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Meaning of set of documents?
Posted: Wed Sep 23, 2009 7:10 pm
by Navi
Dear friends,
.
We received a file of documents from nominated bank, 1 remittance letter for the documents, consisting of:
3 different invoices, each related with different transport docs and other docs. i.e.
3 invoice, 3 CMR, 3 Cert of origin, 3 analysis cert, 3 shipment fax etc.
.
Each invoice and CMRs were discrepant however accepted by applicant.
According to LC terms, USD.100.- will be deducted for each set of docs. We requested 300 USD however, nominated bank rejects, claiming that there were only one set of docs. and insisting to be deducted only USD.100.-
.
What determines the set of docs, number of invoices? number of transport docs or covering letter of nominated bank?
.
Regards
Set = Availment
Posted: Wed Sep 23, 2009 7:45 pm
by picant
Hi Pals,
IMHO set of documents means all documents presented in availment of the l/c. So three availments, three set, USD 300,00. But, if you make only one payment, you, just you, consider all as one set. And frankly did you provide to advise discrepancies etc, or the fact that documents were discordant allows you to charge the commission?
Let me know.
Ciao
Another view
Posted: Thu Sep 24, 2009 4:22 pm
by cristiand969
My best guess is that customary practice of each bank applies here although I consider there is one international standard practice namely that the beneficiary should be charged with USD 100 only, as the remitting bank has made ONLY one presentation regardless there is two invoices or two of other documents.
Form my logical point of view, this should be charged as one presentation. If the intention of issuing bank was to charge for docs under each shipment separatelly this should have been clearly stated in the credit. If not stated I see here one set meaning one presentation or one drawing under the credit.
Remember also that it can be one shipment under 3 bills of lading or an invoice splitted per each item separatelly, either by request of the credit or as per outside agreement between applicant and beneficiary.
Banks should not strive for 'robbery' as a discrepancy mean only a small penalty to beneficiary for mistakes in document.
As already picant explained very well you pay one time (i.e for one presentation) and not for two or several separate ones.
ICC opinion 581rev
Posted: Thu Sep 24, 2009 4:41 pm
by shahriar
i think ICC opinion 581rev may be helpful here.
QUERY
1. Under a L/C that permits partial shipment, the beneficiary presented several sets of documents identical in form. All the documents were presented simultaneously, i.e., under one cover letter. Is it permissible for the nominated bank to refuse one set of documents as discrepant and pay the other sets as compliant? In case the documents have been presented in consecutive drawings, is it still a normal practice to pay the first drawing and refuse another one?
1. Where multiple presentations are made on the same day under the same L/C, a presenter would be well advised to create individual schedules in order to avoid any potential delays in situations where some presentations comply and others do not.
Where more than one complete presentation of documents is made under one cover letter or schedule for the full amount of all the presentations, the presenter should be advised of the discrepancies in respect of the presentation(s) that do not comply. An issuing bank or nominated bank may request the beneficiary or presenter to provide agreement for the settlement of individual amounts for those presentation(s) that do comply. This does not negate the issuing or confirming bank's obligation to honor the presentation(s) of documents that do comply
In response to the second question, the independent nature of each complete presentation of documents has been covered by the ICC in Opinion R 473, which included the following statement in the conclusion thereto: "Each drawing under a credit is considered to be independent of any other."
comment
Posted: Thu Sep 24, 2009 5:28 pm
by cristiand969
I am tempted to feel that ICC opinion is somehow in line with my view .
Thanks Shahriar for the documentation in this respect.