Q&A Uncategorized CONFIRMATION By Mr Old Man Posted on March 19, 2016 3 min read 5 0 4,012 Share on Facebook Share on Twitter Share on Google+ Share on Reddit Share on Pinterest Share on Linkedin Share on Tumblr On the summit of Hai Van Pass QUESTION Dear Mr. Old Man, We need your expertise opinion on the following case: LC issued by ABC Bank states: – Field 41a: (Available With …. By…) ANY BANK BY NEGOTIATION – Field 49 (Confirmation instructions) CONFIRM We as the advising bank advised the LC as received to the beneficiary without adding our confirmation to the LC. However, we forgot to inform the issuing bank of the same. Our questions: Is our bank deemed to have confirmed the LC? Must our bank negotiate without recourse if the documents presented are complying? Thank you in advance. Best regards, PN ————— ANSWER Hi, My quick answers are: No. No. What I understand from your description is that your bank is requested to confirm the LC and it was not prepared to do so, but it failed to inform the issuing bank of its decision not to confirm the LC, and that it advised the LC to the beneficiary without confirmation. As it advised the LC without confirmation, it is not the confirming bank, and hence, it is not obliged to negotiate the documents. (The beneficiary should know that the code “CONFIRM” in Field 49 does not signify that the LC has been confirmed. It is just a request or an authorization by the issuing bank for the advising bank/the receiver to add its confirmation to the LC and the advising bank may or may not agree to act on that request or authorization). By failing to inform the issuing bank of its decision not to confirm the LC, the advising bank did not comply with UCP 600 sub-article 8 (d). However, this failure does not cause the advising bank to become the confirming bank that must negotiate the documents and/or drafts. Kind regards, Mr. Old Man
IS THE NOMINATED BANK REQUIRED TO VERIFY WHETHER THE BENEFICIARY HAS AUTHORIZED THE PRESENTING BANK TO PRESENT THE DOCUMENTS?
CAN THE ISUING BANK CITE “LATE PRESENTATION” AS A DISCREPANCY SOLELY BASED ON THE DATE OF THE COVER LETTER?
IS THE NOMINATED BANK REQUIRED TO VERIFY WHETHER THE BENEFICIARY HAS AUTHORIZED THE PRESENTING BANK TO PRESENT THE DOCUMENTS?
CAN THE ISUING BANK CITE “LATE PRESENTATION” AS A DISCREPANCY SOLELY BASED ON THE DATE OF THE COVER LETTER?