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HOW TO EFFECT LC SHIPMENTS WHEN CONTRACT RATE IS NOT FINALISED

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Mon, 04/04/2016 - 01:44
purti singhal
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Hi,

 

I want to know what are the possible ways by which shipments under LC can be efftected?  Problem area here is Contract price is not finalised yet.  The cut off date for 1st shipment is near by.  Actually this is a Shipper - Vendor - Importer trade where prices differ. Irrevocable transsferable  LC will be initited by importer which will then be tranferred to the shipper by the Vendor.

 

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Thu, 04/07/2016 - 01:23
#1
Abrar
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Joined: 03/12/2009
provisional invoice

You could consider an amendment to the LC, replacing the commercial invoice requirement to provisional invoice requirement with a final invoice (once the price is fixed) to be also presented under the LC once the goods have been delivered and adjustments made (rebate given or rebate requested) accordingly. This structutre is fairly common under commodity transactions but usually concerns potential shortages in final delivered quantity but against a pre-determined unit price. Your case is however different and with the added complication of an additional layer in the supply chain.         

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Wed, 04/06/2016 - 11:02
#2
Abrar
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Joined: 03/12/2009
transferable LC

The practical solution is to arrange an extension to the shipment date under the LC and hence also under the LC whilst the contract is being finalised

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Thu, 04/07/2016 - 00:53
#3
purti singhal
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Joined: 04/04/2016
Thanks Abrar!  Actually the

Thanks Abrar!  Actually the dispatches cannot be delayed.  So. is there any other way to deal with the situation?

 

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