ensuring the compensation of contingent liabilities in the event of a breach of contract.
‧Ensuring the deposits can be successfully returned.
Note: CTBC Bank’s ESCROW service is confined to transactions related to real estate or share sale and purchase only.
