A certificate of origin should certify the origin of the goods.
When a letter of credit indicates the origin of the goods and requesting presentation of a certificate of origin, any reference to the origin of goods on the certificate of origin or another document, is not to conflict with the stated origin.
For example, when a letter of credit indicates “origin of the goods: Japan”, a certificate of origin or a statement on any stipulated document indicating a different origin of the goods is to be considered a conflict of data, discrepancy.
As per letter of credit rules and international standard banking practices a certificate of origin must certify the origin of the goods as indicated in the letter of credit.
If the issuing bank determines that the certificate of origin is not reflecting correct origin of goods, then the issuing bank raises a discrepancy, which is known as origin of goods inconsistent with the letter of credit.
Discrepancy Example: Origin of Goods Inconsistent with the Letter of Credit
A letter of credit has been issued in SWIFT format, subject to UCPURR latest version, with the following details:
Letter of Credit Conditions
Field 45A: Description of Goods and or Services:
Aluminum Round Bars 15000 kgs. Delivery Terms: FOB Port of Jebel Ali, Dubai, UAE Incoterms 2010.
Field 46A: Documents Required:
- Duplicates of signed and stamped commercial invoices issued by the beneficiary stating this letter of credit number.
- Certificate of Origin in 1 original and 2 copies issued by any chamber of commerce stating that goods are of United Arab Emirates origin.
- Full set of original bill of lading clean shipped on board established to the order of issuing bank notify applicant marked freight collect.
The beneficiary presented a Certificate of Origin as shown on the below picture.
Certificate of Origin
Discrepancy: Certificate of origin should have shown that the goods are of United Arab Emirates origin, but the certificate of origin shows that the goods are Turkish origin, which is a clear discrepancy.
Reason for Discrepancy: A certificate of origin should certify the origin of the goods as indicated in the letter of credit.
