CDCS Practice Test 4

MIA19 · Post by **MIA19** » Thu Mar 17, 2011 2:07 pm

I am confused with the one of the questions in respect of documents which were refused because certificate of origin was not presented. As is was presented later (presumably within time limits allowed) it had discrepancy that goods description does not match. Even so, correct answer was that discrepancies can only be made for different presentations. (I presumed that it is a 2nd presentation and that discrepancy can be raised).
Somehow it isn' t logical to me. That means that anyone can present documents without one document which is discrepant, wait for refusal notice and than present it and issuing bank would be precluded from raising discrepancy since it should be considered as one presentation?!
please comment
regards
Snježana

ozgur murat · Post by **ozgur murat** » Thu Mar 17, 2011 7:12 pm

Dear Snježana
You are missing one point.. In first presentation, a document is missing.. this is the discrepeancy. In second presentation, the document that was missing in first presentation is carrying discrepancies, this is another discrepancy.... so the nominated bank can not be precluded from raising discrepancy. But if the nominated bank finds a discrepancy on any of the other documents,after submitting this missing doc. together with documents accepted at first presentation (so called a second presentation..), then you are right, the bank woul be precluded from raising discrepancy.
In general, if the nominated bank's location is closer to the beneficiary's location (in the same country, in the same city...), the banks call the beneficiary to bring this missing doc. to their premises before sending discrepancy notification, so to avoid time limitation and such misunderstandings..
This is my opinion, other comments appreciated,
Regards,
Ozgur Murat

abrar · Post by **abrar** » Mon Mar 21, 2011 5:56 pm

It would be interesting to see the original question. Could someone please post?

sabineasmar · Post by **sabineasmar** » Fri Mar 28, 2014 1:36 am

dear,
the second time, the discrepancy was relating to THE INVOICE showing description not matching with L.C==> THATS WHY UNDER THE SAME PRESENTATION, AND WHEN THE ONLY DISCREPANCY WAS CORRECTED (PRESENTATION OF CERT. OF ORIGIN) NEW DISCREPANCIES CANNOT BE RAISED.

THIS IS MY OPINION

hachem · Post by **hachem** » Fri Mar 28, 2014 9:31 pm

Hi,
The sub-article 16(a) stipulates the following:

When a nominated bank actiong on its nomination, a confirming bank, if any, or the issuing bank detremines that a presentation does not comply, it may refuse to honour or negotiale

So a nominated bank which has found that a document presented does not comply with the credit terms and conditions and notify the presenter of these discrepancies within 5 banking days of its presentation, the nominated may refuse to honour or negotiate even the presenter presents a complying presentation.

Regards
H Jallouli

gegeeee · Post by **gegeeee** » Tue Apr 01, 2014 6:45 pm

Actually i agree with ozgur murat,

If nominated bank raised only one discrepancy in first presentation "missing cert. of origin" it means that other conditions comply with the original credit. The only discrepancy is missed cert. of origin. So in second presentation only cert. of origin should be checked, if it complys with the conditions of credit.
.
If suddenly in second presentation nom. Bank finds out some other discrepancies in other already presented docs. it will be precluded from raising discrepancy, because it has already been checked and if it was something wrong in docs nom. bank should have raised it at first presentation.

hachem · Post by **hachem** » Wed Apr 02, 2014 6:35 pm

Hi gegeeee,

As per sub-article 14(c)(ii), the nominated bank acting on its nomination, the confirming bank, if any, or the issuing bank decides to refuse to hounour or negotiate, it must give a single notice to that effect to the presenter which must evidence that the bank is refusing to honour or negotiate and each discrepancy. So once the presenter representes the discrepant document, I think that it should be considered as a second presentation and the bank has a period of 5 bankings following the day of the second presentation to determine if this presentation is complying or not. The discrepancies that may be found shouldn't rely only on the first presentation.

