Training

At the end of this training course, participants will be able to:

• Understand the general principles of the Documentary Credit,
• Manage the full life cycle of a documentary credit: from its preparation to payment,
• Suggest appropriate plans of action to reduce:
  • Days sales outstanding (DSO),
  • Financial costs,
  • Risks.
• Understand the financial impact of documentary credits on the company
• Understand the constraints of both exporter and importer

Topics covered:

• Introduction: Definition, Background, Issues
• Setting up: Bank scheme, Opening, Notification
• Receipt of the documentary credit: Terms and conditions
• Study of the terms: Exam
• Pre-issuance / Post-issuance procedure
• Types of documentary credits: transferable / back to back / red clause
• Availability options: notion of financing (forfaiting, …)
• Issuance and document review
• Notion of risk: Confirmation, Del credere, discrepancies
• RUU 600: New regulations
• Financial costs: calculation methods
• Evaluation test: Case studies, Multiple choice (with corrections)
• Conclusion: overview of a Standby Letter of Credit

Case studies and numerous examples will be used to illustrate the whole session …

Corporate managers or employees in charge of administrative, financial and trade operations at the international level.

The training objectives are:

• Providing the participants with the necessary skills to understand and manage:
• The security for the buyer and the consequences for the seller
• The difference between the different methods (sureties, guarantee, SBLCs)
• Operational management of sureties and guarantees: drafting of acts, issuance, extent of commitments, mechanisms for the release of commitments.
• Risks of bad faith calls and relative insurance
• Guarantee specific features on certain geographical areas.

• General information on sureties and guarantees – Legal aspects
  Definition of a guarantee – Background – Difference between a surety and an independent guarantee – The relationship between payment protection techniques and guarantees
•  From the call for tenders to the end of the contractual obligations
• Main sureties and guarantees over the course of the contract – Comments on sureties and guarantees.
• The extent of commitments – Documentary guarantees – How they differ from first demand guarantees, such as RUGB 458
• SBLC guarantee mechanism – Pros and cons for all parties
• Negotiation of sureties and guarantees
• Essential points to negotiate – Hidden difficulties in guarantees – The relationship between guarantees and payment protection (e.g. documentary credit)
• Practicalities of guarantees: Purpose of guarantees, validity, total amount, applicable laws – Impact on the exporter – Guarantee issuance methods: direct and indirect guarantees – Relationship between the exporter and the counter-guarantor bank, the local bank and the beneficiary – Drafting of acts – Common clauses and specific clauses.
• Claiming guarantees
• Conditions and principles for claiming guarantee – Conflict of interests – The role of the bank – Appeal a priori and a posteriori

Corporate managers or employees in charge of administrative, financial and trade operations at the international level.