Letter of credit
The letter of credit ( English Commercial letter of credit , CLC or English letter of credit , L / C) is the instruction to one or more credit institutions to provide the payee named in the document with a certain sum of money as cash payment .
General
As with other types of instructions, there are three parties involved in the letter of credit. The instructing author authorizes the issuer of the letter of credit instructed by him to make payment to the recipient of the instruction on presentation of the letter of credit . Only credit institutions act as exhibitors. The main purpose of the letter of credit used to be that when traveling (especially abroad), cash could be withdrawn by presenting the letter of credit to certain banks .
history
The former bishop of Paris, Maurice de Sully , is said to have issued a deed in 1191, "the oldest letter of credit we know so far". In it he promised 16 knights from the third crusade under Philip II a payment in Paris on their return. The French “Ordinance Louis XIV on the trade of merchants and merchants”, which came into force under Louis XIV in March 1673, also contained the law on bills of exchange from Art . For the French merchant Jacques Savary , in his Code Savary (1673), the bill of exchange with the clause “value understood” ( French valeur entendue ) was a letter of credit. In his Dictionnaire universel de commerce in 1723 he and his sons considered the letter of credit to be a different form of debt .
As early as December 1797, the possibility of a merchant issuing a letter of credit in Germany was mentioned. In December 1850 sold Heinrich Schliemann be as prospectors in California found gold to the Bank of England and deposited half the money equivalent value against a letter of credit with a bank in New York. In May 1914, the German post office introduced the postal credit letter , in which the maximum amount of 10,000 marks had to be paid into a postal check office beforehand. Each post office was allowed to pay out up to 3,000 marks from this. It was abolished in May 1930 and replaced by postal travelers' checks. The letter of credit was increasingly replaced in Germany from 1960 by the travelers check and is no longer relevant in its original form today.
species
There was the special letter of credit and the circular letter of credit ( travel letter of credit ). While the special letter of credit is only addressed to one bank, which is only allowed to pay out after prior notification (written notice), the letter of circular credit can be redeemed in whole or in part at several banks. If partial payments are planned, these will be noted on the back of the certificate. The "Commercial Letter of Credit" ( commercial letter of credit ) is now the Anglo-Saxon countries in foreign trade common form of the German letter of credit .
Legal issues
The term letter of credit is misleading, because credit is by no means made available to the instructing person. According to the Reichsgericht (RG), the letter of credit is a special form of instruction for payment and not for crediting. According to this judgment, the letter of credit and the travelers check are related to the letter of credit . The Instructional needs at the bank the payee made available sum of money before issuing the letter of credit deposit , which then hands over to him the letter of credit. If he wishes to be paid out from the letter of credit, he must present it to the banks. The letter of credit is therefore classified as a commercial obligation under Section 363 HGB . In accordance with the economic purpose, it does not initially have an order clause and is in the name of the payee, i.e. it is registered paper . Letters of credit are considered money surrogates , so they can be used as a means of payment , but are not subject to any obligation to accept from third parties.
The letter of credit is recognized as a letter of credit in its form as a commercial letter of credit according to Art. 9a UCP 600 and is defined in Art. 10b II UCP 600 as a freely negotiable letter of credit. The difference between the commercial letter of credit and the letter of credit lies in their legal basis. While trade letter of credit is to be regarded as a commercial certificate of obligation, it is the letter of credit to an agency agreement ( § 675 BGB ). The commercial letter of credit is - with an existing order clause - freely transferable by endorsement , the letter of credit is only transferable once.
International
In Switzerland , Article 407, Paragraph 1 of the Swiss Code of Obligations contains a legal definition for letters of credit , according to which an addressee instructs the addressee “with or without specifying a maximum amount to pay out the requested amounts to a specific person”. This also stipulates that the letter of credit is to be assessed in accordance with the Swiss regulations on the order and the instruction.
The main country in which the letter of credit is used today is the USA , where the “Commercial letter of Credit” is simply abbreviated to “CLC” or “C / L”. The CLC is regulated in detail in the Uniform Commercial Code (UCC) in §§ 5-102 ff. UCC and is used in foreign trade like a letter of credit for export or import . According to the legal definition there in § 5-102 (10) UCC, the CLC is an "obligation that fulfills the requirements of § 5-104 UCC by an exhibitor who, upon request, for the account of the applicant on the basis of the presentation of documents honors the payment of money or the delivery of values ”. After that, the CLC is a document with which the issuing bank authorizes the beneficiary to draw bill of exchange drafts accompanied by documents to the issuing bank and is obliged to redeem them to any bona fide purchaser (“bona fide clause”). As such, it is also used by the German trading partners of American companies in international payment and credit transactions as a trade securing transaction .
See also
- Hawala (informal referral system developed in the early Middle Ages)
Individual evidence
- ↑ Alexander Cartellieri, Philip II. August, King of France , Volumes 2-3, 1906, p. 317
- ^ French "Ordonnance de Louis XIV. Sur le commerce des négocians et merchands"
- ^ Jacques Savary, Code Savary , 1673, p. 114
- ^ Johann Friedrich Unger , Yearbooks of the Prussian Monarchy under the Government of Friedrich Wilhelm the Third , 1800, p. 518
- ↑ Justus Cobet, Heinrich Schliemann: Archaeologist and Adventurer , 1997, p. 39
- ↑ Georg Obst , Das Bankgeschäft , Volume 1, 1923, p. 200
- ↑ RGZ 64, 109
- ^ Hermann Hämmerle, Commercial Law: systematically presented , 1960, p. 1130
- ↑ Siegfried G. Häberle (Ed.), Handbook of letters of credit, collections, export documents and bank guarantees , 2000, p. 87
- ↑ Wolfgang Grill / Ludwig Gramlich / Roland Eller (eds.), Gabler Bank-Lexikon: Bank, Börse, Zusammenarbeit , 1996, p. 360