The Usance LC is a crucial document in international trade finance, particularly within the Saudi Arabian context where it must comply with both international banking practices and Islamic law principles. This document is typically used when buyers require extended payment terms while ensuring sellers receive a secure payment commitment from a bank. The Usance LC specifies a future payment date, usually 30, 60, 90, or 180 days after document presentation or shipment date. It includes detailed terms regarding document requirements, payment conditions, and compliance with Saudi Arabian banking regulations and Shariah principles. The document is essential for businesses engaged in international trade where deferred payment terms are needed while maintaining security for all parties involved.
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1. LC Number and Date: Unique identification number and issuance date of the Letter of Credit
2. Applicant Details: Complete information about the buyer/importer requesting the LC
3. Beneficiary Details: Complete information about the seller/exporter who will receive payment
4. Issuing Bank Details: Information about the bank issuing the LC
5. Advising Bank Details: Information about the bank advising the beneficiary
6. Credit Amount and Currency: Specified amount and currency of the LC
7. Payment Terms: Detailed usance (deferred payment) terms including maturity period
8. Shipment Details: Information about goods, shipping terms, and latest shipment date
9. Document Requirements: List of required documents for LC negotiation
10. Presentation Period: Timeframe within which documents must be presented
11. Governing Law and Jurisdiction: Specification of Saudi law and relevant jurisdiction
1. Transferability Clause: Include when the LC needs to be transferable to another beneficiary
2. Partial Shipment Terms: Include when partial shipments are allowed or prohibited
3. Transhipment Terms: Include when specific transhipment requirements exist
4. Insurance Requirements: Include when specific insurance coverage is required
5. Special Conditions: Include when there are additional requirements or conditions
6. Confirmation Instructions: Include when LC confirmation by another bank is required
7. Reimbursement Instructions: Include when specific reimbursement arrangements are needed
1. Schedule A - Commercial Invoice Requirements: Detailed requirements for commercial invoice presentation
2. Schedule B - Transport Document Requirements: Specific requirements for bills of lading or other transport documents
3. Schedule C - Goods Description and Specifications: Detailed description of goods being traded
4. Schedule D - Inspection Certificate Requirements: Requirements for inspection certificates if applicable
5. Appendix 1 - Document Presentation Checklist: Checklist of all required documents and their specifications
6. Appendix 2 - Bank Contact Details: Complete contact information for all banks involved in the transaction
Relevant legal definitions
Clauses
Relevant Industries
Banking and Financial Services
International Trade
Manufacturing
Import/Export
Logistics and Transportation
Commodities Trading
Retail
Agriculture
Oil and Gas
Construction
Telecommunications
Automotive
Relevant Teams
Legal
Finance
International Trade
Treasury
Risk Management
Compliance
Trade Operations
Credit Administration
Documentary Credits
Supply Chain
Procurement
Relevant Roles
Trade Finance Manager
International Banking Officer
Documentary Credits Specialist
Compliance Officer
Import/Export Manager
Treasury Manager
Credit Risk Officer
Trade Operations Manager
Banking Relationship Manager
Chief Financial Officer
Finance Director
Supply Chain Manager
Procurement Manager
Legal Counsel
Shariah Compliance Officer
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