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ITS-03-FIT-003 Documentary Credits Fundamentals
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To understand how a documentary credit works and the obligations of the parties involved. Detailed Topic Listing as follows:
LU FIT 003 Documentary
Credits Fundamentals
1 - THE DOCUMENTARY CREDIT
1.1 Why Letters of Credit are
Used
1.2 Guarantees for the Importer
and the Exporter
1.3 Documentary Credit Rules
1.4 Example of SWIFT
1.5 The Parties to a Documentary
Credit
1.6 Documentary Credit Cycle
1.7 Comment on Documentary
Credits
1.8 Graphical Summary
1.9 Documentary Credit and the
Importer
1.10 Documentary Credit and the
Exporter
1.11 Suggestions for the Exporter
1.12 Opinion
2. OPENING A LETTER OF CREDIT
2.1 Opening a Letter of Credit
2.2 Letter of Credit and Contract
of Sale
2.3 Banks and the Goods
2.4 Non-Compliance with the Terms
of the Contract
2.5 Bank Charges
3. CONTENTS OF DOCUMENTARY CREDIT
3.1 Unconfirmed Irrevocable
Letter of Credit
3.2 Tolerance
3.3 Partial Shipments
3.4 Transhipment
3.5 Type of Letter of Credit
3.6 Form of Advice of a Letter of
Credit
3.7 Date and Place of Expiry
3.8 Date of Issue of the Credit
3.9 Description of the Goods
3.10 Advice and Confirmation of
the Letter of Credit
3.11 Amendments
3.12 Details on Transport
4. IMPORT LETTERS OF CREDIT
4.1 Items to check with the
importer
4.2 Completing Documentary Credit
(DC) Application Form
4.3 Internal Records
5. TRANSMISSION OF DOCUMENTARY CREDIT
5.1 Charges for Documentary
Credits
Further Reading
1 - Sample LC Application form
2 - Dissertation on Using UCP600
3 - Sample SWIFT Template for LC
4 - Summary Guide to the UCP600
Rules
5 - The Power of Argument
6 - The Role of Documentary
Credits in the International Sales Contract
Forum Assignment
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eBSI Export Academy
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ITS-03-FIT-004 - Management of Documentary Credits
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The main objective of this Learning Unit is to learn about the managing the various documentary credit options available.Detailed Topic Listing as follows:
LU FIT 004 Management
of Documentary Credits
1. AVAILABILITY OF
LETTER OF CREDIT
1.1 Letter of Credit available by
Acceptance
1.2 Letter of Credit available by
Negotiation
2. DOCUMENTS IN A
LETTER OF CREDIT
2.1 Documents for Presentation
2.2 Comment on UCP
2.3 Which Documents to Request?
2.4 Copies or Originals?
2.5 Other Documents and their
Contents
2.6 Discrepancies
2.7 Action if Documents have
Discrepancies
2.7.1 Summary
of Action if Documents are Discrepant
2.8 "Clean" Transport
Document
2.9 On Board Bill of Lading
2.10 Sea Waybill
2.11 Insurance Documents
2.11.1 Date of
Issue of Insurance Documents
2.12 CMR Convention
2.13 Air Waybill
2.14 Example
3. CHECKLISTS FOR
DOCUMENTS IN AN L/C
4. TYPES OF LETTER
OF CREDIT (I)
4.1 Revocable Letter of Credit
4.2 Transferable Letter of Credit
4.3 Back-to-Back Letter of Credit
4.4 Standby Letter of Credit
4.5 Revolving Letter of Credit
4.6 Red and Green Clause Letters
of Credit
4.7 Latest Developments in
Letters of Credit
5. TYPES OF LETTER
OF CREDIT (II)
5.1 Irrevocable Letter of Credit
5.2 Confirmed Irrevocable Letter
of Credit
5.3 Unconfirmed Irrevocable
Letter of Credit
5.4 Summary - Types of
Documentary Credit
Further Reading
1 - Impact of the Doctrine of
Strict Compliance on a Letter of Credit Transaction
2 - A Critical Commentary on the
UCP 600 Rules
3 - Standby Letters of Credit and
the Independence Principle
4 - Effective Notice of Refusal
in Letter of Credit Transactions
5 - Negotiation in LC Practice
