What Is A Mirror DC

[javed]

Dear All,

My name is Javed. May I have some idea about "Mirror DC" from anyone?

[shahriar]

dear javed,

i have searched a lot and have two possible answer

1. a mirror lc is a transferred lc
2. a complying document is a mirror lc!!!

im looking for the other members opinion

shahriar

[javed]

Dear Shahriar,

Thanks for your comment.

My view is, Mirror DCs are those in which terms of Back to Back DCs exactly match those of Master DCs. Your comment please.

If anyone has experience of handling such transaction, please share.

Thanks
Javed

[shahriar]

dear javed,

yes, your btb concept seems more appropriate. i have just found a statement at hang seng bank website

We will issue a transferred documentary credit on your behalf with terms and conditions that mirror the master documentary credit from your buyer, even you have not arranged any banking facilities with us.

though it has used the term transferred credit, i will take it as a BTB since there is a master lc behind.

shahriar

[kamal]

Dear Javed & Shahriar,

Thanks for your good question and participation. In this way we can learn many things.


Thanks a lot Shahriar for your effort. We think this kind of dedication will continue.

[nesarul]

Dear All,
I have disagreement with Shahriar, Transferred credit and BTB credit can not be the same, Yes, One can open BTB credit from the same goods.
thanks
nesar

[shahriar]

dear all

sorry for the last posting. my intention was nt to say that btb is same as transferred letter of credit. all i was trying to say that mirror lc could be a btb lc that has same features as the master lc.

however i made a serious mistake in analysis.

We will issue a transferred documentary credit on your behalf with terms and conditions that mirror the master documentary credit from your buyer, even you have not arranged any banking facilities with us.

as i reconsider the bold words, i felt that the bank is actually pointing to transferred letter of credit. since its quite obvious that a bank wont issue BTB lc on behalf of the non customers

shahriar

[Md.zakir Hossen]

I agree with Nesar opinion. So more findings needed for the Mirror Documentary Credit.

[nesarul]

Dear All,
From my point of view mirror L/C can take any of the following form:
1.After receiving an export L/C, the beneficiary can issue an BTB for the same product from another beneficiary(not second beneficiary) with the same terms and condition.
2. transferring bank after receiving a transferable credit ,may issue a Transferred credit with allowable alteration mentioned in sub article 38(g). and
3. When the issuing bank issues a pre-advise credit, It has to issue an operative credit instrument with terms and conditions not inconsistence with the pre-advise credit.
thanks
nesar

[javed]

Dear All,

I would like to ask two more questions relate to Mirror DC:
1) Do any bank has the parctise of opening Mirror DC?
2) What type of risk involve with this?

Thanks
Javed

[Sharif]

Dear All
While looking for Mirror L/C I have found some interesting use of Mirror L/C at Trust agreement and also some more L/C related terms such as "Addition letter of credit" and "Secondary letter of credit".

It seems that the mirror L/C is not a trade facilitator rather it is used as irrevocable commitment to pay under some circumstances.

Pls find the following link.

http://www.techagreements.com/agreement ... 13,%201997

Regards
Sharif

[shahriar]

dear sharif,

good pickup.

shahriar