Assignment Of Letter Of Credit

Assignment Of Letter Of Credit-85
Yet when the infamous and much quoted case of Banco Santander SA vs Banque Paribas was heard before the English courts in 1999, it raised serious concerns amongst trade finance practitioners.Many articles were written at the time, resulting in one of the most important changes in the updated ICC Uniform Customs and Practice for Documentary Credits The ICC was compelled to ensure that there was consistency between regions on a point so critical to the survival of secondary market trading.Needless to say however, this is not always possible.

Yet when the infamous and much quoted case of Banco Santander SA vs Banque Paribas was heard before the English courts in 1999, it raised serious concerns amongst trade finance practitioners.

Such an assignment does not, in and of itself however, cure or resolve the issues relating to defects or adverse claims affecting the assignor’s rights explained above but these can be overcome with a suitably worded acceptance of the notice of assignment by the Issuing Bank.

Obtaining an acceptance of assignment of proceeds is, and has been for some time, standard forfaiting practice but care needs to be taken as whilst UCP 600 makes it clear that a beneficiary may assign proceeds, the Issuing Bank is under no obligation to either accept such requests or to acknowledge them.

This has become more of an issue with some Banks becoming increasingly wary of accepting such requests from non customers, or in some circumstances where it is claimed that the assignment will result in a conflict with local law.

Needless to say this is a barrier to the prepaying/discounting by third party institutions and is therefore to be discouraged.

In such circumstances, it would be unfair for the debtor to lose its rights simply because there had been a change of creditor.

It is perfectly possible for a debtor, say an Issuing Bank, to agree that it will pay an assignee regardless of any defects in the rights which have been acquired from the assignor.

Google(); req('single_work'); $('.js-splash-single-step-signup-download-button').one('click', function(e){ req_and_ready('single_work', function() ); new c.

party beneficiaries according to instructions of beneficiaries under L/C.

Whilst this treatment of deferred payment credits addresses the main issue raised in Santander, the question as to whether Third Party Banks or forfaiters which further discount such Credits get the same protection as the Nominated Bank has not been resolved or dealt with by the changes made in UCP600.

What is the position, for example, of the Third Party Bank/forfaiter which gets an assignment of proceeds from a Nominated Bank or directly from the beneficiary?

SHOW COMMENTS

Comments Assignment Of Letter Of Credit

The Latest from www.foxtrot-fab.ru ©