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Question

An LC which authorises the Advising Bank, to transfer, at the request of the First Beneficiary the credit available in whole or in part to one or more other beneficiaries ( Second Beneficiaries) is known as _______

A Anticipatory LC Correct Answer Incorrect Answer
B Revolving LC Correct Answer Incorrect Answer
C Transferable LC Correct Answer Incorrect Answer
D Back to back credit Correct Answer Incorrect Answer
E Revocable LC Correct Answer Incorrect Answer

Solution

A transferable credit is one that  can  be  transferred  by  the  original (first)  beneficiary  to  one  or  more  second  beneficiaries. Unless specifically stated anLC is not transferable i.e. the  LC  is  deemed  to  be  transferable  only  if  it  is  stated  to  be ‘Transferable’  in  the  LC. Second beneficiary has no right to transfer to third beneficiary

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