Purpose of Letter of credit (“LC”) is to give payment security to the beneficiary The applicable rules of UCP A generic checklist is given below to assist parties involved in the transaction in . Certificate of Origin. An LC is a contract by which a bank agrees to pay the beneficiary upon the Credits (“UCP”) are international rules published . such as insurance documents and certificates. the LC. 2. Bills of lading are not clean – meaning they bear. As an exporter, how accurate are the letter of credit documents that Practice for Documentary Credits (UCP ), transport documents, A Certificate of Origin is a signed declaration stating the country of origin of the goods.

Author: Goltik Zulkigar
Country: South Africa
Language: English (Spanish)
Genre: Politics
Published (Last): 8 December 2006
Pages: 460
PDF File Size: 10.8 Mb
ePub File Size: 2.30 Mb
ISBN: 280-8-88870-164-5
Downloads: 52735
Price: Free* [*Free Regsitration Required]
Uploader: Midal

Indicate the place of issuance. It should show deduction towards agency commission payable etc. Bear in mind, as cup, that over half of credit documents are rejected on first presentation to the banks.

A great many of those rejections could be avoided if more care was taken to ensure that the documents called for in the credit are properly completed.

It must indicate whether freight is prepaid or payable at destination. Unless otherwise stated in a Letter of credit, this document may be issued by the beneficiary, however it is more likely that the credit will stipulate that a Certificate of Origin is to be issued or authenticated by a local Chamber of Commerce.

In order to ensure you have all the information necessary for negotiating a sales contract you my wish to consider the following points:. Fill in your details below or click an icon to log in: Must be issued by a named carrier or his authorized agent. Where there are any inconsistencies with this guide, UCP lrtter prevail. To ensure a letter of credit is workable, trouble-free and provides the security of payment for which it is requested in the first place, it is essential to take simple yet effective precautions at the start.

It is recommended that the details of the credit be recorded at this point so that a progress check can be updated right through to presentation cretificate the final documents to the bank for payment. Advanced Letters of Credit Training for Exporters. This checklist is intended primarily for use in export sales and shipping departments.


Where there are any inconsistencies with this guide, UCP will prevail. Indicate the name of consignor and his address.

Kindly note the below checklist is only illustrative and not exhaustive. Leave a Reply Cancel reply Enter your comment here The Insurance Certificate stipulates the amount of insurance, the goods insured and risks covered. Be signed by the named carrier or his authorized agent. If LC allows transshipment, such risk must be covered. Successive surveys by SITPRO and others have shown that well in excess of fifty percent of documents presented by exporters to banks crefit payment under letters of credit are rejected on first presentation.

Common Letter of Credit Documents

Any letter of credit requirements which are still not clear should be referred to your bank for clarification without delay. A Waybill is a document issued by the carrier of the goods or its agent. At an uc; stage, it will be in your best interests to send a copy of the credit to your forwarder or whoever will obtain the transport documents.

When will the Advising Bank Pay? The draft is issued by the beneficiary as required under the terms of the credit and is drawn on the bank stipulated in the credit.

Letters of Credit – Checklist and Guide for Exporters – Sit Pro

It must confirm to facts like IEC No. Under UCP rules, banks require documentary evidence to support such conditions. Making these key checks on the day the credit arrives, consulting other departments accordingly and carrying out the more detailed checks immediately afterwards, will enable difficulties to be spotted in better time to take action.

Banks enjoy finding Discrepancies. It is required by the customs authorities of certain countries checklisst import to assess import duty and verify place of manufacture for political reasons.

Letters of Credit – Checklist and Guide for Export Sales Executives

Description of goods specified must correspond with the description in the LC. Must indicate the name of the consignor and address.


All documents are submitted in the requisite number of copies. The terms and conditions of the documentary credit. The checklist designed for importers is to be used by purchasing staff when applying to local banks for letters of credit. Must indicate the name of the assured. Road, Rail or Inland Lether Transport Document Signed ot required by UCP article 24, noting that if an agent signs on behalf of a carrier, the agent must be named and indicate the capacity in which it is signing i.

If ocean transport forms only a part of the complete journey, a Multimodal Transport Document or Combined Transport Bill of Lading can be issued to cover all stages of the journey. In order to represent the sales contract properly, complete the bank application form with certivicate customer, watching for points in the following list.

Ensure these detailed but ecrtificate points are settled before concluding discussions oritin can save problems with discrepancies later. The requisite and stipulated documents are originals or marked as originals and appear to be signed. Learn how your comment data is processed. Air Waybills also known as Air Consignment Notes are obtained from airlines whilst Sea Waybills are issued by a shipping company. Indicate receipt of the goods by signature, stamp or notation.

It is not a document of title. Must indicate the mode of conveyance Air, Sea, Road etc.

Bill of Lading Be issued by a named carrier or his authorized agent. It should be signed by the drawer or his authorized representative. It should be drawn in the same currency of LC, unless otherwise specified. Must bear the number of the LC. Nevertheless, the buyer is in letger being asked certificaet, after all, they still want the goods and is prepared to accept the discrepancies in the documents.

Indication of freight payment is in accordance with the requirements of the documentary credit. It acts as a receipt for the goods and provides evidence of a contract of carriage.

Posted in: Art