By Charlotte GAUCHON
23 March 2025
In international commercial transactions, documentary credit offers valuable security to the parties involved. This payment method is based on a complex network of obligations between the buyer, seller and banks. Let us examine these legal relationships and their practical implications. Relationship between buyer and seller The buyer (principal) undertakes to open a documentary credit in favour of the seller (beneficiary). This obligation arises from the sales contract. Time of opening the credit The seller is entitled to the opening of the credit before any delivery. The Commercial Court of Marseille clearly established this principle (23 February 1948, Droc v. Sofrancor). When the contract provides for a delivery period, the buyer must nevertheless open the credit at the beginning of this period. Consequences of failure to open What happens if the buyer does not open the credit within the specified time frame? Case law is severe. The Court of Cassation (com., 11 February 1980) considers that the contract does not...
EN 
FR