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clause 41-a

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Wed, 03/10/2010 - 05:01
amran_raza
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Hi,

if "available with... by..." is issuing bank. In this case how we can negotiate our documents.   

Regards

Imran Nazir 

 

 

‹ Credit available with confirming bank's branch in the same country difference between usance and deffered payment ›
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Thu, 03/11/2010 - 02:00
#1
tulsi
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L/C NEGOTIATION WITH ISSUING BANK
  • The L/C documents can negotiate with the issuing bank, If the L/C is unrestricted,
  • Some of the local L/C, issuing bank itself advising and negotiating the L/C documents.  

Regards

Tulsi/Dubai

 

  

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Thu, 03/11/2010 - 04:56
#2
mic60
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Joined: 09/15/2008
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LC Negotiation with Issuing Bank

I agree with Abrar & Mujeeb

Issuing bank's undertaking is to honour a complying presentation, not to negotiate the docs as the issuing bank is certaiin about itself.

Please refer to

UCP 600 Art. 6. A

A credit available with a nominated bank is also available with the issuing bank.

UCP 600 Art. 6d(ii)

"The place of the bank with which the credit is available is the place
for presentation. The place for presentation under a credit available
with any bank is that of any bank. A place for presentation other than
that of the issuing bank is in addition to the place of the issuing
bank."

BUT the situation of presentation to issiung bank arises when:

1. a nominated bank does not negotiate;

2. a nominated bank does not pay;

3. a nominated bank does not accept a draft drawn on it or, having accepted a draft drawn on it, does not pay at maturity;

4. a nominated bank having incurred its deferred payment undertaking, does not pay at maturity;

In all above points, the issuing bank is bound only to honour a complying presentaion.

More comments from my forum mate are appreciated.

Manish (mic)

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Wed, 03/10/2010 - 14:50
#3
Abrar
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Negotiation

Just to reinforce an earlier point; an issuing bank does not and cannot negotiate its own commitment. An issuing bank simply honours its commitment. Negotiation is the act of purchasing an issuing bank's underlying commitment to pay a beneficiary, by a third party nominated bank (negotiating bank).

An issuing bank may issue the LC directly to the beneficiary, in which case it may choose to restrict the LC to be available by payment, deferred payment or by acceptance of drafts drawn on the issuing bank.

However, it is not unheard of (although impractical) to issue the LC directly to a benficiary, with availability by negotiation with any bank or a specific bank.

 

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Wed, 03/10/2010 - 06:52
#4
tulsi
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Issuing bank can also negotiate L/C documents

Dear Mr. Mujeeb

 

Pls note the issuing bank can also negotiate L/C documents.

 

Regards

Tulsi / Dubai  

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Wed, 03/10/2010 - 05:57
#5
smmujeeb
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clause 41-a

It should be available either with Nominated bank, confirming bnak or with any bank.

Issuing bank cannot negotiate the docs.

A credit available with nominated bank is also available with issuing bank.

Regards!!!!

Mujeeb :-) 

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Wed, 03/10/2010 - 07:02
#6
mohkahn
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clause 41-a

Sorry Tulsi,

Please enlighten us. I have never heard of Issuing bank being able to negotiate docs. Issuing bank always and only honours. so please tell us, under what circumstances issuing bank is allowed to negotiate? thanks. 

 

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Wed, 03/10/2010 - 13:48
#7
nejuan4lcs
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Joined: 03/03/2010
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how does this work if the l/c has been advised directly?

hi guys,  I am new here and this site has been a great place to learn. I have been dealing with l/cs for commodities - namely sugar and oil - for 14 years but the situations put forward here still educate me!

Anyway - If the l/c has been advised to the beneficiary directly by the issuing bank doesn't the issuing bank need to negotiate the dox? (or am i getting the wrong end of the stick!)

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Thu, 03/11/2010 - 02:34
#8
amran_raza
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thanks every one for their

thanks every one for their support

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