Shipping Terms L

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Letter of Credit L/C conditional letter issued from buyer’s bank guaranteeing to process payment to the shipper whit in certain time frame.

Straight L/C that contains a limited engagement clause, indicating that the issuing bank promises to pay the beneficiary upon required documents presentation.

Revocable L/C is an instrument that can be cancelled or modified at any time without no­tice of the beneficiary, but usually includes a clause in the credit that revocation or amendment will be honored by the issuing bank. It is not commonly since there is no protec­tion for the selle

Irrevocable: L/C once established, cannot be modified or cancelled with­out the agreement of all parties involved.

Back to Back L/C is a three–party transaction when a new letter of credit is provided to another beneficiary on behalf of a primary credit. The second L/C may use primary L/C as collateral

Clean L/C requires receipt or draft presented from the beneficiary for certain funds before receiving payment.

Confirmed  L/C is guaranteed payment issued by both the issuing and confirming bank when seller’s documents are in order, and the letter of credit terms are met . Only applied to irrevo­cable L/C’s. The confirming bank assumes the credit risk of the issuing bank.

Deferred Payment L/C A issued for the purchase or financing of merchan­dise, it requires sight drafts payables presentation on an installment basis.

Non cumulative L/C is revolving letter of credit, that disallows payment if the amount is not used during the certain time period from being available afterwards.

Restricted L/C is condition within the letter of credit which restricts its negotiation to a named bank.

Revolving L/C is irrevocable letter issued for a specific amount and time and renews itself for the same amount over a predetermined time period

Transferable L/C Used by intermediary party and allows the beneficiary to transfer part or the whole amount to another beneficiary if such transfers does not exceed the amount of the creditUnconfirmed L/C is letter of credit forwarded to the beneficiary by the advising bank with­out commitment of the advising bank.

LCL – Less than Container Load, refers for small and medium size cargo shipments not enough to fill the whole container. Usually consolidated in container with other cargo and shipped.

LTL – Less Than Truckload is inland cargo movement via truck, rail or air. Also known as LCL.

Long Ton 1000 kg  or 2,240 pounds.

Loose Cargo is non palletized, crated cargo, without packing.