L/C with two (and only two) successive beneficiaries. In this arrangement
, the first beneficiary
or importer's foreign representative) can assign
part or whole of the L/C amount
to a second beneficiary (the supplier
or manufacturer). To be transferable, the L/C must be so marked by the issuing bank
on the instructions
of the buyer
(the account-party). On the instructions of the first beneficiary the advising bank
it to the second beneficiary but not any further. Used extensively in the Far East (China, Japan, Korea, Singapore, Taiwan, among others).
See also back to back letter of credit.