BRANCHES OF A BANK IN THE SAME COUNTRY

QUERY FROM ABDUL JALEEL
Credit available with confirming bank's branch in the same country
Wed, 03/10/2010 – 23:45 — abdul jaleel

Hi,

Pls, someone can assist me on this :

We have a L/C stating as CREDIT AVAILABLE WITH …. BY PAYMENT. In this case, do we need to submit the documents in our Banker's counter or at the confirming bank's branch office in our country? Whether we can request our banker to scrutinise the documents & forward to the confirming bank's branch ?

A quick reply would be appreciated.

———————————–

COMMENT
Thu, 03/11/2010 – 13:20 — nhduc.dng
Branches of a bank in the same country

Hi,

Branches of a bank in the same country is considered to be the same bank. Please refer to ICC conclusions on a similar query quoted below:

R387:
Branches of the same bank in the same country are considered to be the same bank. If a letter of credit is stated to be available with Bank X Branch Y in Country Z, then the documents may be negotiated by that particular branch or any other branch of that bank in the Country Z.

R506:
Article 2 of UCP 500 is quite clear in stating that for the purposes of the Articles in UCP, branches of a bank in a different country are considered to be another bank. It follows that branches of banks in the same country are considered to be the same bank.

Hope you find it helpful.

Regards,
Nguyen Huu Duc

——————-

Thu, 03/11/2010 – 14:06 — abdul jaleel
few more points required

As written in the L/c under 41 D, it is AVAILABLE WITH CITIBANK BRANCH OFFICE, BY PAYMENT. What we need to know is whether we can submit the documents through our Banker ? Will our bank scrutinise the documents before sending to citibank ? Will the payment be made by the Citibank branch office or it has to be released by the issuing bank ? Pls. clarify thanks.

—————————-

Thu, 03/11/2010 – 15:53 — nhduc.dng
The confiming bank must pay …

Hi,

If the LC is confirmed by and available with Citibank Branch Office by payment, the documents should be presented to Citibank Branch Office for payment. The confirming bank, i.e. Citibank Branch Office, must pay if the documents presented are complying.

The documents can be presented to the counter of the confirming bank either directly by the beneficiary or through the beneficiary’s banker.

In case the documents are presented through the beneficiary’s banker which is not a branch of Citibank or is a branch of Citibank but not located in the same country, the beneficiary’s banker is acting as a remitting bank only. The remitting bank may or may not check the documents at its own discretion but must ensure that the documents must reach the counter of the confirming bank by the last day for presentation and within the validity of the LC. Please note that under LC available with a nominated bank by payment, the LC would normally expire at the counter of the nominated bank.

Regards,
Nguyen Huu Duc …