International settlement

letter of Credit

SWIFT MT700 ： ISSUE OF A DOCUMENT CREDITFrom ： × × BANK40A FORM OF DC ： IRREVOCABLE20 DCNO ： 123431C DATE OF ISSUE ： 20 × ×31D DATE AND PLACE OF EXPIRY ： 20× × ， CHINA50 APPLICANT ： A COMPANY59 BENEFICIARY ： B COMPANY32B DC AMT ： CURRENCY USD × ×41A AVAILABLE WITH/BY ： ANY BANK BY NEGOTIATION42C DRAFTS AT ： SIGHT42A DRAWEE ： × × BANK43P PARTIAL SHIPMENT ： ALWD43T TRANSHIPMENT ： ALWD45A GOODS ： × × GOODS 46A DOCUMENTS REQUIRED ： COML INVO AND B/L IN TRIPLICATE48 PERIOD FOR PRESENTATION ： DOCS TO BE PRESENTED WI 15

DAS49 CONFIRMATION INSTRUCTIONS ： WITHOUT

开证行开出的信开信用证的份数，如无特殊需要，一般来讲，应开出一份正本和三份副本，其转递流程见图：

正 本

第 1 副本

第 2 副本

第 3 副本

开 证

银 行

通 知

银 行

受益人 正 本

通知银行保存

开证行 开证申请人保存 开证申请人付款

开证行存档

Kinds of L/C

Irrevocable Credit (clause)

We (Issuing Bank) hereby issue the Irrevocable

Documentary Credit in your favor. It subject to the Uniform

Customs and Practice for Documentary Credit (1993

Revision International Chamber of Commerce, Paris, France,

Publication No.500) and engages us in accordance with the

terms thereof, and especially in accordance with the terms of

Article 9a thereof.

Kinds of L/C

Revocable Credit (clause)

This Credit is subject to revocation or modification at

any time without notice to you, conveys no engagement

on our part, and is simply for your guidance in

preparing and presenting drafts and documents.

Kinds of L/C

Confirmed Credit

At the request of our correspondent, we confirm thi

s Credit and engage with you that all drafts drawn

under and in compliance with the terms and conditi

ons of this Credit will be duly honoured by us upon

presentation.

Kinds of L/C

Buyer’s Usance Credit /Usance Credit Payable at Sight

Draft at 90 days sight on Issuing Bank

L/C terms:

a) Immediate reimbursement will be provided by us on receipt o

f the documents

b) Discount charge is for the buyer’s account.

c) Draft drawn under this Credit should be negotiated at sight.

案例 1 远期信用证的风险

• 南方外贸 A 公司与孟加拉 B 公司签订贸易合同，出口印染面料，合同金额约 22 万美元，付款条件为远期信用证（ L/C120 天）。 开证行孟加拉 C 银行实际开出两个信用证，合计金额为 USD257625.60 。 A 公司所有七票货运单证，表面均与信用证要求相符，银行审单无异议， B 公司也按时承兑。但在四个月信用期满前， B 公司通过 C 银行提出货物质量有问题，声称无法付款，要求 A 公司给予 50% 的折扣。经 A 公司据理力争，买家最后承认是因为市场销售不好，无法付款。此时 C 银行却声明必须等待买卖双方解决争端之后才能付款。为最大限度减少损失， A公司被迫同意给予 B 公司 25% 的货款减让。

• 在买卖双方达成减让货款 25% 协议后，信用证 2 项下尚有余款8 万多美元，开证行一直拖延不付。为此， A 公司专门组团赴达卡，向孟加拉开证银行催款，最终开证行提出最多只能议付7 万美元。最终，在以远期信用证为付款条件下， A 公司损失金额为 USD63,160.62 。

Kinds of L/C

Transferable Credit

Article 48. Transferable Credit

a. A transferable Credit is a Credit under which the Beneficiary

(First Beneficiary) may request the bank authorized to pay, inc-

ur a deferred payment undertaking, accept or negotiate (the

"Transferring Bank"), or in the case of a freely negotiable Cre-

dit, the bank specifically authorized in the Credit as a Transfer-

ring Bank, to make the Credit available in whole or in part to

one or more other Beneficiary(ies) (Second Beneficiary(ies)).

Kinds of L/C

b. A Credit can be transferred only if it is expre-

ssly designated as "transferable" by the Issui-

ng Bank. Terms such as "divisible," "fractio-

nable," "assignable," and "transmissible" do

not render the Credit transferable. If such ter-

ms are used they shall be disregarded.

Kinds of L/C

c. A Transferring Bank shall be under no obligati-

on to effect such transfer except to the extent a-

nd in the manner expressly consented to by suc

h bank.

