INTERNATIONAL TRADE

Course 4 Yudy Yunardy S.E., M.M.

 WHO AM I ?

Fifteen years of Banking experience, six

years’ experience in Trade Finance
Operations background with Unsecured
Loan experience, equipped with another
seven years’ experience in Management
Information Analyst and Dashboard
Reporting. Vastly experienced in Bank
Indonesia reporting (LBU, SID, LBBU, BMPK
etc.)
 EMPLOYMENT SUMMARY

2014 Present Indonesia Banking School

2013 2014 Deutschebank AG
2011 2012 Misys Plc
2010 2011 DBS Indonesia
2010 2010 ANZ Bank
2005 2010 RBS Bank
2004 2005 Vendor at Bank Mandiri, BCA and Circle K
1999 2004 HSBC Bank
1998 1999 MetLife Insurance
1997 1998 Demographic Institution FEUI
1996 1997 Private Investment Manager
 RULES

1.Disable your comm. device

2.Presence 80% minimum
3.Time alloc. 08.00 – 10.30
 TEXTBOOK

Koch, Timothy
(2015), Bank
Management,
The Dryden Press
 GRADING EVALUATION

1. Participation 5%
2. Quiz / exercise 10%
3. Assignment 15%
4. Midterm 35%
5. Final 35%

MT 700
SENDER: ABC BANK, MELBOURNE, AUSTRALIA
RECEIVER: IOB, MUMBAI, INDIA
:27: SEQUENCE OF TOTAL
:40A: FORM OF DOCUMENTARY CREDIT
:20: DOCUMENTARY CREDIT NUMBER
:31C: DATE OF ISSUE
:40E: APPLICABLE RULES
:31D: DATE AND PLACE OF EXPIRY
:50: APPLICANT
LAST WEEK’S EXERCISE
1/1
IRREVOCABLE TRANSFERABLE
EL20088033319
150609
UCP LATEST VERSION
150105 OPENING BANKS COUNTERS
HOT AND SPICY PTE LTD
240 YARROWEE STREET
SEBASTOPOL
VICTORIA, AUSTRALIA 3356

:59: BENEFICIARY
:32B: CURRENCY CODE, AMOUNT
:41D: AVAILABLE WITH
:42C: DRAFT
:42A: DRAWEE
:43P: PARTIAL SHIPMENTS
:43T: TRANSHIPMENTS
:44E: PORT OF LOADING
:44F: PORT OF DISCHARGE
:44C: LATEST SHIPMENT DATE
LAST WEEK’S EXERCISE
AACHI MASALA PTY LTD
41, NORTH CAR STREET,
CHENNAI, INDIA-600007
AUD 60,000.00
ANY BANK BY NEGOTIATION
AT SIGHT
ABC BANK, MELBOURNE, AUSTRALIA
NOT ALLOWED
NOT ALLOWED
ANY INDIAN PORT
ANY INDONESIAN PORT
150525
 LAST WEEK’S EXERCISE

:45A: DESCRIPTION OF GOODS CUTE 15 YEARS OLD GIRLS, RPG,

FLAMETHROWER, M-16, AR-15,
KALASHNIKOV AK-47,
INVOICE NO 123456.
CIF AUSTRALIA
:46A: DOCUMENTS REQUIRED
1. SIGNED COMMERCIAL INVOICE
2. 3/3 CLEAN ON BOARD BL MADE OUT TO ORDER OF ABC BANK AND MARKED
FREIGHT PREPAID EVIDENCEING NOTIFY PARTY AS APPLICANT.
3. CERTIFICATE OF ORIGIN ISSUED BY LOCAL CHAMBER OF COMMERCE
PREVIOUSLY…
RULES FOR TRADE PRODUCTS
 RULES FOR TRADITIONAL TRADE
PRODUCTS

1. Uniform Customs & Practice (UCP 600)

2. International Standby Practices (ISP 98)
3. Uniform Rules for Collections (URC 522)
4. Uniform Rules for Bank-to-Bank
Reimbursements (URR 725)
5. Uniform Rules for Demand Guarantees
(URDG 758)
 UCP 600 VS UCP 500

