第六章外贸函电.pptVIP

Chapter Ⅵ L/C Establishment, Amendment and Extension;;; Letter of credit (L/C)is a chief method of payment in international trade. It is a written document given by a bank to the exporter at the request of the importer, promising to make payment for a certain amount under a certain condition. And it is a reliable and safe payment mode facili- tating trade with unknown buyers and giving protection to both sellers and buyers. There are different types of the L/C: (1)Irrevocable L/C; An irrevocable L/C means that the issuing bank cannot amend or cancel a credit without the approval of the party involved; the issuing bank must effect payment so long as the beneficiary presents shipping documents called for in accordance with the terms of the L/C. Since UCP 600 was put into effect on 1st July,2007, a credit is always irrevocable even if there is no indication to that effect. ? ;(2)Confirmed L/C A confirmed L/C is a credit issued by the issuing bank and guaranteed by another bank to fulfill the payment upon presenation of certain documents. (3)Transferable L/C A transferable L/C means a credit that specifically states it is transferable. It may be made available in whole or in part to an- other beneficiary (second beneficiary) at the;request of the beneficiary (first beneficiary). (4)Revolving L/C A credit is established for a certain sum and quantity of goods with a provision that when a shipment has been made and documents presented re-available in its original form and another shipment can be so on until to the stipulated time or total amount. (5) Reciprocal L/C A reciprocal L/C is that two parties open;letters of credit in favor of each other. (6)Back to Back L/C Back to back L/C means that beneficiary requires the advising bank of the original credit or other bank to issue a new credit with similar contents on the basis of the original L/C. Note: UCP (Uniform Customs and Practice