The exporter shipped textile fabrics to an importer in Bangladesh.
The importer refused to make payment, alleging that the delivered fabrics were not as per the approved quality and their subsequent buyer had cancelled the order.
Contacting the Debtor and Buying Agent: MNS initiated communication with the debtor (importer) and the buying agent in Bangladesh to address the quality dispute and gather more information regarding the claims made by the buyer.
Supporting Documentation: MNS collected and compiled all the necessary supporting documents to refute the debtor's allegations. These documents aimed to prove that the delivered fabrics were indeed as per the approved quality.
Contacting the Debtor's Bank: MNS reached out to the debtor's bank, providing them with the collected supporting documents. The objective was to counter the debtor's claim and demonstrate that the dispute should be resolved based on the documents presented, not on the goods or services themselves, in accordance with the Uniform Customs and Practice for Documentary Credits (UCP 600).
Legal Notice: MNS Associate Lawyer served a legal notice to the debtor's bank, highlighting the dishonoring of the Letter of Credit (L/C). This step aimed to emphasize the seriousness of the situation and the exporter's commitment to seeking a resolution.
Negotiation for Full Payment: In response to the legal notice, the debtor's bank requested MNS to convince the exporter to offer a 50% discount on the bill value. However, MNS insisted on the bank's obligation to deal with the presented documents and not to consider requests for discounts.
Through persistent efforts and adherence to the UCP 600 guidelines, MNS successfully secured full payment for the exporter. The banks involved in the transaction recognized the importance of handling documents and decided in favor of the exporter, thereby validating the legitimacy of the delivered goods and ensuring that the exporter received the rightful payment.
This case study exemplifies the challenges faced by an exporter when dealing with an importer disputing the quality of delivered goods. By engaging in effective communication, providing supporting documentation, and asserting the importance of adhering to established trade practices, MNS was able to overcome the importer's objections and secure full payment for the delivered textile fabrics. This successful resolution reinforces the significance of documentation and adherence to internationally recognized trade guidelines in resolving disputes in international trade transactions.
If you operate in the textile sector and wish to uncover the invaluable contributions that MNS Credit Management Group can offer to enhance your collections endeavors, do not hesitate to reach out to our team. With extensive expertise in debt recovery within Bangladesh, we are equipped to assist you effectively. Contact us at 09560700251 or simply request a call back, and let us demonstrate how we can optimize your collections process.
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