1. Article 8 and 6 (part) which

refer to revocable LC was
removed
2. Article 38 ‘Other documents’
was removed
3. Article 5 and 12 was removed
UCP 600
 UCP 600

1. General Provisions
2. Liability
3. Examination
4. Documents
5. Misc Issues
6. Disclaimers
7. Transfer & Assignment
 UCP 600 – GENERAL PROVISIONS

1. Article 1 Application of UCP

2. Article 2 Definitions
3. Article 3 Interpretations
4. Article 4 Credits v. Contracts
5. Article 5 Documents v. Goods,
Services or Performance
 UCP 600 – LIABILITY
6. Article 6 Availability, Expiry Date and Place for
Presentation
7. Article 7 Issuing Bank Undertaking
8. Article 8 Confirming Bank Undertaking
9. Article 9 Advising of Credits and Amendments
10. Article 10 Amendments
11. Article 11 Teletransmitted and Pre-Advised
Credits and Amendments
12. Article 12 Nomination
13. Article 13 Bank-to-Bank Reimbursement
Arrangements
 UCP 600 – EXAMINATION

14. Article 14 Standard for Examination

of Documents
15. Article 15 Complying Presentation
16. Article 16 Discrepant Documents,
Waiver and Notice
17. Article 17 Original Documents and
Copies
 UCP 600 – DOCUMENTS

18. Article 18 Commercial Invoice

19. Article 19 Transport Document
Covering at Least Two Different Modes
of Transport
20. Article 20 Bill of Lading
21. Article 21 Non-Negotiable Sea Waybill
22. Article 22 Charter Party Bill of Lading
 UCP 600 – DOCUMENTS
23. Article 23 Air Transport Document
24. Article 24 Road, Rail or Inland Waterway
Transport Documents
25. Article 25 Courier Receipt, Post Receipt or
Certificate of Posting
26. Article 26 "On Deck", "Shipper's Load and
Count", "Said by Shipper to Contain" and
Charges Additional to Freight
27. Article 27 Clean Transport Document
28. Article 28 Insurance Document and Coverage
 UCP 600 – MISC ISSUES
29. Article 29 Extension of Expiry Date or Last
Day for Presentation
30. Article 30 Tolerance in Credit Amount,
Quantity and Unit Prices
31. Article 31 Partial Drawings or Shipments
32. Article 32 Instalment Drawings or
Shipments
33. Article 33 Hours of Presentation
 UCP 600 – DISCLAIMERS

34. Article 34 Disclaimer on

Effectiveness of Documents
35. Article 35 Disclaimer on Transmission
and Translation
36. Article 36 Force Majeure
37. Article 37 Disclaimer for Acts of an
Instructed Party
 UCP 600 – TRANSFER &
ASSIGNMENT
38. Article 38 Transferable Credits
39. Article 39 Assignment of
Proceeds
ISP 98
 ISP 98

1. RULE 1: GENERAL PROVISIONS

2. RULE 2: OBLIGATIONS
3. RULE 3: PRESENTATION
4. RULE 4: EXAMINATION
5. RULE 5: NOTICE, PRECLUSION, AND
DISPOSITION OF DOCUMENTS
 ISP 98

6. RULE 6: TRANSFER, ASSIGNMENT, AND

TRANSFER BY OPERATION OF LAW
7. RULE 7: CANCELLATION
8. RULE 8: REIMBURSEMENT OBLIGATIONS
9. RULE 9: TIMING
10. RULE 10: SYNDICATION/PARTICIPATION
URC 522
 URC 522

A. General Provisions and Definitions

B. Form and structure of collections
C. Form of presentation
D. Liabilities and responsibilities
E. Payment
F. Interest charges and expenses
G. Other provision
 GENERAL PROVISIONS AND
DEFINITIONS

1. Applications of URC 522

2. Definition of collection
3. Parties to a collection
 FORM AND STRUCTURE OF
COLLECTIONS

4. Collection instruction
 FORM OF PRESENTATION

5. Presentation
6. Sight/Acceptance
7. Release of commercial
documents
8. Creation of documents
 LIABILITIES AND RESPONSIBILITIES

