| 释义 |
letter of credit
A document whereby a bank, at the request of a customer, undertakes to pay money to a third party (the beneficiary) on presentation of documents specified in the letter (e.g. bills of lading and policies of insurance). The obligation of the bank to pay is independent of the underlying contract of sale and so is not affected by any defects in the goods supplied under the contract of sale. A contract of sale of goods may require the buyer to open an irrevocable letter of credit in favour of the seller. This cannot be revoked by the issuing bank or the purchaser of the goods before its expiry date, without the consent of the beneficiary. A confirmed letter of credit is one in which the negotiating bank guarantees payment to the beneficiary should it not be honoured by the issuing bank. |