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UCPDC ARTICLE 5-7

UCPDC Article 5-7

 

ARTICLE 5 : Documents V. Goods, Services or Performance

Banks deal with documents and not with goods, services or performance to which the credit may relate.

ARTICLE 6 : Availability, Expiry Date and Place for presentation

a. A credit must state the bank with which it is available or whether it is available with any bank. A credit available with a nominated bank is also available with the issuing bank. b. A credit must state whether it is available by sight payment, deferred payment, acceptance or negotiation. c. A credit must not be issued available by a draft drawn on the applicant. d. i. A credit must state an expiry date for presentation. An expiry date for honour or negotiation will be deemed to be an expiry date for presentation. ii. The place of the bank with which the credit is available is the place for presentation. The place for presentation under a credit available with any bank is that of any bank. A place for presentation other than that of the issuing bank is in addition to the place of the issuing bank. e. Except as provided in sub-article 29 (a), a presentation by or on behalf of the beneficiary must be made on or before the expiry date.

ARTICLE 7: Issuing Bank Undertaking

a. Provided that the stipulate documents are presented to the nominated bank or to the issuing bank and the constitute a complying presentation, the issuing bank must honour if the credit is available by: i. sight payment, deferred payment or acceptance with the issuing bank; ii. sight payment with a nominated bank and that nominated bank does not pay; iii. deferred payments with a nominated bank and that nominated bank does not incur its deferred payment undertaking or, having incurred its deferred payment undertaking, does not pay at maturity; iv. acceptance with a nominated bank and that nominated bank does not accept a draft drawn on it, or having accepted a draft drawn on it, does not pay at maturity. v. negotiation with a nominated bank and that nominated bank does not negotiate.b. An issuing bank is irrevocably bound to honour as of the time it issues the credit.  c. An issuing bank undertakes to reimburse a nominated bank that has honoured or negotiated a complying presentation and forwarded the documents to the issuing bank. Reimbursement for the amount of a complying presentation under a credit available by acceptance or deferred payment is due at maturity, whether or not the nominated bank prepaid or purchased before maturity. An issuing bank’s undertaking to reimburse a nominated bank is independent of the issuing bank’s undertaking to reimburse a nominated bank is independent of the issuing bank’s undertaking to the beneficiary.

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