THIS QUESTION IS REGARDING INTERNATIONAL METHODS OF PAYMENT

4- Complete the TELEX FORMAT DOCUMENTARY CREDIT knowing that you are familiarized with the DC Application Form and Data fields of a SWIFT Format Documentary Credit.

It will be necessary to read the telex and to fill the following Documentary credit.

CASE DETAILS:

Expert Telecom LTD, 27 Communication Way, Dublin, Ireland, have agreed a contract valued at USD 230.000 with Mobil TEC CO. Central AVE, Tripoli City, Libya to be settled by irrevocable Documentary credit issued by Libyan first Bank.

Expert Telecom LTD has requested that the credit be advised through Export Trade Ban Dublin.

Payment is to be made to Expert Telecom LTD in Dublin 180 days after the shipment date but Expert Telecom LTD require a Bank acceptance of bills of exchange immediately y after presentation of the shipping documents to the Bank Dublin.

Expert Trade Bank has been requested to add their confirmation to the documentary Credit.

The goods to be shipped before 10 July 2009

The Goods are to be insured a per INCOTERMS 2000

The goods must be shipped from Dublin Port to Tripoli Port

Transhipment is allowed

Part Shipment is not allowed as all the good must arrive together

Pre-shipment inspection of the goods is required.

TO: (1)..................

WE: (2)..................... ISSUED OUR (3).................... DOCUMENTARY CREDIT NUMBER (4)..................

AT THE REQUEST AND FOR ACCOUNT OF THE APPLICANT (5)............................ IN FAVOUR OF (6)................................

AMOUNT: USD 230,000.00 (TWO HUNDRED AND THIRTY THOUSAND DOLLARS ONLY).

EXPIRY DATE: (7)............................ EXPIRY PLACE: (8).......................

AVAILABLE BY: (9)....................... OF DRAFTS DRAWN AT (10)....................... ON EXPORT TRADE BANK DUBLIN ACCOMPANIED BY DOCUMENTS AS SPECIFIED BELOW.

COVERING: Telecom equipment mobile accessories HS XXXXXX; AS PER

PROFORMA INVOICE NO 0001/ARB/022 Dated 12 January 2009)

CIF TRIPOLI PORT (INCOTERMS 2000)

DOCUMENTS:

* SIGNED INVOICES IN DUPLICATE

* INSURANCE CERTIFICATE SHOWING MINIMUM COVER OF (11)...................... OF THE CIF VALUE AS STATED ON THE INVOICE COVERING ALL RISKS, WAREHOUSE TO WAREHOUSE.

* QUALITY INSPECTION CERTIFICATE ISSUED BY (12).................,AND DATED BEFORE ACTUAL DISPATCH DATE CONFIRMING THAT GOODS CONFIRM TO ISO 0991/1 AND THAT QUANTITY DISPATCHED CONFIRMS TO ORDER.

* MARINE BILL OF LADING MARKED FREIGHT (13)..................

LATEST SHIPMENT DATE: (14).......................

SHIPMENT FROM (15).................... SHIPMENT TO: (16).......................

PART SHIPMENT: (17).................... TRANSSHIPMENT: (18).....................

DOCUMENTS TO BE PRESENTED WITHIN 21 DAYS OF THE DISPATCH DATE

PLEASE ADD YOUR (19).........................TO THIS DOCUMENTARY CREDIT.

ALL CHARGES OUTSIDE TRIPOLI ARE FOR ACCOUNT OF THE BENEFICIARY. IN REIMBURSEMENT OF DRAWINGS COMPLYING WITH THE TERMS AND CONDITIONS OF THIS DOCUMENTARY CREDIT, PLEASE CLAIM ON OUR US DOLLAR ACCOUNT WITH TRADE BANKERS BANK NEW YORK, AT MATURITY.

THIS DOCUMENTARY CREDIT IS ISSUED SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS PUBLICATION NO (20)................. OF THE INTERNATIONAL CHAMBER OF COMMERCE, PARIS, FRANCE.

5- The company GUEYE, Producer of groundnuts, based in DAKAR- SENEGAL arrives to an agreement with the Company HERMANOS GARCIA of SANTIAGO DE CHILE- CHILE

The order is 2 x 40 and will be discharged at Santiago de Chile Port. The payment is letter of credit at sight in CFR

Make a model of letter of credit taking into account the following aspects:

Issuing bank ( one of your choice)

Confirming bank ( one of your choice)

Insurance

CFR transport

BL

Deadline for shipping and presentation of documents

Also make a model of:

Certificate of origin

Certificate of analyse

Certificate of weight

Certificate of the beneficiary

What is the advantage of this payment? And which are the disadvantages?

Which steps you will do before shipment?

In case of not complying with the conditions of the Letter of Credit, what would happen?