The Principles About Exception On Fraud On L/C And Implementation

Letter of Credit (L/C) evolves out of businessman, which is set by bank for exporter according to the application of importer, written promise guaranteeing to pay other funds that the payment for goods or other things the L/C stipulate after receiving the document which accords with the regulation of the letter of credit that people submitted. As a kind of international trade settlement way, the L/C is perfect day by day with the development of trade. And it has been generally adopted by most banks and businessmen in the world for its commercial credit and bank credit. Unfortunately, with the enlargement of international trade in recent years, the fraud on L/C become more and more rampant. China, as a developing country, is one of the main injured countries by the fraud on L/C. It is an inevitable trend to apply the principles about exception on fraud on L/C to attacks the fraud. But in the judicial practice, there will be a lot of problems to be solved on the fraud exception in our country.This paper has done some preliminary research on the problem of the principles about exception on fraud on L/C, in which comparing method is used to analyze the principles about the fraud exception adopted in foreign countries. It also introduces valuable experience and the principles about the fraud exception used in the judicial circle and finance circle of several developed countries. At last it proposes some advice to develop the L/C in China.