DOCUMENTS DIRECTLY PRESENTED BY THE APPLICANT

QUERY

Nhu writes:

Dear Mr Old Man,

Pls help me with the following question: L/C call in 46A: cert of quantity and quality will be presented directly by applicant. Ben presented to the issuing bank without cert of quantity and quality issuing bank show the discrepancy: cert of quantity and quality not be presented. they haven't been receiving that cert from the applicant.

In your opinion, is it discrepancy? Thanks for your advices.

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COMMENT

Dear Nhu,

ISBP para. 4 warns that a credit should not require presentation of documents that are to be issued or countersigned by the applicant. If a credit is issued including such terms, the beneficiary must either seek amendment or comply with them and bear the risk of failure to do so.

It’s worse if the required documents are to be presented by the applicant. The beneficiary should have asked the issuing bank to delete this “out of control” requirement from field 46A to avoid this dilemma.

It is agreed that all documents required in field 46A must be presented to constitute a complying presentation and that missing any required documents would result in a non-complying presentation. Strict compliance doctrine followers would agree that the discrepancy raised by the issuing bank is valid.

As far as I’m concerned, document checkers should approach the issue with common sense. If I were the issuing bank, I would not reject the documents. My argument is that anyway, the applicant is not in position to reject the documents due to a discrepancy caused by himself.

Best regards,
Mr. Old Man