ISBP 745 Article C C2: Invoice Description Must Not Conflict with the Credit

Introduction

The goods description on the commercial invoice is one of the most scrutinized data points in a documentary credit presentation. ISBP 745 Paragraph C2 establishes that the invoice description must not conflict with the description in the credit. This rule ensures that the bank can confirm the goods being invoiced match the goods the credit was issued to finance. A conflicting description—whether in the product name, grade, specification, or packaging—triggers a discrepancy finding that delays payment. This guide explains how C2 works, why description conflicts occur, and how to prepare invoices with compliant descriptions.

Failure Modes

1. Different product name. The credit specifies "Arabica coffee beans, washed, Grade 1" but the invoice says "Premium washed coffee." The descriptions are substantively different and may conflict.

2. Omitted specification. The credit requires "Grade 1 Arabica coffee beans, washed, 100% Colombian origin." The invoice says "Arabica coffee beans, Grade 1." The invoice omits the origin specification.

3. Added specification not in credit. The credit specifies "frozen orange juice concentrate" but the invoice adds "Grade A, Brix 65." The added specification may conflict if the credit does not mention these parameters.

4. Abbreviation creates ambiguity. The credit uses "extra virgin olive oil" but the invoice abbreviates to "EVOO." The bank may not recognize the abbreviation and may find a conflict.

5. Different units of measurement. The credit specifies "500 metric tons" but the invoice shows "500,000 kg." The conversion is mathematically correct, but the unit mismatch may create a discrepancy.

Resolution Steps

1. Extract the exact goods description from the credit. Copy the credit's goods description word-for-word into the invoice. Do not paraphrase, abbreviate, or add specifications.

2. Use the credit's product name, grade, and specifications. If the credit says "Grade A extra virgin olive oil, cold-pressed, 5L tins," use that exact description on the invoice.

3. Do not add specifications not in the credit. The invoice should not include additional specifications (e.g., "Brix 65," "pH 3.5") unless the credit requires them.

4. Do not omit specifications from the credit. If the credit specifies "100% Colombian origin," the invoice must include that specification. Omitting it creates a conflict.

5. Use the same units of measurement. If the credit says "metric tons," the invoice should say "metric tons" or "MT," not "kg" or "lbs."

6. Verify the description against the bill of lading and insurance certificate. The goods description must be consistent across all three documents. Any conflict triggers a discrepancy.

7. Coordinate with the invoicing team. Provide the invoicing team with a copy of the credit's goods description and instruct them to use it exactly. Do not rely on their standard invoicing templates.

8. Review the invoice before submission. Check the goods description against the credit one final time before presenting to the bank. This simple check prevents one of the most common discrepancies.

Conclusion

ISBP 745 C2 requires the invoice description to correspond with the credit description. The rule is simple: copy the credit's description word-for-word into the invoice. Do not paraphrase, abbreviate, or add specifications. A pre-submission review—comparing the invoice description against the credit—eliminates this discrepancy entirely.

FAQ

Q1: Can the invoice description be shorter than the credit description?
Yes, as long as the shorter description does not conflict with the credit. If the credit says "Grade A extra virgin olive oil, cold-pressed, 5L tins," the invoice can say "Extra virgin olive oil, Grade A" without conflict.

Q2: Can the invoice description be longer than the credit description?
The invoice may include additional details that do not conflict with the credit. However, the additional details should not contradict the credit description.

Q3: What if the credit description is vague?
If the credit description is vague (e.g., "food products"), the invoice description must correspond with that vague description. The invoice should not add specifications that narrow the description beyond what the credit states.

Q4: Does this rule apply to all documents?
The no-conflict rule applies to all documents under UCP 600 Article 14(d). However, ISBP 745 C2 specifically addresses the invoice description as the most common source of description discrepancies.

Q5: Can the applicant waive a description discrepancy?
Yes, under UCP 600 Article 16(b), the applicant may waive any discrepancy, including a goods description conflict. The bank is not obligated to seek a waiver.

Source Notes

Source 1: "ICC briefing addresses the topic of reducing discrepancy rates" — Trade Finance Global (August 2022). Context only: analysis of common documentary credit discrepancies, including goods description conflicts.

Source 2: "Everything you need to know about Letters of Credit: A comprehensive guide to Documentary Credits" — Trade Finance Global (2022). Context only: comprehensive reference on documentary credit compliance, including invoice description requirements.

Source 3: "Agentic AI in trade finance" — KPMG (2023). Context only: context on AI-driven document examination, including automated description matching.