I would like to know whether your experts would agree with the following view:

"- Buyers (or their banks) often call for documents required for import clearance (certificates of origin, of inspection, sanitary, veterinary certificates, etc.). However, documents that may be claimed under a credit should only correspond to the seller's obligations under the Incoterm applicable to the contract. Except under DDP Incoterm (*), these documents intended for import clearance are not part of the seller's obligations and should therefore neither be required in the credit nor submitted to the banks' examination.

(*) In any case, since a documentary credit is supposed to link the payment to the shipment of the goods, DDP is not consistent with this technique of payment, which should preferably be replaced by a SWIFT transfer accompanied by a bank guarantee such as a standby letter of credit unless there is a governmental regulation that imposes settlement through an L/C.

- The seller might consider clarifying this issue during commercial negotiation and propose one of two alternatives:

. he sends these documents directly to the buyer if their relationship is trustworthy, or

. should the issuing bank insist on their surrender, he clearly indicates in his pre-instructions for the credit opening that they will be stated in field 47A of the SWIFT MT700 as accompanying documents and will thereby not be checked by banks for compliance against other documents stipulated in the credit."

Many thanks for your answer.

Best regards.

Banks usually follow the terms stipulated by applicants in the standard bank application forms which usually contain some of the requirements imposed by the regulatory bodies in the country they domicile. Though, as stated above, all issues (including those standard requirements in LC applications) related to the terms and conditions of the credit must be agreed upon prior to establishing an LC, a seller who does not agree to the terms and conditions stipulated in the credit received should contact the buyer in time and ask for an amendment if feasible; otherwise, the contracting parties should look for alternative methods to conclude their deals. Parties should not keep their differences until the last minute.

Best Regards

Abdulkader