GLOSSARY OF INTERNATIONAL TRADE TERMS

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L

Landing Certificate Legal Weight Letter Of Credit (L/C), Commercial Letter Of Credit, Advised Letter Of Credit, Clean Letter Of Credit, Confirmed Letter Of Credit, Negotiable Letter Of Credit, Red Clause Letter Of Credit, Restricted Letter Of Credit, Standby Letter Of Credit, Straight Letter Of Credit, Transferable Letter Of Instruction Licensing Lighter

Letter Of Credit, Standby Similar to a commercial L/C in structure, the use of a standby is very different. While a commercial L/C is the primary payment mechanism for a commercial trade transaction, the standby L/C is only used (drawn upon) in the event of a default by the bank's customer on some contractual arrangement between him and the beneficiary of the L/C outside the L/C transaction itself. Standby L/C's are often used in lieu of bid or performance bonds or as payment guarantees. See related terms: Letter Of Credit (L/C), Commercial

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