ICC Digital Library Forum

I seek your comments on the below.

A Standby L/C to be issued a bank with presentation of Draft at Sight. However, as per L/C beneficiary will specify in their demand to the issuing bank a payment date (which may be two/three months after the date of presentation) and the issuing bank shall honour the claim and effect payment on that specific future date which must be on or before the L/C expiry date. Which means today beneficiary submit their demand with SIGHT draft and requesting issuing bank to pay after two month.

The beneficiary may further request the issuing bank to accelerate the payment by further presentation of beneficiary's certificate. The beneficiary also has the option to revoke any drawing presented to the issuing bank.

L/C is subject to UCP 600.

Do you think under sight draft we can pay after two month from the date of presentation ?

Regards,

Shahed
Toronto

This is a rather awkward way to write an LC that provides for deferred payment that the beneficiary can by demand accelerate. I would want a more clearly written LC payment provision that does not depend on a sight draft.

That said, the sight draft is just a piece of paper until it is paid, and it should not be paid and need not be considered paid if the beneficiary demands deferred payment per the awkwardly drafted provisions in the LC that you describe.

Regards, Jim Barnes

Sight draft in case is juast a simple receipt and a proved that beneficiary has claim to the applicant. If they mentioned specific date or maturity date in future then it is agreement between Beneficiary and the Applicant and it does'nt contradiction with sight draft.