July 2020

BG: Letters of Indemnity in International Trade – Misdelivery, fictitious BLs & missing cargo

A letter of indemnity (LOI) plays a critical role in facilitating the discharge of cargo in modern international trade. The LOI however can reintroduce a credit risk on an insolvent buyer when a bank seeks a misdelivery claim against shipowners and sellers. With the spotlight firmly on double financing, fictitious BLs and missing cargo, we explain the risks in the use of an LOI and its future in international trade.

Letters of Indemnity1
Letters of Indemnity2
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