Its primary responsibility is to authenticate the LC to ensure that the LC comes from genuine source. Accordingly, the carrier needs to be advised that the fact that Jac offered the carrier an indemnity if a clean bill of lading was issued meant that between the seller of the goods and the buyer of exchange, the delivery Trade law essay the bill of lading is Trade law essay way of pledge, and the security of the buyer of exchange is, until acceptance by the buyer on delivery to them of the documents, the liability of the seller as drawer of the bill of exchange with the bill of lading as collateral security.
Foreign buyers are also concerned that the goods may not be sent if payment is made in advance. To establish a letter of credit in favour of the seller or exporter called the beneficiary the buyer called the applicant or account party either pays the specified sum plus service charges up front to the issuing bank, or negotiates credit.
A Nominated Bank is not responsible to pay under the credit unless it has added its confirmation to the credit.
However, the bill of lading must not only comply with the requirements set out above but it must also accurately evidence the contract of carriage because the buyer is not obliged to investigate, or to accept assurances about, the contract of carriage outside the bill of lading.
As getting paid in full and on time is the primary goal for each export sale, an appropriate payment method must be chosen carefully to minimize the payment risk while also accommodating the needs of the buyer. A letter of credit guarantees payment of a specified sum in a specified currency, provided the seller meets precisely-defined conditions and submits the prescribed documents within a fixed timeframe.
In such a case, it will become a Confirming Bank. Nevertheless, the carrier must still be advised that estoppel will be available to the indorsee or holder only if they have changed their position on the faith of the representation and the fact that the indorsee has taken up and pays for the bill of lading and other shipping documents under a CIF contract is prima facie evidence that they changed their position on the faith of the representation in the bill of lading.
Moreover, the buyer is also not obliged to accept a bill varied after issue or one altered before issue other than to correct a minor clerical error because the bill of lading must be procured on shipment. Moreover, it must also be shown in looking to advise the carrier that those relying on the estoppel satisfied the court that the defect in question was one which would have been apparent to the shipowner on reasonable examination and the statement upon which the alleged estoppel is founded must be clear and unqualified, otherwise the whole case of estoppel against them fails.
Thus, exporters that insist on this method of payment as their sole method of doing business may find themselves losing out to competitors who may be willing to offer more attractive payment terms. Since the unambiguity of the terminology used in writing a letter of credit is of vital importance, the International Chamber Of Commerce ICC has suggested specific terms called Incoterms that are now almost universally accepted and used.
In effect, a letter of credit substitutes the creditworthiness of a bank for the creditworthiness of the buyer. Also, where the contract of sale fails to stipulate as much, or where it expressly envisages shipment may be direct or indirect, the buyer can reject a bill of lading granting the carrier a liberty to deviate where the extent of the liberty is uncertain because the clause itself is not printed on the bill.
This is because the contract is an agreement for the sale of goods to be performed by delivery of documents, or a sale of documents representing goods, with the seller having obligations in law regarding both the goods and the documents covering them Accordingly, this is in keeping with the fact that an agreement for the carriage by sea of a cargo or for the use of a ship for a voyage or series of voyages or for a specified time is normally contained in or evidenced by a bill of lading On this basis, it must be recognised that the carrier needs to be advised the bill of lading is considered the most important document in this kind of contract.
A tenor draft is normally required but not mandatory for presentation under a usance credit and is drawn on the Issuing Bank. But the suit may be brought in any competent jurisdiction, not necessarily in the jurisdiction where the matter is ultimately decided; and the suit must be brought in the name of a party who has title to sue under an agreement known as the Gold Clause Agreement, entered into between British shipowners and underwriters.
The Confirming Bank will only confirm an LC upon satisfactory evaluation on the conditions of the Issuing Bank and its domicile country. Advising Bank An Advising Bank or sometimes known as notifying bank is the bank that advises the LC beneficiary that there is an LC issued in his favour.International trade is when countries exchange goods and services with one another.
Usually each country will use money to pay for the goods or services from the other country. Goods can be things like clothes, food, machine parts, or even things like furniture. Services are tasks or jobs that one 3/5(19). - Introduction to International trade International trade is the exchange of capital, goods, and services across international borders or territories or in other words is the process of import and export.
international trade has been present throughout much of history its economic, social, and political importance has been on the rise in recent centuries. International Trade Before The World Trade Organisation International Law Essay International Trade before WTO From tothe General Agreement on Tariffs and Trade (GATT) provided the rules for much of world trade and presided over periods that saw some of the highest growth rates in international commerce.
This essay was produced by one of our professional writers as a learning aid to help you with your studies. 1. The selection of an alternative dispute resolution mechanism is particularly pertinent in international trade cases because the parties are, by definition, domiciled in different nation states (Chuah, ).
BTW International Trade Law Assignment 2 Jesse Cooper, Part A: On the face of it, or prima facie there are three issues that are raised in this case. Sample law essay. The law essay below has been submitted to us by a student in order to help you with your studies.
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