What Is Document Compliance & How to Achieve It Effectively
Publish Time: 2026-02-26 Origin: Site
1. What Is Document Compliance?
Document compliance means that all documents provided by the exporter must strictly match the requirements stated in the letter of credit (L/C) issued by the importer’s bank.
2. Key Points of Document Compliance
The types, content, and number of documents are exactly as required by the L/C
The wording and details on the documents fully follow the L/C terms
If documents appear compliant with the L/C but the goods are inconsistent, the bank bears no responsibility.
If the goods are correct but documents show discrepancies with the L/C, the bank is liable, and the applicant may refuse payment.
3. Case Analysis of Document Discrepancies
Quantity: “about 50,000 yards”
Insurance: W.P.A. + War Risk
Insurance coverage shown on the policy did not match the L/C requirement.
The bill of lading showed 44,800 yards, which was inconsistent with “about 50,000 yards”.
However, banks only check surface compliance with the L/C, not the actual benefits to the buyer.
According to UCP500 Article 39, the word “about” allows a 10% tolerance, meaning the acceptable range is 45,000–55,000 yards.
Since 44,800 yards was outside this range, the bank lawfully refused payment.
4. How to Effectively Achieve Document Compliance
To avoid discrepancies under L/C payment terms:
- Carefully check the L/C immediately upon receipt
Confirm consistency with the sales contract
Identify and remove soft clauses
Ensure all terms are practical and achievable
- Request amendments promptly for any unacceptable terms Do not take risks or rely on luck.
- Prepare all documents strictly according to the L/C Double-check descriptions, quantities, unit prices, ports, and insurance terms.
Only by strictly following document compliance can exporters avoid risks and protect their rights.