The Letter of Credit Terms document serves as a crucial instrument in Indonesian international trade transactions, providing a formal framework for secure payment arrangements between importers and exporters. This document becomes necessary when parties engage in cross-border trade and require a bank-guaranteed payment mechanism. The Letter for Credit Terms specifically outlines the conditions, requirements, and obligations that must be met for the letter of credit to be honored, including document requirements, payment terms, and compliance conditions. Operating under Indonesian banking laws and regulations, particularly Bank Indonesia Regulation No. 5/11/PBI/2003, while also adhering to international UCP 600 standards, this document helps mitigate risks in international trade by providing a secure payment mechanism backed by bank guarantees.

1. Letter Header: Bank's letterhead, date, reference number, and addressee details

2. L/C Amount and Currency: Specification of the credit amount and currency of payment

3. Type of L/C: Specification of whether it's irrevocable, confirmed, transferable, etc.

4. Expiry Date and Place: Clear statement of when and where the L/C expires

5. Beneficiary Details: Complete details of the beneficiary including name, address, and banking information

6. Shipment Terms: Details of shipment including latest shipment date, partial shipments, transshipment permissions

7. Document Requirements: List of required documents for L/C presentation

8. Payment Terms: Specification of payment terms, timing, and conditions

9. Bank Charges: Allocation of banking fees and charges between parties

10. Governing Law: Statement that the L/C is subject to Indonesian law and UCP 600

11. Authorized Signature: Space for bank official's signature and stamp