Example Of Revolving LC

Albert · Post by **Albert** » Sat Jan 21, 2017 12:31 am

Dear All,

Can some one help me how revolving LC by time is different from shipment schedule .

Appreciate your respond.

khaledosama · Post by **khaledosama** » Sun Feb 12, 2017 4:23 pm

Dear Albert,

revolving l/c depending on three factors
1-revolving by time , or by value .
2-automatic or not automatic.
3-cumulative or not cumulative .

in your case if its revolving by time lets say usd 20,000 every month and its not automatic
then the face value of the l/c will be only USD 20,000.00
And it starts over every time your give instruction,

revolving l/c can be any combination of the three elements , and each time the result will be different

Lydia · Post by **Lydia** » Tue Feb 14, 2017 2:41 pm

Thanks for your clarifications

But I need to ask in case of revovoling LC by time , if one of the shipment is not made on time so this LC will be cease for this shipmement and following shipment or discrepancy for this shipment only

shafi865 · Post by **shafi865** » Sat Feb 25, 2017 12:13 am

Hi,
A revolving LC has three main features :
1) The type
2) Automatic or not
3) Cumulative or not

As the revolving LC has the characteristic of being cumulative, this allows any amount not used in a period/month is available in each following period/month.

So from this nature, it is obvious that revolving LC is not govern by UCP 600 article 32, that is, not to cease the availability of any installment that is not drawn or shipped in time.

Regards,
Shafique

khaledosama · Post by **khaledosama** » Tue Mar 07, 2017 1:06 pm

Dear Lydia ,

as Mr. shafi865 says,
under revolving l/c you can only chose whether to be cumulative or not cumulative ,
if the revolving l/c not cumulative , then any installment not shipped will not be available

best regards