Intro In LC practice, refusals often arise not because a document is missing, but because banks read documentary requirements in isolation rather than in context. One recurring issue is whether supporting evidence attached to a required document must independently comply with a general condition such as “all documents must show contract number and date”. The following Q&A illustrates why …

Intro There have been cases where an issuing bank refused to honour a credit on the grounds that the beneficiary presented the documents at a branch other than the branch expressly nominated in the LC, even though both branches belong to the same bank and are located in the same country. In such cases, the beneficiary is unable to re-present …

Intro In LC practice, commercial invoices are often treated as rigid documents that must strictly mirror the credit amount. However, UCP 600 allows for a degree of flexibility — provided banks understand where discretion ends and obligation begins. One such provision is UCP 600 sub-article 18(b), which deals with invoices issued for amounts exceeding the LC value. The following Q&A …

Intro Credits that split payment between shipment and installation often cause confusion when partial shipments are involved. The key question is whether payment should be linked to a percentage of the invoice or a percentage of the LC amount. Question Dear Mr. Old Man, We have an LC for USD 10,000, available by payment. The LC provides: * 80% payable …

Intro Insurace documents under letters of credit often create confusion—especially when beneficiaries apply bill of lading concepts to insurance policies or certificates. One recurring grey area is whether an insurance document should be endorsed “to” a named bank or “to the order of” that bank, particularly when the credit expressly requires the document to be transferable. The following Q&A addresses …

Intro  One of the recurring sources of confusion in trade finance arises when Incoterms® are mechanically copied into a letter of credit without considering what those rules actually require — or do not require.  A typical example is an LC issued on DDP terms that nevertheless calls for the presentation of an insurance policy or certificate. Is that correct? And …

Intro In practice, documents are often presented to a nominated bank close to the LC expiry date and then forwarded onward to a confirming bank. This raises a recurring question: does the confirming bank have the right to refuse simply because the documents reach its counter after expiry?  The following scenario illustrates why forwarding time must not be confused with …

Intro One of the most common — and often unnecessary — discrepancies raised in document examination relates to the format of dates shown on transport documents. Examiners sometimes hesitate when a date is expressed numerically rather than with the month stated in words. But does such hesitation have any basis under ISBP 821? Let’s look at a straightforward example. __________ …

Intro  Credits often require that documents “indicate the L/C reference,” but do not always specify which reference is meant. Is it the issuing bank’s LC number? Or could a negotiating bank expect its own reference to appear on the documents? Mr. Old Man looks at this question through the lens of UCP 600 and ISBP 821. Question Dear Mr. Old …

Intro One of the most common — and persistent — areas of confusion in document examination arises when a credit requires an ocean bill of lading, but the routing information in the L/C or the transport document refers to an inland final destination. Does this automatically turn the document into a multimodal transport document to be examined under UCP 600 …