BUYER PROCESSING: FROM LOI to LC
(International Commodity Trade – ICC Standards)
In global commodity trading, professional transactions follow a structured procedure from Letter of Intent (LOI) to Letter of Credit (LC). This process ensures legal security, payment protection, and transparency for both buyers and suppliers.
Buyer Issues LOI (Letter of Intent)
- Commodity name & specification
- Quantity required
- Destination port (FOB / CIF / CFR)
- Payment term (LC / SBLC)
- Target shipment schedule
Seller Issues FCO / SCO
- FCO (Full Corporate Offer)
- SCO (Soft Corporate Offer)
Buyer Issues ICPO + KYC / CIS
- ICPO – Irrevocable Corporate Purchase Order Company profile
- CIS (Customer Information Sheet)
Buyer Bank Issues LC Draft
- Draft Letter of Credit prepared by buyer's bank
- Terms set as per the contract
Buyer Bank Issues LC
- Final Letter of Credit issued
- SWIFT notice sent to seller's bank
Shipment of Goods
- Seller ships the goods to the destination port
Presentation of Documents
- Seller presents documents to the bank
- Bank verifies if documents meet LC terms
Payment to Seller
- Seller receives payment
- Buyer collects shipping documents
- Goods cleared at the destination port
- Professional ICC based procedures ensure secure, transparent, and risk-controlled international trade.
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