full transfer-does first benef renounce all rights under the
full transfer-does first benef renounce all rights under the
A credit has been transferred in full with the first beneficiary authorizing the transferring bank to automatically advise all future amendments to the second beneficiary. Now the questions become: In this case, does the first beneficiary not renounce his rights under the credit? Does the transferring bank even need to advise any amendment to the first beneficiary? (One would assume not if he has renounced his rights.) Does an amendment which increases the credit not fall under the umbrella of the initial full transfer request?
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larryBacon
- Posts: 689
- Joined: Fri Apr 05, 2019 5:26 pm
full transfer-does first benef renounce all rights under the
The fact that the first beneficiary is foolish enough to tell the transferring bank to automatically advise all amendments to the 2nd beneficiary does not excuse that bank from a duty of care to advise the first beneficiary of the extreme dangers involved in doing so.
The transferring bank does not have to accept such instructions, but even if the first beneficiary persisted in this folly, I think it would be prudent of the transferring bank to advise all amendments to the first beneficiary, with a notified time lag before advising 2nd beneficiary, in case of a change of heart by the first beneficiary.
Laurence
The transferring bank does not have to accept such instructions, but even if the first beneficiary persisted in this folly, I think it would be prudent of the transferring bank to advise all amendments to the first beneficiary, with a notified time lag before advising 2nd beneficiary, in case of a change of heart by the first beneficiary.
Laurence