Kinds of L/C

d. At the time of making a request for transfer and prior to

transfer of the Credit, the First Beneficiary must ir-revo

cably instruct the Transferring Bank whether or not he

retains the right to refuse to allow the Transfer-ring Ban

k to advise amendments to the Second Benefi-ciary(ies). I

f the Transferring Bank consents to the tra-nsfer under t

hese conditions, it must, at the time of tra-nsfer, advise t

he Second Beneficiary(ies) of the First B-eneficiary's inst

ructions regarding amendments.

Kinds of L/C

e. If a Credit is transferred to more than one Second Be-

neficiary(ies), refusal of an amendment by one or mor-

e Second Beneficiary(ies) does not invalidate the acce-

ptance(s) by the other Second Beneficiary(ies) with re-

spect to whom the Credit will be amended accordingl-

y. With respect to the Second Beneficiary(ies) who rej-

ected the amendment, the Credit will remain unamen-

ded.

Kinds of L/C

f. Transferring Bank charges in respect of transf-

ers including commissions, fees, costs or expen-

ses are payable by the First Beneficiary, unless-

otherwise agreed. If the Transferring Bank agr

-ees to transfer the Credit it shall be under no o

-bligation to effect the transfer until such charg

-es are paid.

Kinds of L/C

g. Unless otherwise stated in the Credit, a transferable Credit can-

be transferred once only. Consequently, the Credit cannot be tr-

ansferred at the request of the Second Beneficiary to any subse-

quent Third Beneficiary. For the purpose of this Article, a retra-

nsfer to the First Beneficiary does not constitute a prohibited tr-

ansfer. Fractions of a transferable Credit(not exceeding in the

aggregate the amount of the Credit) can be transferred separat-

ely, provided partial shipments/drawings are not prohibited, an-

d the aggregate of such transfers will be considered as constitut-

ing only one transfer of the Credit.

Kinds of L/C

h. The Credit can be transferred only on the terms and conditions

specified in the original Credit, with the exception of:

  - the amount of the Credit,

  - any unit price stated therein,

  - the expiry date,

  - the last date for presentation of documents,

  - the period for shipment,

  any or all of which may be reduced or curtailed

Kinds of L/C

The percentage for which insurance cover must be eff-

ected may be increased in such a way as to provide the

amount of cover stipulated in the original Credit, or t-

hese Articles. In addition, the name of the First Benefi-

ciary can be substituted for that of the Applicant, but

if the name of the Applicant is specifically required by

the original Credit to appear in any document(s) other

than the invoice, such requirement must be fulfilled.

Kinds of L/C

i. The First Beneficiary has the right to substitute his own i

nvoice(s) (and Draft(s)) for those of the Second Benefi-ci

ary(ies), for amounts not in excess of the original am-oun

t stipulated in the Credit and for the original unit prices

if stipulated in the Credit, and upon such substi-tution of

invoice(s) (and Draft(s)) the First Beneficiary can draw u

nder the Credit for the difference, if any, between his v

oice(s) and the Second Beneficiary's(ies') invoice(s).

Kinds of L/C

When a Credit has been transferred and the First Benefi-ci

ary is to supply his own invoice(s)(and Draft(s)) in ex-cha

nge for the Second Beneficiary's(ies') invoice(s)(and Draf

t(s)) but fails to do so on first demand, the Transfe-rring

Bank has the right to deliver to the Issuing Bank the doc

uments received under the transferred Credit, includin

g the Second Beneficiary's(ies') invoice(s)(and Draft(s))

without further responsibility to the First Be-neficiary.

Kinds of L/C

j. The First Beneficiary may request that payment or negotiation be

effected to the Second Beneficiary(ies) at the place to which the

Credit has been transferred up to and including the expiry date

of the Credit, unless the original Credit expressly states that it

may not be made available for payment or negotiation at a place

other than that stipulated in the Credit. This is without prejudic-

e to the First Beneficiary's right to substitute subsequently his o

wn invoice(s) (and Draft(s)) for those of the Second Beneficiary-

(ies) and to claim any difference due to him.

Kinds of L/C

Back-to-Back Credit

This Credit shall become operative only upon our

receipt from xxx of the relative documents as r

equested by the master Credit No. xx dated xx a

nd made out in compliance with the terms there

of.

Kinds of L/C

Back to Back Credit Transferable Credit

The issuance of it is not the intention of applic-ant and issuing bank in the master credit. They have no concern with the back to back credit.

At the request of the applicant and with the issuing bank,they issue a transferable credit.

Usually,the documentary credit is preceded by “transferable”.

A back to back credit is opened against the master credit. Two credit coesixt.

The credit amount is transferred either in whole or in part to the second beneficiary.

Such amount no longer exists in the original transferable credit.

The secondary beneficiary of back to back credit can not obtain issuing bank’s undertaking of payment in the master credit.

The secondary beneficiary always obtains the issuing bank’s undertaking of payment.

The bank which has issued a back to back credit is an issuing bank of that credit.

