LC Amendment

[bdesh]

Hi everybody,
> IB sent amendment number 1, 2 and 3.
> subsequently IB sent mt799 to treat amendment number 3 as null and void
> IB sent next amendment bearing number 4
.
Should the adv bank advise amendment number 4 or seek clarification from ib regarding number of amendment (amendment number 3 or 4) ? If in the meantime amendment number 3 is
1. Advised
2. Unadvised.
Thanks

[picant]

Hi Pals,

IMHO, MT707 is an officiam amendment, MT799 is only a correction of a previous MT707 comtaining a mistake, probably a clerical mistake, sent to avoid the comunication to the l/c beneficiary of the incorrect amendment. In your case, assuming that amendment no. 3 had no validity, the correct amendment has to be numbered 3(rev) as the beneficiary and the presenting/nominated bank need a numerical sequence.

Other comments appreciated

Ciao

[Judith]

The advising bank should advise all the messages i.e. MT 707s and MT 799 to the beneficiary.

The beneficiary can then decide if amendment 3 or 4 can be accepted.

This is because once an amendment leaves the counters of the issuing bank, it is irrevocable and only the beneficiary has the authority to accept or reject it. (Articles 7 and 10)

The MT 799 from the issuing bank stating that Amendment No. 3 is null and void will not be effective unless agreed to by the beneficiary.

Other comments appreciated.

[ajoy]

Should the adv bank advise amendment number 4 or seek clarification from ib regarding number of amendment (amendment number 3 or 4) ? If in the meantime amendment number 3 is
1. Advised
2. Unadvised.

Hi Bdesh,

My take is as below:

1. Amendment no 3 already advised.

You will need to check with beneficiary first.. Here you will have to pass on the 799 to the bene and ask for thier consent to cancel amendment no 3. Once bene has been advised IB cannot revoke the amendment unilateraly without bene consent.

( In this case it is better to have new amendment number as 4 only. If bene confirms cancellation of amendment no 3, your file should show amendment no 1 , 2 , 3 and 4 as well as cancellation of amnedment no 3 by bene's acceptance. If bene does not respond to 799 at all then the all 4 amendments will remain till the bene submits documents and you can figure out from documents which amendment satys live. I do recommend chasing the bene on the cancellation status though. )

2. Amendment no 3 not advised by you yet:

In this case you may treat the amendment as null and void and change amendment number 4 to amendment no 3 . Do inform the IB that the said amendment no 3 has not been advised and hence you are changing the number to avoid confusion. Please ask them to confirm your action otherwise this might create confusion later on.

Judith is right that UCP is quite clear that once the amendment has left IB counters it irrevocable but if the bene has not been advised yet i.e advising bank is yet to advise amendment no 3 , in practice it makes sense to close it.

Remember Advising bank is taking instructions from and acting on behalf of the IB therefore if they do recall a message which has not left Advising bank's counters yet advising bank must follow the instruction. An agent simply follows instructions unless thier is a valid reason why they cannot.

In either case inform the IB of your actions.

Lastly, I donnot think this is a major problem. If you read the amendments 3 & 4 or talk to bene you are very likely to find out that amendment no 3 has an error/ was not whta bene had asked applicant for and the error was corrected in amendment no 4.

Cheers

Ajoy