QUESTION
Dear Mr Old Man,
Please help me the following:
L/C required documents to be sent to the issuing bank in two lots but the negotiating bank sent in one lot only.
The issuing bank raised the discrepancy “Documents sent in one lot instead of two lots”.
I was told that the discrepancy was not valid according to TA768.
Could you explain to me why?
Best regards,
LNAT
———-
ANSWER
Dear LNAT,
There’s no need for Mr. Old Man’s explantion. The discrepancy was not valid for refusal. Below is ICC’s analysis and conclusion quoted from TA768.
QUOTE
Analysis
An instruction regarding the mailing of documents is a bank-to-bank instruction and has nothing to do with the determination of their compliance with the terms and conditions of the credit. The wording of the refusal notice appears to indicate that the documents themselves were complying.
If a nominated bank decides, on its own initiative or at the request of the beneficiary, to deviate from the stated mailing instructions, it bears the risk associated with such action, including the loss of documents in transit.
However, when the documents reach the issuing bank in one mailing as opposed to two, it is bound to examine them for compliance under the requirements of UCP 600.
If the presentation is compliant, the issuing bank must honour or reimburse according to sub-article 7 (c), even if the manner in which the documents were sent is different from that stated in the credit.
Conclusion
The discrepancy is not valid and the issuing bank must honour.
UNQUOTE
Hope it’s clear now.
Best regards,
Mr. Old Man
