Janakpuri Forex-207-Transferable Letter of Credit

JANAKPURI FOREX-207JANAKPURI FOREX-207

TRANSFERABLETRANSFERABLELETTER OF CREDITLETTER OF CREDIT

MEANING OF TRANSFER LCMEANING OF TRANSFER LC

Transferable Letter of Credit:Transferable Letter of Credit:A transferable letter of credit is one, which A transferable letter of credit is one, which specifically states that it is transferable. This will specifically states that it is transferable. This will only occur if the applicant for the letter of credit only occur if the applicant for the letter of credit (buyer) agrees.(buyer) agrees.In a transferable letter of credit, the rights and In a transferable letter of credit, the rights and obligations of the beneficiary are transferred to obligations of the beneficiary are transferred to another party, usually a manufacturer or another party, usually a manufacturer or wholesaler. Transfer may be either full or partial. wholesaler. Transfer may be either full or partial.

TYPES OF TRANSFER LCTYPES OF TRANSFER LC

Transfer LC with Substitution Clause

Transfer LC without Substitution Clause

REASON FOR TRANSFERING REASON FOR TRANSFERING LETTER OF CREDITLETTER OF CREDIT

Most transfers involve a seller who, as beneficiary of Most transfers involve a seller who, as beneficiary of the letter of credit, has a pending sale, but is unable to the letter of credit, has a pending sale, but is unable to purchase the merchandise from the manufacturer on purchase the merchandise from the manufacturer on open account. Export brokers most often use open account. Export brokers most often use transferable L/Cs. Transferring a portion of the export transferable L/Cs. Transferring a portion of the export L/C to the manufacturer allows the broker to leverage L/C to the manufacturer allows the broker to leverage the buyer's banker's credit by providing the the buyer's banker's credit by providing the manufacturer with assurance of payment if the manufacturer with assurance of payment if the manufacturer performs under the transferred L/C manufacturer performs under the transferred L/C terms and conditions.terms and conditions.

1. Beneficiary approaches nominated bank to transfer this L/C in favour of 3 sub suppliers (A, B & C) at 50%, 25%, 25% retaining his profit margin of 10 % .Please note the same L/C is transferred in parts .

Partial Shipment ClausePartial Shipment Clause

A LC is transferable only if the issuing bank designates it.

Beneficiary has the right to request the nominated bank to transfer credits in parts or in full in favour of one or more beneficiaries if partial shipment permitted.

LC TRANSFER-CHECK POINTSLC TRANSFER-CHECK POINTS 40A: Form of documentary credit

Irrevocable Transferable

57D: Advise through bankAXIS Bank LimitedAXISINBB207

Irrevocable Transferable should be mentioned on LC

Before Transferring LC the LC should be advised by our Bank

AXIS bank should be mentioned in clause 57D other wise advise the client to amend the LC

If yes the we can go for Transfer the LC

If no then first advise the LC

Please Check the Following :31D: Date and place of expiry32B: Maximum credit amount43P: Partial shipments44C: Latest date of shipmentSubstitution Clause

LC TRANSFER-CHECK POINTSLC TRANSFER-CHECK POINTS The first step is to check whether LC is mentioning word Transferable or not, if The first step is to check whether LC is mentioning word Transferable or not, if

not then advise the client to amend the LCnot then advise the client to amend the LC Before Transferring LC it should be advised by our bank..Before Transferring LC it should be advised by our bank.. LC should not be expired other wise advise the client to amend the LCLC should not be expired other wise advise the client to amend the LC Shipment date should not be expired other wise advise the client to amend the Shipment date should not be expired other wise advise the client to amend the

LCLC Partial shipment should be allowed if part amount is to be transferred or there Partial shipment should be allowed if part amount is to be transferred or there

are more than one transferee.are more than one transferee. If above all points are ok then please go for Transferring the LC and enter the If above all points are ok then please go for Transferring the LC and enter the

details in our software'sdetails in our software's Please endorse the original LC on its back page and keep a copy with you in Please endorse the original LC on its back page and keep a copy with you in

following manner:following manner:1. AMOUNT TRANSFER :USD 136,314.80 IN FAVOUR OF URVI 1. AMOUNT TRANSFER :USD 136,314.80 IN FAVOUR OF URVI INTERNATIONALE-353, GREATER KAILASH – 1,NEW DELHI – INTERNATIONALE-353, GREATER KAILASH – 1,NEW DELHI – 110048, INDIA.110048, INDIA.