and Law
6 - Standby Letter of Credit
Rules and Practices Misunderstood or Little Understood by Applicants and Beneficiaries
Forum Assignment
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eBSI Export Academy
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ITS-03-FIT-005 - Bonds & Guarantees
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The main objective of this Learning Unit is to learn about different types of bonds and guarantees and how they operate. Detailed Topic Listing as follows:
LU_FIT_005 Bonds and Guarantees
1. INTRODUCTION
1.1 Issuers of Guarantees
1.2 Categories of Bonds or
Guarantees
2. Tender Bond
2.1 Exporters and Tender Bonds
3. PERFORMANCE BOND
3.1 Purpose of Performance Bond
or Guarantee
3.2 Exporters and Performance
Guarantees
3.3 Performance Guarantees and
Documentary Credits
3.4 Amount of the Performance
Guarantee
4. ADVANCE/
PROGRESS PAYMENT BOND
4.1 Purpose of Advance/Progress
Payment Bond or Guarantee
4.2 Advance Payment Guarantees
and Documentary Credits
4.3 Amount of the
Advance/Progress Payment Guarantee
5. RETENTION BOND
5.1 Other Types of Guarantees
6. ON DEMAND BOND
6.1 Rules Governing Demand
Guarantees - Key Points
7. CONDITIONAL BOND
7.1 Advantages of Conditional
Bonds or Guarantees
8. MANAGING BONDS
AND GUARANTEES
8.1 Bank Obligations to the
Beneficiary
8.2 Payment Guarantee
8.3 Importance of Correct Wording
in Bonds or Guarantees
8.4 Bonds or Guarantees Customer
Liability Records
8.5 Procedure for Obtaining
Release from Liability
8.6 ICC Rules for the Issuance of
Bonds and Guarantees
8.7 Bank Charges and Fees in
Respect of Bonds and Guarantees
8.8 Standby Letter of Credit
8.9 Managing Bonds and Guarantees
Further Reading
1 - UN Convention on Independent
Guarantees and Stand-By Letters of Credit
2 - The Role and Importance of
Bank Demand Guarantees in International Trade
3 - Fraud and the UN Convention
on Independent Guarantees and Stand-By Letters of Credit
4 - Understanding the URDG
5 - Selective Legal Aspects of
Bank Demand Guarantees
6 - No Guarantees No Trade: How
Banks Affect Export Patterns
Forum Assignment
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eBSI Export Academy
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ITS-03-FIT-006 - Short and Medium Term Finance
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Understand the differences between the various short and medium term finance options used in international trade. Detailed Topic Listing as follows:
LU FIT 006 Short and
Medium Term Finance
1. INTRODUCTION
1.1 Overtrading and Liquidity
1.2 Short Term Finance
1.3 Working Capital Management
1.4 Cash Conversion Cycle (CCC)
2. MANAGEMENT OF
RECEIVABLES
2.1 Trade Receivables Policy
3. INVOICE
DISCOUNTING
3.1 Invoice Discounting - how it
works
4. FACTORING
4.1 Benefits of Factoring
4.2 Obstacles to Growth of
Factoring
4.3 Import and Export Factor
4.4 Comparison between Factoring
and Invoice Discounting
4.5 Comparison between Factoring
and Forfaiting
4.6 Comparison between Forfaiting
and Factoring
5. BILL DISCOUNTING
5.1 Bill of Exchange Discounting
- how it works
6. FORFAITING
6.1 Definition of Forfaiting
6.2 Endorsements
6.3 Aval as a Form of Guarantee
6.4 Application of Forfaiting
6.5 Primary and Secondary
Forfaiting Markets
6.6 Forfaiting and Benefits for
Exporter
6.7 Advantages of Forfaiting
6.8 Cost of Credit
6.9 The Rate of Discount
6.10 Forfaiting Example
Further Reading
1 - Guide to Invoice Finance
2 - SME Exporters Guide to
Forfaiting
3 - Invoice Discounting -
Factoring in the Change
4 - Getting through the Cash Flow
Pinch
5 - Financing SMEs with
Forfaiting in the New Entrepreneurial Environment
Forum Assignment
