Dates of the Documents : Possible source of discrepancies and source of frustration

Understanding dates of the trade documents in letters of credit transactions?

Either you are an export specialist in a small manufacturing company, an import responsible in a medium size international trade firm or a trade finance expert in one of the first class banks, you should always be very careful with the dates of the documents as this subject is one of the main source of discrepancies for letters of credit transactions all around the world. This claim is also supported by enormous numbers of ICC Banking Committee Opinions issued repeatedly related to dates of the trade documents for the last 25 years. 
How to deal with dates of the documents when working with a letter of credit?

As a rule of thumb you should always follow the instructions indicated on the letter of credit text. Advising banks advice credits to their customers in a swift message format in most of the cases. Currently many banks issue letters of credit with a similar expression listed below :

"All documents including transport documents must be dated but not dated prior to the issuance date of this credit."

If the letter of credit you are dealing with contains a similar statement as indicated above, than you should put dates all the documents you are going to present. Just be careful not to be presenting a document dated prior to the lc issuance date. 

Note : Even if there is no such statement is indicated on your letter of credit text as mentioned above still you may choose to put dates to all documents that you are going to present to your bank to be on the safe side.

         Special suggestions from International Standard Banking Practice - ISBP 2007 :

  1. Drafts, transport documents and insurance documents must be dated even if a credit does not expressly so require.
  2. Documents must not indicate that they were issued after the date they are presented.
  3. Any document, including a certificate of analysis, inspection certificate and pre-shipment inspection certificate, may be dated after the date of shipment. However, if a credit requires a document evidencing a pre-shipment event (e.g., pre-shipment inspection certificate), the document must, either by its title or content, indicate that the event (e.g., inspection) took place prior to or on the date of shipment.
  4. A document indicating a date of preparation and a later date of signing is deemed to be issued on the date of signing.
  5. Dates may be expressed in different formats, e.g., the 12th of November 2007 could be expressed as 12 Nov 07, 12Nov07, 12.11.2007, 12.11.07, 2007.11.12, 11.12.07, 121107, etc. Provided that the date intended can be determined from the document or from other documents included in the presentation, any of these formats are acceptable. To avoid confusion it is recommended that the name of the month should be used instead of the number.

Explanations of most frequently used phrases signifying time on either side of a date or event

  1. “within 2 days after” indicates a period from the date of the event until 2 days after the event.
  2. “not later than 2 days after” does not indicate a period, only a latest date. If an advice must not be dated prior to a specific date, the credit must so state.
  3.  “at least 2 days before” indicates that something must take place not later than 2 days before an event. There is no limit as to how early it may take place.
  4. “within 2 days of” indicates a period 2 days prior to the event until 2 days after the event.
  5. The term “within” when used in connection with a date excludes that date in the calculation of the period.

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Why dates of the trade documents is a very important consept in letters of credit transactions? 

"All documents including transport documents must be dated but not dated prior to the issuance date of this credit."
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