Letter of Credit Discrepancies: 21 UCP 600 Checks Before You Present
Which mistakes count as letter of credit discrepancies? A discrepancy is any point where your documents don't meet the credit or the UCP 600 rules, and a bank may refuse to pay against even one. Most can be caught before you present. The 21-check list below, tested on 11 labelled sample sets on 5 October 2026, agreed with an independent blind re-work in 231 of 231 check results.
This page covers the presentation stage, after shipment. If you're still choosing a payment term, start with choosing between a letter of credit and open account, or with what a telegraphic transfer or LC costs an importer.
Checked 5 October 2026 · By Iman Yusoff · The sample document sets on this page are fictional test cases, not real shipments.
Key point: Banks check documents, not goods. Under UCP 600 a bank has up to five banking days to examine your set, and it may refuse a presentation that doesn't comply. Run the dates first (21 days after shipment, never past expiry), then insurance, then consistency between the documents.
Key Takeaways
ICC's UCP 600, Article 14, gives you 21 calendar days from shipment to present original transport documents, and never past the credit's expiry.
Article 14(b) gives each bank a maximum of five banking days after the day of presentation to decide whether your documents comply.
If the credit is silent on insurance, ICC's UCP 600, Article 28, sets the minimum cover at 110% of the goods' CIF or CIP value.
A harmless misspelling is not a discrepancy, but a changed model number is. ICC's own guidance quotes this rule from ISBP 745.
In the 11 sample sets, 7 carried at least one discrepancy and 15 checks failed in all. That figure reflects how the test cases were built, not how often real banks refuse documents.
What Are Letter of Credit Discrepancies?
A letter of credit discrepancy is a point where the documents don't match the credit, the UCP 600 rules or each other. Under ICC's UCP 600, Article 14, the banks judge a presentation from the papers only, deciding whether it looks compliant on its face, and Article 5 adds that banks deal in documents, not in the goods themselves. The cargo can be perfect and the set can still be refused, a point our guide to TT and LC payment also makes.
UCP 600 is ICC's 2007 revision of the rules, sold by ICC as a priced publication, and the ICC Academy says UCP 600 runs to 39 articles. They apply when the credit says it is subject to UCP 600.
Article 1 adds that the credit itself can change or switch off any of them. So the credit comes first: read its own deadlines and document clauses before you rely on any default in this article.
How strict is strict? The ICC guidance paper on strict compliance quotes Lord Sumner's 1927 judgment: "There is no room for documents which are almost the same, or which will do just as well." The same paper quotes article 14(d): data "need not be identical to, but must not conflict with" the credit or the other documents. Wording can differ; facts can't.
Here a common piece of advice misfires. Some guides tell sellers that any spelling error is a discrepancy. The ICC paper quotes ISBP 745 paragraph A23 instead: a misspelling that doesn't change the meaning, such as "mashine" for "machine", is not a conflict, while "model 123" instead of "model 321" is. ICC Academy's guide to ISBP 821 adds that a missing or mistyped credit reference number on a document is not, by itself, a valid reason to refuse.
One exporter asked on a trade Q&A site whether a PO box shown as "1500 97008" on the credit and "15009 7008" on the bill is a discrepancy. Under article 14(j), an address only has to be in the same country as the one in the credit, except where the buyer appears as consignee or notify party on the bill: there, its details must be exactly as the credit states them. Make the digits match and the question goes away.
What Happens When the Bank Finds a Discrepancy?
The bank may refuse to honour, but it must refuse properly. Under ICC's UCP 600, Article 16, as this law-firm guide to the rules also explains, a refusing bank gives a single notice that lists each discrepancy.
The notice says whether the bank is holding the documents, returning them, or holding them while the buyer decides on a waiver. The deadline for that notice is the end of banking day five after presentation, sent by telecommunication where possible. Article 16(f) holds the bank to this: an issuing or confirming bank that skips these steps loses the right to call the set non-complying.
A refusal is not always the end. Article 16(b) lets the issuing bank, at its own discretion, ask the buyer to waive the discrepancies. That is what people mean by discrepancy acceptance. A waiver doesn't extend the five-day period, and it needs a buyer who still wants the goods.
Can you fix the documents and present again? If the bank is holding them on your instructions, ask it about replacing the faulty document. The 21-day limit and the expiry date keep running.
