Wrong spelling in LC documentation
Is ‘spelling wrong’ a problem in documents under Letter of Credit? What is the consequences if documents with spelling errors in LC. Does bank reject documents if wrong spell in documents under Letter of credit? These questions are common in import export trade.
Let us find solution on above questions, Does spelling errors in documents under letter of credit make problems in receiving LC amount by seller from buyer.
I have specifically mentioned in my other articles in the same website about the importance of proper care in documentation under LC terms including spelling error, punctuations, coma etc.
Let me tell you with a short story about importance of a ‘punctuation’. This example perfectly serves the answer for this article.
It is said that in a verdict, Judge declared his judgment orally by saying – “Kill him not, let him free”. But the clerk who has taken dictation has written the verdict in file as – “Kill him, not let him free”. The accused has been killed based on the written statement – “Kill him, not let him free”, although the actual judgment was to leave the accused free.
Let me come back to our question – whether spelling error or punctuation in documentation in Letter of Credit is a discrepancy.
Terms and conditions of a Letter of Credit (LC) is adopted by Banks all over world
based on the guidelines of UCP 600 (Uniform Customs and Practice for Documentary Credit 600) by International Chamber of Commerce. As per UCP 600, Any error in presentation, spelling, punctuation, signatures, stamps or any other discrepancy bank can find, is a discrepancy of documents under Letter of Credit. However, apparent spelling mistake, punctuations etc. in documentation under Letter of Credit which do not alter the meaning, specification, description, value of goods, quantity or any other contents can be acceptable by bank without treating as a discrepancy of documents. However, if bank found such spelling error or punctuation as a ‘discrepancy’, the beneficiary can contact the opener either by fax or email and request him to advise opening bank to accept documents by overlooking and waiving such discrepancies.
You can also read more information by clicking Letter of credit - How does LC work? What are the advantages of Letter of Credit to Exporter? How LC is benefited to Importer? Are there any disadvantages to importer for a consignment under Letter of Credit? What are the disadvantages of LC to an exporter? Who are the parties involved in Letter of Credit? How to check authenticity of LC? What is Prime Banker? Yes, I am sure, once after going through those articles you will have a good knowledge about Letter of Credit.
I hope, you have satisfied with the clarification on spelling error and punctuation in documents under LC.
The above information is a part of Import Export Training online
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The information provided here is part of Export Import Online Tutorial