Prior to 1993 revision of UCP, the ‘reasonable time’ allowed to the issuing bank to verify the documents to judge whether they were in conformity with the requirements of letter of credit was not clearly defined. The vagueness associated with the term was cleared by Article 13(b) inserted in the 1993 revision.
As per this Article “the issuing bank, the confirming bank, if any, or a nominated bank acting on their behalf, shall have a reasonable time, not to exceed seven banking days following the day of receipt of documents, to examine the documents and determine whether to take up or refuse the documents and inform the party from which it received the documents accordingly.”
Thus the maximum time available to bank for scrutiny of documents has been clearly stated as seven banking days.
Further the new Article confers the right to have time and the right to reject the documents not only on the issuing bank but on the confirming bank and nominated bank as well.
