Article 1

1. The Uniform Customs and Practice for Documentary Credits, 2007 Revision, also known
as UCP 600, are rules that govern any documentary credit (including standby letters of
credit) if the credit explicitly states that it follows these rules.
2. These rules are mandatory for all parties involved unless the letter of credit specifically
changes or excludes them.

Article 2
1. Advising Bank: The bank that informs the beneficiary about the credit, as requested by
the issuing bank.
2. Applicant: The party who asks for the credit to be issued.
3. Banking Day: A day when a bank is open at the location where actions related to the
letter of credit are supposed to happen.
4. Beneficiary: The party who the credit is issued in favor of.
5. Complying Presentation: Documents presented according to the terms of the letter of
credit, these rules, and standard banking practices.
6. Confirmation: When a bank, in addition to the issuing bank, guarantees to honor a
complying presentation.
7. Confirming Bank: The bank that adds its assurance to a credit upon the request or
authorization of the issuing bank.
8. Credit: Any arrangement, irrevocable in nature, where the issuing bank commits to
honor a complying presentation.
9. Honour: Paying according to the terms of the credit, like paying immediately, deferring
payment, or accepting a bill of exchange.
10. Issuing Bank: The bank that issues the credit at the request of the applicant or on its own
behalf.
11. Negotiation: When a nominated bank buys drafts or documents from the beneficiary,
advancing funds before the reimbursement date.
12. Nominated Bank: The bank specified in the letter of credit where the beneficiary can
receive payment, or any bank if the credit is available with any bank.
13. Presentation: Delivering documents under the credit to the issuing or nominated bank,
or the documents themselves.
14. Presenter: The beneficiary, bank, or other party making a presentation.

Article 3
Interpretations
For the purpose of these rules:
1. Singular words also mean their plural form, and vice versa.
2. Once a credit is given, it can't be taken back, even if it doesn't explicitly say so.
3. You can sign a document in various ways, like writing by hand, using a stamp, or
electronically.
4. If a document needs to be legalized or certified, any suitable signature or mark will do.
 5. Banks in different countries are treated as separate entities.
6. Certain words like "qualified" or "official" mean anyone can issue a document except the
person who will benefit from it.
7. Words like "promptly" or "immediately" won't matter unless the document specifically
says they're needed.
8. "On or about" means within five days before or after the specified date.
9. Words like "to", "until", "from", and "between" include the mentioned dates.
10. "Before" and "after" exclude the mentioned date.
11. "From" and "after" exclude the mentioned date when talking about a maturity date.
12. "First half" and "second half" of a month mean the first 15 days and the last 15 days,
respectively.
13. "Beginning", "middle", and "end" of a month mean the first 10 days, the next 10 days,
and the remaining days, respectively.

Article 4

Credits v. Contracts

a letter of credit (LC) is a separate deal from any sales contract it's based on. Banks handling the
LC aren't involved with or bound by that contract, even if it's mentioned in the LC. So, if the
buyer has any issues with the seller or the bank, they can't bring them up when it comes to the
LC. The seller can't use any agreements between banks or between the buyer and the issuing
bank to their advantage.

Additionally, it suggests that banks issuing LCs should discourage buyers from trying to attach
copies of contracts or invoices to the LC itself.

Article 5
Documents v. Goods, Services or Performance

banks handle documents, not the actual goods, services, or performance that the documents
might be about.

Article 6
Availability, Expiry Date and Place for Presentation

Availability

a. The credit must say with which bank it is available or if it is available with any bank. If it's
available with a nominated bank, it's also available with the issuing bank.

b. a credit must state whether it is available by sight payment, deffered payment, by acceptance,
or by negotiation.
c. a credit must not be issued, available by a draft drawn on the applicant

d. Expiry Date

i. The letter of credit must have an expiry date for presentation. If there's an expiry date for honor
or negotiation, it counts as the expiry date for presentation.

Place for Presentation

ii. The place of the bank with witch it is available, determines where documents must be
presented. If it is available at any bank, documents can be presented at any bank. A place of
presentation other then that of issuing bank is in addition to the issuing bank

e. a presentation by or on behalf of beneficiary must be made on or before the expiry date

Article 7
Issuing Bank Undertaking

a. If the stipulated documents are presented to the nominated or issuing bank and they constitute
a complying presentation, the issuing bank must honor

if the credit is available by:

I. Sight payment, deferred payment, or acceptance with the issuing bank.

ii. sight payment with a nominated bank, but it doesn't pay.

iii. Delayed payment with a nominated bank, but it doesn't incur its deferred payment
undertaking, or if it does, doesn't pay on time.

iv. Acceptance with a nominated bank, but it either refuses to accept a draft drawn on it or, if it
does accept, doesn't pay on time.

v. Negotiation with a nominated bank, but it doesn't negotiate.

b. The issuing bank is irrevocably bound to honor as of the time it issues the letter of credit

c. Issuing bank promises to pay back the nominated bank if it honors or approves documents
from the beneficiary according to the letter of credit's rules.

