We have been ask to send some goods in 2 shipments on a FCA basis to Iran under an unconfirmed Irrevocable letter of Credit which is payable at sight - It is likely that there will be approximately 12 weeks between each shipment - Will the shipment documents for the first shipment be valid until this point.
Should the date of letter of credit be after the final shipment or after the first
Also should the LC state that the goods can be transhipped or that partial shipment is allowed if we are not sending them
Partial Shipment Unconfirmed L/C
A few points to cosider here :
1. Shipment on an FCA basis means that you (as the seller) are obligated to deliver the goods to the buyers carrier or agent at a named place. Make sure that you clearly define what document needs to be presented to evidence that the goods have been so delivered - IT SHOULD NOT BE A BILL OF LADING. The B/L issuance is under the control of the buyer and if they do not release the B/L to you to present under the L/C then you have neither the goods nor the payment.
2. It is increasingly difficult for international companies to do business with Iran. US regulations are very strict so please ensure that your sales currency is not US Dollars - all US Dollar payments flow through New York and US banks may hold the funds. This is especially important if you (the seller) have any business interests registered in the States.
3. As to your specific points - if shipment is being made in two lots then partial shipments must be allowed. You will present documents after each delivery (not hold the first set until after delivery of the second shipment). The expiry date of the L/C should be 21 days after the final latest shipment date. As to transhipment, you are not actually involved in the movement of the goods past your agreed delivery point so any transhipment is the responsibility/risk of the buyer and therefore the L/C should not mention transhipment at all.
Partial Shipment for an Unconfirmed LC
First Q: 'Will the shipment documents for the first shipment be valid until this point?' Sorry, the question is not very clear to me.
Second Q: 'Should the date of letter of credit be after the final shipment or after the first?' The LC, to the best of my understanding, should be valid till the final shipment and presentation are made.
Third Q:'...Should the LC state that the goods can be transhipped or that partial shipment is allowed if we are not sending them?' The first is up to you. If you are planning two shipments, then the LC should allow partial shipments. No harm in including that option; you can always ship the entire lot in a single shipment, if you so wish.