Free covering letter for presenting documents under a letter of credit
When you present shipping documents under a letter of credit, your bank usually wants a covering letter, or its own presentation form, that lists the credit, the amount you draw, every document with the number of originals and copies, and what to do if there are discrepancies. Fill in this template, or use it to check your bank's form before you go.
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What the template covers
- To the nominated, negotiating or advising bank, with date and your reference
- Letter of credit number, issue date, issuing bank and expiry date
- Beneficiary (you) and applicant (the buyer), as in the credit
- Amount drawn and currency, and the draft (bill of exchange) number and tenor if one is required
- Each document presented with the number of originals and copies
- Shipment details: transport document number and date, vessel or flight, ports
- What the bank should do if it finds discrepancies, and where to pay the proceeds
- Name, title and signature of an authorised person
Sources
Guides on this topic
Present on time: 21 days and the expiry date
Under UCP 600, a presentation that includes an original transport document must be made no later than 21 calendar days after the date of shipment, and in any event no later than the expiry date of the credit (article 14(c)), unless the credit states another period. Banks have up to five banking days after the day of presentation to decide whether it complies (article 14(b)), so present early enough to correct a discrepancy before the deadline.
List every document as the credit names it
Use the document names and the number of originals and copies that the credit asks for, and check that data such as the goods description, amounts, dates and names do not conflict between documents (UCP 600 article 14(d)). The commercial invoice description must correspond with the credit's description of the goods (article 18(c)). Keep a copy of the covering letter and of every document you hand over.
Say what to do with discrepancies
If the bank finds discrepancies, the issuing bank may in its sole judgement approach the applicant for a waiver (UCP 600 article 16(b)). Tell your bank whether to contact you first, to send the documents to the issuing bank on an approval basis, or to return them for correction. Remember that a bank is not obliged to pay against discrepant documents, so correcting them in time is usually better.
Common questions
What is a covering letter for L/C documents?
A letter or schedule the beneficiary gives the bank with the documents presented under a letter of credit. It identifies the credit and the amount drawn, lists the documents with originals and copies, and gives instructions on discrepancies and payment.
How long do I have to present documents under a letter of credit?
Under UCP 600 article 14(c), no later than 21 calendar days after the date of shipment when the presentation includes an original transport document, and never after the expiry date of the credit, unless the credit sets a different period.
How long does the bank have to check the documents?
Each bank examining the documents has a maximum of five banking days following the day of presentation to decide whether the presentation complies (UCP 600 article 14(b)).
Can I use my bank's own form instead?
Yes. Many banks have their own presentation or negotiation form and may require it. This template helps you prepare the same information and check that nothing is missing.
What happens if the documents have discrepancies?
The bank may refuse to honour or negotiate. The issuing bank may ask the applicant whether it waives the discrepancies (UCP 600 article 16(b)); until then, the bank is not obliged to pay. If time allows, correct the documents and present them again before the deadline.
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