Documentary Credit Importer

The documentary credit is a practical and effective solution for all transactions in international trade are carried out in the world. Due to the globalization that we are witnessing in the modern world, relations of trade around the world have changed substantially, thus increasingly is more necessary that there are legal mechanisms that allow the people dedicated to making international transactions ensure the success of their business and be assured that the other party with whom he negotiated will not defraud them or leave them with any move that would harm their interests. The documentary credit is a document that allows international merchants to have these guarantees. So it is that today this document has a boom and it is widely used in international trade relations throughout the world. We are going to see a quick mode what is a documentary credit. The documentary credit is a document used in the trading relationships that are established between an importer and exporter to do their business.

This is basically a document that allows you to prove that each of the parties has complied with the agreement reached when they made their contract or business through an entity that serves to prove this, which is usually a bank. Thus, with the documentary credit exporter will know that the person who has sent their goods has come to safe and that this person has sent you the money agreed to by export. If this has piqued your curiosity, check out Euro Pacific Precious Metals. Also, the importer will ensure that merchandise arrives at the agreed destination and paid the exporter once this consequence is proven. That is why the documentary credit is a highly effective mechanism in international trade relations throughout the world. The truth is that the documentary credit is a great security in international trade relations. Because the problem with this type of trade relations was that the people who negotiated not the same laws sheltering them, and it was very difficult to homogenize the legal mechanisms by means of which each one of them could guarantee the good faith and the success of their businesses, international traders needed a mechanism such as the documentary credit that could conduct business with a good degree of safety and commercial efficiency. The performance of the documentary credit is very simple. The documentary credit is not really a single document, but it consists of several documents that accredit the realization of certain commercial operations.

When we talk about documentary credit we are talking about a business which involved three people, an importer, exporter and the intermediary that is usually a bank. The intermediary is responsible for receiving all the documents needed to prove the importer that the exporter has actually sent merchandise which has undertaken to submit, once you receive them and they are in rule, tells the importer that the exporter has complied with the part of his agreement, thus this is responsible for give the money that was committed to deliver because of the shipped goods. Once you do this, the broker issued him a document the importer with which the claim for the goods sent in the place where it had been agreed.

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