Credit To Pay For Legal Problems

The Uniform Customs and Practice is one of most authoritative and common legal sources in field of L/C. UCP500 played an irreplaceable role in promoting the extensive use of the L/C in international trade and settlement since implement from 1994.However, with the development of the banking, transportation, insurance of the industry, UCP500 can not meet the needs of the reality.In October 2006, "The Uniform Customs and Practice for Documentary Credits, - 2007 Revision ", that is, UCP600 was passed at the ICC annual meeting held in Paris, and came into force at July 1, 2007 . It undoubtedly has a significant impact on import and export enterprises, banks, legal, judicial circles, shipping and insurance business, and can guide international order of trade and settlement.This paper will describe the important changes between two practices in detail in method of case study and comparative analysis. In addition, the paper also focuses on studying and solving the problem that how to choose effective measures for the parties in L/C in order to raise suggestions to the international trade practice.This paper is divided into four parts. The first part is case analysis including case introduction and the mental legal issues.The second part raises some theoretical analysis soon after through analyzing the legal issues in the case.The third part is theoretical analysis part about L/C amendments, document examination standard, negotiation and document disposal. It first introduces the characteristics of L/C amendments, points out its major significance for the parties and compares UCP500 with UCP600 in L/C amendments. Compared with UCP500, UCP600 stresses passing on the acceptance or rejection notice by advising bank; increases the clause of deprecating "Qui ne dit mot consent" upholding the irrevocable principle of the L/C.UCP600 has erased the provision of "reasonable time" in UCP500. The provision" not more than five banking days following the day of presentation" in UCP600 makes for reducing controversy and protecting the rights of beneficiary.UCP600 incorporates a number of contents of UCP500 and ISBP based on using the compound standard in the core of "strict compliance", reflecting further softening the "Strict compliance" principle.UCP600 defined the word "negotiation" which made the theory from" value" to "purchase" and take L/C financing into the protection of it.In document disposal, UCP600 add two provisions "the issuing bank is holding the documents until it receives a waiver from the applicant and agrees to accept it, or receives further instructions from the presenter prior to agreeing to accept a waiver" and "the bank is acting in accordance with instructions previously received from the presenter" which meets the need of the reality.The last part of the paper discuss the influences on the parties after the implementation of UCP600 and the strategies, with a view to be helpful for the international trade practice.