Studies On Legal Issues Of The Inward Documentary Bill Under Documentary Credit

The documentary credit is known as "the living blood" in the international trade since its generation, which not only solves the risk of sharing between buyers and sellers, and promotes the development of international trade. In addition to international settlement instrument, the documentary credit has strong financing capabilities as well, manifested as the inward documentary bill pledged with the bill of lading.Based on UCP600and China’s existing relevant laws and regulations about the Documentary credit, the thesis mainly discusses the general legal issues involved in the Documentary credit, and analyses the nature of the rights enjoyed by the banks under the documentary credit, the standard of examination of the bills, the facing credit fraud and the existing legal risks, and proposes the introduction of the trust receipt and the guarantee system, and perfects the system of the inward documentary bill, promotes the healthy development of the trade finance business, maintains the security interest of the issuing bank.The first chapter analyzes the general legal issues involved in the inward documentary bill under the credit. The first section analyzes the various theories of the banking industry and academia on the inward documentary bill, further analyzes the legal characteristics of the inward documentary bill and comparatively analyses the differences between the outward bill and inward documentary bill. The second section analyzes the legal relationship of the documentary credit and the inward documentary bill. The parties of the documentary credit are basically divided into the applicant, the issuing bank and the beneficiary, the relationship between the parties is a contractual relationship, mutually assumes different rights and obligations. Section Ⅲ analyzes that the inward documentary bill is a combination of the bill of lading and the documentary credit, and analyzes of the development history of the bill of lading and the documentary credit, and concludes the inward documentary bill is the history product of economic development.The second chapter analyzes the nature of the rights of the documents enjoyed by bank in the inward documentary bill. The first section analyzes a variety of theories of ownership, pledge and mortgage of the documents obtained by bank, the theory of pledge is more convincing from the results of the implementation of the law. Section Ⅱ analyzes the nature of the bill of lading. The inward documentary bill is mainly based on the pledge of the bill of lading. Understanding of the function and the nature of the bill of lading may interpret the inward documentary bill from the point of view of the bill of lading. By comparative analysis of the different points of view, the thesis concludes that the bill of lading is negotiable securities combined with real right and obligatory right, and then explains why the bill of lading may be pledged, also indicates that not all the bill of lading may be pledged.The third chapter analyzes how to examine the documents during the process of the pledge of the documentary bills. The first section analyzes the nature of the documentary credit. The documentary credit is a contract in essence and commits to honor a complying presentation. The nature of the documentary credit determines the bank’s examination standards. Examination standards reflect the principle of the independence of the documentary credit. The examination of documents is an important factor during the process of the pledge of the document, not only preventing risk but also avoiding the unnecessary loss. The bank generally abides by the principle of mirror image, substantial compliance and strict compliance. UCP600sets new rules about " on the face" and "not conflict." The new rules enlarge the bank right to examine the documents. Section Ⅲ summarizes how to examine the bill of lading under the inward documentary bill.The fourth chapter analyzes the legal issues of credit fraud in the inward documentary bill. There are various types of credit fraud, including forged or altered documents which mean that exporter frauds importer, as well as the collusion between importer and exporter frauds the issuing bank. The credit fraud arises mainly due to the principle of independence of the documentary credit. The principle of independence is the basic principle of the documentary credit; the bank examines the documents only required by the documentary credit, regardless of the underlying contract. The bank does not intervene in the underlying trade contract, is not responsible for the authenticity of the documents. The non-responsibility mechanism facilitates document fraud in the credit transactions. Blindly adhere to the principle of independence is contrary to the principle of good faith and the fairness, The principle of fraud exception becomes a good way to resolve this contradiction.The fifth chapter analyses how to establish China pledge institution of the inward documentary bill. Facing the predicament that the bank rights cannot be adequately protected during the process of inward bill, the thesis introduces the two systems about trust receipt and alienation guarantee. The first section analyzes the legal predicament of the inward documentary bill. Section Ⅱ investigates and analyses the British trust receipt system from the perspective of comparative law, points out the existing legal risks about China’s inward documentary bill. Section Ⅲ analyses the alienation guarantee system of continental law, such as Germany and Japan, to explore useful lessons for China’s guarantee mechanism construction under the inward documentary bill from the different legal guarantee systems. Around the status quo of the inward documentary bill about practical operation and judicial practice, analyses the obstacles and dilemmas of the practical operation of the domestic banks under the legal framework of the current guarantee law and trust law in China, combined with a related case verdict, summarizes judicial practice problems, explores the deeper reasons and the crux.The final conclusion: the system of trust receipt and alienation guarantee must be established to reasonably perfect the system of inward documentary bill in China, and reasonably protect and balance the legitimate interests among honoring bank, importer, and the third party.