| A credit was a sight bill but there wasn't a negotiating bank appointed and no clause for freely negotiable credit. A question was made whether the credit can be regarded as a freely negotiable credit but the opening bank had no response so the question was officially inquired to I.C.C.
Case study
1. Usage location indication for credit
According to the Sub-Article 10(b) of U.C.P,, unless a credit is not limiting the usage to the opening bank, all the credit must designate indication of paying, taking over or negotiating bank and whether accepting the freely negotiating credit.
2. Incomplete or unclear instructions
When there is a incomplete or unclear instruction with a credit, it must go through a advising bank and inquiry to a opening bank to clarify the instruction.
3. Responsibility of a advising bank with incomplete instructions
When there is a incomplete or unclear instruction with a credit, the advising bank must confirm with a opening bank of the fact instead of notifying it as is. If being requested to notify it as is, there must be a clause declaring that the bank has no responsibility in notifying the instruction and that the offering is just an act to providing a information.
4. Responsibility of a opening bank
If being requested as a opening bank to provide necessary information because there is a incomplete or unclear instruction, the opening bank must provide the information requested at once. (The 12 of U.C.P. 500)
According to the I.C.C. pub 489 case No.191, this case is sentenced as a general practice to regarded as a freely negotiating credit.
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