国际贸易英语信用证Letter of Credit

1、Unit 4 Execution of the ContractTerms of Payment:1.L/C2.Collection (D/P and D/A) 3.Remittance 4.Open account 5.Cash in advanceTerms of Payment:2.Collection: 托收 The exporter authorizes the bank tocollect the money from the importer.出口人委托银行向进口人收取货款D/P: documents against payment 付款交单D/A：documents again

2、st acceptance 承兑交单Terms of Payment:3.Remittance 汇付 The buyer himself remits money to the seller through b/c.Mail transfer 信汇Telegraphic transfer 电汇Demand transfer 票汇Note: Only when the transactions are very small and the finance involved is small too.1. L/C: Definition RESONS OF USING L/C： foreign c

3、redit reports are often sketchy and do not give the right information.The country in which the foreign importer is located may be in a weak financial position.Importer is reputable, conditions beyond his control prevent him from fulfilling his obligation.1. L/C: DefinitionGenerally: a documentary le

4、tter of credit is defined as instrument by which a bank promises to pay the seller for his goods providing the seller conform exactly to the condition laid down in the L/C1. L/C: DefinitionSpecifically: it is an arrangement, whereby the buyer requires his bank to establish a credit in favor of the s

5、eller. The buyers bank undertakes, or authorizes its correspondent bank in the exporters country, to pay the exporter a sum of money against presentation of specified shipping documents.1. L/C: DefinitionAdvantages:Security of payment to the exporter.Enable the buyer to ensure that he received the g

6、oods as ordered. L/C: Parties involved: applicant 申请者The party who applies for the opening of L/C, usually importer.: opening bank 开户行Which opens the L/C upon the request of the importer. It is responsible for the payment of the goods.L/C: Parties involved: advising bank 通知银行Usually the corresponden

7、t of issuing bank 开证行代理行The bank in the exporters country who informs the exporter that a L/C has been opened in his favor, and transfer the L/C to the exporter.L/C: Parties involved: beneficiary 受益人Usually the exporter, who is entitled to receive the L/C for the payment of the goods.: negotiating b

8、ank 议付银行The bank who buy an exporters draft submitted to it under a L/C and then forward the draft and documents to the opening bank for reimbursement. Usually is the advising bank.L/C: Parties involved: payment bank Usually the opening bank or a third bank designated bank, makes payment to the bene

9、ficiary against presentation of stipulated documents.: confirming bank 保兑行The bank which is requested to add its own commitment to the L/C, USUALLY the advising bank.L/C: chief contentsthe parties involvedRemarks of the l/c, the No.,type, date, etc.The clauses of the bill of change, such as the amou

10、nt of bill, drawer and drawee, the paying date the amount of L/C the clauses about the documents, description of the goodsL/C: chief contents guarantee clauses of the opening bank, which testifies that the opening bank will hold itself responsible for the payment to the beneficiary or the holder of

11、the drafts.Particulate clausesL/C: proceduresThe importer applies to the issuing bank for the L/C application form: restatement of the clauses of the sales contractThe L/C is drawn by the issuing bank.The advising bank informs the seller of the arrival of L/CL/C: proceduresThe beneficiary check the

12、L/C, he should mainly focus on :The shipping dateThe time of validity of L/CQuantity of goods and amount of paymentThe address of the beneficiaryThe price term, loading and unloading portsInsurance clausesThe consignee of the B/LPacking description of the goodsL/C: proceduresWhen the seller has made

13、 sure there are no more problems, he should make the delivery of the goods and then comes to negotiating bank for negotiation.Having effected the payment to the negotiating bank, the paying bank then presents the documents to the buyer upon his payment of the amount of the due or acceptance of the d

14、raft. With the documents the buyer can get the delivery of the goods.L/C: classificationsRevocable / irrevocable L/CConfirmed/unconfirmed L/CSight L/C and usance L/CTransferable /non transferable L/CRevolving L/CBack to back L/CRed clause creditsStandby L/CL/C: True or false exercises Under l/c, the

15、 money of the bank is used for the settlement of the payment in international trade.The opening bank is usually a bank where the exporter keeps an account.The negotiating bank must be designated in the L/CThe paying bank can claim its payment back by exercising the right of recourse.L/C: True or false exercisesAn advising bank is usually located in the country of the