Hi friends,
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UCP600 9-b briefly states the responsibility of the advising bank as determining "the authenticity of the credit or amendment" and "...that advice accurately reflects the terms and conditions of the credit or amendment received"
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No conflict for the first one but I have questions for the second one. Does the advising bank have responsibility for the contents of the advice it received if it is not nominated or confirming bank? Should they examine it before advising to beneficiary?
regards
UCP600 9B Briefly States The Responsibility Of Advising Bank
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Navi
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shahriar
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Re: UCP 600 article 9,b...
dear navi,
the responsibility of the advising bank is to advice the credit which accurately reflect the terms and condition of the original credit. i think there are many ways to ensure that and going through may be one of the way. but in any case advising bank is not responsible to study the terms. FAQ3 says that if some content is missing while the advising bank receives the credit from the issuing bank, its the responsibility of the issuing bank.
however you may like to read it for another reason. the LC may contain some terms and conditions that are contradictory to the law of the land. i once found one where the LC requires to send 2% commission to a UN sanctioned country. in that case i decided to revert to the issuing bank.
regd
shahriar
the responsibility of the advising bank is to advice the credit which accurately reflect the terms and condition of the original credit. i think there are many ways to ensure that and going through may be one of the way. but in any case advising bank is not responsible to study the terms. FAQ3 says that if some content is missing while the advising bank receives the credit from the issuing bank, its the responsibility of the issuing bank.
however you may like to read it for another reason. the LC may contain some terms and conditions that are contradictory to the law of the land. i once found one where the LC requires to send 2% commission to a UN sanctioned country. in that case i decided to revert to the issuing bank.
regd
shahriar
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nesarul
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Re: UCP 600 article 9,b...
Dear,
despite The term" accurately reflect the terms & conditions " of a credit is new in the UCP, it is not new at all in the international trade community. this terminology has been inharited from ISP 98.
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Here from my point of view accuractly reflection of terms & Conditions can be explain under the following way:
let advising bank received L/C consists of four pages. while advising a credit, the advising bank advised only three pages whereas the four page contain a condition of stipulated document under this credit.
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since the beneficiafry has not received the condition in its advised letter of credit, he is unable to complied with that.
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under this circumstances the advising bank doesn't fulfilled its advising function. and darely we can say advising bank is liable for it.
regards
nesar
despite The term" accurately reflect the terms & conditions " of a credit is new in the UCP, it is not new at all in the international trade community. this terminology has been inharited from ISP 98.
.
Here from my point of view accuractly reflection of terms & Conditions can be explain under the following way:
let advising bank received L/C consists of four pages. while advising a credit, the advising bank advised only three pages whereas the four page contain a condition of stipulated document under this credit.
.
since the beneficiafry has not received the condition in its advised letter of credit, he is unable to complied with that.
.
under this circumstances the advising bank doesn't fulfilled its advising function. and darely we can say advising bank is liable for it.
regards
nesar
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cristiand969
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Re: UCP 600 article 9,b...
It is a standard banking practice that the advising bank should carry a standard checking the terms and conditions of the credit. As Nesar pointed out there may be conditions contrary to the local or international law, or the credit carries a condition that is not operative until xxx happens or be received.
When advising the credit to your customer he may not be familiar with all publications/practices in place and would happen not to understand operativeness of the credit and my keep you responsible for hiding this.
On the other hand advising bank may be requested to add their confirmation to the credit and if it is unable must inform issuing bank without delay. What's happen if the issuing bank does not check such terms and conditions?
Is therefore an LC officer a responsible person or just want to charge beneficiary just because forwarded ' what it has received' ?
Just some thoughts....
regards
Cristian
When advising the credit to your customer he may not be familiar with all publications/practices in place and would happen not to understand operativeness of the credit and my keep you responsible for hiding this.
On the other hand advising bank may be requested to add their confirmation to the credit and if it is unable must inform issuing bank without delay. What's happen if the issuing bank does not check such terms and conditions?
Is therefore an LC officer a responsible person or just want to charge beneficiary just because forwarded ' what it has received' ?
Just some thoughts....
regards
Cristian