A Deliberation on the Classic and New Exceptions in the Area of Autonomy Principle of Letter of Credit

Letter of credit, since its emergence, has undergone various transformations regarding doctrines and legal procedures, the majority of which revolves around the domains of autonomy from the underlying contract and exceptions to these rules. The principle of autonomy of letter of credit aims to facilitate and build trust for the international trades, it is, however, one aspect of this principle. On the other hand, this principle can be subject to abuse. It is possible that the beneficiary hands in forged documents to banks, or maybe the underlying contract itself is illegal and therefore null which can lead to an unjust enrichment. To limit the abuse of this principle, the first step is to recognize the exceptions of fraud and illegibility. However, its stipulations are not limited to this domain. Emergence of new exceptions l, like ‘nullify’, has raised controversies in legal procedures and doctrines.