The letter of credit (LC) has arrived through your bank. Production has not started, the buyer wants confirmation that you will ship, and the credit runs to several pages of dates, codes and document requirements. Everything that can later cause a refusal is already in that text. The cheapest moment to fix it is now, before you commit stock or book space.
Short answer. Review the credit in the order that time runs out: expiry and presentation first, then shipment dates and routing, then the documents and who must issue them, then any condition you do not control. Decide for each field whether you can comply from where your stock and suppliers actually are. If you cannot, send one complete amendment request before shipping. If the credit cannot be made workable, say so early. ICC guidance points the same way: an ICC Banking Commission technical briefing advises beneficiaries to check whether there is enough time to produce, ship and present, and to request any required amendments on a timely basis. ICC, Technical Advisors Briefing No. 3, June 2022
This article assumes a commercial documentary credit subject to the International Chamber of Commerce's (ICC) Uniform Customs and Practice for Documentary Credits (UCP 600, 2007 revision). It covers the review before you accept. If documents are later refused, the next steps are different; see why banks refuse documents and how to fix a presentation.
First pass: can you physically meet these dates?
Before reading any document clause, answer three questions:
- Where is the stock, or when will it be produced?
- When can you realistically get space on a vessel or aircraft from the required port?
- How long does it take, from loading, to have every required document in hand and at the bank?
Write the answers down as dates. The review that follows is a comparison between those dates and the credit.
Three simple tests catch most date problems before you read anything else:
- Ready date plus booking lead time must fall on or before the latest shipment date.
- Your document-assembly time plus courier time must fit inside the presentation period, with a margin for any correction.
- The latest shipment date plus the presentation period should not run past the expiry date; if it does, the expiry silently shortens the time you have.
If any test fails, you already know the first line of your amendment request. If all three pass comfortably, the rest of the review is about wording rather than time.
The twelve fields, in review order
1. Expiry date and place
UCP 600 requires a credit to state an expiry date for presentation; the place of the bank with which the credit is available is the place for presentation, and a presentation must be made on or before expiry. ICC, UCP 600, article 6 If the credit is available only with the issuing bank in the buyer's country, your documents must arrive there in time, courier days included. Where you can, ask for the credit to be available with, and expire at, a bank in your own country.
2. Presentation period
Where the credit calls for original transport documents, UCP 600 requires presentation no later than 21 calendar days after the date of shipment, and in any event by expiry. ICC, UCP 600, article 14(c) A credit may state its own period, which can be shorter. Compare it with your document-assembly time from the first pass. If certificates, inspection reports or legalisation take longer than the credit allows, you have a problem before you ship.
3. Latest shipment date
Set this against production, inspection and booking, not against the buyer's hopes. Check that the expiry date leaves room for the presentation period after the latest shipment date; a credit whose expiry falls a few days after the last shipment date shortens the real presentation window.
4. Availability and confirmation
Which bank is the credit available with, and is it available by sight payment, deferred payment, acceptance or negotiation? Is it confirmed, or is confirmation requested? These answers decide when and from whom you will be paid. The US International Trade Administration (ITA) says the exporter and its bank must be satisfied with the creditworthiness of the importer's bank, and notes that an exporter concerned about the issuing bank can ask for a second bank's confirmation. ITA, Letter of Credit; ITA, Trade Finance Guide 2022 Settle the confirmation question before accepting, not after shipment.
5. Amount, currency and tolerance
Check the amount and currency against the contract, and how the credit treats any quantity or amount tolerance. A contract tolerance that the credit does not accommodate can stop a presentation that is commercially correct.
6. Goods description, quantity and unit price
Compare every word with the contract or pro forma invoice; your commercial invoice will be compared with this text. ISBP 821, the ICC's International Standard Banking Practice for examining documents under UCP 600, treats a misspelling or typing error that does not affect meaning as harmless, but treats a changed model number as a conflict of data (paragraph A23). ICC, ISBP 821 Grades, pack sizes and specification references in the credit behave like model numbers: if the credit's wording differs from the contract, ask for the correction now rather than hoping a bank will read past it.
7. Delivery term and named places
The Incoterms rule, its edition and the named place should match the contract. So should the ports or places of loading and discharge, which the transport document will have to show. A credit naming a port you cannot ship from is unworkable, however good the rest.
