document missing; is it a valid discrepacy under UCP 600

[berry]

i just got this question in mind. say document is presented to nominated bank who then forwarded the document to the issuing bank. in this case, there could be three scenario

1. full document send to issuing bank and issuing bank received them accordingly
2. full document send to issuing bank but missed in transit in full or in part
3. part of the document send to issuing bank and issuing bank received them accordingly. one or two documents are kept intentionally which is clear before the issuing bank

my question can the issuing bank raise discrepancy even if it didnt get the full document. the beneficiary did present the full document to the nominated bank. who is to comply this discrepancy then? wont it mean that discrepancy can also be raised against the nominated bank?

[bdesh]

Hi berry,
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Let me start from first. is there really any way to the issuing bank to become clear that one or two documents are kept intentionally by the nominated bank?
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ucp-600 art.35 states

If a nominated bank determines that a presentation is complying and forwards the documents to the issuing bank or confirming bank, ..........an issuing bank or confirming bank must honour or negotiate, or reimburse that nominated bank, even when the documents have been lost in transit between the nominated bank and the issuing bank or confirming bank, or between the confirming bank and the issuing bank.

Therefore, the issuing bank cannot raise discrepancy even if it didnt get the full document.

[Judith]

The issuing bank can raise a discrepancy even if certain documents are not presented.

Most LCs insist that “documents are to be sent in one lot…” This requires the presenter to send all documents together. If this instruction is not followed, the issuing bank can quote the discrepancy “Document X, Y etc. not presented.”

(While the UCP is silent on this issue, ISP98 provides specific guidelines on this.)

Article 35 only covers situations where documents are lost in transit. This usually refers to situations where documents are lost by the courier company etc. and does not cover situations where documents are not sent by the nominated bank.

Other comments welcome.

[cristiand969]

Well to start off...

i just got this question in mind

and

one or two documents are kept intentionally which is clear before the issuing bank

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I assume therefore you are the nominated bank.
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We do not encurage tricks whereby a nominated bank to be 'clean' before issuing bank, rather I would say to which risk you are exposed.
THE RISK OF NONPAYMENT.
By retaining document against your cover letter stating that all docs comply you as a nominated bank are in default and may suffer an unimaginable loss.
On the other hand I cannot see an incomplete delivery of documents under one sealed mail unless the courier notify a default delivery both to receiver and sender and such default can be referred to art 35.
Other comments appreciated.