Letters of credit (LC) often do not work out as planned, and this is usually because the documents provided in support of a claim under the letter of credit do not meet the conditions (and so become a “Discrepant letter of credit”).
When the conditions are not met, there is no obligation for the Issuing Bank to pay. In this situation, the documents are referred to as “discrepant". The issuing bank cannot waive discrepancies without the consent of the Importer.
When the documents presented are Discrepant under the Import L/C contract, in order to process the discrepant document set and to clarify the discrepancies with the Presenting Party, BRTDCR transaction is used in the system. This can also be used to reject the documents to the party presented.
In case if the Return of Documents checkbox is checked, then the documents will be rejected and
returned back to the presenting bank and the contract is closed. This can also be seen from the Close Contract checkbox that is also automatically checked.
When the Send Advice of Refusal (MT734) checkbox is checked, a rejection message will be sent to the presenting party. The order date is mainly entered by the user to claim back the document amount.
When the checkbox Send Advice of Discrepancy (MT750) is checked, then the discrepancy advice will be sent.
If the 'Rejection pending Instructions' checkbox on the Discrepancies/Refusal details panel is checked, the rejection is not final. In this case, the contract is not closed and the liability is not reversed. Documents are only then be settled, or the contract closed when the principal issues its final acceptance/rejection of documents.
To Process Discrepant Documents under an Import L/C Document Set contract , BRTDCR transaction is used.
Select it from the menu item[Import Products -> Import L/C -> Documents -> Process Discrepant Docs].
When you have made your changes, click on the ( ) Save function to save all the the data entered in the transaction to the database.