tolerance in letter of credit

[nura]

we received a LC which has the following description of goods

1. Goods xxxxxx, Price USD 1000 per unit, Unit 10 Pcs
2. Goods zzzzzzz, Price USD 500 per unit. Unit 10 Pcs

LC value 15000
in 46a, the LC has a tolerance of 5% on price. my question is, does that 5% falls on price as well? if no, can we increase the price of goods xxxx by 5% (that is USD 1050) and ship 10 pcs for 10500 and ship 9 Pcs of goods zzzzz? in that way we will be within the LC value? please note partial shipment is allowed

[mia vervacke]

What was written in field 46A? Please give exact statement.

Field 46A considers 'Documents required' and you already state in your question 'the LC has a tolerance of 5% on price'. I don't understand your question 'does that 5% falls on price as well?'

[Phani Krishna]

hi,
my opinion is,
as per ucp600 article 30 if a tolerance is for value then maximum of -5% of the value is acceptable and not more then LC amount and by the way if you increase the unit price also issuing bank//paying bank will not be responsible for the value which is more than credit amount.
hope this is correct and let me know if it's not the correct solution.

[mia vervacke]

I don't agree with Phani Krishna

Tolerance is always on total value and quantity, unless otherwise stated.

Unit price should always be as stated in the credit, except if tolerance refers to unit price (f.e. approximately/ about USD 1.000).

Other comments appreciated