If the letter of credit allows for payments to be made later like with acceptance or deferred
payment, the issuing bank has to pay the nominated bank when those payments are due at
maturity, even if the nominated bank paid the seller earlier.
The issuing bank's promise to pay the nominated bank is separate from its promise to the seller.
This means the issuing bank has to pay the nominated bank no matter what, even if there are
other issues with the transaction.
Article 8
Confirming Bank Undertaking

a. Provided that the stipulated documents are presented to the confirming bank or to any other
nominated bank and that they constitute a complying presentation, the confirming bank must
honor:

if the credit is available by

i. sight payment, deferred payment, or acceptance with the issuing bank.

ii. sight payment with another negotiation bank and that nomited bank doesn’t pay.
iii. deferred payment with another 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 another 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 another nominated bank and that nominated bank does not negotiate.

Negotiate, without any recourse, if the credit allows negotiation with the confirming bank

Once the confirming bank confirms the credit, it's legally bound to honor or negotiate the
transaction.

If a confirming bank has appointed any nominated bank on his behalf and the nominated bank is
paying on his behalf then he will forward the documents to the confirming bank. Whenever the
nominated bank paid confirming bank has no concern over it when the due date of maturity will
be or when the confirming bank will get the evidence then the confirming bank will reimburse
the nominated bank. Confirming bank reimbursing to another nominating bank is independent of
the confirming banks undertaking to the beneficiary

If a bank authorized or asked by the issuing bank to confirm a credit but it is not prepared to do
so then:

- It must inform the issuing bank promptly.

- It can advise the letter of credit without confirming it.

Article 9
Advising of Credits and Amendments

Advising Bank's Role: an advising bank inform the beneficiary about a letter of credit (LC) or
any changes to it. the advising bank that is not the confirming bank, it only tells the beneficiary
about the LC or changes without any commitment to make payments.
b. Responsibility of the Advising Bank: When the advising bank tells the beneficiary about the
LC or changes, it ensures that the information looks real and accurately matches what it received.

c. Using Another Bank to Inform: The advising bank can ask another bank i.e second advising
bank to inform the beneficiary about the LC or changes. If this happens, the second bank needs
to make sure the information is real and matches what it received.

d. Consistency in Advising Banks: If a bank uses another bank to inform the beneficiary about
the LC or changes, it must keep using that same bank for any further changes.

e. Informing if Not Advising: If a bank is asked to inform the beneficiary about the LC or
changes but chooses not to, it needs to tell without any delay the bank that sent the LC or
changes, amendments or advices has been received

f. If Doubtful, Informing the Source: If a bank has doubts about the authenticity of the LC,
changes, or information received, it should tell the bank that sent the instructions. If the advising
bank or second bank still decides to inform the beneficiary despite the doubts, they need to let
the beneficiary know about their concerns.

Article 10
Amendments

. Agreement Needed for Changes: No changes can be made to a letter of credit (LC) without
the agreement of the issuing bank, the confirming bank, and the beneficiary.

b. When Banks Are Bound by Changes: Once an amendment (a change) is made to the LC, the
issuing bank that issued the amendment is stuck with that change. If a confirming bank also
confirms the change, they're bound by it too, once they advise it. However, a confirming bank
can advise a change without confirming it, but they have to tell the issuing bank and the
beneficiary right away.

c. Accepting Changes: The terms of the original LC stay in place until the beneficiary accepts
the changes. They need to let the bank that advised the change know if they accept or reject it. If
beneficiary fails to give such notification, presenting documents that follow the original LC and
any unaccepted changes counts as accepting the changes, and the LC is updated.

d. Informing About Acceptance or Rejection: A bank that advises an amendment (informing

the benificiary) should inform the bank from which it received the amendment of any
notification of acceptance or rejection.

e. No Partial Acceptance: You can't partially accept a change. If you present documents
following part of a change and not the rest, it's considered rejecting the change altogether.

f. Ignoring Time Limits for Rejection: If a change says it'll happen unless the person or
company it's for rejects it within a set time, that part of the change doesn't count.