Why should we accept letters of
credit through you in London, when we can use our
The Trade Operations Centre offers a highly personalised,
and 24 hour turnaround service. We also have direct
links with the Issuing Bank, so should there be
any queries, we are able to contact the issuing
bank by phone in the first instance.
What happens if there are discrepancies
in the documents we send to you? How can we avoid
delays being incurred due to the documents having
to be returned to us and additionally when they
are represented to yourselves?
This question is often asked, that is why upon arrangement
we offer a 'facsimile pre-check Service', where
even prior to certification and legalisation, documents
can be faxed to us for checking. We will then endeavour
to have these checked within 24 hours and advise
you immediately. This will then allow you to have
compliant documents upon presentation to us. Many
mainland European customers use this service.
What is UCP 600?
This is the most recent publication issued by the International Chamber of Commerce. It contains a universally recognised set of rules governing the use of Documentary Credits in international commerce. UCP600 came into effect on 1 July 2007.
Can part shipments be by air and
Yes, if the Documentary Credit allows.
Does the goods description have
to be exact?
A goods description on the invoice must match the
Documentary Credit. However, on other documents
goods may be described in more general terms, not
inconsistent with the Documentary Credit.
Do I have to quote a unit price?
Not necessarily, but if quoted in goods description
of a Documentary Credit, then your invoices should
Can I prepare a Certificate of
Only if allowed by the Documentary Credit.
How can I obtain an amendment to
a Documentary Credit?
If amendments are required you will need to ask
the applicant to instruct the issuing bank to amend
the original, however, they are not obliged to do
so. Alternatively, if specifically requested we
can intervene on your behalf by contacting the issuing
bank with which we have direct links with.
What happens if I present discrepant
documents to a bank?
Documents presented with discrepancies could lead
to payment being refused or delayed.
I have shipped late or have not
been able to present documents in time against the
Documentary Credit - what options do I have?
In effect, by not complying with the terms and conditions
of a Documentary Credit you have lost all the protection
previously afforded by it. You may either contact
your customer, requesting that the terms and conditions
be amended, or you may present documents to the
Bank together with instructions to contact the opening
bank/issuing bank requesting them to accept the
documents notwithstanding the discrepancies. Alternatively,
the documents may be presented to the opening bank
as a Documentary Collection..
Who do I draw a Bill of Exchange
A Bill of Exchange is drawn on the entity that is
paying you the money. Normally with a Documentary
Credit this will be on the issuing/confirming bank.
A bill of Exchange can also be referred to as a
draft. Documentary Collections allow you to draw
it on your customer.
What does "on board notation" mean?
This is evidence, applied by the carrier, of the
date upon which the goods were loaded on the vessel.
What does confirmation mean?
Where a bank, usually the advising bank, undertakes
to pay, accept or negotiate with the issuing bank.
The confirming bank removes the risk of non-payment
by the issuing bank and other risks associated with
the country of issue. If a Documentary Credit is
unconfirmed, neither the advising bank nor any nominated
bank commits to pay.
The Documentary Credit expires
on a non working day and the goods will not be loaded
until the previous working day, so I cannot get
the documents to you in time. What can I do?
If Saturday is not a normal working day for Documentary Credit purposes at the bank authorised to handle documents, UCP 600 allows the latest date for presentation to be extended to the next working day.
When do I get paid under my Documentary
Credit once I have presented my documents?
There are four distinct types of Documentary Credit
and the timing of payment will depend on the type
- Under a Sight Payment Documentary Credit, if
documents are in order, these will be taken up
and payment made.
- Under a Deferred Payment Documentary Credit,
the timing of payment will depend on the terms.
The date of payment will be defined in the Documentary
Credit. This is usually a specific number of days
after the despatch of the goods or the presentation
- Under an Acceptance Documentary Credit, your
usance draft will be accepted by the nominated
bank and will become payable at a future date
in accordance with the terms of the Documentary
- If the Documentary Credit is available by negotiation,
payment will be made in accordance with its terms.
Can you handle letters of credit from other
banks in Saudi Arabia ?
Can you handle business from other parts of
the world ?
Yes on a case by case basis, you should contact
us for further details
Do you provide finance for shipments to Saudi
Depending on the transaction it may be possible
to structure some financing.
When should i talk to you about a new contract
and financing ?
As early as possible, if you are still in negotiations
it is easier to ask for something to be included
in the contract to help structure the financing,
rather than after it has all been signed.
Will you look at trade business that is not
covered by a letter of credit?
Yes we are happy to consider bank avalised bills
of exchange/ promissory notes, or standby letters
We work on open account but have a credit insurance
policy, can you help us ?
Yes we would be happy to consider advancing funds
against a suitable credit insurance policy.
Do you discount acceptances under letters of
credit or avalised bills of exchange ?
Yes depending on the accepting bank.
What is a supplier credit facility ?
It is a simple process we use to provide a bank
guarantee for deferred payment shipments to pre
approved buyers in Saudi Arabia. We would be happy
to send you further details.