When you issue an L/C available with any bank by negotiation in order to prevent duplicate or fraud presentations,do you add any special clauses to the L/C text? And do you also give confirmation authorization to this type of L/C? And do you prefer to issue this type of L/C?
Thanks..
Any Bank By Negotiation
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BilselTatar
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- Joined: Fri Apr 05, 2019 5:16 pm
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BillSlowinski
- Posts: 13
- Joined: Fri Apr 05, 2019 5:13 pm
Any Bank By Negotiation
For freely negotiable LCs, we do not add any special clause. We do provide instructions for the forwarding of documents to us and ask that they be sent in one lot. But for confirmations, we would restrict presentation to the confirming bank counters and call for drafts on the confirming bank. We would also provide reimbursement instructions. Most of our commercial LCs are freely negotiable.
Any Bank By Negotiation
In this type of LC, ANY BANK is a negotiating bank. Negotiation under this credit is normally made 'with recourse' to the beneficiary.
The issuing bank may however ask for the confirmation by one specific bank, in which case, the beneficiary has interest of presenting the documents to that bank in order to benefit from its confirmation and have the documents negotiated by it on a without recourse basis.
Normally, in this kind of LC, there's no reimbursing bank involved. The negotiating bank purchases the documents by advancing or agreeing to advance the beneficiary from its own funds until it gets paid by the issuing bank on due date after receipt of the documents by the issuing bank and having found them in good order.
I think the main purpose of such credit is not to avoid fraudulent or duplicate presentation, but :
. for the beneficiary to get paid immediately on presentation by having the documents discounted by the negotiating bank, and
. for the applicant to pay on due date after receipt of the documents by the issuing bank and having found them in order.
Regards
Antoine Samaha
The issuing bank may however ask for the confirmation by one specific bank, in which case, the beneficiary has interest of presenting the documents to that bank in order to benefit from its confirmation and have the documents negotiated by it on a without recourse basis.
Normally, in this kind of LC, there's no reimbursing bank involved. The negotiating bank purchases the documents by advancing or agreeing to advance the beneficiary from its own funds until it gets paid by the issuing bank on due date after receipt of the documents by the issuing bank and having found them in good order.
I think the main purpose of such credit is not to avoid fraudulent or duplicate presentation, but :
. for the beneficiary to get paid immediately on presentation by having the documents discounted by the negotiating bank, and
. for the applicant to pay on due date after receipt of the documents by the issuing bank and having found them in order.
Regards
Antoine Samaha
Any Bank By Negotiation
Bilsel,
1. We include a Credit endorsement provision.
2. We do not have any objection, in principle, to asking another bank to confirm a Credit we have issued that is freely available by negotiation, notwithstanding the apparent illogicality of this.
3. We are quite happy issuing, advising or confirming Credits that are freely available by negotiation.
Jeremy
1. We include a Credit endorsement provision.
2. We do not have any objection, in principle, to asking another bank to confirm a Credit we have issued that is freely available by negotiation, notwithstanding the apparent illogicality of this.
3. We are quite happy issuing, advising or confirming Credits that are freely available by negotiation.
Jeremy