The Right Protection For Bank In Negotiation

Letter of credit is an undertaking of a bank for account of the importer to pay the foreign exporter the value of the goods provided the required documents are submitted and the terms of the credit are complied with. The import trade service(negotiation) under letter of credit is one of the most universal business of bank. However, no matter in China or abroad, the bank often face the obstacles when they try to protect their right, the problem focus on there is no defined law for the banks to instruct their behaviors on import trade service, banks can not always get support from the court when they order pledge right.The article try to solve this problem through put forward rational explanation for the banks' pledge right. In author's opinion, the Trust Receipt is an important instrument for explain bank's right on the Document of Title while providing import trade service for customers.The article is divided into 6 parts which focus on explain the negotiation, disputes among the banks, analysis the obstacles when the banks order for proprietary right, or pledge right on the Document of Title, and analysis the Trust Receipt. In the end, the article gave a solution for the banks to protect their rights during negotiation.