Hi there,
One of my clients, a major french company, is starting to deal with Iran, and ask me, if there is any special issue concerning iranian lcs, and which banks in France or Europ, confirm iranian lcs.
Any comment would be highly appreciated.
Thank you to all and have a nice week end.
Monique
Dealing with iranian LCS
Dealing with iranian LCS
Monique, my understanding is that Iranian banks will not agree to authorising their credits to be confirmed. Therefore, any 'confirmation' has to be on a 'silent' basis I believe. Can't comment on particular banks that might be able to do this.
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JudithAutié
- Posts: 195
- Joined: Fri Apr 05, 2019 5:20 pm
Dealing with iranian LCS
My personal experience with Iranian credits has generally been positive, as far as respecting their payment obligations, but I have also found that the examination of documents was extreeeemly strict... so that any exporter has to be very very careful in his documentation.
Best regards
Judith
Best regards
Judith
Dealing with iranian LCS
Thank you both for your comments.
Will keep you posted, if I get other informations from my client.
Have A nice day
Monique
Will keep you posted, if I get other informations from my client.
Have A nice day
Monique
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MargaretaSkoglund
- Posts: 12
- Joined: Fri Apr 05, 2019 5:22 pm
Dealing with iranian LCS
Dear all, we have seen
1) statements to the effect that discrepant documents should be handled on collection basis,
2) Minor discrepancies resulting in the issuing banks' asking for permission to hand over original documents in order to arrange for inspection of goods, (which of course is not acceptable unless we are provided with an undertaking from the issuing bank to effect payment)
Best regards
Marianne Wabnik
1) statements to the effect that discrepant documents should be handled on collection basis,
2) Minor discrepancies resulting in the issuing banks' asking for permission to hand over original documents in order to arrange for inspection of goods, (which of course is not acceptable unless we are provided with an undertaking from the issuing bank to effect payment)
Best regards
Marianne Wabnik
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KimChristensen
- Posts: 404
- Joined: Fri Apr 05, 2019 5:21 pm
Dealing with iranian LCS
Dear all,
Just wanted to share with you a wording we have seen in an Iranian LC recently:
QUOTE
The negotiating bank must certify on the covering schedule that all credit terms have been complied with, or list the discrepancies, otherwise the documents will lose the consideration of notification as per art no 14(D) from our side.
UNQUOTE.
Anybody dare guess the impact of such clause? Anybody dare move along with such LC? What if not ALL discrepancies are mentioned in the covering schedule?
Best regards
Kim
Just wanted to share with you a wording we have seen in an Iranian LC recently:
QUOTE
The negotiating bank must certify on the covering schedule that all credit terms have been complied with, or list the discrepancies, otherwise the documents will lose the consideration of notification as per art no 14(D) from our side.
UNQUOTE.
Anybody dare guess the impact of such clause? Anybody dare move along with such LC? What if not ALL discrepancies are mentioned in the covering schedule?
Best regards
Kim
Dealing with iranian LCS
Kim,
Provisions similar to this were raised at the last Annual Survey. Can’t remember if you were there. There was overwhelming hostility to them, I think it fair to say.
My ‘analysis’ is that the Iranian issuing bank is trying to avoid responsibility for / incurring the cost of examining the documents and identifying any discrepancies. Among other things, such a provision -which concerns the nominated bank alone- goes directly against the issuing bank’s undertaking to the beneficiary, which must be unaffected by the acts of the nominated bank (over which the beneficiary does not have any control). If banks do not have the confidence to examine documents for compliance / cannot afford the cost of doing so, they should get out of the credits business. Therefore, I strongly recommend all banks refuse to handle credits containing such outrageous provisions.
I would stress these are purely my personal views.
Scandalised of Birmingham
Provisions similar to this were raised at the last Annual Survey. Can’t remember if you were there. There was overwhelming hostility to them, I think it fair to say.
My ‘analysis’ is that the Iranian issuing bank is trying to avoid responsibility for / incurring the cost of examining the documents and identifying any discrepancies. Among other things, such a provision -which concerns the nominated bank alone- goes directly against the issuing bank’s undertaking to the beneficiary, which must be unaffected by the acts of the nominated bank (over which the beneficiary does not have any control). If banks do not have the confidence to examine documents for compliance / cannot afford the cost of doing so, they should get out of the credits business. Therefore, I strongly recommend all banks refuse to handle credits containing such outrageous provisions.
I would stress these are purely my personal views.
Scandalised of Birmingham
Dealing with iranian LCS
I agree with Jeremy that the clause arguably tries, perhaps clearly enough to be given legal effect, to reverse the effect of UCP500 Article 14 obligating the issuing bank to make its own determination and not to rely on the nominated bank. A presenter's responsibility for compliance under this kind of provision would run past 7 banking days and arguably past the date reimbursement was made. Regards, Jim Barnes