Any comments
H Jallouli
Regards

gegeeee · Post by **gegeeee** » Thu Apr 03, 2014 2:42 pm

Dear hachem,

Thank your for your reply.

If i understand correctly you mean sub article 16 (c)(II).

So lets discuss this case with the example:

I am the issuig bank, i received docs. and find out that the only discrepancy is missing certificate of origin. In other document's (Commercial Invoice, B/L, P/L) i (issuing bank) think that everything is complying. So i made reply to the nominated bank that presentation was discrepant and also reason why i (issuing bank) refused it.
Reason was : missing certificate of origin.

Later from the beneficiary i received this missed certificate of origin, after receiving it i have again five banking days following the presentation day to check it. I have checked it and find out that data was in conflict with the original LC. Also i have again checked already presented docs and suddenly find out that something was incorrect in B/L. For exapmle not signed as per UCP600, wich i did not find earlier.

I think that the only discrepancy i can raise is data conflict in cert of origin. Second disc. "not signed as per UCP" is not valid because i have to refused it in first presentation. This was my (issuing banks) fault that i didnot notice it at first presentation.

If i am not correct please response.

Thanks in advance.

hachem · Post by **hachem** » Fri Apr 04, 2014 1:27 pm

Hi gegeeee,

Yes I meant sub-artice16(c)(ii).

Me too, I'm little confused about this matter.

I have read the article 16 of UCP600 and I have found that there is no notion of a ''second presentation''. What I have understood is the following:

1) as per sub article 16(a): When the NB acting on its nomination, the CB, if any, or the IB determines that a presentation does not comply, it may refuse to honour or negotiate.

2) Then, as per sub article 16(b), if one of these bank decides to refuse to honour or negotiate, it must give a single notice to that effect to the presenter stating each discrepancy.

3)Now, if one these banks accepts that the presenter re-presentes the discrepant document, it (one of these bank) must precluded to evidence a discrepancies others than those found in the last document presented. More, the NB, CF or the IB must determine if the presentation is complying within 5 days after the day of the presentation of the document, not after the day of the representation of the discrepant document. As I have said early, there is no notion of a second presentation.

Any comment
Regards
H Jallouli

gegeeee · Post by **gegeeee** » Fri Apr 04, 2014 2:03 pm

Hi Hachem,

A little example again. BENEFICIARY presented docs on 04/04/2014, in this case we (issuing bank) have 5 banking days following the presentatin. So deadline is 09/04/2014. Now we found the discrepancy and beneficiary represented already corrected doc on 09/04/2014, so as you say i (issuing bank) doesnot have any time to check it.

Correct formulation is that i (issuing bank) have again 5 banking days from the represented date 09/04/2014 + 5 days to check this exact doc. which was discrepant.

Any comment,

hachem · Post by **hachem** » Fri Apr 04, 2014 8:21 pm

Hi gegeeee

As I have said, there is no second presentation. So, if the issuing bank agrees that the presenter re-presents the discrepant document, it must determine if the presentation is complying within 5 days after the presentation date, within 09/04/2014.

Regards
H Jallouli

gegeeee · Post by **gegeeee** » Sat Apr 05, 2014 8:42 pm

Hy Hachem,

But what if bene presents docs on 10/04/2014?

expiry date is 20/04/2014.

hachem · Post by **hachem** » Sat Apr 05, 2014 11:19 pm

Hi gegeeee,

If the discrepant document is presented after the expiry of 5 banking days after the day of presentation, in this case on 10April2014, the presentation will discrepant.

Regards
H Jallouli

gegeeee · Post by **gegeeee** » Mon Apr 07, 2014 12:44 pm

HY Hachem,

So as you say, i (issuing bank) can check document and reply to nom bank and beneficiary on fifth day and bene will have no time to present doc again.

gegeeee · Post by **gegeeee** » Tue Apr 08, 2014 1:16 pm

My opininon remains the same that, beneficiary can re-present already corrected doc at any time up to the expiry date.

Any comments,