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eBSI Export Academy
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ITS-03-FIT-007 Factoring Fundamentals
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The main objective of this Learning Unit is to understand how Factoring operates. Detailed Topic Listing as follows:
LU FIT 007 Factoring Fundamentals
1. INTRODUCTION TO
FACTORING
1.1 The Factoring Division
1.2 Factoring or Invoice Purchase
Procedures
1.3 Initial Procedures
1.4 Mechanics of Processing a Client
Order
2. THE FACTORING
AGREEMENT
2.1 The Factor's Discretion
2.2 Fees
2.3 Termination
2.4 Personal Guarantee
3. The Contract
3.1 The Contract - Warranties
3.2 Purchase All Acceptable
Accounts by Factor
3.3 Prior Approval of Sales
3.4 Notice of Assigned Invoices
to appear on all Invoices
3.5 Purchase Price and Margin
3.6 Authorization to the Factor
for Charges and Obligations
3.7 Procedures for approved
account invoices
3.8 Reserve of Facial amounts of
invoices over finance provided
3.9 Receipt of Goods without
Dispute
3.10 Credit Terms
3.11 Solvency and law provisions
Further Reading
1 - UNDROIT Convention on
International Factoring
2 - Factoring - A Tool for Trade
Financing
3 - Introduction to International
Factoring and Project Finance
4 - Freight Factoring
5 - Factoring : A Better
Alternative
6 - Factoring and the Firm Value
Forum Assignment
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eBSI Export Academy
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ITS-03-FIT-008 - Export Credit Agency Finance
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You will become familiar with the roll of the Export Credit Agency, ECA, Supplier Credits, Buyer Credits and gain an understanding of the concept of Warehouse Financing. Detailed Topic Listing as follows:
LU FIT 008. ECA and
Warehouse Finance
1. ECA BASED
FINANCING
1.1 Medium to Long Term Financing
1.2 Market Characteristics
1.3 Long-Term Financing Needs
1.4 Participants in the Market
1.5 Export Credit Agencies
1.6 Export Credit Agencies -
Protections
2. SUPPLIER CREDITS
2.1 Supplier Credits (continued)
2.2 Mechanics of the Supplier
Credit
2.3 Advantages of Supplier Credit
2.4 Disadvantages of Supplier
Credit
2.5 Players and Relationships in
Supplier Credit
2.6 Commitment, Draw-down, and
Payback in Supplier Credit
3. BUYER CREDITS
3.1 Mechanics of the Buyer Credit
3.2 Advantages and Disadvantages
of Buyer Credit
3.3 Players and Relationships in
the Buyer Credit
3.4 Commitment, Draw-down, and
Payback in a Buyer Credit
3.5 Buyer Credit (Refinancing)
3.6 Comparison: Supplier and
Buyer Credits
3.7 Bank Earnings and Fees
3.8 OECD Consensus or Arrangement
3.9 Benefits to Banks
3.10 Export Credit Insurance and
the Berne Union
3.11 Benefits of Export Credit
Insurance
3.12 Examples of Main ECA
Providers and their Mission Statements
4. WAREHOUSE
FINANCE
Further Reading
1 - OECD Consensus - Arrangement
on Officially Supported Export Credits
2 - Disciplining Trade Finance -
the OECD Export Credit Arrangement
3 - Export Credit Guarantees,
Moral Hazard and Exports Quality
4 - Testing the Trade Credit and
Trade Link:
Evidence from Data on Export
Credit Insurance
5 - Public Export Guarantees and
Foreign Trade Structure
Forum Assignment
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eBSI Export Academy
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ITS-03-FIT-009 - Structured Commodity Trade Finance
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The main objective of this Learning Unit is to understand the functioning of Letters of Indemnity (LOI) and fundamentals of Asset Based Lending. Detailed Topic Listing as follows:
