the terminal side of an angle in standard position

In the middle of Eightieth Century, Lord Mansfield introduced legal aspects of LC operation for the first time to the Common Law System. Part four will discuss liabilities of issuing banks towards beneficiary and finally part five will touch upon situation in which bank will right to recourse against beneficiary.ĭespite the fact that Documentary Letters of Credit are involved in process of International Trade for many centuries, but their legal personality is very new and their life span is much shorter than their existence. Part two and three will take a comprehensive look at legal basis of relations between issuing bank and beneficiary, as well as bank’s obligations under documentary credit law. Further, it endeavours to tap on principle of autonomy and strict compliance as governing principles of documentary letters of credit. Part one will provide an introduction to function and relation among different parties in process of an international LC transaction.

Main objective of paper is providing answer to the question of what is the role of issuing bank in the process of LC transaction and which liabilities does it have towards beneficiary? Article consists of five main parts. This article tries to shed light on vague aspects of relations between issuing bank and beneficiary by studying obligations of the issuing bank towards beneficiary under the law of documentary letters of credit while comparing provisions of UCP with English Common Law on subject matter. Amongst all relations in process of LC transaction, relation between issuing bank and beneficiary is the most complicated and least clear from legal stand point. The process of using LC is complicated and involves different players and relations between them. By using the LC as method of payment, parties will shift payment obligation from buyer as a natural person to the guarantee of bank as a legal person. Employing documentary letters of credit (LC) is one of the ways to reduce payment risk in international business especially when partner’s financial standing is unknown to each other. Risks will be more considerable when times come to deal with receiving/sending payments from/to unknown business partners in remote geographic areas. Process of international trade is complicated and risky.

The terminal side of an angle in standard position