QUESTION
Dear Mr. Old Man,
Thks a lot for yr support all the time. I am facing a difficult case which I would like to ask for yr opinion as below
Bank A in Vietnam received a collection docs subject to URC522 from a remitting bank in Hongkong. Tenor: DA 90 days from B/L date. Upon acceptance of the Drawee, Bank A released the doc and sent advice of acceptance to the Remiting bank with maturity date as 4 July 2012. However, because of the internal policy, bank A was unable to finance the drawee on the maturity date. Then, the drawee was unable to effect payment through bank A .
According to remitting bank’s instructions (by swift msg) and in line with the drawee’s instructions, Bank A forwarded all copy of docs, original covering letter and swift msg of remitting bank to us and instructed us to effect payment (The reason is that we are ready to finance the drawee to effect this payment)
Question:
1. According URC522, could our bank make payment for the a/m docs?
2. If the answer is “NO”, could our bank make this payment outside URC522? In this case, what should we do to avoid risks?”
With best regards,
DMN
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ANSWER
Hi,
1) Why not? Your bank may make payment to the remitting bank under URC 522 in accordance with the remiting bank’s instructions indicated in their covering letter. Please do quote their transaction reference. If needed (but I thinhk there is no need), please also send a swift message to the remitting bank explaining the facts.
2) I am not sure to understand what you mean by saying “could our bank make this payment outside URC522”. However, you are advised not to effect the payment without complying with the remitting bank’s payment instructions.
Hope the solution can help you.
Best regards,
Mr. Old Man
