Document background
An Advised Letter of Credit is a crucial document in international trade finance, particularly within the Malaysian banking framework. It is used when a bank (the advising bank) in the beneficiary's country verifies the authenticity of a Letter of Credit issued by a foreign bank and advises it to the beneficiary. The document becomes necessary when parties engage in cross-border trade transactions where the beneficiary requires local bank verification of the credit's authenticity. Under Malaysian jurisdiction, these documents must comply with both domestic banking regulations and international banking practices, including the UCP 600. The advising bank's role is to confirm the apparent authenticity of the credit without taking on payment obligations, providing the beneficiary with confidence to proceed with the transaction.