8. Partial shipments and transhipment
UCP 600 allows partial drawings or shipments unless the credit says otherwise. ICC, UCP 600, article 31 Transhipment is dealt with separately in the article for each type of transport document. For a bill of lading, article 20 includes a container-specific provision: a bill indicating that transhipment will or may take place is acceptable even if the credit prohibits transhipment, if the goods have been shipped in a container, trailer or LASH barge as evidenced by the bill of lading. ICC, UCP 600, article 20 Air, road and multimodal documents have their own articles. Do not assume the container provision covers your case: read the credit's own transhipment and partial-shipment wording against your actual routing, and ask your bank how it applies before you accept.
9. Transport document requirements
Check the type of transport document, how it must be consigned and endorsed, the notify party, freight wording and any on-board requirement. Then confirm with your forwarder that the carrier will issue exactly that. How the consignee box controls release of the goods is explained in reading a bill of lading.
10. Other documents, read as tasks for other people
Every certificate is something you must persuade someone else to issue, with the wording and date the credit demands:
- Inspection or weight certificates: is the named company available at your loading point, and can it issue the required wording in time?
- Official certificates: will the authority issue that form, with that text, before the presentation deadline?
- Origin certificates and legalisation: how long does the chamber or consulate take?
Who issues each document, and in what order, is mapped in the document set behind one shipment.
11. Conditions you do not control
Look for any requirement that depends on the buyer or its agent: a certificate countersigned by the applicant, an inspection by the buyer's representative, an approval to be sent by the buyer. Such a condition lets the buyer decide whether you can present compliant documents. Ask for it to be replaced with a document from an independent issuer.
Also look for conditions that name no document. UCP 600 says that where a credit contains a condition without stipulating a document to indicate compliance, banks will deem the condition not stated and disregard it. ICC, UCP 600, article 14(h) ISBP 821 adds that data in the documents you do present must not conflict with such a condition (paragraph A26). ICC, ISBP 821 So a packing or origin condition with no named document can still cause a refusal if your invoice or packing list says something different. Clarify these conditions before shipment rather than arguing about them afterwards.
12. Charges, rules and additional conditions
Check which charges are for your account and will be deducted from payment, that the credit states it is subject to UCP 600 (and to the eUCP, the ICC's supplement for electronic presentation, if electronic presentation is intended), and read the additional-conditions text line by line. Unusual instructions often sit there.
What failure looks like, field by field
Use this summary when the review is shared between sales, logistics and finance. Each row names the symptom to look for and the usual form of the request.
| Field | Warning sign | What to ask for |
|---|---|---|
| 1. Expiry | Expires abroad, or too soon after the latest shipment date | Expiry at a bank in your country; a later date |
| 2. Presentation period | Shorter than your document-assembly time | A period that covers issuance, legalisation and courier time |
| 3. Latest shipment | Earlier than production and booking allow | A realistic date, with expiry moved to match |
| 4. Availability | Available only at the issuing bank; confirmation needed but absent | Availability with a bank in your country; confirmation |
| 5. Amount | Contract tolerance not reflected | Matching tolerance wording |
| 6. Goods description | Grade, pack or specification differs from the contract | The contract wording |
| 7. Delivery term and places | Wrong rule, port or place | Correct rule, named place and edition |
| 8. Partial shipments and transhipment | Prohibited where your routing needs them | Permission, or wording that fits the route |
| 9. Transport document | Consignee, notify or freight wording the carrier will not issue | Wording confirmed with your forwarder |
| 10. Other documents | Issuer unavailable, wording unobtainable, timing too long | Different issuer, obtainable wording, or removal |
| 11. Conditions outside your control | Applicant's signature, approval or inspection required; condition with no named document | An independent issuer's document; clarified or deleted condition |
| 12. Charges and additional conditions | Unexpected deductions or instructions | Clarification or deletion |
Before you accept: who reviews, and how fast
A credit review is a team task compressed into a short window. Assign it on the day the credit arrives.
- Your bank confirms that the credit came through a proper banking channel and can advise on the issuing bank and on confirmation.
- Production or procurement confirms quantity, specification and the date goods will be ready.
- Logistics confirms routing, booking dates, transhipment and what the carrier will put on the transport document.
- Documentation confirms each certificate's issuer, wording and time to obtain.
