Made In China Talk  

Go Back   Made In China Talk > Import-Export Knowledge > Basics Knowledge of Import-Export
Directory Register FAQ Members List Calendar Mark Forums Read 中文




What are the risks of using L/Cs in international trade and how can these risks be averted?


Reply
 
Thread Tools Display Modes
  #1  
Old 07-12-2008, 02:09 PM
trade trade is offline
Senior Member
 
Join Date: May 2008
Posts: 1,222
Feedback: (0)
Default What are the risks of using L/Cs in international trade and how can these risks be averted?

For example - if I am buying a product on an L/C with CIF shipping terms, what is there to stop the seller packaging something that is not what I ordered?

The way I understand an L/C CIF deal is that the shipping company completes the bill of lading and checks that the number of packages, weight and labels agree with the other documents, but doesn't open any packages for inpection. Is this true?

Isn't it very easy then, for a seller to simply not pack the correct product and put something like sand in the packages?

I thought that it may be possible to put requirements in the L/C that payment will only be affected upon inspection of the goods at the destination port...is this possible? Or is there an even better way to ensure that you get what you pay for?

Anyone who can help me with these questions, please answer...I don't want to get ripped-off!
Reply With Quote




  #2  
Old 07-12-2008, 02:37 PM
India India is offline
Senior Member
 
Join Date: May 2008
Posts: 2,052
Feedback: (0)
Default What are the risks of using L/Cs in international trade and how can these risks be averted?

complicated question, and you really should ask your lawyer, you're not likely to get very good legal advice in this forum.
generally, the letter of credit is for the protection of the seller, not you, the buyer.
you can arrange for the letter of credit to be held by an escrow agent, who will only release it upon your confirmation that the shipment has been received and is as invoiced.
Reply With Quote
Reply



Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Forum Jump


| Business Forum | Toronto Chinese

All times are GMT +9. The time now is 08:44 AM.


All rights reserved. Copyright 2007 Made In China Talk