LC Containing Clause "All Discrepancies Are Acceptable"

[pakmga]

Hi all


We requested our LC Issuing bank to open all our LC with a clause that all discrepancies are acceptable. On company letterhead We gave standing instructions to our bank that they must never advise discrepancies to presenting bank and that we irrevocably confirm that all discrepant presentations are acceptable to us.

on 15 may issuing bank received docs for usd64000 for 30 days sight. LC was for usd 32000. Our bank had sufficient secured LC line and our account also had credit balance of usd90000. Our bank asked us to sign discrepancy acceptance and TR form. We signed these on 15 may.

We told or bank to block additional usd32000 from our account and release documents.

Unknown to us, our bank sent discrepancies advice to beneficiary bank on 15 may.

Till 17 May they held documents despite our request to release.

Is issuing bank justified in doing so?
under article 16 iii b what is the value of our signed acceptance?
what is the value of LC clause that all discrepancies are acceptable?
is this act of bank legal?
What remedy do we have if beneficiary calcel our LC facility ?

Shahid Yasin

[picant]

Hi Pal,

IMHO," all discrepancies are acceptable" is similar to "documents accepted as presented", point A19 g ISBP 745 states that so not compliant presentation must be made within the expiry date and not exceeding the l/c amount.
So the issuing bank refused the presentation correctly, to avoid any possible implication.
Under your instructions the bank will further accept documents. Banks involved have the same instruction and must understand each other. Seller's bank will inform its customer that this is the praxis.
Other comments appreciated
Ciao

[tituisrt]

Dear,
Issuing Bank is right in point of view by using UCP-600 Article 16 b & ISBP-745 A19 g.
.
other comments r appreciable.
thanks