Document background
The Acceptance LC (Letter of Credit) is a crucial trade finance instrument used when parties require a bank-guaranteed deferred payment mechanism in international trade transactions. This document type is particularly relevant under Danish law, which provides a robust framework for banking and trade finance operations while adhering to international standards like UCP 600. The Acceptance LC serves as a bank's commitment to accept time drafts drawn by the beneficiary and pay them at maturity, typically ranging from 30 to 180 days after sight or shipment. It is commonly used when sellers need a bankable instrument that can be discounted for immediate financing while providing buyers with extended payment terms. The document includes specific terms regarding document presentation, payment conditions, and compliance requirements, all structured within the Danish legal framework while maintaining international banking practices.
