Scrutinizing Export Letters of Credit
- Is your company’s name spelled correctly and is the address correct?
- Does the LC state it is irrevocable?
- Was it necessary for the LC to be confirmed and, if so, is the confirming bank acceptable?
- Is the amount and currency of the LC correct?
- Is the tenor of the draft acceptable?
- Is the merchandise described correctly?
- Does the Incoterm match your sales contract?
- Are the transportation details correct?
- Can the shipping date be met?
- Are the insurance instructions clear and correct?
- Is the expiration date acceptable, and does it expire where the credit is available or the country of Issuance?
- Are the document requirements clear and understandable?
- Does the LC contain reimbursement instructions?
- Are the banking fees being paid by the correct parties?
- Is the LC subject to the UCP600?
Foreign Exchange Remittance
- How foreign exchange transactions handled in a Bank?
- Currency coversion rates and role of bank and treasury unit within the banks.
- How currency deals are done in advance?
- Spot Deals, Forward Deals, Hedge Option, Put and Call Options
Cross Border Trade Mechanism
- How trade happen between parties located in different countries?
- What are the preliminary requirements for a trade transaction?
- What are the regulations to follow for a cross border trade transaction?
- How goods and/or services and money move between countries.
- How a local currency is convered into a foreign currency?
- Rules to follow for a currency converstion process.
- Why a currency conversion is required to make a payment?
- How volatility of a currency value is anticipated and handled by traders?
Payments and Reimbursement
- How payment mechanism works?
- How Reimbursement Mechanism works?
- URR 725 [Uniform Rules for Reimbursement ICC Publication 725.
- Articles of URR 725
- Parties and Roles in this process