concept of risk in definition of negotiation

[berry]

dear friends,

another thought on negotiation.

Negotiation means the purchase by the nominated bank of draft (drawn on a bank other than the nominated bank) and/or documents under a complying presentation, by advancing or agreeing to advance funds to the beneficiary on or before the banking day on which reimbursement is due to the nominated bank.

when i say due, i appears to me that there is some sort of undertaking from the issuing bank. but negotiating is suppose to before the communication of acceptance of the issuing bank and hence during negotiation there should be nothing like "due".

help me to understand this.

[iLC]

i would certainly call that an attorney's interpretation. anyway, to me the UCP is fairly right on this occasion. due means, "at least to me", unpaid

[ybattia]

I need help on this one too,
could someone please explain what's exactly meant by negotiation in simple steps..

Waiting your replies,

Thanks,

[iLC]

i guess this one is the most discussed topic so far anyway, i will try to explain; in simple

negotiation is like paying other's liability from own pocket. if the credit is available by negotiation, the beneficiary will approach the nominated bank for negotiation. if the document is found complying, the nominated bank "may" negotiate. in that case it will create a temporary loan account and will pay the beneficiary from that account. since its a kind of loan, the nominated bank will charge interest for that. the document will then be forwarder to issuing bank which will in turn reimburse the nominated bank. this is the whole process in simple

i know there are flaws in the answer from "critical point of view". experts, please excuse me on this occasion.