Glossar Trade & Export Finance
Glossar (P)

p.a.

Abbreviation for per annum (annually).

Partial drawings/shipments (in connection with documentary credits)

Permitted unless expressly prohibited by the documentary credit. For partial shipments/drawings special regulations apply. See UCP Art. 31 and Art. 32.

Parties involved in the documentary credit

At least the following three parties are involved in the documentary credit:

  • Applicant (buyer),

  • Issuing bank (opening bank),

  • Beneficiary (seller).As a rule, however, the issuing bank will entrust a correspondent bank with the task of authenticating and advising the credit and, if applicable, to honour the same. See under «Availability under documentary credits». The issuing bank may also request the advising bank to add its confirmation.

Payment Guarantee

To secure any claims by the seller on the buyer for payment of the contract price by the agreed date.

Payment under reserve (in case of discrepancies in the documents)

If the nominated bank receives documents containing discrepancies (explanation see under this term), it may agree with the beneficiary to provisionally honour the same. The nominated bank reserves the right of «recourse» against the beneficiary if the issuing bank refuses to accept the documents because of the discrepancies.
Please note that certain documentary credits prohibit payment under reserve.

Performance Bond

Used in export/import, but also in domestic industry, trade and commerce to secure any claims the buyer may have against the seller arising from default in delivery or performance of the terms of the contract. Usually 10% of the contract value.

Political risk

Extraordinary measures of foreign countries and political events abroad which make it impossible for the debtor to comply with the contract or which lead to the loss, confiscation of or damage to goods belonging to the exporter, e.g. war, revolution, annexation, civil war which can have a detrimental effect upon the exporter. An exporter may be able to cover this risk by utilising confirmed letters of credit or by applying for cover from export credit agencies. If you have any questions in this respect, please contact your customer advisor at UBS who will be happy to help.

Port-to-port Bill of Lading

Marine/Ocean bill of lading which covers the transport of goods between two ocean ports. See UCP Art. 20. See also under «Bill of lading».

Postal Receipt

Receipt of a post office for the acceptance of a parcel for carriage to the named consignee.

Pre-advice

At the request of the applicant the issuing bank may give a pre-advice of issuance and/or amendment of a documentary credit. A pre-advice is usually marked with a reference such as «Full details to follow». Unless otherwise stated, the pre-advice irrevocably commits the issuing bank to issue/amend the credit in a manner consistent with said pre-advice. See UCP Art. 11.

Preamble

The introductory section of a bank guarantee setting out the contractual relationship between the obligor and the beneficiary arising out of the underlying transaction.

Preferential traffic

See under «GSP Form A».

Purchase contract

Documentary credits are, by their nature, separate transactions from the purchase or other contracts on which they may be based. Banks will not be concerned with such contracts, even if they are referred in the documentary credit. See UCP Art. 4.

Presenting bank

Is the bank presenting the collection to the drawee.

p.q.

Abbreviation for per quarter.