Article # 30

Article # 30 Tolerance in Credit
Amount, Quantity and Unit Prices

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The articles formatted to explain in the classroom context. This work has no association
with the International Chamber of Commerce (ICC). These materials are not to be
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published articles

For the actual text of these rules, readers are advised to refer to ICC Uniform Customs
and Practices for Documentary Credit, ICC Publication No. 600 Copyright (C) 2006,
International Chamber of Commerce (ICC) available at https://2go.iccwbo.org/finace

TOLERANCE IN CREDIT AMOUNT, QUANTITY AND UNIT PRICES

a. The words "about" or "approximately" used in connection
with the amount of the credit or the quantity or the unit
price stated in the credit are to be construed as allowing a
tolerance not to exceed 10% more or 10% less than the
amount, the quantity or the unit price to which they refer.

b. A tolerance not to exceed 5% more or 5% less than the
quantity of the goods is allowed, provided the credit does
not state the quantity in terms of a stipulated number of
packing units or individual items and the total amount of
the drawings does not exceed the amount of the credit.

c. Even when partial shipments are not allowed, a tolerance
not to exceed 5% less than the amount of the credit is
allowed, provided that the quantity of the goods, if stated
in the credit, is shipped in full and a unit price, if stated in
the credit, is not reduced or that sub-article 30 (b) is not
applicable. This tolerance does not apply when the credit
stipulates a specific tolerance or uses the expressions
referred to in sub-article 30(a).

1. Extract from a credit:

LC Value: USD 10,000 / Quantity: 100 Kgs / Partial
Shipments: Not Allowed Which of the following
presentations are ACCEPTABLE?

A. Invoice showing shipment of 100 Kgs for USD 9,000
B. Invoice showing shipment of 100 Kgs for USD 9,800
C. Invoice showing shipment of 90 Kgs for USD 9,500
D. Invoice showing shipment of 105 Kgs for USD 10,500

1. Extract from a credit:

LC Value: USD 10,000 / Quantity: 100 Kgs / Partial
Shipments: Not Allowed Which of the following
presentations are ACCEPTABLE?

A. Invoice showing shipment of 100 Kgs for USD 9,000
B. Invoice showing shipment of 100 Kgs for USD 9,800
C. Invoice showing shipment of 90 Kgs for USD 9,500
D. Invoice showing shipment of 105 Kgs for USD 10,500

02. Which of the following shipments are acceptable under a
credit which prohibits partial shipment and requires
shipment of 1000 boxes of shoes for about USD 10,000?

I. Shipment consisting of 1000 boxes of shoes for USD 9500
II. Shipment consisting of 950 boxes of shoes for USD 10,000
III. Shipment consisting of 1000 boxes of shoes for USD 11,000
IV. Shipment consisting of 1050 boxes for USD 10,500

Options:
A. I only
B. II and III
C. I and III
D. II and IV

02. Which of the following shipments are acceptable under a
credit which prohibits partial shipment and requires
shipment of 1000 boxes of shoes for about USD 10,000?

I. Shipment consisting of 1000 boxes of shoes for USD 9500
II. Shipment consisting of 950 boxes of shoes for USD 10,000
III. Shipment consisting of 1000 boxes of shoes for USD 11,000
IV. Shipment consisting of 1050 boxes for USD 10,500

Options:
A. I only
B. II and III
C. I and III
D. II and IV

03. Which of the following statements is TRUE?

A. If a credit requires shipment of 2,000 bales of cotton
and partial shipment is not allowed: 1950 bales can be
shipped

B. If a credit requires shipment of 10,000 yards of cloth for
US$ 200,000: 10,200 yards may be shipped for US$
200,000

C. Under a credit issued for US$ 25,000 which does not
allow partial shipment: documents for US$ 23,000 may
be presented

D. If a credit requires shipment of 5,000 MTs of coal at US$
500 / MT, 5000 MTs may be shipped at US$ 495 / MT

03. Which of the following statements is TRUE?

A. If a credit requires shipment of 2,000 bales of cotton
and partial shipment is not allowed: 1950 bales can
be shipped

B. If a credit requires shipment of 10,000 yards of cloth
for US$ 200,000: 10,200 yards may be shipped for
US$ 200,000

C. Under a credit issued for US$ 25,000 which does not
allow partial shipment: documents for US$ 23,000
may be presented

D. If a credit requires shipment of 5,000 MTs of coal at
US$ 500 / MT, 5000 MTs may be shipped at US$ 495 /
MT

04. Credit indicates the quantity of goods as “12,000
MT’s”. Which of the following shipments are
acceptable under UCP 600?

