Documentary Credit (LC) for new employees

Question:
I´m a newly employed clerk at a small exporting company and I have just received a documentary credit (LC) in our favour from an advising bank. What shall I do?

Answer:
In order to get paid you should present documents required in the LC according to the terms and the conditions stated in the LC and in accordance with the UCP 600.

Step one:
Read the documentary credit and compare it with the contract signed by you and the buyer. Check if the goods can be transported as per LC terms. Check if the documents required can be presented within the time limits stated in the credit. If the terms and conditions stated in the LC cannot be fulfilled contact the applicant (the buyer) in order to have the LC amended. The amendment will come into force when all parties agree, the issuing and the advising bank, the applicant, the beneficiary and the confirming bank if any. Such amendment will be communicated to you (the beneficiary) the same way as the original LC.

Step two
When all the documents required in the LC are produced, send them together with a cover letter to the advising bank. You will find our cover letter at SEB (Trade Finance/Tools/Forms/Forms Sweden/Bankuppdrag remburs ). The documents will be checked by the bank. If they are found correct, depending on the instructions in the LC, payment or a promise to pay (in case of acceptance or deferred payment) will be made/given by either the advising bank (in case the LC is confirmed) or the issuing bank.