Creative Commons

This dissertation was written as part of the LL.M in Transnational and European Commercial Law, Banking law, Arbitration/Mediation at the International Hellenic University. The purpose of this study is to provide a comparative and critical analysis of the reasons that the banks use as a legal basis for restraining payment in a letter of credit transaction. Letter of credits are important instruments for the facilitation of international trade. There is a thorough analysis of what happens in jurisdictions such as English and American as well as other common law jurisdictions such as Australia,Canada, Singapore and Malaysia. All the exceptions are exceptions to the principle of autonomy. The fraud exception is examined in English law where the approach is very narrow and it is also examined in American case law where the approach is broader. Furthermore inconsistencies that exist in other countries’ case law are exposed such as Australia,Canada and Malaysia. Apart from case law, there is an overall presentation of soft law legislation such as the UCP rules and the UNCITRAL RULES. Other exceptions such as nullity, illegality, unconscionability are described lucidly in this study in the light of comparative analysis in order to be able to form an informed view regarding the international landscape of these exceptions and their relationship to the principle of autonomy as well as the fraud exception. As a conclusion, the international legal framework that is depicted in case law seems completely fragmented and there is a lot of work to be done in order to unify the concepts due to a lot of inconsistencies.