Please a copy of original LC and attached a transfer letter with it. Please also Please a copy of original LC and attached a transfer letter with it. Please also endorse the copy of LC also for transferee.endorse the copy of LC also for transferee.

In the request letter it should mentioned whether future amendment right are In the request letter it should mentioned whether future amendment right are available with transferor or not. The request letter should be signed by available with transferor or not. The request letter should be signed by authorised signatory of the company.authorised signatory of the company.

TRANSFERRED LC FORMATTRANSFERRED LC FORMATMT 720MT 720

27: Sequence of Total27: Sequence of Total 1/11/1 40B: 40B: Form of Documentary CreditForm of Documentary Credit IRREVOCABLEIRREVOCABLE WITHOUT OUR CONFIRMATIONWITHOUT OUR CONFIRMATION 20: 20: Transferring Bank's ReferenceTransferring Bank's Reference 207XLADV09010A207XLADV09010A 21: Documentary Credit Number21: Documentary Credit Number TD605500158074-9TD605500158074-9 31C: Date of Issue31C: Date of Issue 090514090514 40E: Applicable Rules40E: Applicable Rules UCP LATEST VERSIONUCP LATEST VERSION 31D: Date and Place of Expiry31D: Date and Place of Expiry 090702, INDIA090702, INDIA 52A: Issuing Bank of the Orig D/C-BIC52A: Issuing Bank of the Orig D/C-BIC BANK OF AMERICA, N.A. BANK OF AMERICA, N.A.

50: First Beneficiary50: First Beneficiary URVI INTERNATIONALURVI INTERNATIONAL B-6/27/2 SAFDARJUNG ENCLAVEB-6/27/2 SAFDARJUNG ENCLAVE NEW DELHI 110029NEW DELHI 110029 INDIAINDIA 59: Second Beneficiary59: Second Beneficiary TIN BOX INTERNATIONALTIN BOX INTERNATIONAL B 19 MAYAPURI INDUTRIAL B 19 MAYAPURI INDUTRIAL

AREA,AREA, PHASE-1, NEW DELHI-110064,PHASE-1, NEW DELHI-110064, INDIAINDIA 32B: Currency Code, Amount32B: Currency Code, Amount Currency : USD (US DOLLAR)Currency : USD (US DOLLAR) Amount : #7,638.30#Amount : #7,638.30#

TRANSFERRED LC FORMATTRANSFERRED LC FORMATMT 720MT 720

39A: Percentage Credit Amt Tolerance39A: Percentage Credit Amt Tolerance 05/0505/05 41D: Available With...By... - Name&Addr41D: Available With...By... - Name&Addr ANY BANKANY BANK BY NEGOTIATIONBY NEGOTIATION 42C: Drafts at...42C: Drafts at... AT SIGHTAT SIGHT 42A: Drawee - BIC42A: Drawee - BIC BOFAHKHXBOFAHKHX BANK OF AMERICA, N.A. HONG KONGBANK OF AMERICA, N.A. HONG KONG HONG KONG HKHONG KONG HK 43P: Partial Shipments43P: Partial Shipments PERMITTEDPERMITTED 43T: Transhipment43T: Transhipment PERMITTEDPERMITTED 44E: Port of Loading/Airport of Dep.44E: Port of Loading/Airport of Dep. INDIAINDIA 44F: Port of Dischrge/Airport of Dest44F: Port of Dischrge/Airport of Dest SAN FRANCISCO OR OAKLAND OR SAN FRANCISCO OR OAKLAND OR

DIXON, CADIXON, CA

45A: Descriptn of Goods &/or Services45A: Descriptn of Goods &/or Services GOODS DESCRIPTION: BABY OR CHILDRENS GOODS DESCRIPTION: BABY OR CHILDRENS

APPAREL OR ACCESSORIESAPPAREL OR ACCESSORIES P.O. NO QTY. PRICE EXT.AMOUNT P.O. NO QTY. PRICE EXT.AMOUNT

SKU LATEST SHIPMENT DATE SKU LATEST SHIPMENT DATE

+813652 2214 3.45 7638.30 +813652 2214 3.45 7638.30 140053844 140053844 17JUNE200917JUNE2009

49: Confirmation Instructions49: Confirmation Instructions WITHOUTWITHOUT 78: Instr to Payg/Accptg/Negotg Bank78: Instr to Payg/Accptg/Negotg Bank THE NEGOTIATING BANK IS TO FORWARD THE NEGOTIATING BANK IS TO FORWARD