The bank which has opened a new transferabl-e credit is a transferring bank

Kinds of L/C

Reciprocal Credit

Primary Credit Clause

This credit shall not be available unless and until the re

ciprocal credit is established by ABC Bank in favor of x

xx company for a sum of USD 250,000

Kinds of L/C

Reciprocal Credit Clause

This is a reciprocal credit against xxx Bank Cre

dit No. xxx favouring xxx covering shipment of x

xx.

Kinds of L/C

Anticipatory Credit

Clean Payment Credit

Partial Payment in Advance Credit

Red Clause Credit

Green Clause Credit

Kinds of L/C

Clean Payment Credit Clause:

Beneficiary may draw in advance under this Cr

-edit by his sight draft for amount up to 100% of

the Credit amount accompanied by his underta-

king to the effect of shipment within the validity

of this Credit and to provide documents in terms

of the Credit.

Kinds of L/C

Red Clause Credit Clause

30% down payment will be paid upon negotiation

of beneficiary’s simple receipt and their under-

taking to ship the goods.

Kinds of L/C

Green Clause Credit Clause

Warehouse receipts in the bank’s name covering

the goods are being held by the bank.

Kinds of L/C

Revolving Credit

Cumulative Revolving Credit

Non-cumulative Revolving Credit

Revolving Credit in Relation to Time

Revolving Credit in Relation to Value

Automatic Revolving Credit

Semi-automatic Revolving Credit

Non-automatic Revolving Credit

Kinds of L/C

Cumulative Revolving Credit

This Credit is revolving at USD1000000 Coveri-

ng shipment of xxx per calendar month cumula-

tive operation from January 2005 to June 2005

inclusive.

Kinds of L/C

Non-cumulative Revolving Credit

This Credit is revolving at USD1000000 Cover-

ing shipment of xxx per calendar month nonc-

umulative operation from January 2005 to Ju-

ne 2005 inclusive.

Kinds of L/C

Revolving Credit in Relation to Time

This is a monthly revolving Credit which is available for

up to the amount of USD15000 per month, and the full

Credit amount will be automatically renewed on the 1st

day of each succeeding calendar month. Our maximum

liability under this Revolving Credit does not exceed U-

SD90000 being the aggregate value of six months. The

unused balance of each month is non-cumulative to the

succeeding month.

Kinds of L/C

Revolving Credit in Relation to Value

This Credit is revolving for three shipments only. Ea-

ch shipment should be effected at one month interval.

The amount of each shipment is not exceeding USD

50000. The total value of this revolving Credit does

note exceed USD150000. The unused balance of each

shipment is not cumulative to the following shipments

.

Kinds of L/C

Automatic Revolving Credit Clause

The amount paid under this Credit shall be again available to you automatically until the total of the payment reaches USD200000.

Kinds of L/C

Semi-automatic Revolving Credit Clause

Should the Negotiating Bank not be advised of

stopping renewal within a week, the unused

balance of this Credit shall be increased to the

original at the beginning of the next week after

each negotiation.

Kinds of L/C

Non-automatic Revolving Credit Clause

The amount shall be renewed after each negot-

iation only upon receipt of Issuing Bank’s noti-

ce stating that the Credit might be renewed.

Kinds of L/C

Stand-by Credit

The Standby Credit is a documentary Credit

or similar arrangement, however named or

described, which represents an obligation to

the beneficiary on the party of the issuing

bank to:

Kinds of L/C

1. repay money borrowed by the applicant, or advanced

to or for the account of the applicant;

2.make payment on account of any indebtedness under-

taken by the applicant, or

3.make payment on account of any default by the appli-

cant in the performance of an obligation.

Kinds of L/C

Similiarities and differences between the Commercial Credit an

d the Standby Credit

Similiarities:

1.Both commercial Credit and Standby Credit are independent

undertakings which are separate transactions from the underl-

ying contract.

2. Both above credits are to be paid against complying document-

s, both issuing banks undertake primary liability for payment

Commercial Credit Standby Credit

1.It is used in trade settlements.

2.Each commercial credit must pay against presentation of co-mplying documents.

3.It usually stipulates shipments, expiry dates, latest date for presentation of documents, and the complicated documentary requirements.

1.It is used in non-trade settlements and trade financial transactions.

2.It makes preparations against any contingency or default in the perform-ance of an obligation, if the default did not arise, payment would not be effec-ted.

3.It usually stipulates only expiry date and simple documentary requirements, such as simple draft or draft accompa-nied by statement of default.

differences

4.It is subject to UCP500.

5.Payment effected on the basis of the beneficiary’s fulfilment of credit terms.

4. It is subject to ISP98.

5.Payment under some standby credit to be effected on the basis of the applicant in breach lf his obligation.

Kinds of L/C

Credit Opened by Mail (Mail Credit)

Credit Opened by Teletransmission

Brief Cable Advice

Full Cable/Telex

SWIFT

Kinds of L/C

Kinds of L/C