The process of operating with a single letter of credit is as follows:
1. Buyers and sellers are used in trade contracts to use with a single letter of credit.
2. The buyer notifies that the local bank (issued bank) opens the letter of credit with the seller as the beneficiary.
3. The issuing bank requests another bank notice or warranty letter.
4. Inform the bank to notify the seller, the letter of credit has been opened.
5. The seller receives the letter of credit and ensures that it can perform the goods after performing the conditions specified by the letter of credit.
6. The seller will submit the document to the designated bank. The bank may be a bank, or a payment, acceptance or orientation of a payment within a letter of credit.
7. The bank reviews documents according to the letter of credit. If the document meets the letter of credit, the bank will pay, accept or negotiate according to the letter of credit.
8. Banks outside the issuing bank will send documents to the issuing bank.
9. After the issuance of the issuance of the issuance, the bank will pay for banks that have been paid according to the letter of credit, acceptance or negative in the form of the letter of credit, acceptance or negative.
10. The issuing bank is updated after the payment is delivered, and then the buyer will pick up the goods.
Letter of credit
1. Application for the issuance
After the import and export agreement, the importer has a responsible issuing after paying with a single letter of credit. The first thing is to fill in the issuance application form. This table has established legal relationships with the issuing applicant and the issuing bank. Therefore, the issuing application form is the most important document for the issuance.
2. Documentation requirements
The requirements for the application for letter of credit have clearly stated in the unified convention, and the importers must be exactly the bank.
The indication of the letter of credit must be complete and clear. Applicants must always remember that the letter of credit transactions is a document transaction, not a trade transaction. Bank home is not a businessman, so applicants cannot want bank staff to fully understand the technical terms in each transaction. Even if he writes all the terms in the sales contract to the letter of credit, if the beneficiaries really want to deceive, he can't get full protection. This requires banking and applicants to work together to use common sense to avoid the credit for all parties. Banks should also discourage their content sets in the past have been opened when the letter of credit has been opened.
3. The security of the issuance
After receiving the complete instructions of the issuer of the issuer, the bank must open the letter of credit immediately. On the other hand, the bank also has the right to request the applicant to hand over a certain amount of funding or other forms of its property as a guarantee of its instructions.
According to current regulations, foreign exchange owned by local, departments and enterprises must usually be deposited in China. If some units need to import goods or technologies with a single letter, China's bank will freeze funds that are equivalent to the credit amount in their accounts as the issuing margin.
If the applicant does not have an account in the issuing bank, the issuing line is likely to ask the applicant before the opening of the letter of credit, and the payment is equivalent to the funds equivalent to all credit amounts. This guarantee can be implemented by mortgage or derivation, but banks may also provide financing by goods for trading. The issuing bank must first investigate the sales of the goods. If the goods are easy to sell, the bank will have much higher the financing amount provided by the letter of credit to customers.
4. The obligations and responsibilities of the applicant and the issuing bank
Applicants have a three major obligations to the issuing bank:
(1) Applicant must pay the issuance of the issuer to obtain the document representative to the loans paid to the beneficiary. Before he pays, the document as the property certificate is still in the bank.
(2) If the document is consistent with the terms of the letter of credit, the applicant refuses to "redemption", and its funds that have been frozen as a guaranteed deposit or account will return to the bank.
(3) The applicant has the responsibility of all the costs required to issue the issuing bank.
Responsibilities to the applicant:
First, once a detailed instructions of the issuing bank have been issued, there is a responsibility to issue as soon as possible.
Second, once the issuing bank accepts the application, it must be strictly in accordance with the applicant's instructions.
Notice of the letter of credit
Responsibility for notification
In most cases, the letter of credit is not directly notified by the issued bank, but through its agent, the lead in the beneficiary country, that is, the notification line is transferred.
The maximum advantage of notifying the beneficion is safe. The responsibility of the notice is to review the surface authenticity of the letter of letters it notified reasonably.