- One person owns the consolidated list of changes and sends the single amendment request.
Record the date the credit was received and the date the review finished. If the review repeatedly takes longer than the time you have, fix the process before the next credit arrives.
Amendments: ask once, completely
Each amendment takes time and usually costs fees. Collect every change you need and send them in one request.
UCP 600 sets the mechanics. A credit cannot be amended without the agreement of the issuing bank, any confirming bank and the beneficiary; the issuing bank is bound by an amendment once it issues it; the original terms stay in force for you until you communicate acceptance; partial acceptance is not allowed and counts as rejection; and a clause saying an amendment takes effect unless rejected within a set time is disregarded. If you give no notification, a later presentation that complies with the credit and the not-yet-accepted amendment is treated as acceptance of it. ICC, UCP 600, article 10 Tell your bank clearly whether you accept or reject each amendment.
A useful request states, for each change: the field, the current wording, the wording you need and the reason. It is easier for the buyer to agree, and for its bank to issue, when nothing needs clarifying.
The decline decision
Sometimes the right answer is no. Decline, or refuse to proceed until the credit is amended, when:
- the dates cannot be met from where your stock actually is;
- a document is required from an issuer that will not produce it;
- the buyer controls whether you can present compliant documents;
- the issuing bank or country is unacceptable and confirmation is not available.
When you decline, put the reason in writing and state what would make the credit workable, so the buyer can decide quickly whether to amend it or change the payment method. If a different method is on the table, weigh what you give up; documentary collection or letter of credit compares the two. Saying no early preserves the relationship and your stock. Discovering the problem after shipment turns a negotiation into a refusal.
Worked example: two problems, one request
Hypothetical teaching example. A gum arabic exporter, its buyer and the banks are invented. Dates and requirements are illustrative; this is not a Maqboola transaction.
A credit arrives with a latest shipment date that the exporter can meet. Two fields fail the review.
Field 11: the credit requires a quality certificate "countersigned by the applicant's representative at the port of loading". The buyer has no permanent representative there.
Field 2: the credit allows 15 days after shipment for presentation. The exporter's realistic document timeline is longer:
| Step after shipment | Day |
|---|---|
| Bill of lading issued | 1 |
| Quality and weight certificate from the named inspection company | 4 |
| Final invoice and packing list | 5 |
| Certificate of origin issued and legalised | 12 |
| Documents couriered and received by the nominated bank | 16 |
| Correction buffer (time for one reissue) before the deadline | +5 days |
| Days needed from shipment to a safe presentation | Day 21 (day 16 + 5-day buffer) |
Receipt by the bank on day 16 plus a five-day buffer for one correction gives 21 days, six more than the credit allows. The buffer is the exporter's own allowance, not a rule and not the bank's examination time.
The exporter sends one amendment request, set out so the buyer's bank can act on it without questions:
Illustrative amendment request. (1) Additional conditions: delete the requirement for a certificate countersigned by the applicant's representative; replace it with a certificate issued by [named independent inspection company] stating that the goods meet the quality parameters in contract [reference]. Reason: no applicant representative is present at the loading port. (2) Presentation period: amend to 21 days after shipment. Reason: legalisation of the origin certificate takes about a week in this exporter's timeline. (3) Expiry: amend to a date at least 21 days after the latest shipment date. Reason: to preserve the full presentation period.
The wording is a teaching illustration, not a clause approved by any bank. The exporter's bank should review the final text.
Neither problem was a banking technicality. Both were visible on the day the credit arrived.
Common mistakes
- Starting production before the review is finished.
- Reading the document list before checking whether the dates work.
- Accepting a condition that only the buyer can satisfy.
- Sending amendment requests one at a time.
- Staying silent on an amendment and leaving acceptance to be inferred.
Next step
If you are agreeing a supply contract with Maqboola that will be paid by letter of credit, share the draft credit wording before it is issued, together with realistic shipment and document timelines, when you request a quote. Aligning the credit with the contract before issue avoids the amendments that consume the shipment window. Your bank remains the right adviser on credit wording.
General information. This article explains common practice and cited ICC rules for general educational purposes; it is not legal or banking advice. The terms of each credit, the banks involved and the applicable law decide what applies, so confirm the wording and its effect with your bank before accepting a credit.
