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UCP 600 (Uniform Customs and Practice for Documentary Credits)
The ICC rules in force since 2007 that govern almost every letter of credit worldwide. They set the banks’ examination period (five banking days after presentation), the standard for compliant documents, the ±10 % tolerance implied by the word “about”, a ±5 % quantity tolerance for bulk goods, and the presentation period (no later than 21 days after shipment unless stated otherwise). The eUCP supplement covers electronic presentation.
Usance (deferred-payment) letter of credit
A letter of credit under which payment falls due at a set time after complying presentation – for example 90 or 180 days after the bill of lading date. It finances the buyer, who can process and sell the goods before paying, while the seller can obtain cash early by having the bank discount the accepted claim (forfaiting). The interest for the usance period and the discount cost should be built into the price.