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by Roy Becker
A company in the United States placed an order with a company from a country other than Scotland. The seller asked the buyer to open a letter of credit to pay for the purchase. The merchandise description in the letter of credit read simply, "Scotch Whiskey."
When the documents arrived at the issuing bank, they discovered that the merchandise on the invoice read, "Scotch-type Whiskey," not "Scotch Whiskey" as required by the letter of credit. The rules that govern the processing of letters of credit, the Uniform Customs and Practice for Documentary Credits (UCP), states, "The description of the goods, service or performance in a commercial invoice must correspond with that appearing in the credit." (Article 18c.)
Did it? Does Scotch-type Whiskey mean the same as Scotch Whiskey? A cautious banker would properly conclude, "Why should I make the decision? I'll call the applicant and let him decide." This is an accepted practice as defined in Article 16 of the UCP.
The applicant, too, wondered, "What is Scotch-type Whiskey?" The bank and the applicant concluded the beneficiary should submit a correct invoice to read, "Scotch Whiskey."
However, the beneficiary refused to substitute the invoice, which of course made everyone suspicious. If the beneficiary refused to replace the invoice, perhaps they shipped something other than "Scotch Whiskey." They may have shipped a whiskey like Scotch, but not Scotch.
The applicant did not waive the discrepancy, instructed the bank to refuse payment, and returned the shipment. No one, except the shipper, knows what was actually shipped, and he ain't talkin'.
Many exporters become frustrated by a bank's nit-picky examination of documents. The bank has an obligation to pay under the letter of credit only if the beneficiary presents documents that comply with the terms of the letter of credit. Without correct documents a bank can only pay if the applicant waives the discrepancies.
All legitimate discrepancies carry equal weight. A small discrepancy may seem like a mouse to the exporter, but to the importer looking for a way to refuse the payment it may look like an elephant.
Exporters must prepare documents that strictly meet the terms of the letter of credit in order to demand payment from the bank. If unable to meet the terms, they should request an amendment before shipping the goods.
| Product Model | Inside Diameter | Outside Diameter | Thickness |
| LUHR50-2LS bearing | 50 | 62 | 70 |
| LUHR40-2LS bearing | 40 | 52 | 60 |