2. Delivery method of letter of credit
The letter of credit can be passed through the air mail, telegraph or electrical transmission. Swift in Brussels uses the rental line to deliver information in the bank of many countries. Most banks, including China's banks joined this organization. 3. Instructions for effective letter of credit
When the issuance of any valid telecom transmission method indicates the notification line, notify the letter of credit or the revision of the letter of credit, the telecommunications will be considered a valid letter of credit file or a valid modification and does not need to send a post certificate.
Beneficiary audit
After receiving the letter of credit, the beneficiaries should be used immediately as follows:
1. Is the name and address of the buyer and the company? Is it exactly the same as the company name and address written on the invoice?
2. Is the payment guarantee for the letter of credit meet the requirements of the beneficiary?
3. Is the amount of the letter of credit? The total amount of the letter of credit should be combined with the contract, including all payables for the contract.
4. Does the conditions for payment meet the requirements? Exporters usually require immediate payment unless certain national or certain specific importers. Under the conditions of forward letter, the duration of the draft should be consistent with the contract. There is a letter of credit to open a long-term draft, but can be paid, which is called "false and far-sized letter of credit", which is the same for the beneficiary.
5. Is the trade terms mentioned in the letter of credit comply with the original requirements of the beneficiary?
6. Is it possible to send various documents to a bank within a period of validity and freight documents?
7. Can you provide the required cargo documents?
8. Is the provisions about insurance consistent with the terms of sales contract?
- The risk of insurance is required. The beneficiary should contact the Chinese People's Insurance Company to decide whether to accept the requirements of the applicant. Any fees that exceed the sales contract stipulate that the insurance coverage should be burden on the applicant.
-Insured amount. Most of the credit requirements shall be insured by 110% of the CIF invoice.
9. Is the goods instructions (including free attached items), is the number of other items?
If you find any missing or error while checking each of the above entries, you should make a decision on the following points, take the necessary measures:
Can you change the plan or document content?
- Is it necessary to ask the buyer to modify the letter of credit, which party pays?
If you have any questions, you can contact your bank or inform the bank or inform you. But one thing to remember: Only the applicant and the beneficiary and the relevant banks agree to decide to decide.
Performance of the letter of credit
Document submission
In order to communicate with a single letter of credit, the submission of documents plays a very important role because it is the key to the final settlement of the letter of credit. Whether the beneficians will receive the payment to the bank to pay the document, it is largely dependent on whether the letter of credit and whether the document is set.
2. Limitation of the order time
The submission of the documents is determined by the following three factors:
(1) The failure date of the letter of credit;
(2) Dedicated delivery date after shipping date;
(3) Banks have no obligation to submit documents outside of their business hours.
The "stop", "to", "until", "Since", "" and similar words, "" "and similar words" in the credit can be understood. The term "later" is understood to not include the date.
"Training in the first half", "the second half" is understood to be included in the last day of the month to 15 and 16th to the month.
"Early", "Month" or "Moon" is understood as the month to ten days, eleventh to 20 days, on the last day of the month, the last day of the month, is included in the first day.
3. Restrictions on the single place
All letter of credit must specify a payment, acceptable, or in the case of a negative credit, there must be a place to pay in the form of a single, except for free negotiation credit.
Like the submission of the documents, the expiration of the letter of credit will also affect the beneficiary situation. Sometimes this happens, the issuing line will set the expiration of the letter of credit in its own or his own business counter, rather than the beneficiary country is extremely unfavorable, because he must guarantee the validity of the letter of credit Submit a document before the opening of the bank business counter. Bank review document
After the beneficians submit documents to the bank, banks are obliged to carefully review documents to ensure that the documents are displayed on the surface of the credit request and each document.
Trial guidelines
Banks must be reasonably and cautiously review all documents of the credit card to determine if the documents that are consistent with the terms of the credit terms on the surface should be determined by international standard bank practices reflected in these provisions. . The document is not complus each other on the surface, and it should be considered as surface and the stereotypes of the action certificate.