ORIGINAL SET OF DOCUMENTS PLUSORIGINAL SET OF DOCUMENTS PLUS ONE SET OF NON-NEGOTIABLE ONE SET OF NON-NEGOTIABLE

DOCUMENTS IN ONE LOT STRICTLY INDOCUMENTS IN ONE LOT STRICTLY IN COMPLIANCE WITH TERMS MENTIONED COMPLIANCE WITH TERMS MENTIONED

ABOVE DIRECTLY TO AXIS BANK LTD,ABOVE DIRECTLY TO AXIS BANK LTD, C-3 / 21, JANAKPURI, NEW DELHI-110058, C-3 / 21, JANAKPURI, NEW DELHI-110058,

INDIA BY COURIER AND WEINDIA BY COURIER AND WE SHALL REIMBURSE THEM AS PER THEIR SHALL REIMBURSE THEM AS PER THEIR

INSTRUCTIONS.INSTRUCTIONS.

Article 38 Transferable Credits-UCP 600Article 38 Transferable Credits-UCP 600

a. A bank is under no obligation to transfer a credit except to the extent a. A bank is under no obligation to transfer a credit except to the extent and in the manner expressly consented to by that bank.and in the manner expressly consented to by that bank.

b. For the purpose of this article:b. For the purpose of this article:

Transferable credit means a credit that specifically states it is Transferable credit means a credit that specifically states it is “transferable”. A transferable credit may be made available in whole “transferable”. A transferable credit may be made available in whole or in part to another beneficiary (“second beneficiary”) at the request or in part to another beneficiary (“second beneficiary”) at the request of the beneficiary (“first beneficiary”).of the beneficiary (“first beneficiary”).

Transferring bank means a nominated bank that transfers the credit Transferring bank means a nominated bank that transfers the credit or, in a credit available with any bank, a bank that is specifically or, in a credit available with any bank, a bank that is specifically authorized by the issuing bank to transfer and that transfers the authorized by the issuing bank to transfer and that transfers the credit. An issuing bank may be a transferring bank.credit. An issuing bank may be a transferring bank.

Transferred credit means a credit that has been made available by the Transferred credit means a credit that has been made available by the transferring bank to a second beneficiary.transferring bank to a second beneficiary.


c. c. Unless otherwise agreed at the time of transfer, all charges Unless otherwise agreed at the time of transfer, all charges (such as commissions, fees, costs or expenses) incurred in (such as commissions, fees, costs or expenses) incurred in respect of a transfer must be paid by the first beneficiary.respect of a transfer must be paid by the first beneficiary.

d. d. A credit may be transferred in part to more than one second A credit may be transferred in part to more than one second beneficiary provided partial drawings or shipments are beneficiary provided partial drawings or shipments are allowed.allowed.

A transferred credit cannot be transferred at the request of a A transferred credit cannot be transferred at the request of a second beneficiary to any subsequent beneficiary. The first second beneficiary to any subsequent beneficiary. The first beneficiary is not considered to be a subsequent beneficiary.beneficiary is not considered to be a subsequent beneficiary.


e. e. Any request for transfer must indicate if and under Any request for transfer must indicate if and under what conditions amendments may be advised to the what conditions amendments may be advised to the second beneficiary. The transferred credit must second beneficiary. The transferred credit must clearly indicate those conditions.clearly indicate those conditions.

f.f. If a credit is transferred to more than one second If a credit is transferred to more than one second beneficiary, rejection of an amendment by one or beneficiary, rejection of an amendment by one or more second beneficiary does not invalidate the more second beneficiary does not invalidate the acceptance by any other second beneficiary, with acceptance by any other second beneficiary, with respect to which the transferred credit will be respect to which the transferred credit will be amended accordingly. For any second beneficiary that amended accordingly. For any second beneficiary that rejected the amendment, the transferred credit will rejected the amendment, the transferred credit will remain unamended.remain unamended.

