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 L/C(Letter of Credit) |
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 {1} Letter of credit
 [10] Documents related to L/C
(1) A bill of change Nego application
| 1. Definition |
- A application where an exporter completes goods' shipping, prepares bill of
change and the shipping documents that correspondence to the L/C terms
and request negotiation as per the agreement with a foreign exchange
bank.
- Before Nego application for export bill of change is presented, export bill of
change agreement has to be made with a foreign exchange bank in advance
and per the agreement, a foreign exchange bank accepts the application
and Nego the shipping documents.
- When presenting export bill of exchange Nego application to a foreign
exchange bank, the original L/C and the incidental shipping documents required by L/C should be attached together.
- The composition of export bill of exchange Nego application is divided in 3
kinds as L/C, processing details of shipping documents and payment and
certification. |
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2. Preparation method |
a) Nego number--A Nego bank will indicate this section.
b) Beneficiary--It is a general rule to indicate a beneficiary of L/C since the
beneficiary of L/C is requesting negotiation. However, the grantee is to be
indicated if L/C is transferable L/C.
c) Commodity-- Indicate the name of goods to export. It must be same as the
goods indicated on the invoice.
d) Advice No--If L/C is to notified by an advising bank: The notification number
of an advising bank is to be endow on the cover of L/C, the endowed
number is to be indicated. The first letter of advising number starts with a
letter A. Ex) A-0667-404-03135"
e) Export Licence No.--Indicate export license number. It must be same as the
export permit license number.
f) Issuing Bank--Indicate name of the opening bank. If L/C is to be transfer
from third country and the documents are to be sent to a transferring bank
(T/S Bank) to settle payment, the same bank should be indicated.
g) Invoice value-- Indicate amount on the invoice.
h) Shipping Expiry--indicate shipping date on the L/C.
i) Credit Expiry-- Indicate the validity period of L/C. Except, if it is Renego, the
time of the documents arrival date to the Renego should be within the valid
period.
j) Account number to remit-- Indicate the account number where an exporter's
export payment is to be deposit.
k) Accountee--Indicate the applicant of the L/C.
l) Processed details--This section is to indicate a process method of Nego
payment if a foreign exchange bank Nego the documents requested to be
nego.
m) Nego Amount--Indicate Nego requesting amount (bill of change amount).
n) Settled details--If received financial benefit basis on the inquired L/C, forward
the application to the financial circles that accepted the finance and
compute, indicate the reimbursing amount and get confirmation for strike a
balance and pay to an applicant.
o) Negotiation request date--The date that a negotiation applicant Nego the
shipping documents from a foreign exchange bank is to be indicated.
p) Name plate or a seal impression of the negotiation applicant-- A section
where the negotiation applicant's name plate and a seal impression is to be
register. Should be same person as a beneficiary.
q) Payment term--Indicate the payment terms of the shipping documents which
requesting negotiation.
r) Exchange rate--The foreign currency that a beneficiary is requesting Nego to
a foreign exchange bank. Indicate the foreign rate by conversing to the
home money.
s) Nego performance date--Indicate the date that a foreign exchange bank is
executing the Nego of the shipping documents upon a beneficiary's request.
t) Memorandum--If presenting shipping documents fail to meet L/C conditions, a
beneficiary will compensate for the entire disadvantages of the bank due to vice(discrepancy). By a beneficiary registers and signs the memorandum and request Nego to a foreign exchange bank, the bank will inspect the documents and other than the critical vice informations, the presented documents can be Nego after the memorandum is obtained. |
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