The meaning of the above "surface" is that banks do not need to ask if they are fake, whether they are fake, whether they have shipped goods truly shipped, and whether they fail after issuance issued. Unless the bank knows the fraudulent behavior, these actual conditions have nothing to do with the bank. Thus, if the fake document that matches the letter of credit on the surface of the beneficiary, it can also get the payment. However, if the beneficiary has shipped the specified goods in an appropriate manner, the bank will refuse to accept the documents at some criteria, and the bank will never receive the payment. The bank does not review the documents not specified in the letter of credit. If the bank receives such a document, the author will return the author or transfer and is not responsible for this.
2. Documentary validity
Bank's form, integrity, accuracy, authenticity or legal effect, or documents, or documents, is not responsible for the form of any document. Bank's description, quantity, weight, quality, condition, packaging, delivery, amount or existence of goods on behalf of the goods, and whether the delivery, carrier, freight forwarders, consignee, or cargo insurer And any other person's integrity, behavior, and / or negligence, pay-saving, behavioral capacity, or information status is not responsible.
3. Review documents
How long does the bank take a long time to review the documents submitted by the seller, and notify whether the seller is complete? Unified Practical Article 13 B is clearly stated: the issuing bank, the defense line (such as a fund) or representing their designated banks should have a reasonable time, ie, no more than seven after receiving documents Bank business day, audit documents, decide whether to accept or refuse to collect a single, and notify the parties received from the documents.
4. Do not conform to documents and notices
If the issued bank authorizes another bank to pay the document payment on the terms of the letter, it is obliged to accept the deferred payment responsibility, accept the bill or negative, and the guarantee shall be obligated: (1) Accept the document; (2) payment for payment, payment of extension payment responsibilities, acceptance bills or negotiations.
After receiving the document, the issuing bank and / or guarantee line (such as the backed) or representing their designated bank must be uniquely based on the document, and the surface is not consistent with the letter of credit. If the document does not match the credit on the surface, the bank can reject the document.
If the issuing line determines that the document is not in conforms on the form of the document, it can be fully contacted with the applicant according to your own decision, please remove it.
If the issued bank and / or guarantee line (such as a backed) or represents the decision of the decision to reject the document, it must be not late from the date of the seventh bank not from the date of receipt of the document. No lesson is issued in telecommunications, or other shortcuts without delay. This notice should be sent to the bank from which documents are received directly, and will notify the beneficiary.
The notification must indicate all the unconfluentials of the rejection, but also to explain whether the bank retains documentation processing or returns the document. The issuing bank or the defense line has the right to pay any payment and interest that has been given to the order line.
If the issuance or the defense line is not handled according to these regulations, or if the document is not allowed to wait, the document is returned to the order, the issuing bank, or the security bank does not have the right document that does not meet the terms of the letter of credit. If you send a single line to the document or the BAP, it has been paid in the customs or payment of the payment or payment of the deferred payment responsibility to the bill or the guarantee, the issuance of the payment shall be issued. The line does not mean any obligation. Letter of credit
When the bank trial is completed, the letter of credit will enter the settlement phase. Unified Practical Article 10 Point out: "All letter of credit must clearly indicate whether the certificate is applicable to murder payment, extension payment, acceptance or negotiation."
Turkey
(1) The beneficiary will pay the document.
(2) The bank review document is paid to the beneficiary after payment of the terms of the letter of credit.
(3) If the bank is not issued, the document will be sent to the document shall be issued in prior agreed.
2. Extended payment
(1) The beneficiary puts the document to the bank that is responsible for the deferred payment.
(2) If the bank audit document is consistent with the terms of the letter of credit, payment based on the expiration date that the letter of credit can be determined.
(3) If the bank is not issued, the document will be sent to the document shall be issued in prior agreed.
3. Acceptance
(1) The beneficiary sends the document and the long-term draft issued to the bank to the bank (accepting line) of the letter of credit.
(2) The bank audit document is consistent with the credit conditions, the acceptance will be returned and refunded to the beneficiary.
4.
(1) The beneficiary shall send the document along with the immediate or extensive draft of the payer as prescribed by the letter of credit.
(2) Direct payment of bank audit documents with the credit regulations, can buy documents and drafts.
(3) If the Bank is in a non-invasive line, the document and the bill of exchange will be deployed in prior agreed.
