Factors Contributing To The Use Of Commericial Letter (S) Of Credit On International Business Transaction(S): A Case Of Manufacturing Industries In Kenya
The use of letters of credit has become a very important aspect of international trade due to the nature of international dealings including factors such as distance, differing laws in each country and difficulty in knowing each party personally. The LC therefore helps both the importers and exporters in the sense that the importer will be waved the liability of incurring bad debts and on the other hand the exporter is saved the fear of losing his money when dealing with the importer directly. It is therefore a hedging and also the most sophisticated payment. This study attempted to establish factors contributing to the use of Letter of credit in international business aspiring to address the objectives which touches on the impact of exporter/importer standing bank credibility and its association to using the LC, explore the extend on the bank inefficiencies and the central bank policies contributing to the LC ,how the bank financing to the company contributes to the application of the LC method and finally ascertain which risks and challenges are a major concern to pushing the use of LC. The study targeted forty Companies from the manufacturing sector in Kenya considering industries on areas of Plastics and Rubber, Chemicals and Allied, Building, Mining and Construction, Food and Beverages and Pharmaceuticals and Medical Equipment’s considered to be using LC for its payments. Simple random sampling technique was used in this study to enable equal chances of all the targeted companies being selected. The study also used respondents with expertise in this area of study to answer questions being financial controllers, procurement or logistics manager and directors. The primary data was collected using structured interviews and questionnaires which were then analyzed using statistics, Graphs and pie charts. Summary of the findings was discussed and recommendations made.
The Limits of Liability, Keeping the Floodgates Shut
Preliminary Observations W.V.H. Rogers, et al. Limitation and Mitigation in German Tort Law C. v. Bar. Direct and General Limits on Tort Damages in the United States D.B. Dobbs. European Tort Law: Hellenic National Report K.D. Kerameus, Kl. Roussos. Mitigation of Damages under Austrian Law and Ideas for Future Regulations H. Koziol. La moderation de la reparation du dommage dans le droit belge de la responsabilite civile extra-contractuelle A. van Oevelen. Keeping the Floodgates Shut: "Mitigation" and "Limitation" of Tort Liability in the English Common Law W.V.H. Rogers. How to Keep Liability Within Reasonable Limits? A Brief Outline of Dutch Law J. Spier. Moderation et limitation des responsabilites et des indemnisations: Rapport sur le droit francais G. Viney. Determination et reduction de la reparation en droit suisse P. Widmer.
Negotiation in Letter of Credit Practice and Law: The Evolution of the Doctrine
ABSTRACT The concept of negotiation in letter of credit practice and law has evolved from being an appendage of the law of negotiable instruments to an independent discipline that often alters basic assumptions of negotiable instruments law. From playing a central role in the letter of credit process, the draft or bill of exchange has become incidental and atrophied. Indeed, with respect to banks nominated in the letter of credit to "negotiate," negotiation can occur without there being a draft or bill of exchange. Nonetheless, negotiation, as used in letters of credit, is an important aspect of letter of credit practice, enabling it to serve as a means of trade facilitation and finance. The latest revision of the Uniform Customs and Practice for Documentary Credits, UCP600, reflects the currency of this concept in its attempts to define "negotiation" and to clarify its role in letter of credit practice. This paper surveys and compares the concept of negotiation in both fields. It summarizes the law of negotiable instruments (Part I), studying, analyzing, and comparing negotiation in letter of credit practice (Part II). It then considers important issues that arise in the negotiation of LCs, such as the requirement of a draft, formalities, recourse, and letter of credit fraud (Part III), and ends by suggesting an approach to the definition of "negotiation" in letter of credit practice and law (Part IV). It suggests that negotiation - whether by a bank that undertakes to do so in its letter of credit undertaking or by a bank nominated to do so without having made such an undertaking - gives rise to a basis of liability that is separate and preemptive from, if sometimes parallel to, that which arises on negotiable instrument that may be involved. Although the letter of credit concept of negotiation readily borrows from the law of negotiable instruments with respect to protection of the right to a protected status, important differences arise based on the nature of the letter of credit undertaking. Where there is a letter of credit undertaking to negotiate, negotiation is the means by which the bank honors its letter of credit obligation to the beneficiary, taking up the documents presented and any draft, and discounting the amount due to present value in the event of a time obligation without any right to seek recourse against the beneficiary. Where there is no undertaking, a bank that negotiates pursuant to a nomination is the transferee of the right to the proceeds of the letter of credit. I. SURVEY OF NEGOTIATION OF DRAFTS IN THE LAW OF NEGOTIABLE INSTRUMENTS' Negotiation in the law of negotiable instruments is a special transfer of intangible rights in a negotiable instrument, which entitles the transferee to claim under the instrument as if it were payable directly to it, transfer it in a similar manner to others, and claim under appropriate circumstances that it takes free of certain defenses that could have been raised against the drawer or prior transferees.2 While there are differences as to how one becomes entitled to exercise these rights, these differences have little practical significance in discussing negotiability in connection with letters of credit, and the common law and civil law identify this person as a "holder."3 Negotiation in the law of negotiable instruments has certain formal prerequisites. Not just any promise or order to pay can be negotiated. To be negotiated, it must be in the form of a negotiable instrument-it must meet certain formal requirements, which include being unconditional.4 Because the concept of negotiation necessarily involves the use of abstract terminology drawn from the major legal regimes, it is easier to explain how negotiation occurs than what it is. Negotiation of a negotiable instrument always entails the delivery of the instrument to an entity who becomes a holder. Where the instrument is issued in bearer form or indorsed in blank or to bearer, only delivery is required to effect a negotiation. …