Payment Terms Dlc for Malaysia

Payment Terms Dlc Template for Malaysia

A comprehensive legal document governed by Malaysian law that outlines the terms and conditions for payment through Documentary Letter of Credit (DLC). This document establishes the framework for secure international trade transactions, incorporating requirements under the Malaysian Financial Services Act 2013 and international banking practices (UCP 600). It details the obligations of all parties involved, document requirements, payment conditions, and compliance requirements within the Malaysian legal context while adhering to international trade standards.

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What is a Payment Terms Dlc?

The Payment Terms DLC document serves as a crucial instrument in international trade transactions under Malaysian jurisdiction. It is specifically designed for situations where parties seek a secure payment mechanism through Documentary Letters of Credit, providing certainty to both exporters and importers. The document incorporates Malaysian banking regulations, particularly the Financial Services Act 2013, while aligning with international banking practices under UCP 600. It outlines detailed procedures for document presentation, payment conditions, and bank obligations, making it essential for cross-border trade transactions where Malaysian entities are involved. This document type is particularly relevant when dealing with significant commercial transactions requiring formal bank-mediated payment arrangements.

What sections should be included in a Payment Terms Dlc?

1. Parties: Identification of all parties involved: Applicant (Buyer), Beneficiary (Seller), Issuing Bank, and any Advising/Confirming Banks

2. Background: Context of the underlying commercial transaction and purpose of the DLC arrangement

3. Definitions: Key terms used throughout the document, including banking, shipping, and trade-specific terminology

4. Letter of Credit Details: Specific details of the DLC including type, amount, currency, and expiry date

5. Payment Terms and Conditions: Detailed conditions for payment, including required documents and presentation requirements

6. Document Requirements: Comprehensive list of required documents for DLC activation and payment

7. Timeline and Deadlines: Key dates including shipment, document presentation, and payment schedules

8. Bank Obligations: Responsibilities and obligations of all banking parties involved

9. Discrepancy Handling: Procedures for handling document discrepancies and resolution process

10. Force Majeure: Provisions for unforeseen circumstances affecting the DLC transaction

11. Governing Law and Jurisdiction: Specification of applicable law (Malaysian) and jurisdiction for dispute resolution

What sections are optional to include in a Payment Terms Dlc?

1. Transfer Rights: Include when the DLC needs to be transferable to another beneficiary

2. Back-to-Back LC Provisions: Required when dealing with intermediate traders or back-to-back LC arrangements

3. Special Shipping Requirements: Include when specific shipping arrangements or requirements apply

4. Insurance Requirements: Additional section when special insurance arrangements are needed

5. Bank Guarantees: Include when additional bank guarantees are required

6. Sanctions Compliance: Include for international transactions involving sensitive jurisdictions

7. Electronic Presentation: Include when electronic presentation of documents is permitted

8. Confirmation Requirements: Include when LC confirmation by another bank is required

What schedules should be included in a Payment Terms Dlc?

1. Schedule A - Commercial Invoice Requirements: Detailed specifications for commercial invoice presentation

2. Schedule B - Transport Document Requirements: Specifications for bills of lading or other transport documents

3. Schedule C - Document Checklist: Comprehensive checklist of all required documents

4. Schedule D - Bank Details: Complete banking information for all parties

5. Schedule E - Goods Description: Detailed description of goods/services covered by the DLC

6. Appendix 1 - Standard Forms: Template forms for various required documents

7. Appendix 2 - UCP 600 References: Relevant articles from UCP 600 applicable to the transaction

8. Appendix 3 - Timeline Chart: Visual representation of key dates and deadlines

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Cost

Free to use

Relevant legal definitions

Clauses

Relevant Industries

International Trade

Banking and Financial Services

Manufacturing

Import/Export

Commodities Trading

Retail

Agriculture

Oil and Gas

Electronics

Textiles

Automotive

Construction Materials

Relevant Teams

Trade Finance

International Banking

Treasury

Legal

Compliance

Risk Management

Procurement

Supply Chain

Commercial Operations

Financial Control

Documentary Credits

Relevant Roles

Trade Finance Manager

International Trade Specialist

Finance Director

Treasury Manager

Commercial Banking Officer

Trade Operations Manager

Documentary Credits Specialist

Compliance Officer

Risk Manager

Import/Export Manager

Chief Financial Officer

Banking Relationship Manager

Supply Chain Manager

Procurement Manager

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Credit Note Letter To Customer

A Malaysian-compliant business document that formally acknowledges a reduction in a customer's payment obligation to a company, typically issued to correct billing errors or process returns.

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What is a Payment Terms Dlc?

What sections should be included in a Payment Terms Dlc?

What sections are optional to include in a Payment Terms Dlc?

What schedules should be included in a Payment Terms Dlc?

Authors

Alex Denne

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