How To Know That Collection Instruction Requires Avail

[Chamnan]

Dear Expert

Could you told me in the covering schedule which instruction that we know this collection require avail?

Thanks

[picant]

Hi Pal,

Normally the remittance letter contains instructions for payment (D/P) or acceptance (D/A). In your case you will add to acceptance instructions "AND YOUR BANK'S AVAL" and the way that the sentence is "PLEASE DELIVER DOCUMENTS AGAINST DRAWEE' ACCEPTANCE OF THE DRAFT AND YOUR BANK'S AVAL". PLEASE RETURN THE ACCEPTED AND AVALISED DRAT TO OURSELVES or HOLD THE DRAFT FOR COLLECTION AT MATURITY or the like.
Other comments appreciated
Ciao

[moneo]

Under collection they must present a draft drawn on the collecting bank name (drawee's bank) and can not be drawn on the customer name, However, that draft must supported by their clear instruction to AVAL the draft.

[picant]

Hi Pals,

IMHO aval is something to add to acceptance, acceptance is made by the drawee, aval by a third party/bank.
Ciao

[LLawrence]

Whether the bill requires avalisation or not - it will be mentioned on the bank schedule.
Nevertheless, if you don't get bill avalised you could contact your bank for more info - the worst case scenario they will say that the bill is not avalised. It's a common practice where banks forget to mention that bill needs to be avalised.