Reconstruction Of The Rule Of Holder In Due Course Under Letters Of Credit

It is undisputable that the protection of the holder in due course in letters of credit transaction shows very different pictures in different countries. On one hand, different Negotiation Instrument Laws have different doctrines on the holder in due course, and it is almost impossible to have a common definition among countries especially between the Geneva Convention system and the Common law system because of their distinct legal traditions and systems. On the other hand, it is also very difficult to apply the holder in due course doctrine in letter of credit transaction directly. Therefore, in order to keep balance between dealing in good faith and the reliance on the independency of letters of credit, it is time to review the elements of holder in due course under letters of credit transaction.Chapter 1 compared the rules for holder in good faith in UCP 600 and UCP 500. The holder in due course is more significant in the international letter of credit system because the new UCP600 leaves the issue of protecting bona fide participators to the national law.Chapter 2 introduces the rule of holder in due course in the Geneva Convention system and the Common law system, which protect the holder in due course in different ways.Chapter 3 analyses the distinct pictures of legal practice and academic theories on the protection of holder in due course.Chapter 4 is case study. The special rule for the holder in due course under the letter of credit should be reconstructed on the balance of the restriction of national laws and the international business practice.Chapter 5 is the study of the above theory in Chinese context, so as to provide an appropriate approach to our legal reform on the relevant Judicial Interpretations.