WHETHER  AN LC CAN STATE MORE THAN ONE PLACE OF EXPIRY

QUESTION

Good morning, Mr. Old Man

Actually, I felt rather awkward calling you “Mr. Old Man” when you look so young in the picture!

I have one question need your expert opinion:

My customer (applicant) would like to open an L/C to a Singapore bank. Beneficiary showing Hong Kong address.

Applicant requested the place of expiry to show “Singapore or Hong Kong” reason being beneficiary cannot decide whether the documents will negotiate in Hong Kong or Singapore as beneficiary has operations both in Singapore and Hong Kong.

Can we accept such a requirement? My understanding is that we can only indicate one expiry place.

Please help!

Many thanks!

Jas

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ANSWER

Dear Jas,

Mr. Old Man was simply a nick given by a friend when I first joined the world of blogs.

In practice, the expiry place is the same as the place for availability. The beneficiary can present the documents to the bank with which the LC is available within the stipulated expiry date and presentation period.

It is true that where the LC is available by negotiation with any bank, the expiry place is normally in the country of the beneficiary. However, this is not a MUST.

If the LC states it is available by negotiation with any bank in Singapore or Hong Kong, the beneficiary may make presentation to any bank in Singapore or Hong Kong for negotiation within the expiry date and/or by the last day for presentation.

In my opinion, such a requirement is acceptable.

Best regards,

Mr. Old Man

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