Letter of Credit Transaction

[Malocm]

A prospective customer of your bank who is an importer who sells in the local market has made the following proposal for credit facilities while he has disclosed the operational modalities of the proposed trade that has contracted with a seller overseas. He has not disclosed the seller’s country or the type of goods in which he wishes to trade. He wishes your bank to establish on his behalf confirmed documentary credits available by negotiation with draft drawn on the confirming bank at 180 days after sight.
The documents required for a complying presentation are,
• Copy or photocopy or fax copy or non negotiable copy of the B/L
• Copy or photocopy or fax copy of the commercial invoice
• Copy or photocopy or fax copy of beneficiaries certificate certifying that the original shipping documents including the bill f lading have been sent by courier direct to the applicant and the goods described in the credit will be discharged at the indicated port.

He also wishes to include the following conditions
• A charter party B/L is applicable
• Documents showing quantity different from B/L in applicable
• B/L presented after 21 days from shipment but before the expiry of the credit acceptable.
• Despite the price being indicated as FOB B/L indicating freight prepaid or payable as per charter party acceptable.
• Third party documents acceptable.
• All discrepancies in documents acceptable with the exception of overdrawing of the credit and expiry of the credit.
• Copy documents acceptable for negotiation.
• The credit should be subject to UCP 600.


help to analyse the request of the customer from the operational method requested by him and identify areas of inconsistency in practices..