Hiya all
Not posted for a long long time but would appreciate your views on the following:
Documents received and found discrepanct. We, as confirming bank, reject the documents and advise the beneficiary accordingly. They instruct us to forward documents to the issuing bank for approval.
Does the fact that we have rejected the documents already remove the requirement for the issuing bank to check and accept/reject within 5 banking days or do they still have to adhere to this clause.
Appreciate your views on this and trust you have sufficient information above to respond.
5 days to reject
5 days to reject
Dear Rob,
600's art.14a states "..and the issuing bank must examine a presentation to determine...".
600's art.14b states "...and the issuing bank shall each have a maximum of five banking days...".
600's art.16c states "...a confirming bank,if any, or the issuing bank decides to refuse to honour or negotiate, it must give a single notice to that effect to the presenter."
as per 16d the notice must be given latest the close of 5th banking day following date of presentation.
consequently:
iss.bank has the following options:
either to reject docs and notify the rejection to you as per ucp600-art.16 (if not otherwise stipulated in the l/c)
or to accept the docs (obtain applicant's acceptance) despite your rejection to bnf and effect paym as per l/c.
in any of the two cases above iss.bank must inform you their decision within 5 banking days.
regards,
bogdan
600's art.14a states "..and the issuing bank must examine a presentation to determine...".
600's art.14b states "...and the issuing bank shall each have a maximum of five banking days...".
600's art.16c states "...a confirming bank,if any, or the issuing bank decides to refuse to honour or negotiate, it must give a single notice to that effect to the presenter."
as per 16d the notice must be given latest the close of 5th banking day following date of presentation.
consequently:
iss.bank has the following options:
either to reject docs and notify the rejection to you as per ucp600-art.16 (if not otherwise stipulated in the l/c)
or to accept the docs (obtain applicant's acceptance) despite your rejection to bnf and effect paym as per l/c.
in any of the two cases above iss.bank must inform you their decision within 5 banking days.
regards,
bogdan
5 days to reject
Yes, the issuing bank can decide to refuse (due to the discrepancies) and if so it must issue its notice of refusal not later the close of the fifth banking day following the day of presentation.
Otherwise the issuing bank will be bound the ‘preclusion rule’ of UCP 600 sub-article 16 (f).
Svetlana
Otherwise the issuing bank will be bound the ‘preclusion rule’ of UCP 600 sub-article 16 (f).
Svetlana