A corrected bill of lading that arrives on day 23 breaches article 14(c) however clean it is. So check before you present.
The 21-Check List to Run Before You Present
The checklist is 21 tests, each mapped to the UCP 600 rule it applies, and each with a yes-or-no answer you can find on the papers in front of you. It covers the invoice, the bill of lading, the insurance and the presentation itself, not drafts, air or road transport documents, partial shipments or any special condition your credit adds, so read the credit's own clauses as well.
# | Discrepancy when... | UCP 600 |
C01 | Presented after day 21, counting calendar days from the shipment date | 14(c) |
C02 | Presented after expiry (an expiry on a day the bank is closed moves to the next banking day) | 14(c), 29(a) |
C03 | Date of shipment later than the latest shipment date, which is never extended | 20(a)(ii), 29(c) |
C04 | Bill shows an "intended vessel" with no on-board notation giving the date and actual vessel | 20(a)(ii) |
C05 | Port of loading or discharge differs from the credit | 20(a)(iii) |
C06 | Fewer originals presented than the full set the bill says was issued | 20(a)(iv) |
C07 | Carrier not named, or signature not identified as carrier, master or agent | 20(a)(i) |
C08 | A clause expressly declaring defective goods or packaging ("shipper's load and count" is fine) | 27, 26(b) |
C09 | Goods shown as loaded on deck ("may be loaded on deck" is fine) | 26(a) |
C10 | Invoice not issued by the beneficiary | 18(a)(i) |
C11 | Invoice not made out to the applicant | 18(a)(ii) |
C12 | Invoice in a different currency from the credit | 18(a)(iii) |
C13 | Invoice goods description doesn't correspond with the credit (a harmless misspelling is fine) | 18(c), ISBP 745 A23 |
C14 | Amount drawn above what the credit allows (10% more if it says "about") | 18(b), 30(a) |
C15 | Quantity outside tolerance: 10% with "about", otherwise 5% unless counted in units or packages, and the drawing stays within the credit | 30(a), 30(b) |
C16 | Insurance dated after shipment without cover effective from shipment | 28(e) |
C17 | Insurance below the credit's percentage, or below 110% of CIF or CIP if the credit is silent, or in another currency | 28(f) |
C18 | Insurance presented as a cover note | 28(c) |
C19 | Model number or quantity conflicts between invoice, packing list and bill | 14(d) |
C20 | Any document dated after the presentation date | 14(i) |
C21 | Applicant address in a different country from the credit | 14(j) |
Three rows need context. On C03, article 20(a)(ii) makes the on-board notation date the date of shipment when there is one, not the date the bill was issued.
On C21, the country test is not enough when the buyer appears as consignee or notify party on the bill: Article 14(j) says its details there "must be as stated in the credit". On C14, article 18(b) lets a bank accept an invoice above the credit amount, but the bank won't pay more than the credit allows.
For invoice basics, see what a commercial invoice must show. For the bill itself, see original, telex and seaway bills of lading.
11 Sample Document Sets, Worked Through
All 11 sets share one fictional credit: USD 50,000 on CIF terms for 10,000 kg of stainless steel fasteners, model 123, shipped Singapore to Jakarta. The latest shipment date is 15 November 2026 and the expiry is 30 November 2026. Each set changes one or a few things; the sample bank closes on Saturdays and Sundays, with no public holidays. Source: the 11 case files in this study's dataset (see Cite This); they are test cases, not records of any real trade.
