ICC Digital Library Forum

I agree that the issuing bank should have drafted it better. Unfortunately on the export side, as the advising bank, we see these almost everyday. It is logistically impossible to question every single item and get the issuing bank to comply when we are advising them. We have gotten fierce arguments from 2nd advising banks and from beneficiaries who state that it is not an issue specifically covered in UCP500 or the ISBP, and therefore requires a common sense approach. If the amount insured is in the currency of the draft/credit then the letter of credit is being complied with despite the fact it is not actually spelled out on the document. On the flip side we have not sited it as a discrepancy and have had the argument from the issuing bank that the letter of credit needs to be strictly complied with. Therefore the document needs to state the exact phrase regardless if it will actually affect the currency a claim is paid in. This leads to what Yahya stated in an earlier post, just stating “Claims payable in the currency of the draft” is really meaningless. The letter of credit is being followed strictly because they put the exact phrase required, but it does not actually state the currency.