Reference no: EM132829616

1. What are the main reasons why a letter of credit may be chosen as a form of International payment?

2. Name some advantages of a letter of credit.

3. The letter of credit deals with documents and not with goods, what risk does this pose to the buyer?

4. What kind of risks is the exporter exposed to under the usance letter of credit?

5. Name (5) five main parties involved in the letter of credit.

6. Which party instructs the bank to open a letter of credit?

7. Which party draws up and issues the letter of credit and then makes payment according to the conditions outlined in the letter of credit?

8. Which party receives payment as stipulated in the letter of credit?

9. Does the advising bank take on any payment obligations to the beneficiary under a letter of credit?

10. What does the Uniform Customs and Practice for Documentary Credits (UCP) outline?

11. What is the current version of the UCP rules used by commercial bankers and commercial parties in the execution of a letter of credit?

12. responsibility under Article 5 of the UCP 600 rules?

13. Is a CIFFA freight forwarder liable for his/her documentation in a letter of credit transaction?

14. As a CIFFA freight forwarder it is your responsibility to comply with the requirements of the letter of credit. What will the failure to do so result in?

15. As a CIFFA freight forwarder what is a good way to avoid any lack of attention or mistakes going through the documentary requirements?

16. The UCP 600 rules provide room for some interpretation; as a CIFFA freight forwarder what should you do if you are in doubt?

17. What date do the banks look for if the credit prescribes an on board bill of lading and a latest shipping date?

18. Under the UCP 600 rules, which date do you use to present the documents to the paying bank?

19. If a bill of lading indicates a place of receipt different from the port of loading, on board n

20. Under the UCP 600 rules, Article 23, is a house air waybill acceptable?

21. Unless specified by name in the letter of credit, is a house bill of lading covered in the UCP 600 rules?

22. Is it possible to assign to another party all or part of the proceeds of a drawing/payment under a credit?

23. As a CIFFA freight forwarder you should guard yourself against the risk of non- payment. How can you ensure payment from your client?

24. Name (3) three types of letter of credit.

25. What is the difference between a revocable and irrevocable letter of credit?

26. If there are spelling errors in the credit instructions, what should the CIFFA freight forwarder do?

27. Name some of the most common errors and/or deficiencies in the execution of a letter of credit.