Documents in documentary credit operations

Documents have to be prepared in the L/C settlement; 


n– Transport document
     Transport documents are documents indicating that goods have been loaded on board, dispatched or taken in charge.
n– Marine Bill Of Lading ( B/L ).
        The marine Bill of Lading could be considered as the most important type of document in the documentary credit operation as it is the title document of the goods. Therefore in practice it is impossible to claim the goods from the shipping line without presenting original B/L.
n– Commercial Invoice.
        It must describe the goods exactly as they are stated in the credit therefore the seller confirms that deliver the goods as stated in the contract. The amount of invoice should be the same amount and in the same currency as it is in the draft.


n– Insurance Documents.
      Insurance is needed when the L/C stipulated that the price is CIF terms, the insurance document should be in the form stipulated in the credit and be issued and/or signed by an insurance company, an underwriter or its agents. Unless otherwise stipulated in the credit the insurance coverage must be expressed in the same currency as the credit and must cover as least the CIF value of the goods plus 10%.
n– Other Documents
      No other specific reference is made in the UCP, but it is importance this documents satisfy the credit conditions and consistent with other documents.

– Packing List
      It describes the way the goods are packed, sometimes also the material of the packing. The goods description should be exactly the same as in the commercial invoice.
– Weight Note.
    It shows the weight of the goods being shipped either gross or net weight. The weight shown must be consistent with the weight in other documents.
– Certificate Of Origin.
   It shows the origin of the goods, thus it confirm that the goods are actually had been produced in a particular country. Usually it is issued by the competent authority office such as Trade Dept. or Chamber Of  Commerce.
– Clean Report Finding.
   Often importer requires the goods to be inspected by Independent surveyor such as SGS prior to shipment in order to make sure that the type/quantity/quality of the goods are according to their order.
– Certificate of Analysis.
   It shows detailed analysis about components of the goods being shipped, it is usually required for chemical material.

General Principles for checking documents

n– Completeness : to make sure all documents which are required by the L/C presented to negotiating bank.
n– Conformity with all terms and conditions of the L/C, to make sure each terms and conditions of the L/C have been satisfied by the documents.
n– Consistency of the document with each other
n– Compliance with the “Uniform Custom and Practice for Documentary Credit”  Revision 2007 (UCP) Issued by International Chamber of Commerce, Paris