Set | Type | What changes | Result |
S01 | Baseline | Clean set; the bill carries "shipper's load and count" | Complies |
S02 | Boundary | Shipped 5 Nov, presented 26 Nov, day 21 exactly | Complies |
S03 | Failure | Shipped 5 Nov, presented 27 Nov, day 22 | Discrepant: C01 |
S04 | Failure | Bill issued 14 Nov but on-board notation 16 Nov; latest shipment 15 Nov was a Sunday | Discrepant: C03 |
S05 | Boundary | "About" credit; 10,950 kg and USD 54,750 invoiced (9.5% over) | Complies |
S06 | Failure | Insurance for 105% of CIF, dated two days after shipment | Discrepant: C16, C17 |
S07 | Failure | Bill notes "4 cartons torn, contents exposed"; 2 of 3 originals presented | Discrepant: C06, C08 |
S08 | Boundary | Invoice spells "fastners"; packing list says model 321 | Discrepant: C19 (the misspelling passes) |
S09 | Boundary | Expiry on Sunday 29 Nov, presented Monday 30 Nov; intended vessel with on-board notation | Complies |
S10 | Failure | Intended vessel with no on-board notation; invoice issued by a third party; buyer's address in another country | Discrepant: C04, C10, C21 |
S11 | Failure | Unidentified signature, different discharge port, loaded on deck, cover note, packing list dated after presentation | Discrepant: C05, C07, C09, C18, C20 |
Day 21 is in time and day 22 is late. A Sunday expiry rolls to Monday, but a Sunday latest shipment date doesn't move. The S05 overrun is fine on an "about" credit and would be discrepant on one that states an exact amount.
Which Discrepancies in the Samples Are Easy to Miss?
Which date counts as the shipment date?
The on-board date. In S04 the bill was issued on 14 November, inside the deadline, but the on-board notation says 16 November. Under article 20(a)(ii) the notation date is the shipment date, so the set is a day late.
Do weekends move the deadlines?
Only the expiry and the last day for presentation. Article 29(a) moves an expiry that falls on a closed day to the next banking day, which is why S09 passes. Article 29(c) keeps the shipment deadline where it is, which is why S04 is still discrepant even though 15 November was a Sunday.
How are the 21 days counted?
In calendar days. S02 and S03 differ by one day and get opposite results. Count from the date of shipment, not from when the bills reach you, and check the credit for a shorter period of its own.
Which insurance details trip a presentation?
The amount and the date. In S06 the policy covers 105% of CIF and is dated after loading. Article 28(f) wants at least 110% when the credit is silent.
Article 28(e) wants the document dated no later than shipment unless it shows cover from that date. Both are easy to fix before shipment and hard afterwards. See marine cargo insurance for SMEs for the policy itself.
Can a remark on the bill of lading stop payment?
Yes. In S07 the carrier noted torn cartons. Article 27 accepts only a clean transport document, one with no clause expressly declaring defective goods or packaging. So the place to prevent a claused bill of lading is the packing, before the cargo reaches the carrier. IFG covers clean and claused bills of lading in a separate guide.
Two ICC opinions quoted in the ICC paper show where the line sits. In Official Opinion TA.817rev, a credit required FCL shipment and the bill showed CY/CY instead. It was held discrepant because it didn't expressly mention FCL. In TA.818rev, an invoice that named the applicant under the heading "Customer" complied.
Verdict: Check Dates and Insurance Before Anything Else
With little time, check dates and insurance first. In the sample sets, the date checks (C01 to C03 and C20) and the insurance checks (C16 to C18) produced 6 of the 15 discrepancies.
Most of them are also hard to correct afterwards: an on-board date can't be changed, and insurance that only started after loading can't be made to start earlier. A harmless misspelling can pass under A23; a day-22 presentation can't.
Next, read the credit the day it arrives, not the day you present. ICC's guidance on credit formats, citing ISBP 745, traces many examination-stage problems back to how the credit was applied for and issued. If a term can't be met, ask for an amendment while there's time to ship.
Before You Present: Six Steps
The day the credit arrives, list its latest shipment date, expiry date, presentation period, ports, insurance percentage and every document it names. Ask for an amendment now if any term can't be met.
Before loading, check the packing so the carrier has no reason to clause the bill, and place insurance dated on or before the loading date, for at least 110% of CIF if the credit is silent.
When the bill of lading is issued, read the on-board notation date against the latest shipment date, and the ports, vessel, carrier name and signature against the credit.
Count the 21 days from the on-board date and mark the earlier of that day and the expiry in your calendar. If either day falls on a day the bank is closed, article 29(a) moves it to the next banking day. The latest shipment date never moves.
Lay the invoice, packing list and bill side by side and compare model numbers, quantities, currency, the buyer's name and address, and every date against the presentation date.
Run all 21 checks once more on the final set, count the originals, and present early enough to fix a fault in time.
Method
The checks, the sample sets and the checker were built by an AI agent working for IFG's editorial team on 5 October 2026. It wrote the 21 checks from the ICC text of UCP 600 and from ISBP 745 paragraph A23 as quoted in ICC's guidance paper.
