ICC Digital Library Forum

Dear Sir/Madam
.
We issued L/C which stated in field 47A as: "All docs must be presented to issuing bank through a bank". Today, we received a set of docs under a/m L/C presented directly to us by beneficiary. Could we consider it as discrepancy for refusal?
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Hope to receive your opinions soon!!!!
Tks so much!!!!!!!!!!
AK

I would regard the presentation as appearing on its face not to be a complying (with the terms and conditions of the credit) presentation for the purpose of sub-Article 14(a). I would therefore consider this to be a 'discrepancy'.

I would not consider this as a discrepancy as the credit does not seem to have excluded Art 7. and Art 6E.

I cannot see 6(e) is relevant but I agree 7 is. However, I not would expect 7 to need to be expressly excluded in order for this provision to be legally effective, notwithstanding how Art 1 might be read. Nonetheless, I agree that to be absolutely safe it is best to exclude expressly an article where modifying or overriding it.

what is your reason for including such a request in your l/c's?

It is simple: Not Discrepant. The beneficiary has an irrevocable undertaking from the issuer. As beneficiary, they have the absolute right to present documents directly to that issuer. All I see is a LC with an unrealistic request because no one is expected to verify any signatures, etc.

Hi,

It’s not a discrepancy. A credit available with a nominated bank is also available with the issuing bank. Provided the presentation is complying and the beneficiary’s signature appearing on the covering schedule is verified, the issuing bank must honour.

For the purpose of identification/authentication, the beneficiary’s covering schedule should include a signed confirmation by the issuing bank’s correspondent bank stating that the latter has verified the beneficiary’s signature appearing thereon.

Best regards,
Duc N.H



[edited 12/13/2010 11:54:16 PM]

Glenn,

I see absolutely no reason why –given the provisions of Article 1 and most laws acceptance of the principle that the express terms of a contract automatically override any standard contractual terms to which it is stated to be subject- an issuing bank cannot override the APPARENT (not express) right –in Articles 2 & 7- of the beneficiary to present documents direct to the issuing bank where there is also a nominated bank.

Regards, Jeremy

Hi Jermey,
While we generally align on topics, and notwithstanding Article 1, an issuer attempting to refuse documents based solely on the premise that they were sent directly to the issuer is not a requirement, in my opinion, that can truly be imposed. An Issuer is obligated to honour complying documents. How documents are received should have no bearing whatsoever. It’s a beneficiary’s fundamental right to send documents in any manner they deem correct. The definitions of “presenter” and “presentation” support a “beneficiary” presentation. In this case, the simple statement added to this LC does not, in my opinion, override the UCP fundamentals and the beneficiary's right to payment.

We will have to agree to disagree Glenn.