CAN THE FIRST BENEFICIARY REQUEST TO TRANSFER THE LC FOR AN AMOUNT LOWER THE ORIGINAL AMOUNT? QUESTION Hi Mr. Old Man. I would like to seek your professional opinion. Master LC amount USD770,000 47a show invoice amount USD1,070,000，USD770,000 paid by LC，USD300,000 prepayment. First beneficiary request transfer LC, transferred LC amount USD720,000 47a show invoice USD800,000，USD720,000 paid by LC，USD80,000 prepayment. Can the advising bank accept the first beneficiary ‘s request? Thanks!! Kevin — ANSWER Hi, According to … Read More
CAN AN SBLC BE ISUED IN FAVOUR OF MORE THAN ONE BENEFICIARIES? QUESTION Dear Mr. Old Man, Our customer (ABC, Singapore) has a draft SBLC to be issued in their favour and the applicant’s name is XYZ, Taiwan. No other special instruction stated in the SBLC. In the event of default of payment by applicant, the beneficiary will activate this SBLC to claim on the issuing Bank. Our customer is asking if … Read More
WHETHER AN INSURANCE DOCUMENT CAN INDICATE THAT COVER IS SUBJECT TO A DEDUCTIBLE CLAUSE QUESTION Dear Mr. Old Man, LC requires: FULL SET OF ORIGINAL INSURANCE POLICY/CERTIFICATE IN ASSIGNABLE FORM AND ENDORSED IN BLANK FOR 110PCT SHIPMENT VALUE, COVERING ALL RISKS, SHOWING CLAIM PAYABLE IN VIETNAM IN INVOICE CURRENCY AND SHOWING TOTAL NUMBER OF ORIGINALS ISSUED. The presented insurance policy shows: DEDUCTIBLE: 0.3% OF THE SUM INSURED OF THE WHOLE CONSIGNMENT. Can we raise … Read More
INVOICE SHOWING GST QUESTION Dear Mr. Old Man, LC requests for 1 original commercial invoice. LC value USD 30,000 Amount tolerance: 10/10 Bene: XYZ LTD, Melbourne, Australia Applicant: ABC, Melbourne, Australia Goods description: 560kgs of xxx as per PI no 123 and other details as per Purchase contract 678. DDP Melbourne, Australia Presented Commercial invoice Reflects the goods description as per LC and … Read More
IS IT POSSIBLE TO ISSUE A BILL OF LADING OR AN AIRWAY BILL CONSIGNED TO TWO BANKS? QUESTION Mr. Old man, Is it possible to issue BL or AWL consigned to two banks? Mirza —- ANSWER Hi Mirza, I must admit that I have never come across a bill of lading or an airway bill consigned to two banks. However, it is quite possible. If the LC requires a bill of lading or an airway bill consigned … Read More
Q&A REGARDING PRESENTATION PERIOD AND 1/3 ORIGINAL BL SENT DIRECTLY TO THE APPLICANT QUESTION Hi Mr. Old Man, 1/ I’ve studied some LCs from the Internet and found out that most of the presentation period is within 10-15 days. Is it enough time considering it may take longer to send the documents overseas? Not to mention that the courier may have some difficulties that may delay the shipment of the docs. 2/ LC … Read More
WHETHER THERE ARE CASES WHERE THE ISSUING BANK HAS ACTED IN A MANNER THAT FAVOURS THE APPLICANT AND HARMS THE BENEFICIARY QUESTION Hi Mr. Old Man, Thank you for the prompt response. I’ve spent few hours browsing the Internet before writing this email but still have questions that I can’t find the answers for. If you click this link, the article says: “The applicant has not provided its waiver of discrepancies within the time allowed by the UCP 600 (which can be no … Read More
WHERE THE DOCUMENTS CONTAIN DISCREPANCIES NOT WAIVED BY THE APPLICANT QUESTION Hi Mr. Old Man, I hope you are doing fine. I have some follow-up questions again. 1/ What happens to an LC if it is discrepant and the buyer refuses to waive the discrepancies? a. Does the buyer typically let the LC expire? If so, are there any fees charged to the seller? b. I assume the seller would … Read More
WHERE THE INSURANCE CERTIFICATE SHOWS THE ISSUING BANK AS THE ASSURED PARTY QUESTION Dear Mr. Old Man, Following insurance clause in the LC, full set insurance certificate for 110pct of invoice value in favour of Bank of India, Mumbai covering All risks and war risks. Presented certificate states: Insured – Bank of India, Mumbai My view in this case Insured being the said Bank meets the LC requirement of insurance certificate in … Read More
MT 799 – PROOF OF FUNDS QUESTION Dear Duc Nguyen Huu Sincere greetings! How are you Bank Master? There is currently a new seller who requires the buyer to provide proof of any bank-to-bank funds. The buyer said that due to MT799/199, the entire payment needs to be deposited in the bank. Large companies have no problem due to their strong funds, but small and medium-sized … Read More