The Non-Operative Letter of Credit is a fundamental banking instrument used in international trade finance, particularly when parties seek secure payment methods in cross-border transactions. This document, governed by Dutch law and EU regulations, provides a formal commitment from a bank to pay a specified amount to a beneficiary upon presentation of compliant documents. It incorporates essential elements required by the UCP 600, Dutch Financial Supervision Act (Wft), and other relevant Dutch banking regulations. The document is typically used when companies engage in international trade requiring payment security, document verification, and bank intermediation. A Non-Operative Letter of Credit includes specific terms regarding payment conditions, required documentation, timeframes, and banking arrangements, serving as a crucial tool in facilitating secure international trade transactions.
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1. Letter Header: Bank letterhead, date, reference number, and contact details
2. Addressee Details: Beneficiary's complete name and address
3. Letter of Credit Number: Unique identification number of the LC
4. Transaction Amount: Currency and amount of the Letter of Credit
5. Expiry Date: Validity period of the Letter of Credit
6. Applicant Details: Complete name and address of the party requesting the LC
7. Available With/By: Terms of availability and payment method
8. Required Documents: List of documents required for presentation
9. Shipment Terms: Delivery terms and conditions if applicable
10. Special Conditions: Any specific conditions or requirements
11. Authorized Signature: Bank official's signature block and authorization
1. Partial Shipments: Include when specifying whether partial shipments are allowed or prohibited
2. Transhipment: Include when specifying whether transhipment is allowed or prohibited
3. Insurance Coverage: Include when specific insurance requirements need to be detailed
4. Description of Goods: Include when a detailed description of the underlying goods is required
5. Bank-to-Bank Instructions: Include when specific instructions between issuing and advising banks are needed
6. Transfer Conditions: Include when the LC is transferable and conditions need to be specified
1. Schedule A - Document Requirements: Detailed list of required documents and their specifications
2. Schedule B - Payment Terms: Detailed payment instructions and conditions
3. Schedule C - Goods Description: Detailed description of goods or services covered by the LC
4. Appendix 1 - Standard Presentation Form: Template for document presentation
5. Appendix 2 - Bank Details: Complete banking information for all parties
6. Appendix 3 - UCP 600 Disclaimers: Standard disclaimers and notices as per UCP 600
Relevant legal definitions
Advising Bank
Applicant
Banking Day
Beneficiary
Bill of Exchange
Bill of Lading
Commercial Invoice
Complying Presentation
Confirmation
Credit
Documents
Draft
Expiry Date
Honour
Issuing Bank
Negotiation
Nominated Bank
Operative Credit
Presentation
Presenter
Reimbursing Bank
Shipment
Trade Documents
Transport Documents
UCP 600
Wft
Working Day
Non-Operative Credit
Applicable Law
Bank Charges
Clean Collection
Documentary Collection
Force Majeure
Governing Law
Insolvency Event
Letter of Credit Amount
Material Adverse Change
Sanctions
Security Interest
SWIFT Message
Applicant
Banking Day
Beneficiary
Bill of Exchange
Bill of Lading
Commercial Invoice
Complying Presentation
Confirmation
Credit
Documents
Draft
Expiry Date
Honour
Issuing Bank
Negotiation
Nominated Bank
Operative Credit
Presentation
Presenter
Reimbursing Bank
Shipment
Trade Documents
Transport Documents
UCP 600
Wft
Working Day
Non-Operative Credit
Applicable Law
Bank Charges
Clean Collection
Documentary Collection
Force Majeure
Governing Law
Insolvency Event
Letter of Credit Amount
Material Adverse Change
Sanctions
Security Interest
SWIFT Message
Clauses
Document Requirements
Payment Terms
Expiry and Presentation
Bank Charges
Force Majeure
Governing Law and Jurisdiction
Assignment and Transfer
Amendments
Notices
Compliance and Sanctions
Anti-Money Laundering
Confidentiality
Document Examination
Bank Liability
Reimbursement
Instructions
Default Events
Communication Methods
Banking Hours
Dispute Resolution
Payment Terms
Expiry and Presentation
Bank Charges
Force Majeure
Governing Law and Jurisdiction
Assignment and Transfer
Amendments
Notices
Compliance and Sanctions
Anti-Money Laundering
Confidentiality
Document Examination
Bank Liability
Reimbursement
Instructions
Default Events
Communication Methods
Banking Hours
Dispute Resolution
Relevant Industries
Banking & Financial Services
International Trade
Import/Export
Manufacturing
Retail
Commodities Trading
Shipping & Logistics
Agriculture
Energy
Construction
Relevant Teams
Trade Finance
International Banking
Documentary Credits
Treasury
Risk Management
Compliance
Legal
Operations
Credit Administration
Trade Operations
Relevant Roles
Trade Finance Manager
International Banking Officer
Documentary Credits Specialist
Financial Controller
Treasury Manager
Import/Export Manager
Trade Operations Manager
Compliance Officer
Credit Risk Manager
Documentary Collections Officer
International Trade Specialist
Banking Relationship Manager
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