Information on Foreign Trade Practice 04/2011

Case Study Letter of Credit

Question:
Under a Letter of Credit, a commercial invoice has been
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presented, made out in the name of the LC applicant. EXPORT MASTER GMBH
However, the applicants address has not been mentioned.
The issuing bank rejects the documents due to the missing APPLICANT:

IMPORT COMPANY INTERNATIONAL

address referring to Art. 2 UCP600* and the fact that in field TURKIYE

50 of the LC the applicant is mentioned together with its DATE: 20.05.2012

address. Is this rejection correct?

Answer: COMMERCIAL INVOICE NO: 509RE2009

According to the opinion of the ICC (International Chamber OFFER / CONTRACT NO.: 123456789

LETTER OF CREDIT NO.: ILC 12345 DD. 10.11.2011

of Commerce Paris), it is expected that an invoice shows
the name as well as the address of the applicant. DESCRIPTION OF GOODS:

However, the definition in Art. 2 of the UCP600* relates only 200 PIECES OF PC AAA-1, EACH FOR EUR 500,00, PACKED IN STRONG CASES, AS PER
CONTRACT NO: 123456789 DATED 01.07.2011 - CIP IZMIR

to the name of the LC applicant there is no requirement for

LC VALUE: EUR 100.000,00
the address of the applicant to be mentioned.
VALUE OF GOODS / CIP IZMIR: EUR 100.000,00________________

The definition of applicant in article 2 is confined to the name BENEFICIARY:

of the party upon whose request the credit was issued. Un- EXPORT MASTER GMBH
MUSTERSTR.
der international standard banking practice, it is expected MUSTERSTADT / GERMANY

that an invoice will include the name and address of the ap-
plicant. However, an invoice that only quotes the name of
the applicant, without any address, would be acceptable
under sub-article 18(a) iii.

Recommendation:
Even though the ICC has decided this particular case as You can find this and further cases under:
described above, we recommend that you include the infor- www.hvb.de/ahpraxisinfo
mation in field 50 of the credit (name and address of appli- For general and useful information about foreign trade
cant) in your invoice in order to avoid possible discussions, click: www.hvb.de/ucgtrade2go
arguments and delays.

* Uniform Customs and Practice for Documentary Credits, International Chamber
of Commerce Paris Publication 600.
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