language of the document

[berry]

dear all,

under the light of the following ISBP paragraph, does not it mean that only the documents issued by the beneficiary is to be in the language of the credit?

23. Under international standard banking practice, it is expected that documents issued by the beneficiary will be in the language of the credit. When a credit states that documents in two or more languages are acceptable, a nominated bank may, in its advice of the credit, limit the number of acceptable languages as a condition of its engagement in the credit.

[shruti]

Your observation is corect.

if the credit is covered under UCP 600 & unless stated otherwise, the langauge of document issued by other than beneficary can be in any language.

Hence , as a precaution , credit field 47a must state all documnts must be in langauge of credit only.

Regards
kalra n k

[iLC]

while i fully agree with Kalra, just to add, that a document should be in the language of the credit. to determine the compliance of a document, the bank must be able to examine it. if the document is in some alien language, the bank may not be able to determine the compliance causing unnecessary delay in honor.

[fionawang]

Thanks, that is the point I have not noticed before.

[ybattia]

ISBP 177 States:
If a credit requires the insurance cover to be irrespective of percentage, the insurance document must not contain a clause stating that the insurance cover is subject to a franchise or an excess deductible.

While UCP600 Art. 28.i.
An insurance document may indicate that the cover is subject to a franchise or excess (deductible).

Questions:

1. Is there a conflict between the two rules, or I'm misunderstanding ? please explain.

2. If the Credit calls for an insurance document, and was silent about whether it is acceptable or not to be subject to franchise or excess deductible, an insurance policy states "Any claim would be subject to %1.5 excess deductible" would be acceptable ? Why ? and according to which article you have built your answer ?

3. If we have a claim (Loss) of USD 1,000 under 2 insurance documents; one subject to 5% excess deductible and the other is subject to 5% Franchise, how much does the insurance company would actually pay under both cases. ? In other words, what is the difference between the excess deductible, and the Franchise ?

Your urgent professional opinions would be highly appreciated, as we're running out of time.

[fionawang]

[quote="ybattia"]ISBP 177 States:
If a credit requires the insurance cover to be irrespective of percentage, the insurance document must not contain a clause stating that the insurance cover is subject to a franchise or an excess deductible.

While UCP600 Art. 28.i.
An insurance document may indicate that the cover is subject to a franchise or excess (deductible).

Questions:

1. Is there a conflict between the two rules, or I'm misunderstanding ? please explain.
A: No confilict. Art.28 j.may indicate
177 credit requires...be irrespective of percentage,then must not contain..

2. If the Credit calls for an insurance document, and was silent about whether it is acceptable or not to be subject to franchise or excess deductible, an insurance policy states "Any claim would be subject to %1.5 excess deductible" would be acceptable ? Why ? and according to which article you have built your answer ?
A:Yes, cause there is no requirement of irrespective of percentage in L/C. And According to Artical 28 j

3. If we have a claim (Loss) of USD 1,000 under 2 insurance documents; one subject to 5% excess deductible and the other is subject to 5% Franchise, how much does the insurance company would actually pay under both cases. ? In other words, what is the difference between the excess deductible, and the Franchise ?
A: In 5% excess deductible, the insurance company will pay maxium USD50
In 5% franchise, the insurance company will pay the total loss-USD50
Just remember, Franchise always benefit Customer.

[ybattia]

Thanks Fiona,

But with respect to your answer on question 3 related to the calculation of loss covered by insurance company, I think in excess deductible term means that insurance co. would cover 95% of the loss and it will deduct 5% from the insured.