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BRANCHES OF A BANK IN DIFFERENT COUNTRIES ARE SEPARATE BANKS

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Bodhisattva Tara in bronze was unearthed at Dong Duong Buddhism Center of Champa Kingdom was recognized as National treasure. 

QUESTION

Hi

If date and place of expiry in letter of credit says 21st Nov 2023 Singapore. However, the documents were presented in a bank located at China.

Does this constitute a discrepancy?

I did not find anything in this regard in UCP or ISBP.

As always thank you for your cooperation.

Regards,

Siddhartha

ANSWER

Hi,

You did not tell me which bank in Singapore the LC is available with. So, my answer is based on the assumption that the LC is available with the issuing bank in Singapore.

If the LC is available with the issuing bank and the date and place of expiry is in Singapore, the documents must be presented to the issuing bank in Singapore before or on the last day for presentation at the latest and must be within the LC validity.

According to Article 3 UCP 600, branches of a bank in different countries are considered to be separate banks. Therefore, the issuing bank’s branch in China is not obliged to honour the documents presented under the LC available with the issuing bank in Singapore. It can only act as a presenter that presents the documents to the issuing bank on behalf of the beneficiary. And if the documents presented by the issuing bank’s branch in China do not reach the issuing bank’s counter in Singapore within the specified presentation period and within the LC validity, the issuing bank may refuse the documents stating the discrepancy “late presentation” or “LC expired”.

The answer is the same in case the LC is available with the confirming bank in Singapore.

Regards.

Mr. Old Man

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