LU FIT 009 Commodity
Trade Finance
1 STRUCTURED TRADE
FINANCE
2 COMMODITY TRADE
FINANCE
2.1 Commodities and Trade
2.2 What Commodities can be financed?
2.3 Commodity Trade Finance - The
Players
2.4 Commodity Finance and Risk/Mitigation
3. LETTERS OF
INDEMNITY
3.1 Letters of Indemnity
3.2 Letters of Indemnity - Other
Purposes
3.3 Working with LOIs in favor of
the Carrier
3.4 Things to consider when
working with LOIs
4. COLLATERAL
CONTROL FOR TRADE FINANCE
4.1 Collateral Control for Trade
Financing Techniques
4.1.1
Repayment Seniority
4.1.2
Collateral Protection
4.2 Unsecured vs. Secured Lending
4.3 Establishing Collateral
Values
4.3.1
Establishing Net Realizable Value ("NRV")
4.4 Accounts Receivable
4.5 A Correct Receivable
4.6 Inventory
4.7 Inventory Insurance
4.8 Advance Rates
4.8.1 Advance
Rates for Inventory
4.9 Collateral Control
4.10 The Bill of Lading
Further Reading
1 - The Economics of Commodity
Trading Firms
2 - Commodity Finance Market
Report 2014
3 - Trade Finance Developments
and Issues
4 - Commodities as Collateral
5 - Structured Financing
Techniques - Oil and Gas
6 - Commodity Finance Fraud
7 - Commodity Trade and
International Risk Sharing
Forum Assignment
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eBSI Export Academy
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ITS-03-FIT-010 - Trade Finance Fraud Prevention
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In this unit you will learn how to identify fraud schemes and how to prevent them from damaging your business. Detailed Topic Listing as follows:
LU FIT 010 Trade
Finance Fraud Identification and Prevention
1. Specifics of
International Trade Finance Fraud
1.1 Definition of Trade Finance
Fraud
2. Letters of
Credit and UCP 600
2.1 Article 7 Issuing Bank
Undertaking
2.2 Article 12 b. Nomination
2.3 Veracity of Documents
2.4 Acting in Good Faith
2.5 Entitlement to Reimbursement
2.6 Case History - Fake
Inspection Certificate Presented
3. Bonds &
Guarantees in International Trade
3.1 Definition of a
Bond/Guarantee
3.2 Reasons for Requiring a Guarantee
3.3 Issuers of Guarantees
3.4 Direct / Indirect Guarantees
3.5 Categories of Bonds or
Guarantees
3.5.1 Customer
Implications re. Issued Bonds and Guarantees
3.6 Banks Consideration when
Issuing a Demand Guarantee
3.7.1 Wording
in Bonds/Guarantees Issued by a Bank
3.8 The Guarantee and the
Contract
3.9 Standby Letter of Credit
3.10 Guarantees, Standby LCs
& Fraud - Example Scenarios
4. The Bank and Customer Relationship
5. Trade Finance Fraud Prevention
5.1 The Occurrence of Letter of
Credit Fraud
5.2 User of Trusted Third Parties
5.3 Highly Complex Transactions
to Cause Confusion
5.4 Authentication of Documents
5.5 Money Laundering
5.6 Overcoming inadequate AML
Legislation
5.7 The use of technology to
avoid trade finance fraud
6. LC Independence
Principle & Fraud Exception
Further Reading
1 - A Comparative Analysis of the
Standard of Fraud Required under the Fraud Rule in LC Law
2 - Preventing Letter of Credit
Fraud
3 - The Fraud Exception in LCs :
A Global Analysis
4 - Money Laundering and
Financial Crimes Caribbean
5 - Documentary Credits in
International Transactions with a special focus on the Fraud Rule
6 - International Trade Fraud
Online Forum Access
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eBSI Export Academy
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