A. 11,500 MT’s
B. 12,250 MT’s
C. 13,000 MT’s
D. 11,000 MT’s

Options:

A. A, B, C & D only
B. A & B only
C. C & D only
D. B & C only

04. Credit indicates the quantity of goods as “12,000
MT’s”. Which of the following shipments are
acceptable under UCP 600?

A. 11,500 MT’s
B. 12,250 MT’s
C. 13,000 MT’s
D. 11,000 MT’s

Options:

A. A, B, C & D only
B. A & B only
C. C & D only
D. B & C only

05. A confirming bank confirms a LC with a value of USD
120,000 and a tolerance up to 5%. This credit is
amended to a value of USD 110,000. The confirming
bank advices this amendment The maximum liability of
the confirming bank is up to:

A. USD 110,000
B. USD 120,000
C. USD 115500
D. USD 126000

05. A confirming bank confirms a LC with a value of USD
120,000 and a tolerance up to 5%. This credit is
amended to a value of USD 110,000. The confirming
bank advices this amendment The maximum liability of
the confirming bank is up to:

A. USD 110,000
B. USD 120,000
C. USD 115500
D. USD 126000

06. A documentary credit for USD 120,000.00 calls for
shipment of fertilizer in February, March, April and
May. Each shipment is to be for about 500 tones.
Shipment was effected as follows:

1. 450 tones sent 24 February for value USD 27,000.00.
2. 550 tones sent 12 April for value USD 33,000.00.
3. 460 tones sent 30 April for value USD 28,000.00.
4. 550 tones sent 04 June for value USD 33,000.00.

Which of the above shipments will be honoured on
presentation?

A. 1 only.
B. 1 and 3 only.
C. 2 and 4 only.
D. 1, 2 and 3 only.

06. A documentary credit for USD 120,000.00 calls for
shipment of fertilizer in February, March, April and
May. Each shipment is to be for about 500 tones.
Shipment was effected as follows:

1. 450 tones sent 24 February for value USD 27,000.00.
2. 550 tones sent 12 April for value USD 33,000.00.
3. 460 tones sent 30 April for value USD 28,000.00.
4. 550 tones sent 04 June for value USD 33,000.00.

Which of the above shipments will be honoured on
presentation?

A. 1 only.
B. 1 and 3 only.
C. 2 and 4 only.
D. 1, 2 and 3 only.

07. If a credit calls for shipment of 10,000 meters of
fabric for USD 20,000.00, the beneficiary may ship

A. 10,300 meters and claim USD 20,000.00
B. 10,500 meters and claim USD 21,000.00
C. 10,000 meters and claim USD 19,000.00
D. 9,900 meters and claim USD 20,000.00

Options:

A. c & d only
B. b & b only
C. c & d only
D. b & c only

07. If a credit calls for shipment of 10,000 meters of
fabric for USD 20,000.00, the beneficiary may ship

A. 10,300 meters and claim USD 20,000.00
B. 10,500 meters and claim USD 21,000.00
C. 10,000 meters and claim USD 19,000.00
D. 9,900 meters and claim USD 20,000.00

Options:

A. c & d only
B. b & b only
C. c & d only
D. b & c only

08. A credit is issued for USD 20,000 CFR with partial
shipments prohibited. The beneficiary may present
documents for:

A. USD 18,975.00
B. USD 19,000.00
C. USD 18,500.00
D. USD 21,000.00

08. A credit is issued for USD 20,000 CFR with partial
shipments prohibited. The beneficiary may present
documents for:

A. USD 18,975.00
B. USD 19,000.00
C. USD 18,500.00
D. USD 21,000.00

09. True or false?

A credit is issued for EUR10000 covering 10000 widgets
at EUR 1 each. The credit amount is shown as being +/-
10%. This tolerance applies to both the amount and
quantity.

