Graham Thorpe

1
Graham Thorpe Trade Finance Manager
(A UK incorporated and UK FSA regulated Bank)
Nigerian Trade Finance -Impact of Changes
2
Number of LCs issued 2005 ..SWIFT
3
Correspondent Banker to

• Intercontinental Zenith
• United Bank for Africa Guaranty Trust
• Access Oceanic
• Diamond IBTC Chartered
• Equitorial Trust First City Monument
• Platinum Sterling
• Fidelity First Bank

4
The Destination Inspection Process
LC ADVISE
RELEASE OF GOODS
7
NPA/FAAN TERMINAL
EXPORTER
FBN BANK (UK) LTD
8
15
9
DOCS
SHIPMENT
LC ISSUANCE
EXAMINATION (GREEN, YELLOW OR RED). EXTENT
DEPENDS ON RAR
14
6
10
DOCS
SUBMISSION TO BANK
APPROVAL/ SUBMISSION
FORWARD FORM M
1
2
5
NIGERIA CUSTOM SERVICE
SCANNING COMPANY
NIGERIAN BANK
IMPORTER
11a
12
13
ENDORSE DOCS
FORWARD DOCS
REQUEST FOR CLEARANCE
GENERATE RAR SEND TO NCS
3
11b
REJECT
11b
REQUEST FOR CLEARANCE
4
ACCEPT /NOTIFY
5
Issues

• Manufacturers Certificate / Lab Test Certificate
• 14 days
• CCVO
• Direct documents / Document Control
• Form M
• Old transactions

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Manufacturers Certificate Lab Cert

• 3 original(s) of Manufacturer/Supplier's
  Certificate with standards adopted of goods
• 3 original Manufacturers Certificate of
  Production confirming the standard used for
  production
• One original Manufacturer's Certificate of
  Production (stating the manufacturing standards
  adopted e.g. ISO,IES etc.) and 2 copies
• Manufacturer's Certificate stating the standards
  adopted thereon i.e. British Standard PD ISO,
  NIS, DIN ETC.
• Laboratory Test Certificates (for chemicals,
  foods beverages pharmaceuticals electrical
  appliances and other regulated products

7
14 Days.examples

• Certificate is required from the beneficiary
  confirming that
• .documents have been sent by their
  bankers directly by courier to x bank
• .documents to be sent directly by courier to x
  bank within 14 days of shipment and a beneficiary
  certificate to that effect is required
• ...to be dispatched by courier to x bank within
  fourteen days of shipment. A copy of the courier
  way bill for the dispatch of the documents is
  required.
• One original beneficiary certificate, with
  original courier
• service airway bill attached certifying that
  documents in
• Field 47a (2) have been forwarded directly
  to X bank within14 days after shipment date
• Form M no and the above LC number are to be
  quoted on all documents

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Good News ??

• We wish to clarify that the Manufacturer
  Certificate was deleted because the product being
  imported is not a manufactured product
• Please note that items of import on these LCEES
  are non regulated items and do not require
  Laboratory Test Certificate
• 3/3 Original Bill of Lading to be presented

9
CCVO .examples

• 3 original (s) and 1 copy(s) of Combined
  Certificate of Value and Origin (C.C.V.O.) as
  required for import into the Federal Republic of
  Nigeria
• 1original Combined Certificate of Value and
  Origin (CCVO) and 3 copies . The Combined
  Certificate of Value and Origin (CCVO) must state
  the adequate description of goods, port of
  destination, shipment identification, date of
  shipment, country of origin, country of supply.
• 3 original and 3 copies CCVO (form C16)
• 1 original Combined Certificate of Value and
  Origin (CCVO) and 3 Copies.

10
Direct Docs / Doc Control / Form M
LC ADVISE
RELEASE OF GOODS
7
NPA/FAAN TERMINAL
EXPORTER
FBN BANK (UK) LTD
8
15
9
DOCS
SHIPMENT
LC ISSUANCE
EXAMINATION (GREEN, YELLOW OR RED). EXTENT
DEPENDS ON RAR
14
6
10
DOCS
SUBMISSION TO BANK
APPROVAL/ SUBMISSION
FORWARD FORM M
1
2
5
NIGERIA CUSTOM SERVICE
SCANNING COMPANY
NIGERIAN BANK
IMPORTER
11a
12
13
ENDORSE DOCS
FORWARD DOCS
REQUEST FOR CLEARANCE
GENERATE RAR SEND TO NCS
3
11b
REJECT
11b
REQUEST FOR CLEARANCE
4
ACCEPT /NOTIFY
11
Direct docs..a suggestion

• These documents may not be released to the
  Applicant unless you hold their Irrevocable
  authority to pay documents presented under your
  LC ref XXXXXXXXXXXXXX despite any discrepancies.
• Please also give your specific approval by
  authenticated SWIFT to the advising / confirming
  / negotiating/ paying bank to effect payment
  despite any discrepancies.

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Evolution of Nigerian LCs

• 100 cash covered
• Non operative unconfirmed
• Clean Line
• Usance Terms e.g. 90 days blading
• Refinancing / discounting
• UCP 600 July 2007 ?