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Trade Process Analysis Database (TPAD)
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Establish payment guarantee
Case Study
Title:
Jasmine Rice Exportation from Thailand to the United States, 2011
Corridors and Routes:
Not Specified
Trade Product:
Jasmine rice
Trade Type:
Export
Process Analysis:
Export from Thailand
Exporting Country:
Thailand
Importing Country:
United States of America
Category:
Goods payment arrangement
Country and Procedure Description:
Establish payment guarantee (Export from THA to USA/Jasmine rice)
Related Rules, Laws and Regulations:
Uniform Custom and Practice for Documentary Credit, International Chamber of Commerce Publication No. 500
Actors and Participants:
- Exporter or Representative
- Exporter‟s Bank (advising bank)
- Importer
- Importer‟s Bank (issuing bank)
Actors and Participants:
- Exporter or Representative
- Exporter‟s Bank (advising bank)
- Importer
- Importer‟s Bank (issuing bank)
Input Criteria to Enter or Begin the Business Process:
Exporter and importer have already concluded trade contract and terms.
Activities and Associated Documentary Requirements:
1. Importer applies for Letter of Credit by submitting Application for Irrevocable Documnetary Letter of Credit and Proforma Invoice to importer‟s bank. 2. Importer‟s bank reviews submitted documents and evaluates importer‟s credit standing. 3. If importer‟s credit is in good standing, importer‟s bank approves the application, issues Letter of Credit, and forward it to exporter‟s bank by electronic means. 4. Exporter‟s bank establishes authenticity of the letter of credit and informs exporter that Letter of Credit is ready for collection. 5. Exporter collects Letter of Credit and determines if it meets contractual agreement and its terms and conditions can be satisfied. 6. If exporter finds Letter of Credit unacceptable, he or she needs to consult exporter‟s bank. 7. Exporter‟s bank consults importer‟s bank. 8. Importer‟s bank then consults importer on the amendment of Letter of Credit. 9. If exporter finds the already issued Letter of Credit acceptable, he or she makes necessary arrangements for the delivery of goods.
Output Criteria to Exit the Business Process:
- Exporter accepted Letter of Credit
- Exporter started to make necessary arrangements to deliver jasmine rice to importer.
Activity Diagrams:
Number of Required Documents:
3
Minimum Required Time:
Maximum Required Time:
Average Required Time:
2
Minimum Cost:
Maximum Cost:
Average Cost:
