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From: Paul S. <zi...@su...> - 2002-02-01 10:40:14
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Please do not mix the terms: "nota de credito" translates to "credit note" and is actually an "I owe you" "Letter of Credit" which is the payment term L/C, normally used with the additions of "confirmed" and "irrevocable". Letter of Credits are used mainly in foreign trade when the seller wants to be sure to obtain the payment for the goods or services delivered. A synonym for L/C is rembourse. When the payment term L/C is used as payment term the proceedings are basicly the following: - The buyer approaches his bank - the bank grants a credit to the buyer and informs the bank of the seller that such a credit has been granted (confirmed meaning informing the seller's bank and irrevocable meaning basicly that the buyer cannot cancel the transaction or credit) - the seller's bank informs the seller that a L/C has been opened - the seller presents proof that the terms of sales have been met (usually by handing over shipping documents and change of title documents, i.e ownership docs) - seller's bank once satisfied that tems of sale have been met releases the money to the seller - seller's bank sends shipping and ownership documents to buyer's bank - buyer's bank hands over documents to buyer As noticed from above L/Cs are banking instruments, pretty complicated and thus expensive. Paul |