Does A Non-Nominated Bank Has 5 Days To Examine Document?

[Navi]

Hi Friends,
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We discuss common LC practices with my friends and I want your valuable comments for the issues below.
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We often issue non confirm L/Cs available with our bank and 31D (place of expiry), stating our country. Moreover, we state period of presentation as lets say 10 days.
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If the beneficiary presents docs to advising bank or any other local bank within presentation period, but we receive it later than that period (although within LC validity), is it considered as late presentation?

Under UCP600-2, presentation should be made either to isssuing bank or nominated bank. UCP600-6-d,ii: the place of the bank with which the credit is available is the place for presentation. , I understand that as issuing bank, we must receive docs within presentation period (10 days after shipment) otherwise it is a discrepancy. The notation of the presenting bank "docs received within presentation period" has no meaning.
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My next question is that: Does the bank other than the nominated bank, confirming bank or issuing bank, to whom the beneficiary presented documents, have 5 banking days to examine docs? If the presenting bank decides to negotiate in its own initiative, does it effect the matter, i.e. have this 5 days for examination?
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thnks and regrds

[cristiand969]

Dear Navi,
1.My answer to your first question: YES, it is late presentation in the light of the article you have quoted
2. Regarding your last question:

If the presenting bank decides to negotiate in its own initiative, does it effect the matter, i.e. have this 5 days for examination?

This is other scenario when the credit is available with other bank than the issuing bank as you posted in your query. If the situation is as I assumed above there is something wrong in your question. A bank other than nominated bank is not permitted to negotiate as it is not the bank authorized by issuing bank to do so. On the other hand, if the beneficiary present document to other bank that the one nominated , the place of presentation has been shifted from nominating bank to issuing bank.

[Navi]

Thanks cristiand969 for yr reply,
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Let me clarify the second issue:
issuing bank: Bank A (we)
available with by payment: Bank A
advising bank: Bank B
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I want to know if Bank B has 5 days for examination if docs were presented to themselves by beneficiary. And next, if Bank B decides to negotiate the docs although they are not authorized to do so, will it change anything, i.e. will that bank have 5 day period for examination of docs? I know it is not logical but we sometimes come across...
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From your previous post, I guess "no"
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regrds

[cristiand969]

Dear Navi,
Such a presentation in both different scenarios as you have stated falls under the same art. of UCP : Except as provided in sub-article 29 (a), a presentation by or on behalf of the beneficiary must be made on or before the expiry date.
The advsing bank merely acts here as an agent of beneficiary (no undertaking toward negotiation) and not as an agent of issuing bank because is no nomination on it.
Therefore my answer is that the named Advising Bank (B) made a presentation ON BEHALF of beneficiary as per above mentioned article and not under a nomination to have 5 days for reviewing docs which anyhow does not matter since the credit is available with issuing bank.
The question of negotiation as per UCP 600 does not apply here, it must be possible that the bank B and beneficiary to come to an agreement for advancing funds based on some forms of guarantee particularly here a complying presentation. But this has nothing to do with UCP nor any involvement in LC transaction can be associated with so called by you negotiating bank B.
regards
Cristian

[iLC]

dear navi,

im bit confused with your question. on a rush now and not sure whether my following opinion is your answer or not

here is my opinion

issuing bank: Bank A
available with: Any bank
advising bank: Bank B
place of expiry: at the counter of bank A
expiry date: 15-10-2008

if the presentation is made at the counter of nominated bank, the same must reach the issuing bank within 15-10. or else late presentation. whether the nominated bank has the 5 days depends on how much time the nominated bank has in hand before 15th.

negotiation of such letter of credit is bit risky unless the nominated bank has sufficient time in hand to reach the issuing bank. though bank issues this type of credit it avoid postal risk, such is not encouraged.

iLC

[cristiand969]

Dear iLC
Incorrect data leads to diferent results The credit is available with issuing bank :geek: