Mr Old Man Payment Q&A WHETHER THE BENEFICIARY CAN NEGOTIATE THE DOCUMENTS WITH THE 1ST ADVISING BANK By Mr Old Man Posted on December 2, 2023 1 min read 2 1 1,166 Share on Facebook Share on Twitter Share on Google+ Share on Reddit Share on Pinterest Share on Linkedin Share on Tumblr QUESTION Hi Sir, Can the 1st advising bank contact the beneficiary and negotiate documents directly even there is a 2nd advising bank indicated in the LC? Regards, DC ———– ANSWER Hi, Where the L/C is available with any bank by negotiation, the beneficiary may present the documents to any bank including the first advising bank for negotiation, that is to say, the first advising bank can negotiate the complying documents and is entitled to the issuing bank ’s reimbursement. Where the L/C is restrictedly available with the second advising bank, the beneficiary who wishes to negotiate the documents should present the documents to the second advising bank for negotiation. The first advising bank in this case is not the bank that is nominated/authorized by the issuing bank to negotiate the documents. Therefore, if it accepts to negotiate the documents, it cannot sue the issuing bank in its own name in the event the issuing bank refuses to reimburse for whatever reasons. 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?