Documentary Letter of Credit.
DEALEXUS structures and runs Documentary Letter of Credit deals transmitted via SWIFT MT700. UCP600 rules enforced. Used by commodity traders, importers and exporters closing bulk goods transactions across multiple jurisdictions.
Importer / buyer
Pay only when goods are shipped in compliance.
Issuing bank pays only on compliant document presentation — B/L, COO, inspection cert, invoice all verified.
Exporter / seller
Guaranteed payment on compliant presentation.
Once the LC is issued and your documents comply, payment is bank-guaranteed regardless of buyer default.
Trade broker
Your share recorded in a signed IMFPA.
IMFPA at step 4 records 45% on your side. Every introduction is on an append-only record.
What is a Documentary LC?
The instrument explained.
A Documentary Letter of Credit (DLC) is a payment mechanism issued by a buyer's bank that guarantees payment to a seller, provided that the seller presents the specified documents (bill of lading, certificate of origin, inspection certificate, commercial invoice) in compliance with the LC terms. It is the most widely used instrument in international commodity trade.
Documentary LCs are transmitted between banks via SWIFT MT700 — the SWIFT Category 7 message for the issuance of a documentary credit. Once issued, the advising bank notifies the beneficiary (seller). On compliant document presentation, the issuing bank pays. The governing rules are the Uniform Customs and Practice for Documentary Credits (UCP600), ICC Publication 600, the global standard used by virtually every trade bank in the world.
Commodity traders use Documentary LCs for crude oil, refined products, base metals, agricultural commodities (CPO, grain, sugar), coal, iron ore and precious metals. The LC locks in payment to the seller while protecting the buyer from paying before goods are shipped in conformity.
UCP600
Governing Rules
Documentary credits are issued under ICC UCP600 (Uniform Customs and Practice for Documentary Credits) — the most widely adopted rules in trade finance, used by banks in 175+ countries.
MT700
The Message Format
SWIFT MT700 (Issue of a Documentary Credit) is the exact message format used to issue a DLC from an issuing bank to an advising bank. The issuing bank drafts and sends the MT700; DEALEXUS hands it a term sheet every party has acknowledged.
MT710 / MT720
Related Message Types
MT710 (Advice of a Third Bank's or Non-Bank's Documentary Credit) and MT720 (Transfer of Documentary Credit) for transferable LCs. Both sit in SWIFT Category 7 alongside the MT700.
DOCUMENTS
Compliant Presentation
Bill of lading, certificate of origin, inspection certificate (SGS, CCIC, Bureau Veritas), commercial invoice, packing list — examined by the banks for UCP600 compliance on presentation.
Document set in a DLC transaction
What gets presented. Where it goes.
The documents a seller presents under a DLC, and what each one is for.
Bill of Lading (B/L)
Title document issued by the shipping carrier. Routed to the buyer's bank only on compliant presentation. Never released early or by email.
Certificate of Origin (COO)
Certifies the country of origin of the goods. Required by customs authorities. Issued by chamber of commerce or approved government body.
Inspection Certificate
Third-party quality and quantity inspection (SGS, CCIC, Bureau Veritas). Confirms goods match the LC description. Required at loading port.
Commercial Invoice
Seller's invoice for the goods, matching the LC terms exactly — currency, amount, description, Incoterms. Discrepancies result in LC refusal.
Packing List
Detailed breakdown of goods by package, weight and marks. Must match the B/L and invoice. Required for customs clearance.
Insurance Certificate
Required under CIF Incoterms. Covers goods from warehouse to final port. Must be issued in the LC currency and endorsed in blank.
Instrument specifications
DLC MT700 deal parameters.
| Instrument type | Documentary Letter of Credit (DLC) |
|---|---|
| SWIFT message | MT700 — Issue of a Documentary Credit |
| Governing rules | UCP600 (ICC Publication 600) · URDG758 for demand guarantees |
| SWIFT category | Category 7 · Documentary Credits and Guarantees · Nov. 2025 Std. |
| Payment terms | At sight · Deferred payment · Acceptance · Negotiation |
| LC types | Irrevocable · Confirmed · Transferable · Back-to-back |
| Commodity coverage | Crude oil · Refined products · CPO · Metals · Minerals · Grains · Soft commodities |
| Inspection bodies | SGS · CCIC · Bureau Veritas · Intertek · Alex Stewart |
| Incoterms | FOB · CIF · CFR · EXW — configured per deal in the term sheet |
| Commission split | 45 / 45 / 5 / 5 — sender broker / receiver broker / sender mandate / receiver mandate |
| Fund holding | DEALEXUS currently holds no client funds. |
| Compliance | FATF · OFAC · EU Sanctions · UN Security Council · BSA · MAS |
Commission split — recorded in the IMFPA (step 4)
Of a pool equal to 1% of face valueThe schedule is fixed in the IMFPA once it is signed at step 4. Each side's principal owes its side's share and the issuing bank disburses it; DEALEXUS holds no client funds.
Structure your Documentary LC on DEALEXUS.
The same eight-step sequence for every deal, with the fee schedule recorded in the signed IMFPA.