Tolerance

[vijay]

Hi Everybody,

First of all i wishes a best of luck to those who will be going to appear CDCS exam April 2010.

And I require some clarifications regarding LC I got as per below from one the buyers.

The LC states Tolerance 39A: 3/3
Our credit amount is EURO 48871.00
Description in LC is as follows:
MORE OR LESS 3CT IN QUANTITY
+
PROGRAM L651 - REF L3900- ORDER N0.F077886
45 pieces in color 65 at EUR48.00/PCE
3 pieces in color 66 at EUR48.00/PCE
114 pieces in color 72 at EUR48.00/PCE
+
REF L3907- ORDER F077889
13 pieces in colour 65 at EUR38.50/PCE
1 pieces in colour 66 at EUR38.50/PCE
12 pieces in colour 72 at EUR38.50/PCE
+
REF L3910 - ORDER F077890
38 pieces in colour 65 at EUR33.50/PCE
9 pieces in colour 66 at EUR33.50/PCE
54 pieces in colour 72 at EUR33.50/PCE
++
REF L3901 - ORDER F077888
62 pieces in colour 65 at EUR9.50/PCE
7 pieces in colour 66 at EUR9.50/PCE
264 pieces in colour 72 at EUR9.50/PCE
+
PROGRAM L650 -REF L3900- ORDER N0.F077891
10 pieces in colour 52 at EUR48.00/PCE
100 pieces in colour 66 at EUR48.00/PCE
160 pieces in colour 91 at EUR48.00/PCE
+
REF L3907- ORDER F077893
70 pieces in colour 52 at EUR38.50/PCE
120 pieces in colour 66 at EUR38.50/PCE
165 pieces in colour 91 at EUR38.50/PCE
+
REF L3910 - ORDER F077894
45 pieces in colour 52 at EUR33.50/PCE
20 pieces in colour 66 at EUR33.50/PCE
120 pieces in colour 91 at EUR33.50/PCE
+
REF L3901 - ORDER F077892
12 pieces in colour 52 at EUR9.50/PCE
37 pieces in colour 66 at EUR9.50/PCE
27 pieces in colour 91 at EUR9.50/PCE

Also quoting the below UCP Article No.30(TOLERANCE IN CREDIT AMOUNT, QUANTITY AND UNIT PRICES)
article 30 - Tolerance in Credit Amount, Quantity and Unit Prices

a. The words "about" or "approximately" used in connection with the amount of the credit or the quantity or the unit price stated in the credit are to be construed as allowing a tolerance not to exceed 10% more or 10% less than the amount, the quantity or the unit price to which they refer.

b. A tolerance not to exceed 5%(in this LC 3%) more or 5% (3%)less than the quantity of the goods is allowed, provided the credit does not state the quantity in terms of a stipulated number of packing units or individual items and the total amount of the drawings does not exceed the amount of the credit.

c. Even when partial shipments are not allowed, a tolerance not to exceed 5% less than the amount of the credit is allowed, provided that the quantity of the goods, if stated in the credit, is shipped in full and a unit price, if stated in the credit, is not reduced or that sub-article 30 (b) is not applicable. This tolerance does not apply when the credit stipulates a specific tolerance or uses the expressions referred to in sub-article 30 (a).

In this connection, pls advice me whether i can shipment 3% less or 3% more.

Regards/Vijay

[Negotiator]

Dear Vijay,

Based on given example, I think this case will not be subject to UCP 600 sub-articles 30.b and c. The goods descriptions show the unit as "piece", which is an individual unit, so sub-article 30.b will not be applicable. And the credit stipulates a specific tolerance (±3%) for total amount and quantity, therefore sub-article 30.b will not be applicable either.

As a result, the beneficiary can make shipment only in accordance with the tolerance given in the credit. 3% more or less in the quantity will be acceptable provided that this tolerance is also observed for each colours.

Regards.
Lee

[vijay]

Dear Lee,

Thanks for the valuable suggestion.

Regards/Vijay