Letter of Credit Forum

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It depends on the jurisdiction and general handling rules. Since there is obviously a contract between the buyer and the seller (otherwise it does not make sense to send a letter of credit anyway) than some jurisdictions rule that silence on the advise of the lc constitutes acceptance, in other jurisdictions courts have constituted an obligation of the seller to answer such advise and the lack of an answer creates an assumption of acceptance as penalty for the break of the answering obligation, others generally say there is no such acceptance by silence. It all goes back to the base contract and has nothing to do with the lc. If the lc is not accepted by the seller as a proper form of payment than the bank will cancel the lc and the buyer may have recourse if the lc was stipulated in the contract. However if the lc was not stipulated in the contract the tbank cost for the cancelled lc will not be  covered by any obligation in the contract.

Think on two lines, one is the buyer/seller (contract) and the other the buyer/bank (LC) with the seller as third party.

There is no obligation for the beneficiary to perform under the LC, and he cannot be compelled to do so. As such, he is not bound by any contract to the issuing bank under the LC until such time he decides to perform under it. Whereas, the LC contract recognises an undertaking by the issuing bank to pay, provided stipuLated documents are presented to it in conformity with the LC and UCP, there is no corresponding obligation that the beneficiary enters into with the issuing bank 

If he communicates his rejection of the LC to the isuing bank, the credit is automatically cancelled. If he remains silent, no inference should be drawn from the silence, and the LC will remain valid till expiry.