Document background
The Irrevocable Transferable LC is a crucial document in international trade finance, particularly when intermediate parties are involved in the supply chain. This specialized form of Letter of Credit, governed by United States law and international banking practices, combines the security of an irrevocable payment commitment with the flexibility of transferability. It is commonly used when a middleman or trading house is involved between the ultimate supplier and the end buyer. The irrevocable nature means that once issued, the terms cannot be modified or canceled without agreement from all parties, while the transferable feature allows the first beneficiary to transfer their rights to a second beneficiary, typically a supplier. This document includes detailed specifications about transfer mechanisms, required documentation, payment terms, and compliance requirements, making it essential for complex international trade transactions involving multiple parties.