Article 38 Transferable Credits-UCP 600Article 38 Transferable Credits-UCP 600g. g. The transferred credit must accurately reflect the terms and The transferred credit must accurately reflect the terms and

conditions of the credit, including confirmation, if any, with the conditions of the credit, including confirmation, if any, with the exception of:exception of:

- the amount of the credit,- the amount of the credit, - any unit price stated therein,- any unit price stated therein, - the expiry date,- the expiry date, - the period for presentation, or- the period for presentation, or - the latest shipment date or given period for shipment,- the latest shipment date or given period for shipment, any or all of which may be reduced or curtailed.any or all of which may be reduced or curtailed. The percentage for which insurance cover must be effected may The percentage for which insurance cover must be effected may

be increased to provide the amount of cover stipulated in the be increased to provide the amount of cover stipulated in the credit or these articles.credit or these articles.

The name of the first beneficiary may be substituted for that of the The name of the first beneficiary may be substituted for that of the applicant in the credit.applicant in the credit.

If the name of the applicant is specifically required by the credit to If the name of the applicant is specifically required by the credit to appear in any document other than the invoice, such requirement appear in any document other than the invoice, such requirement must be reflected in the transferred credit.must be reflected in the transferred credit.


h. h. The first beneficiary has the right to substitute its own The first beneficiary has the right to substitute its own invoice and draft, if any, for those of a second invoice and draft, if any, for those of a second beneficiary for an amount not in excess of that beneficiary for an amount not in excess of that stipulated in the credit, and upon such substitution the stipulated in the credit, and upon such substitution the first beneficiary can draw under the credit for the first beneficiary can draw under the credit for the difference, if any, between its invoice and the invoice of difference, if any, between its invoice and the invoice of a second beneficiary.a second beneficiary.

i. i. If the first beneficiary is to present its own invoice and If the first beneficiary is to present its own invoice and draft, if any, but fails to do so on first demand, or if the draft, if any, but fails to do so on first demand, or if the invoices presented by the first beneficiary create invoices presented by the first beneficiary create discrepancies that did not exist in the presentation discrepancies that did not exist in the presentation made by the second beneficiary and the first beneficiary made by the second beneficiary and the first beneficiary fails to correct them on first demand, the transferring fails to correct them on first demand, the transferring bank has the right to present the documents as received bank has the right to present the documents as received from the second beneficiary to the issuing bank, without from the second beneficiary to the issuing bank, without further responsibility to the first beneficiary.further responsibility to the first beneficiary.


j. j. The first beneficiary may, in its request for The first beneficiary may, in its request for transfer, indicate that honour or negotiation is transfer, indicate that honour or negotiation is to be effected to a second beneficiary at the to be effected to a second beneficiary at the place to which the credit has been transferred, place to which the credit has been transferred, up to and including the expiry date of the up to and including the expiry date of the credit. This is without prejudice to the right of credit. This is without prejudice to the right of the first beneficiary in accordance with sub-the first beneficiary in accordance with sub-article 38 (h).article 38 (h).

k. k. Presentation of documents by or on behalf Presentation of documents by or on behalf of a second beneficiary must be made to the of a second beneficiary must be made to the transferring bank.transferring bank.

FINNACLE / INTELLECT FINNACLE / INTELLECT PORTIONPORTION

IDCM-EXPORT LC ADVISING & TRANSFERSIDCM-EXPORT LC ADVISING & TRANSFERS

IN THE INTELLECT RAISE ALL THE CASE OF IN THE INTELLECT RAISE ALL THE CASE OF TRANSFERS IN EXP LC QUETRANSFERS IN EXP LC QUE

TFC WILL MAKE ENTRY IN FINNACLE FOR ALL TFC WILL MAKE ENTRY IN FINNACLE FOR ALL CHARGES AND WILL SEND SWIFT MESSAGE TO CHARGES AND WILL SEND SWIFT MESSAGE TO ISSUING BANK FOR INFORMING ALL TRANSFERSISSUING BANK FOR INFORMING ALL TRANSFERS

AFTER RECEIVING DOCUMENTS AGAINST AFTER RECEIVING DOCUMENTS AGAINST TRANSFERRED LC IT WILL BE BOOKED IN EXPORT TRANSFERRED LC IT WILL BE BOOKED IN EXPORT LODGEMENT WITH SALE AND PURCHASE FIELD LODGEMENT WITH SALE AND PURCHASE FIELD NONO

Janakpuri Forex-207-Transferable Letter of Credit

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