Unsigned Commercial Invoice in LC: Is It a Discrepancy? UCP 600 Rules

Unsigned Commercial Invoice in LC: Is It a Discrepancy? (UCP 600 Rules + Case Examples)

"A $500,000 LC payment was delayed because the commercial invoice lacked a signature—even though the LC didn’t require it. Was the bank right to reject it? Let’s decode UCP 600 rules and how to avoid this trap." 

UCP 600 Rules: The Official Answer

Under UCP 600 Article 18, a commercial invoice:

• Must appear to be issued by the beneficiary (exporter).

• Does not explicitly require a signature—unless:

  • The LC demands it (e.g., “Signed commercial invoice required”).

  • The invoice template includes a pre-printed signature line (per ISBP 745 A21).

Key Exception: Banks follow “strict compliance”—if the document looks incomplete (e.g., blank signature field), they may reject it.

Real-World Bank Practices

• Rejection Risk: 80% of banks treat unsigned invoices as discrepancies unless the LC waives the requirement.

• Case Study: A Turkish exporter’s LC was rejected for an unsigned invoice. They appealed, citing ISBP 745 A21, and won—but delays cost them $15,000 in storage fees.

3 Ways to Avoid This Discrepancy

1. For Exporters:

   • Add this clause to your LC: “Unsigned commercial invoice acceptable.”

   • Remove signature lines from invoice templates if unnecessary.

2. For Importers:

   • Specify in the LC: “Invoice may be unsigned unless otherwise stated.”

3. For All Parties:

   • Use PDF invoices (no blank fields) or e-signatures if allowed.

Pro Tip: Always Check These 2 Things

1. LC Wording: Does it mention signatures? If silent, assume banks may reject unsigned invoices.

2. Invoice Format: Delete unused signature lines to prevent “incomplete document” flags.

What to Do If Your LC Is Rejected

• Dispute: Cite UCP 600 Art 18 and ISBP 745 A21 (if applicable).

• Check the Reason for Rejection: First, take a close look at why the bank rejected the LC. Common reasons include missing signatures, incorrect dates, or discrepancies between the documents and LC terms.

• Reach Out to the Issuing Bank: Contact the bank to get a clear explanation of the rejection. Sometimes, it's just a small error that can be fixed by resubmitting the correct documents.

• Talk to Your Trading Partner: Let the other party know about the issue. If the rejection is due to mistakes on their side, like incorrect documentation, they'll need to correct it and resend the papers.

• Double-Check Your Documents: Go over your documents again to ensure everything matches the LC terms exactly. Small details, like a missing signature or wrong date, can lead to rejection.

• Fix the Errors: If the rejection was due to a minor mistake, like an unsigned document or wrong date, just correct it and send the documents back to the bank.

• Consider Amending the LC: If the issue is more serious, you may need the buyer to amend the LC to align with the agreed terms. This ensures both sides are on the same page.

• Ask for a Reconsideration: If you feel the rejection was unjust, you can ask the bank to reconsider their decision. You might also provide additional documents or clarification to support your case.

• Get Expert Help: If the issue is complicated, consider getting advice from a trade finance expert or an international trade lawyer. They can help you understand your options and avoid future problems.

• Plan for Delays: Rejection can cause delays in payments and shipments. While you're sorting things out, let everyone involved know that there might be some delays and manage expectations.

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