Abstract
LL.M.
The objective of this study is to identify the legal systems that should be applied in terms
of South African private international law to the different contractual relationships in
respect of a documentary letter of credit.
In South Africa no legislation or (binding) case law in point exists. A comparative study
is therefore made of the relevant legal rules and principles in the following countries: the
United Kingdom; Germany; the Netherlands; Canada; Australia; and the United States of
America.
It is submitted that, in the absence of either an express or a tacit choice of a legal system
by the parties, the proper law of a documentary letter of credit transaction in South
African private international law should be –
1) in respect of the contractual relationship between the applicant and the issuing
bank: the law of the country where the issuing bank is situated;
2) in respect of the contractual relationship between the issuing bank and the
correspondent bank (whether confirming or merely advising): the law of the
country where the correspondent bank is situated;
3) in respect of the contractual relationship between the confirming bank and the
beneficiary: the law of the country where the confirming bank is situated;
4) in respect of the contractual relationship between the issuing bank and the
beneficiary –
a) where a correspondent bank (whether confirming or merely advising) is
involved: the law of the country where the correspondent bank is situated;
b) where no correspondent bank is involved: the law of the country where the
issuing bank is situated.