amendment of a letter of credit

[berry]

UCP 600 article says

Except as otherwise provided by article 38, a credit can neither be amended nor cancelled without the agreement of the issuing bank, the confirming bank, if any, and the beneficiary.

now UCP 600 also allows confirming bank to advise an amendment without extending its confirmation. does it mean that when confirming bank makes such a advise, it has agreed to the amendment?

why it is necessary for a confirming bank to agree with an amendment while it has the option to advise the amendment without extending its confirmation

[Jackie]

Hi
The confirming bank may choose to advise the amendment without extending their confirmation to the contents if the amendment is increasing or extending the validity of the letter of credit. The reason for this is that they may only have authority to confirm the value of the original l/credit or a certain validity or perhaps the country risk has changed since the l/credit was issued.

[roc_soar1983]

I think in this situation,the cinfirming bank has become an advising bank without resposibility to confirm the L/C.It only need to check the authentication on the face of the L/C.

[vinod]

Since confirmation is an irrevocable undertaking, change in terms necessitates revisiting the amended terms by the confirming bank. If the confirming bank feels that their liability is increased or their position weakened by agreeing to amendment or if the staus of the issuing bank has changed adversely the confirming bank has the right to safeguard their interests. However the question is how would a confirming bank handle a credi confirmed by them but amendment unconfirmed only advised.

If docs as per new amendment are submitted then confirming bank can claim that they need not pay since their confirmation is not available on the amended terms. Does this in effect provide an escape route for confirming bank after collecting huge confirming charges.

[iLC]

it is important for an amendment to be agreed by the confirming bank because the amendment may involve some clause not acceptable to the confirming bank. for example if the issuing bank issues an amendment under which goods will be shipped from a UN sanctioned country, confirming bank in most cases will refuse the amendment.

when a confirming bank advises an amendment without extending its confirmation, even in that scenario the confirming bank is agreeing with the amendment. but not extending its confirmation. there could be many reason. for example with the amendment the issuing bank might have been exceeding their credit limit.