Place of expiry...

gt_sen · Post by **gt_sen** » Thu Apr 22, 2010 10:18 pm

Hi experts,

L/C field: 31D Date & Place of expiry - 15 Apr 2010, At Issuing bank's counters

41D : Available with Negotiating bank

Documents presented to negotiating bank on 14 Apr 2010.

Issuing bank receives documents on 18 Apr 2010 which is after expiry date.

Can the issuing bank raise a discrepancy 'L/C expired' since the l/c expiry place is Issuing bank's counter and received after expiry date?

If not a discrepancy, what is the function of giving L/C expiry place as Issuing bank's counter?

shahriar · Post by **shahriar** » Fri Apr 23, 2010 9:40 pm

yes, the issuing bank may refuse to honor. its a valid discrepancy

berry · Post by **berry** » Sat Apr 24, 2010 8:11 am

while i understand the point of the answer given, one thing pinches me. when the nominated bank received the document, it was complying. and as per article 7c and article 12b a nominated bank that has acted on its nomination and honored a complying presentation receives independent undertaking from the issuing bank. therefore even if the LC was expired when it reached the issuing bank counter, should not the issuing bank pay as per article 7C?

ibnejafar · Post by **ibnejafar** » Sun Apr 25, 2010 4:03 am

Dear gt
i pleased to see the detailed answer by berry and berry thanx for that-Let me add one thing that nominated bank can only be in protection if it undertakes on its covering that dox were received within exipry and were of complying terms

Regards,
Ibnejafar

iLC · Post by **iLC** » Sun Apr 25, 2010 11:08 am

i would try to answer it simply. the issuing bank has the right to examine the document independent of the nominated bank's observation. the nominated bank when received the document found it complying. but when it reaches the issuing bank after the expiry, it was discrepant. so unfortunately nominated bank wont be protected under article 7C

gt_sen · Post by **gt_sen** » Mon Apr 26, 2010 11:22 pm

Thank you all for your comments...

If L/C states place of expiry as Issuing bank's counter and availble with negotiating bank, then is there any workability issue?

Some of my pals are stating it is workability issue and l/c can not be issued like this and it will be unsecured for negotiating bank.

If nego bank receives l/c like this, can the nego bank requests issuing bank to change the expiry place?

shahriar · Post by **shahriar** » Tue Apr 27, 2010 6:20 am

dear,

as far as workability is concern, the LC is just fine. all it requires a timely presentation to issuing bank. beneficiary should send the document well ahead of deadline to the issuing bank.

whether as nominated bank u seek amendment or not is a policy issue. i often receives LC in this form for which i hardly sought amendment. it depends

Place of expiry...

Place of expiry...

yes

prtection to nominated bank

Fwd: Protection to nominated bank

sad but true

Is it workability issue?

workable