Letter of Credit Forum

Hi Mujeeb

With regard to your comment in the second paragraph, I should point out that the only instance where a negotiating bank is permitted (or required) to provide such a declaration, is in instances where the latest presentation date or LC expiry date falls on a non-banking day of the negotiating bank. Art. 29 (a) of UCP600 refers.

If the bank were to certify to a statement as alluded to in your second para., it would amount to a misrepresentation of fact. In this case, I doubt whether it would find recourse under UCP, should events turn sour with the issuing bank.  

You can correct documents and re-present up to any time, whether after the latest presentation period or even after the expiry date. But, the point is that whilst the discrepancy in the document may have been corrected, if you present after the latest presentation period, you will automatically incur a discrepancy of 'late presentation', and if presented after LC expiry, you will incur a discrepancy of 'LC expired', even if the documents are otherwise in order. The presentation will be discrepant for being presented out of time. This is what your negotiating bank is trying to tell you, although it appears, perhaps none too clearly.

Dear Abrar,

The question I believe is the replacement of a document already presented with a corrected version. As the beneficiary's bank has up to 5 banking days after presentation to read those documents, my experience is that the negotiating bank will allow a document to be replaced or indeed a missing document to be presented. This means that by the time limit the negotiating bank will be in a position to send of the presentation as compliant. My experience is that negotiating banks see their role as assisting the beneficiary in making their docs compliant, not being a policeman saying "tough, you've broken the rules so you pay the penalty." There is nothing in UCP600 or ISBP681 which instructs either way.

Re the question of making a correction to an existing document and the need to stamp or authenticate the correction, if this is a cover note then it will be issued by a party other than the beneficiary. ISBP681 para 9 covers this. If it is the beneficiary's own document, para 10 covers.