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Issuing Bank issued L/C at sight, for USD12,000 with no tolerance stated.
L/C also stated description of goods "Car spare part as detailed in profomar invoice no.xxxxxxxx, dated:xxxxxx".

Later on, issuing bank receive documents presentation from the nominated bank. Credit Specialist checked document, found some of goods did not conform to profomar invoice detailed.
Furthermore, we had been informed by applicant that goods in invoice are chipper than the goods detailed in profoma invoice. Invoice state value equal to L/C amount.

With this issue, what is the issuing bank should do?
I would appreciate for your kind comment.
Thanks.

Hello Sophea,

As far as my knowledge goes issuing bank cannot do anything about the above said issue except to process document as clean and remit the proceeds. Since Ucp and ISBP discourages to include references to any underlining contract which are not part of LC and not to include them in LC. At the time of issuing the LC when issuing bank has got the 45A goods description it must have asked applicant to give a detailed and proper goods description instead of "Car spare part as detailed in profomar invoice no.xxxxxxxx, dated:xxxxxx". Hence as of now nothing can be done since documents are as per LC and UCP ISBP. Bank is under obligation to honor the presentation.

Regards
Shikha Aggarwal

Hy all,

It is very often for issuing Banks to structure LC as you have in your case. The list of spare parts i guess will be very long, so to suit all detailes in goods descr. is impossible in MT700 Format. The best option in such cases are formulatuion in such manner "NAME OF GOODS AS PER PRO FORMA INVOICE NUMBER:XXX. DATED:DD/MM/YY." So later, if documents checker will receive invoice and goods descr. will be different from that stated in Pro forma it will be discrepancy. Also in Invoice there should be idenitical formulation "NAME OF GOODS AS PER PROFORMAINVOICE NUMBER:XXX. DATED:DD/MM/YY."
.
So in your case document is discrepant and its up to applicant will you make payment or not.