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Checklist for Letters of Credit
- Is the letter of credit irrevocable?
- What bank has committed itself to pay?
- Is your name and address, and that of your buyer, spelled correctly on all documents (i.e. as requested by the letter of credit?
- Is the amount of the letter of credit sufficient to cover the shipment?
- Is there sufficient tolerance allowed on the quantity to be shipped?
- Does the letter of credit describe the merchandise correctly?
- Are shipments permitted from the place you intend to use?
- Does the place of destination quoted by you agree with the letter of credit?
- Are partial shipments permitted, if required?
- Is trans-shipment permitted, if required?
- If the letter of credit stipulates shipment to be effected on a named vessel or vessels of a named steamship company, can you comply with this requirement?
- Does the letter of credit stipulate that it is transferable, if required?
- Do you need an export license? A Certificate of Origin?
- Can you obtain properly executed shipping, consular, and other documents to conform with the letter of credit terms?
- If you are chartering a vessel or airplane, does the letter of credit allow charter party bills of lading?
- Can you comply with insurance risks required in the letter of credit?
- Have you prepared and thoroughly checked all documents against the letter of credit to make sure that all wording matches, and the proper number of copies are attached?
- Have you signed the documents as per the letter of credit terms?
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