It constructed 11 sample sets around one fictional credit: 1 baseline, 4 boundary cases and 6 failure cases. Before writing any code, it worked out the expected answer for every check and froze the case files, the check table and those answers with a SHA-256 hash. It then coded the checks as a short Python script, lc_check.py version 1.0.
A second AI agent, run separately with no access to the script or the expected answers, then worked all 231 check results (11 sets × 21 checks) blind, from the rule text, the check table and the case files only. The script's first, unedited run agreed with that blind re-work in 231 of 231 results, and with the frozen expected answers in 231 of 231.
The building agent re-read every discrepant result against the rule text; no person reviewed the results. There were no disagreements to resolve, and the re-worker raised two places where the check table simplifies UCP 600 (C21 and C14, both explained above).
Limits
One AI agent built the sample sets, the expected answers and the checker. The one independent step is the blind re-work by a second AI agent, and no human examiner has checked the results.
The sets are clean and mostly show one fault at a time, which real presentations rarely do. The 21 checks cover part of UCP 600 only: no drafts, no air, road or courier documents, no partial shipments and no special conditions written into a credit. The ISBP 821 text isn't freely published, so the A23 example comes from ISBP 745 as quoted by ICC; ICC Academy says ISBP 821 was published in July 2023, so check the current edition.
Bank holidays were ignored, and check C01 does not apply the article 29(a) roll-forward when day 21 falls on a closed day (no sample set tested this). A pass on these checks doesn't mean any bank will pay, and the share of sample sets with a discrepancy says nothing about real refusal rates.
Cite This
IFG Shipping, "Letter of Credit Discrepancies: 21 UCP 600 Checks Before You Present". Checks run 5 October 2026; published 20 October 2026. Canonical page: /post/letter-of-credit-discrepancies on the IFG Shipping website. Dataset: lc-checker-validation-2026-10-05.csv, version 1.0, 231 rows, one per check result; public CSV link added at publication.
Learn It With Iman, or Hand It to IFG
If you want to learn to read a credit yourself, the guides on this site cost nothing to read. Iman Yusoff, IFG's founder, posts lessons on LinkedIn and on TikTok as @freightsifu, and you can ask him directly on WhatsApp at +60 14 325 8325. A good place to start is the six-fundamentals roadmap. There are no courses, workshops or certificates behind it.
If you'd rather hand the shipment over, send IFG the credit's document clauses with your booking and draft documents before the goods ship, and we'll reply on the transport documents and the timing we can handle. Your bank still decides whether the set complies, and nobody can promise that it will.
Frequently Asked Questions
Is a spelling mistake a discrepancy in a letter of credit?
Not always. ICC's guidance paper quotes ISBP 745 paragraph A23: a misspelling or typing error that doesn't affect the meaning of a word, such as "mashine" for "machine", is not a conflict of data. "Model 123" instead of "model 321" is a conflict, and so is a changed quantity or date. Treat names, numbers and addresses as exact.
Can letter of credit discrepancies be waived?
Yes, but not by you. ICC's UCP 600, Article 16(b), lets the issuing bank, at its own discretion, ask the buyer to waive the discrepancies. The buyer can agree or refuse, and asking doesn't extend the bank's five banking days. Plan never to need a waiver.
Can I correct documents after the bank refuses them?
Ask your bank first, because the clocks keep running. The corrected set must still arrive within 21 calendar days of shipment under article 14(c), or any shorter period in the credit, and never after expiry. Some faults can't be corrected at all, such as a late on-board date or insurance that started after loading.
Does a discrepancy mean I will not be paid?
No, but it means the bank no longer has to pay you. A refusing bank must send one notice listing every discrepancy within five banking days. You may then correct and re-present in time, or the buyer may waive them. If neither happens, the bank's undertaking no longer protects you, and getting paid depends on the buyer.
Disclaimer: this is general educational information about letter of credit discrepancies under UCP 600, not legal or banking advice. UCP 600 and ISBP 821 are ICC publications; the rules are paraphrased here, so read the official text. The sample document sets are fictional and the 21 checks cover part of the rules only. Your credit's own terms come first, banks may read a set differently, and ICC rules and guidance are revised. Confirm how your advising or nominated bank reads your credit before you ship and before you present.
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