Documents Required After an LC Is Open ~ The Complete Importer & Exporter Playbook

Documentary errors are the single biggest cause of delays and non-payment under Letters of Credit (LCs). This article explains every document banks will check, the exact fields they care about, real discrepancy examples, exporter/importer workflows, and a one-page checklist you can drop into your SOP. Follow this and you’ll avoid the usual weeks-long hold-ups.

Banks don’t finance goods they finance documents. Under UCP 600 and ISBP practice, banks examine documents strictly against the LC. A single mismatch a number, a date, or a name can make a bank refuse the entire set of documents. That’s lost time, higher cost, and frustrated relationships. Get your documents right first time.

Core documents: what they are, what banks check, and common pitfalls

1) Commercial Invoice 🧾

Purpose: Confirms sale, price and payment basis under the LC. Who issues: Seller / exporter. Banks look for: Invoice number & date; seller & buyer names/addresses matching LC; complete goods description (no vague words); quantity; unit price; total value; currency; Incoterm (if required); HS code (if requested); authorized signature/stamp. Common discrepancies: Invoice currency ≠ LC currency; invoice amount ≠ LC amount; ambiguous descriptions like “spare parts.” Quick fix: Reissue invoice or request an LC amendment.

2) Bill of Lading (B/L) 🚢 or Airway Bill (AWB) ✈️

Purpose: Proof of shipment; contract of carriage; negotiable B/L acts as title document. Who issues: Carrier / shipping line / airline. Banks look for: “Clean” B/L (no damage notation), consignee as per LC, shipment date within LC period, correct ports, freight terms matching LC (prepaid/collect). Originals if LC requires negotiable originals. Common discrepancies: Consignee name differs from LC; B/L dated outside the LC shipment window; “freight collect” when LC requires “prepaid.” Quick fix: Request corrected B/L immediately; if not possible, check whether LC allows alternative documents or amendments.

3) Packing List 📦

Purpose: Details package counts, weights, dimensions, marks & numbers to assist verification and customs. Who issues: Exporter / packer. Banks look for: Package count, net/gross weights, dimensions, marks & numbers, clear reference to invoice number. Common discrepancies: Totals not matching the invoice or B/L; missing package numbers. Quick fix: Issue corrected packing list and ensure consistent figures across documents.

4) Certificate of Origin (COO) 🌍

Purpose: Confirms country of manufacture — used for customs and preferential duty claims. Who issues: Chamber of Commerce or designated authority. Banks look for: Proper stamp/signature and correct exporter details. Common discrepancies: Wrong exporter name, missing stamp/signature, incorrect origin wording. Quick fix: Obtain a reissued COO from the authorized issuer.

5) Insurance Certificate / Policy 🛡️

Purpose: Protects against loss/damage during transit; often required to be assigned to buyer or bank. Who issues: Insurer or broker. Banks look for: Policy/certificate number; insured value (often 110% of invoice); currency; named beneficiary per LC; scope of coverage (All Risks vs named perils); period/dates. Common discrepancies: Insured amount too low; wrong beneficiary name; missing policy number. Quick fix: Amend insurance certificate/policy immediately.

6) Inspection / Quality Certificate 🔍

Purpose: Confirms goods meet contractual specs — common for chemicals, raw materials, machinery, food, etc. Who issues: Recognized inspection agency (e.g., SGS, Bureau Veritas) or agreed inspector. Banks look for: Inspector’s name, scope/criteria, results, stamp and signature, date. Common discrepancies: Inspector not on LC-approved list; missing signature; scope mismatch. Quick fix: Re-inspection by an acceptable agency or obtain acceptable documentation.

7) Other supporting documents 📑

Examples: export licenses, phytosanitary/health certificates, consular invoices, VAT/tax docs, beneficiary declarations, certificates required by import regulations or LC special clauses. Key rule: If the LC asks for it — it’s required. Banks will not accept substitutes unless the LC is amended.

Common discrepancy examples

📌 Invoice amount ≠ LC amount — Impact: Bank refuses documents → payment delayed. Fix: Reissue invoice / amend LC.

📌 B/L consignee ≠ LC consignee — Impact: Docs rejected. Fix: Corrected B/L / endorsed originals.

📌 Insurance too low — Impact: Bank rejects docs; exposure to claims. Fix: Amend policy; reissue certificate.

📌 Missing signature on certificate — Impact: Authenticity questioned. Fix: Obtain signed copy.

📌 Shipment date outside LC window — Impact: Non-compliant → payment refused. Fix: LC amendment / acceptable supporting evidence.

Documentary rules

• UCP 600 is the widely used ruleset for documentary credits; banks check documents, not goods.
• ISBP (International Standard Banking Practice) clarifies documentary requirements and common practices. Banks are rigid because they must protect themselves and the issuing bank — they cannot act on unstated facts. That’s why precise wording and matching fields matter.

Exporter — pre-shipment checklist

• Read the LC line-by-line; note required docs, latest shipment date, required wording, and acceptable inspection bodies.
• Prepare draft documents and run an internal pre-check against LC.
• Book carrier with correct consignee and freight terms per LC.
• Obtain insurance with beneficiary exactly as the LC states.
• Use a second person to review final docs before submission.

Exporter — post-shipment actions

• Cross-verify invoice, packing list, and B/L for exact matches.
• Submit documents to presenting/negotiating bank within LC presentation period.
• Keep scanned copies and originals well organized and backed up.

Importer — advising/checking the LC

• Ensure LC wording is operationally feasible (allowable docs, acceptable insurers/inspectors).
• Confirm acceptable shipment terms, B/L type, and beneficiary instructions.
• Factor in bank processing times and any amendment costs.

Exporter shipped a $250k consignment. Packing list showed 9 boxes; invoice and B/L showed 10. Bank refused documents. Outcome: Payment delayed 21 days. Exporter reissued corrected packing list; bank processed after re-presentation and minor amendment fees. Lesson: Package counts must be consistent across all documentary records. Small mismatches cause outsized delays.

FAQ — quick practical answers

Q: Are scanned copies acceptable? A: Depends on LC and bank. Electronic presentation is increasingly accepted, but originals are still commonly required for negotiable B/Ls. Confirm with the issuing bank.

Q: How strict are banks about typos? A: Very. Banks often reject documents for small typos unless the error is clearly immaterial. Don’t rely on leniency.

Q: LC is silent on a document — do I still need it? A: Only documents listed in the LC are required for bank payment. However, customs and buyers may still request additional documents—coordinate early.

LC Documentary Checklist (Quick Reference)

• Commercial Invoice: #, date, currency, unit price & total, clear goods description, Incoterm, HS codes (if required), seller & buyer names per LC, signature.
• Bill of Lading / AWB: Clean B/L, consignee per LC, shipment date within LC window, ports accurate, freight terms correct, originals if required.
• Packing List: Package counts, net/gross weights, dimensions, marks & numbers, matches invoice/B/L.
• Certificate of Origin: Issued by Chamber of Commerce if required; correct stamps/signature.
• Insurance: Policy/certificate #, coverage ≥110% invoice (if required), beneficiary per LC, correct risks.
• Inspection/QA: Inspector name, scope, stamp/signature, within LC-approved list.
• Others: Export license, phytosanitary, health certificates, consular docs — only if LC specifies.
• Final checks: All documents consistent, signed where required, submitted within the LC presentation period. Keep organized originals + scanned backup.

Documentary discipline turns LCs from a paperwork risk into a reliable payment mechanism. Build a simple internal SOP using the checklist above, use a doc buddy (second reviewer), and engage your bank early if something looks uncertain.