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Lc Without Recourse for Australia

Lc Without Recourse Template for Australia

A Letter of Credit Without Recourse is a specialized financial instrument governed by Australian law that provides a secure method of payment in international trade transactions. This document represents an irrevocable undertaking by a bank to pay the beneficiary (seller) a specified amount against the presentation of compliant documents, with the unique feature that the bank cannot seek reimbursement from the beneficiary if the applicant (buyer) defaults. The document incorporates Australian banking regulations and international trade practices, particularly UCP 600, while providing enhanced protection for sellers in cross-border transactions.

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Lc Without Recourse

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What is a Lc Without Recourse?

The Letter of Credit (LC) Without Recourse is a critical financial instrument used in international trade transactions under Australian jurisdiction. This document type is particularly valuable when sellers require maximum payment security while ensuring they cannot be held liable for buyer default after receiving payment. The LC Without Recourse explicitly states that once the issuing bank has paid the beneficiary against compliant documents, it cannot seek reimbursement from the beneficiary even if the applicant fails to reimburse the bank. This instrument is commonly used in high-value international transactions, especially in commodity trading, manufacturing exports, and situations where sellers have strong negotiating positions. The document must comply with Australian banking regulations, international trade practices, and the globally recognized UCP 600 rules, while specifically addressing the unique aspects of Australian trade finance requirements and legal framework.

What sections should be included in a Lc Without Recourse?

1. Letter Date and Reference Number: Opening with date and unique LC reference number

2. Issuing Bank Details: Full details of the issuing bank including address and contact information

3. Beneficiary Details: Complete name and address of the beneficiary

4. Applicant Details: Complete name and address of the applicant (buyer)

5. Credit Amount and Currency: Specification of the LC amount and currency

6. Type and Nature of Credit: Clearly stating it's an irrevocable LC without recourse

7. Availability and Expiry: How and where the credit is available, and expiry date

8. Shipment Terms: Latest shipment date and shipment details

9. Document Requirements: List of required documents for presentation

10. Payment Terms: Specific conditions and timing of payment

11. Special Conditions: Any additional terms or conditions specific to this LC

12. Governing Law Statement: Confirmation that Australian law governs the LC

13. Bank Authorization: Authorized signatures and bank stamps

What sections are optional to include in a Lc Without Recourse?

1. Transferability Clause: Include when the LC needs to be transferable to another beneficiary

2. Revolving Terms: Include for revolving LCs specifying reinstatement conditions

3. Red Clause Provisions: Include when advance payment provisions are required

4. Back-to-Back Provisions: Include when the LC is part of a back-to-back arrangement

5. Partial Shipment Terms: Include when partial shipments are allowed or prohibited

6. Transhipment Terms: Include when specific transhipment conditions apply

What schedules should be included in a Lc Without Recourse?

1. Document Checklist: Detailed list of required documents with specific format requirements

2. Commercial Invoice Requirements: Specific requirements for commercial invoice presentation

3. Transport Document Requirements: Detailed specifications for bills of lading or other transport documents

4. Insurance Document Requirements: Specifications for insurance documentation if required

5. Bank Code Authentication: Authentication codes and verification procedures

6. Fee Schedule: Breakdown of all applicable bank charges and fees

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Australia

Publisher

Ƶ

Document Type

Letter of Credit

Sector

Cost

Free to use
Relevant legal definitions











































Clauses






























Relevant Industries

Banking and Financial Services

International Trade

Manufacturing

Commodities Trading

Agriculture and Food

Mining and Resources

Retail and Consumer Goods

Energy and Utilities

Automotive

Textiles and Apparel

Electronics and Technology

Chemical and Pharmaceuticals

Relevant Teams

Trade Finance

International Banking

Risk Management

Legal

Compliance

Treasury

Global Operations

Documentary Credits

Trade Operations

Credit Administration

International Sales

Finance

Relevant Roles

Trade Finance Manager

International Business Director

Export Finance Specialist

Documentary Credits Officer

Treasury Manager

Global Trade Operations Manager

Risk Management Officer

Trade Services Manager

International Sales Director

Compliance Officer

Credit Risk Manager

Banking Operations Manager

Chief Financial Officer

Import/Export Coordinator

Trade Documentation Specialist

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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