Suggested Checklist for Document Preparation and Examination?

Suggested Checklist for Document

Preparation and Examination:

For the bank which receives the documents:

1. The letter of transmittal:

Ensure:

• that it is addressed to your bank,
• that it has a current date,
• that it relates to the Documentary Credit number referenced,
• that the documents enumerated are attached,
• that the value of the documents and the value mentioned in the cover letter are the same.
• that the bank (if any) remitting the documents is acting as a Paying, accepting, Negotiating, or Remitting Bank,
• that the payment instructions are clear and understood,
• Whether any discrepancy (ies) have been noted and whether payment, acceptance, or negotiation was effected against an indemnity or under reserve.

For the bank and the Beneficiary:

2. The Documentary Credit

Ensure:

• that it is the correct referenced Documentary Credit,
• that it is still valid (not expired/cancelled),
• that the available balance in the Documentary Credit is sufficient to cover the value of the drawing,
• that the documents required by the Documentary Credit are presented,
• that no amendments or previous drawdowns are in a questionable state.

3. The Draft:

Ensure:

• that the Draft bears the correct Documentary Credit reference number,
• that it has a current date,
• that the signature and/or the name of the Drawer corresponds with the name of the Beneficiary.
• that it is drawn on the correct Drawee,

• that the amount in figures and words correspond,
• that the tenor is as required by the Documentary credit,
• that the name of the payee is identified,
• that if it requires an endorsement it is properly endorsed,
• that there are no restricted endorsements,
• that it contains any necessary clauses as required by the Documentary Credit,
• that the amount drawn for does not exceed the balance available in the Documentary credit,
• that the value of the draft and the invoi8ces corresponds,
• that it is not drawn “without recourse” unless authorised by the Documentary Credit.

For the bank and the Beneficiary:

4. The Draft

Ensure:

• that it is issued by the beneficiary of the Documentary Credit,
• that the Applicant (the buyer) is indicated as the invoiced party, unless otherwise stated in the Documentary Credit.
• that it is not titled “pro-forma” or “provisional” invoice,
• that the description of the goods corresponds with the merchandise description in the Documentary credit,
• that the details of the goods, prices, and terms as mentioned in the Documentary Credit are included in the invoice,
• that any other information supplied in the invoice, such as marks, numbers, transportation information, etc. it is consistent with that of the other documents,
• that the currency of the invoice is the same as that of the Documentary Credit.
• that the value of the invoice corresponds with that of the Draft,
• that the value of the invoice does not exceed the available balance of the Documentary Credit,
• that the invoice covers the complete shipment as required by the Documentary Credit (if no part shipments are allowed),
• that if required by the Documentary Credit the invoice is signed, notarised, legalised, certified, etc.
• that the information relative to the shipment, packaging, weight, freight charges or other related transport charges corresponds with that appearing on the other documents,
• that the correct number of original(s) and copy(ies) is presented.

For the bank and the Beneficiary:

5. Other documents

Certificate of origin

Ensure:

• that it is a unique document and not combined with any other document,
• that it is signed, notarised, legalised, visaed as required by the documentary Credit,
• that the data on it is consistent with that of the other documents,
• that the country of origin is specified, and that it meets the requirements of the Documentary Credit.

Weight list/certificate

Ensure:

• that it is a unique document and not combined with any other document.
• that it is signed if a certificate is called for, for as otherwise stated in the Documentary Credit.
• that the data on it is consistent with that of the other documents.

Packing list

Ensure:

• that it is a unique document and not combined with any other document
• that it corresponds with the requirements of the Documentary Credit. A detailed packing list requires a listing of the contents of each package, carton, etc. and other relevant information
• that the data on it is consistent with that of the other documents.

Inspection certificate

Ensure:

• that the inspection firm nominated in the Documentary Credit, if any, issued the certificate.
• that it is signed,
• that the certificate complies with the inspection requirements of the Documentary Credit.
• that it contains no detrimental statement as to the goods, specification, quality, packaging, etc. unless authorized by the Documentary Credit,

Other miscellaneous documents

• UCP 600:

“When documents other than transport documents, insurance documents and commercial invoices are called for, the Credit should stipulate by whom such documents are to be issued and their wording or data content. If the Credit does not so stipulate, banks will accept such documents as presented, provided that their data content is not inconsistent with any other stipulated document presented

It should be noted that when Documentary Credits require a document to be issued as a “certificate”, the document must be signed.

For the bank and the Beneficiary:

6. Insurance document

Ensure:

• that the policy/certificate/declaration/cover note, as required by the Documentary credit, is presented,
• that the full set of the insurance document issued is presented,

• insurance company or underwriter or their agents, and the assured, if so required by the insurance document,
• that the date of issuance or date from which cover is effective at the latest from the date of loading on board or dispatch or taking in charge of the goods, as the case may be,
• that the value of the goods insured is as required by the Documentary Credit
• that it is issued in the same currency as the Documentary Credit, unless otherwise allowed in the Documentary Credit,
• that the goods description corresponds with that of the invoice,
• that it covers the merchandise from the designated port of embarkation or point of taking in charge to port of discharge or point of delivery,
• that it covers the specified risks as stated in the Documentary credit and that the risks are clearly defined,
• that the marks and numbers, etc. correspond with those of the transport document,
• that if the assured named is other than the Confirming Bank, Issuing Bank or buyer, it bears the appropriate endorsement,

• that all other information appearing on the document is consistent with that of the other documents,
• that if any alteration is noted in the document it is properly authenticate.

For the bank and the Beneficiary:

7. Transport documents

Ensure

• that the full set of originals issued is presented,
• that it is not a “charter party” transport document, unless authorised in the Documentary Credit.
• that it is not a forwarder’s transport document unless it is authorised in the Documentary Credit
• that the name of the consignee is as required in the Documentary Credit,
• that if the transport document requires endorsement it is appropriately endorsed,
• that it bears the name of the shipper or his agent,
• that the name and address, if any, of the notifying party is as required in the Documentary Credit.
• That the description of the goods generally corresponds to the description of the goods as stated in the Documentary Credit, and that the marks and numbers as well as other specifications, if any, are identical to those appearing on the other documents,
• that the indication of freight prepaid or freight collect costs, as required by the terms of the documentary Credit, appears on it,
• that there are no clauses on the transport document that may render it “foul” or ”unclean”
• that all other conditions stipulated in the appropriate transport Articles of UCP 600 are complied with.

Finally the documents must be complying presentation and for that purpose the documents must comply:

• Terms and Conditions of L/C
• The Provisions of UCP-600
• The Provisions of ISBP.