9. Good faith and reasonable care

10. Documents vs goods/services/ performances
11. Disclaimer for acts of an instructed party
12. Disclaimer on documents received
13. Disclaimer on effectiveness of documents
14. Disclaimer on delays, loss in transit and
translation
15. Force majeure
 PAYMENT

16. Payment without delay

17. Payment in local currency
18. Payment in foreign currency
19. Partial payments
 INTEREST CHARGES AND EXPENSES

20. Interest
21. Charges and expenses
 OTHER PROVISIONS

22. Acceptance
23. Promissory notes and other
instruments
24. Protest
25. Case-of-need
26. Advises
URR 725
 URR 725

A. General Provisions and Definitions

B. Liabilities and responsibilities
C. Form of notification of
authorisations, amendments and
claims
D. Miscellaneous provisions
 GENERAL PROVISIONS AND
DEFINITIONS

1. Applications of URR 725

2. Definitions
3. Reimbursement
authorisations versus credits
 LIABILITIES AND RESPONSIBILITIES

4. Honour of a reimbursement
claim
5. Responsibility of the issuing
bank
 FORM OF NOTIFICATION OF
AUTHORISATIONS, AMENDMENTS AND
CLAIMS
6. Issuance and receipt of a reimbursement
authorization or reimbursement amendment
7. Expiry of a Reimbursement Authorization
8. Amendment or Cancellation of Reimbursement
Authorization
9. Reimbursement undertaking
10. Standards for a Reimbursement Claim
11. Processing a Reimbursement Claim
12. Duplications of a Reimbursement Authorization
 MISCELLANEOUS PROVISIONS

13. Foreign Laws and Usages

14. Disclaimer on the Transmission of
Messages
15. Force Majeure
16. Charges
17. Interest Claims/Loss of Value
IMPORT LC PAYMENT MECHANISM
 TRADE CYCLE - SIGHT
7. Uang

2. Issued LC
ISS.BANK ADV.BANK
6. Docs 5. Docs

3. Advise LC
9. Uang
1. Apply LC

4. Goods
10. Docs 8. Uang

IMPORTER EXPORTER
SC
 ISSUANCE LC

UCP 600 Article 7 Issuing bank

undertaking
 AMENDMENT LC

1. UCP 600 Article 9 Advising of

Credits and Amendments
2. UCP 600 Article 10
Amendments
 TRADE CYCLE - AMENDMENT
12. Uang

7. Issued Amd

2. Issued LC
ISS.BANK ADV.BANK
11. Docs
15. Docs

3. Advise LC
13. Uang

8. Advise Amd
6. Apply Amd

10. Docs
5. Req Amd
1. Apply LC

4. Req Amd
14. Uang

9. Goods

IMPORTER EXPORTER
SC
 DISCREPANT DOCUMENTS

UCP 600 Article 16 Discrepant

Documents, Waiver and Notice
 DISCREPANT DOCUMENTS

1. In UCP 600 there is no major

or minor discrepancies
2. Strike through
3. Correction
4. Typo
 DISCREPANT DATES

1. Latest delivery date (at BL or

AWB)
2. LC Expiration date
3. Latest presentation date
(UCP 600 Art.29)
 SHIPPING GUARANTEE

A document that allows a customer

to take possession of shipped goods
before the shipping company
receives the bill of lading,
indemnifying the shipping company
from any loss in case the customer
fails to pay
 SHIPPING GUARANTEE

1. Will require cash margin

and/or
2. Promissory note
 SHIPPING GUARANTEE BENEFITS

1. Reduction of capital tied up. Pick up and resell

goods in advance with bank credit in order to
speed up circulation of capital and reduce
capital tied up.
2. Grasp market opportunities. It will assist
importers in obtaining documents of title to
goods, picking up and reselling goods in case
of arrival of goods prior to documents.
3. Less financial expense. Importers can pick up
goods in time to avoid demurrage charge.
FEES AND CHARGES
FEES AND CHARGES