• False
• True

09. True or false?

A credit is issued for EUR10000 covering 10000 widgets
at EUR 1 each. The credit amount is shown as being +/-
10%. This tolerance applies to both the amount and
quantity.

• False
• True

****

As per sub-article 30 (a) of UCP 600 … The words "about"
or "approximately" used in connection with the
amount of the credit or the quantity or the unit price
stated in the credit are to be construed as allowing a
tolerance not to exceed 10% more or 10% less than the
amount, the quantity or the unit price to which they
refer.

10. True or false?

A credit is issued for EUR10000 covering 10000 widgets
at EUR 1 each. The credit amount is shown as being +/-
10%. This tolerance applies to both the amount and
quantity.

• False
• True

10. True or false?

A credit is issued for EUR10000 covering 10000
widgets at EUR 1 each. The credit amount is
shown as being +/-10%. This tolerance applies to
both the amount and quantity.

• False
• True

****
As per sub-article 30 (a) of UCP 600 … The words

"about" or "approximately" used in connection
with the amount of the credit or the quantity or
the unit price stated in the credit are to be
construed as allowing a tolerance not to exceed
10% more or 10% less than the amount, the
quantity or the unit price to which they refer.

11. An exporter is selling shirts to an importer with
payment due 45 days after shipment. The contract
stipulates that there are to be 12 monthly shipments,
each comprising approximately 2,000 shirts. The cost of
each of the shirts is EUR8.00. Which of the following
would BEST secure the exporter's receivables?

Select one:
A. A standby credit for EUR35,200.
B. A documentary credit for EUR192,000.
C. An instalment documentary credit for EUR211,200.
D. A documentary credit for EUR17,600 revolving 11

times on payment, subject to applicant's approval.

11. An exporter is selling shirts to an importer with
payment due 45 days after shipment. The contract
stipulates that there are to be 12 monthly shipments,
each comprising approximately 2,000 shirts. The cost of
each of the shirts is EUR8.00. Which of the following
would BEST secure the exporter's receivables?

Select one:
A. A standby credit for EUR35,200.
B. A documentary credit for EUR192,000.
C. An installment documentary credit for EUR211,200.
D. A documentary credit for EUR17,600 revolving 11

times on payment, subject to applicant's approval.

****

Article 30a of UCP 600 defines ‘approximately’ as plus or
minus 10%. Therefore 2,200 shorts x EUR 8.00 x 12
months = EUR 211,200.

12. An issuing bank has issued a documentary credit for
USD100,000 covering 100 tons of cotton and 100 bales
of wool, with partial shipment prohibited. Which of the
following would be acceptable to the issuing bank?

Cotton Wool Amount
A 105 tons 100 bales USD100,000
B 100 tons 105 bales USD100,000
C 100 tons 95 bales USD95,000
D 100 tons 100 bales USD90,000

Select one:
A. 105 tons 100 bales USD100,000.
B. 100 tons 105 bales USD100,000.
C. 100 tons 95 bales USD95,000.
D. 100 tons 100 bales USD90,000.

A. 12. An issuing bank has issued a documentary credit
for USD100,000 covering 100 tons of cotton and 100
bales of wool, with partial shipment prohibited.
Which of the following would be acceptable to the
issuing bank?

Cotton Wool Amount
A 105 tons 100 bales USD100,000
B 100 tons 105 bales USD100,000
C 100 tons 95 bales USD95,000
D 100 tons 100 bales USD90,000

Select one:
A. 105 tons 100 bales USD100,000.
B. 100 tons 105 bales USD100,000.
C. 100 tons 95 bales USD95,000.
D. 100 tons 100 bales USD90,000.



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